| Page Range | 6167-7630 | |
| FR Document |
| Page and Subject | |
|---|---|
| 82 FR 7629 - Providing an Order of Succession Within the Federal Mediation and Conciliation Service | |
| 82 FR 7627 - Providing an Order of Succession Within the Council on Environmental Quality | |
| 82 FR 7625 - Designation of Officers or Employees of the Office of Science and Technology Policy To Act as Director | |
| 82 FR 7623 - Continuing To Expand Opportunity for All Young People | |
| 82 FR 7621 - Providing an Order of Succession Within the Environmental Protection Agency | |
| 82 FR 7619 - Providing an Order of Succession Within the Department of Justice | |
| 82 FR 7617 - Religious Freedom Day, 2017 | |
| 82 FR 7615 - Martin Luther King, Jr., Federal Holiday, 2017 | |
| 82 FR 6550 - Sunshine Act Meeting | |
| 82 FR 6179 - Promoting Diversity and Inclusion in Our National Parks, National Forests, and Other Public Lands and Waters | |
| 82 FR 6195 - Continuation of the National Emergency With Respect to Zimbabwe | |
| 82 FR 6193 - Continuation of the National Emergency With Respect to Venezuela | |
| 82 FR 6191 - Continuation of the National Emergency With Respect to Ukraine | |
| 82 FR 6189 - Continuation of the National Emergency With Respect to Libya | |
| 82 FR 6187 - Continuation of the National Emergency With Respect to Iran | |
| 82 FR 6185 - Continuation of the National Emergency With Respect to Cuba and of the Emergency Authority Relating to the Regulation of the Anchorage and Movement of Vessels | |
| 82 FR 6235 - Application of Modified Carryover Basis to General Basis Rules | |
| 82 FR 6167 - Establishment of the Reconstruction Era National Monument | |
| 82 FR 6339 - Performance Appraisal System Certification | |
| 82 FR 7336 - Proposed Best Interest Contract Exemption for Insurance Intermediaries | |
| 82 FR 6602 - Changes in Flood Hazard Determinations | |
| 82 FR 6608 - Homeland Security Science and Technology Advisory Committee | |
| 82 FR 6653 - Order of Succession to the Secretary of Labor in Periods of Vacancy, Continuity of Executive Direction, Repositioning and Devolution of Departmental Governance, and Emergency Planning Under Circumstances of Extreme Disruption | |
| 82 FR 6595 - Agency Information Collection Activities: Proposed Collection; Comment Request; Emergency Management Institute (EMI) Independent Study Course Enrollment Application and Test Answer Sheet | |
| 82 FR 6688 - Controlled Substances and Alcohol Use and Testing: J.B. Hunt Transport, Inc., Schneider National Carriers, Inc., Werner Enterprises, Inc., Knight Transportation, Inc., Dupre Logistics, Inc. and Maveric Transportation, LLC Application for Exemption | |
| 82 FR 6627 - Marine Mammals; Incidental Take During Specified Activities; Proposed Incidental Harassment Authorization | |
| 82 FR 6482 - Addition of Moldova to the List of Regions Affected by African Swine Fever | |
| 82 FR 6483 - Notice of Decision To Authorize the Importation of Fresh Star Apple Fruit From Vietnam Into the Continental United States | |
| 82 FR 6607 - Proposed Flood Hazard Determinations | |
| 82 FR 6689 - Parts and Accessories Necessary for Safe Operation; Application for an Exemption From Hino Motors Manufacturing U.S.A., Inc. | |
| 82 FR 6601 - Proposed Flood Hazard Determinations | |
| 82 FR 6597 - Changes in Flood Hazard Determinations | |
| 82 FR 6500 - California State Nonroad Engine Pollution Control Standards; Commercial Harbor Craft Regulations; Notice of Decision | |
| 82 FR 6610 - HUD Approval of Requests for Transfers of Multifamily Housing Project-Based Rental Assistance, HUD-Held or Insured Debt, and Income-Based Use Restrictions | |
| 82 FR 6540 - California State Nonroad Engine Pollution Control Standards; Evaporative Emission Standards and Test Procedures for Off-Highway Recreational Vehicles (OHRVs); Notice of Decision | |
| 82 FR 6625 - Announcement of the Housing Counseling Federal Advisory Committee Notice of Public Meeting | |
| 82 FR 6617 - Federal Property Suitable as Facilities To Assist the Homeless | |
| 82 FR 6615 - Rental Assistance Demonstration: Revised Program Notice | |
| 82 FR 6621 - Consolidated Delegations of Authority for the Office of Community Planning and Development | |
| 82 FR 6611 - Redelegation of Authority to the Deputy Assistant Secretaries in the Office of Community Planning and Development | |
| 82 FR 6551 - Notice of Agreements Filed | |
| 82 FR 6493 - Whaling Provisions; Aboriginal Subsistence Whaling Quotas | |
| 82 FR 6451 - Hazardous Materials: FAST Act Requirements for Real-Time Train Consist Information by Rail | |
| 82 FR 6618 - Redelegation of Authority to Directors and Deputy Directors of Community Planning and Development in Field Offices | |
| 82 FR 6545 - Risk Evaluation Scoping Efforts Under TSCA for Ten Chemical Substances; Notice of Public Meeting | |
| 82 FR 6522 - Statutory Requirements for Substantiation of Confidential Business Information (CBI) Claims Under the Toxic Substances Control Act (TSCA) | |
| 82 FR 6660 - Texas A&M University | |
| 82 FR 6534 - Final National Pollutant Discharge Elimination System (NPDES) General Permit for Stormwater Discharges From Construction Activities | |
| 82 FR 6498 - Revision to the PAG Manual: Protective Action Guide (PAG) for Drinking Water After a Radiological Incident | |
| 82 FR 7432 - Trichloroethylene (TCE); Regulation of Use in Vapor Degreasing Under TSCA Section 6(a) | |
| 82 FR 6546 - Request for Nominations for Peer Reviewers and for Public Comment on Peer Review Materials To Inform the Derivation of a Water Concentration Value for Lead in Drinking Water | |
| 82 FR 6549 - Acumen Communications | |
| 82 FR 6525 - California State Nonroad Engine Pollution Control Standards; In-Use Diesel-Fueled Transport Refrigeration Units (TRUs) and TRU Generator Sets and Facilities Where TRUs Operate; Notice of Decision | |
| 82 FR 7562 - Procedures for Chemical Risk Evaluation Under the Amended Toxic Substances Control Act | |
| 82 FR 6686 - Additional Designation of Syrian Entity Pursuant to E.O. 13382 | |
| 82 FR 7464 - Methylene Chloride and N-Methylpyrrolidone; Regulation of Certain Uses Under TSCA Section 6(a) | |
| 82 FR 6610 - Agency Information Collection Activities: Petition by Entrepreneur To Remove Conditions on Permanent Resident Status, Form I-829; Revision of a Currently Approved Collection | |
| 82 FR 6578 - Agency Information Collection Activities: Proposed Collection: Public Comment Request; Ryan White HIV/AIDS Program: Allocation and Expenditure Forms | |
| 82 FR 6490 - Foreign-Trade Zone 168; Application Requesting Expansion/Reorganization; Dallas/Fort Worth, Texas Area | |
| 82 FR 6581 - Agency Information Collection Activities: Proposed Collection: Public Comment Request; Ryan White HIV/AIDS Program Part F Dental Services Report | |
| 82 FR 6646 - Kraft Heinz Foods Company, a Subsidiary of the Kraft Heinz Company, Including On-Site Leased Workers From Kelly Services, U.S. Securities, West Side Hammer Electric, and Goodwill Keystone Area, Allentown, Pennsylvania; Amended Certification Regarding Eligibility To Apply for Worker Adjustment Assistance | |
| 82 FR 6648 - Notice of Determinations Regarding Eligibility To Apply for Worker Adjustment Assistance | |
| 82 FR 6646 - Northern Industrial Erectors, Inc., Grand Rapids, Minnesota; Notice of Affirmative Determination Regarding Application for Reconsideration | |
| 82 FR 6489 - Foreign-Trade Zone (FTZ) 158-Vicksburg/Jackson, Mississippi; Authorization of Limited Production Activity; MTD Consumer Group, Inc. (Lawn and Garden Equipment); Verona, Mississippi | |
| 82 FR 6647 - REC Silicon LLC, a Wholly Owned Subsidiary of Renewable Energy Corporation ASA, Including Workers Whose Wages Were Reported Under REC Solar Grade Silicon LLC, Including On-Site Leased Workers From Express Employment Professionals, Moses Lake, Washington; REC Silicon ASA, a Wholly Owned Subsidiary of REC Solar Grade Silicon LLC, Including Workers Whose Wages Were Reported Under REC Advanced Silicon Materials, Silver Bow, Montana; Nemo IT Solutions, Working On-Site at REC Silicon LLC, a Wholly Owned Subsidiary of Renewable Energy Corporation ASA, Moses Lake, Washington; Spherion Staffing LLC, Working On-Site at REC Silicon ASA, a Wholly Owned Subsidiary of REC Solar Grade Silicon LLC, Silver Bow, Montana; Notice of Revised Determination on Reconsideration | |
| 82 FR 6648 - Huntington Alloys Corporation, Special Metals Division, a Subsidiary of Special Metals Corporation, Including On-Site Leased Workers From Kelly Services, Huntington, West Virginia; Huntington Alloys Corporation, Special Metals Division, a Subsidiary of Special Metals Corporation, Burnaugh, Kentucky; Amended Certification Regarding Eligibility To Apply for Worker Adjustment Assistance | |
| 82 FR 6652 - Investigations Regarding Eligibility To Apply for Worker Adjustment Assistance | |
| 82 FR 6490 - Foreign-Trade Zone (FTZ) 20-Norfolk, Virginia; Notification of Proposed Production Activity; STIHL Incorporated (Outdoor Power Products Manufacturing); Virginia Beach, Virginia | |
| 82 FR 6489 - Foreign-Trade Zone (FTZ) 177-Evansville, Indiana; Authorization of Production Activity; Best Chairs, Inc. d/b/a Best Home Furnishings (Upholstered Furniture); Ferdinand, Cannelton and Paoli, Indiana | |
| 82 FR 6579 - Agency Information Collection Activities: Submission to OMB for Review and Approval; Public Comment Request; Evaluation of the Maternal and Child Health Bureau's Autism CARES Act Initiative | |
| 82 FR 6559 - Agency Information Collection Activities: Proposed Collection; Comment Request | |
| 82 FR 6558 - Agency Information Collection Activities: Submission for OMB Review; Comment Request | |
| 82 FR 6636 - Notice of Realty Action: Application for Conveyance of Federally Owned Mineral Interests in Maricopa County, AZ | |
| 82 FR 6639 - Notice of Application for Withdrawal and Notification of Public Meeting; Minnesota | |
| 82 FR 6640 - Notice of Application for a Recordable Disclaimer of Interest: Dimmit County, Texas | |
| 82 FR 6551 - Formations of, Acquisitions by, and Mergers of Bank Holding Companies | |
| 82 FR 6634 - BLM Director's Response to the Alaska Governor's Appeal of the BLM Alaska State Director's Governor's Consistency Review Determination for the Eastern Interior Proposed Resource Management Plan and Final Environmental Impact Statement | |
| 82 FR 6580 - Meeting of the Advisory Committee on Heritable Disorders in Newborns and Children | |
| 82 FR 6662 - Income Tax Review | |
| 82 FR 6687 - SMS Rail Lines of New York, LLC-Acquisition and Operation Exemption-Rail Line of WCC, LLC, in Hudson Falls, NY | |
| 82 FR 6692 - FTA Fiscal Year 2017 Apportionments, Allocations, Program Information and Interim Guidance | |
| 82 FR 6487 - Coconino and Tonto National Forests; Arizona; Fossil Creek Wild and Scenic River Comprehensive River Management Plan and Environmental Impact Statement | |
| 82 FR 6494 - Combined Notice of Filings | |
| 82 FR 6566 - Agency Information Collection Activities; Proposed Collection; Comment Request; Adverse Event Program for Medical Devices (Medical Product Safety Network) | |
| 82 FR 6556 - National Center for Health Statistics (NCHS) Confidentiality Pledge Revision Notice | |
| 82 FR 6554 - Proposed Data Collection Submitted for Public Comment and Recommendations | |
| 82 FR 6687 - Projects Approved for Consumptive Uses of Water | |
| 82 FR 6583 - Agency Information Collection Request. 60-Day Public Comment Request, Grants.gov | |
| 82 FR 6583 - Medicare Program; Administrative Law Judge Hearing Program for Medicare Claim and Entitlement Appeals; Quarterly Listing of Program Issuances-October Through December 2016 | |
| 82 FR 6590 - Protecting Our Infants Act Report to Congress | |
| 82 FR 6657 - Notice of Intent To Grant a Partially Exclusive License | |
| 82 FR 6625 - Notice of Intent To Prepare a Draft Environmental Impact Statement for a Proposed Habitat Conservation Plan for the Endangered American Burying Beetle for American Electric Power in Oklahoma, Arkansas, and Texas | |
| 82 FR 6552 - Privacy Act of 1974; Notice of a New System of Records | |
| 82 FR 6482 - Notice of Intent To Grant Exclusive License | |
| 82 FR 6691 - Notice of Establishment of Emergency Relief Docket for Calendar Year 2017 | |
| 82 FR 6716 - FY 2017 Competitive Funding Opportunity: Public Transportation on Indian Reservations Program; Tribal Transit Program | |
| 82 FR 6564 - Psychopharmacologic Drugs Advisory Committee; Cancellation | |
| 82 FR 6490 - Certain Oil Country Tubular Goods From the People's Republic of China: Notice of Court Decision Not in Harmony With Final Scope Ruling and Notice of Amended Final Scope Ruling Pursuant to Court Decision | |
| 82 FR 6687 - Chesapeake Western Railway-Discontinuance of Service Exemption-in Rockingham and Shenandoah Counties, VA. | |
| 82 FR 6726 - Proposed Collection; Comment Request for Form 8874-A | |
| 82 FR 6726 - Proposed Collection; Comment Request for Revenue Procedure 98-32 | |
| 82 FR 6727 - Proposed Collection; Comment Request for Regulation Project | |
| 82 FR 6492 - Proposed Information Collection; Comment Request; Information Collection for Self-Certification to the Swiss-U.S. Privacy Shield Framework | |
| 82 FR 6659 - Advisory Committee on the Presidential Library-Foundation Partnerships | |
| 82 FR 6673 - Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Designation of a Longer Period for Commission Action on a Proposed Rule Change, as Modified by Amendment No. 1, To Amend CBOE Rule 6.53C | |
| 82 FR 6667 - Self-Regulatory Organizations; NASDAQ PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Extend the Cabinet Trading Pilot Program | |
| 82 FR 6669 - Self-Regulatory Organizations; Chicago Stock Exchange, Inc.; Order Instituting Proceedings To Determine Whether To Approve or Disapprove a Proposed Rule Change in Connection With the Proposed Transaction Involving CHX Holdings, Inc. and North America Casin Holdings, Inc. | |
| 82 FR 6674 - Program for Allocation of Regulatory Responsibilities Pursuant to Rule 17d-2; Notice of Filing of Proposed Amended Plan for the Allocation of Regulatory Responsibilities Among the Financial Industry Regulatory Authority, Inc., Miami International Securities Exchange, LLC, and MIAX PEARL, LLC | |
| 82 FR 6662 - Self-Regulatory Organizations; MIAX PEARL, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Exchange Rule 510 To Extend the Penny Pilot Program | |
| 82 FR 6678 - Self-Regulatory Organizations; Bats BZX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Related to Fees for Use of the Exchange's Equity Options Platform | |
| 82 FR 6356 - Recordkeeping | |
| 82 FR 6729 - Proposed Information Collection Activity: (Authorization To Disclose Personal Information to a Third Party (VA Form 29-0975)) | |
| 82 FR 6728 - Agency Information Collection Activity: (Record Keeping at Flight Schools) | |
| 82 FR 6729 - Agency Information Collection Activity: (Employment Information in Connection With Claim for Disability Benefits (VA Form 21-4192)) | |
| 82 FR 6728 - Information Collection Activity: (Presidential Memorial Certificate Form) | |
| 82 FR 6644 - Certain Sleep-Disordered Breathing Treatment Systems and Components Thereof; Commission Determination to Review In-Part a Final Initial Determination on Remand, and on Remand To Affirm With Modification; Vacatur of Suspended Remedial Orders; and Termination of the Investigation | |
| 82 FR 6664 - Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing of Amendment No. 2 and Order Granting Accelerated Approval of a Proposed Rule Change, as Modified by Amendment No. 2, Relating to Continued Listing Requirements for Exchange-Traded Products | |
| 82 FR 6497 - Hydro Kennebec, LLC; Notice of Application To Extend Interim Species Protection Plan for Three Years and Soliciting Comments, Motions To Intervene and Protests | |
| 82 FR 6496 - Alcoa Corporation; Notice of Petition for Declaratory Order | |
| 82 FR 6496 - City of West Memphis, Arkansas; Conway Corporation; Notice of Filing | |
| 82 FR 6495 - Texas Eastern Transmission, LP; Notice of Amendment to Application | |
| 82 FR 6496 - Combined Notice of Filings #1 | |
| 82 FR 6489 - Notice of Petitions by Firms for Determination of Eligibility To Apply for Trade Adjustment Assistance | |
| 82 FR 6646 - Notice of Lodging Proposed Consent Decree | |
| 82 FR 6658 - Records Schedules; Availability and Request for Comments | |
| 82 FR 6658 - Advisory Committee on the Presidential Library-Foundation Partnerships | |
| 82 FR 6488 - Agenda and Notice of Public Meeting of the Connecticut Advisory Committee | |
| 82 FR 6642 - Notice of March 13, 2017, Meeting for Cape Cod National Seashore Advisory Commission | |
| 82 FR 6657 - Senior Executive Service Performance Review Board Membership | |
| 82 FR 6643 - Notice of the 2017 Meeting Schedule for Cedar Creek and Belle Grove National Historical Park Advisory Commission | |
| 82 FR 6641 - Notice of the 2017 Meeting Schedule for Gettysburg National Military Park Advisory Commission | |
| 82 FR 6642 - Notice of an Open Public Meeting for the Lake Clark National Park Subsistence Resource Commission | |
| 82 FR 6588 - National Institute of Neurological Disorders and Stroke; Notice of Closed Meeting | |
| 82 FR 6586 - National Institute of Mental Health; Notice of Closed Meeting | |
| 82 FR 6585 - Eunice Kennedy Shriver National Institute of Child Health & Human Development; Notice of Closed Meeting | |
| 82 FR 6586 - National Institute of Arthritis and Musculoskeletal and Skin Diseases; Notice of Closed Meeting | |
| 82 FR 6584 - National Institute on Alcohol Abuse and Alcoholism; Notice of Closed Meeting | |
| 82 FR 6585 - National Heart, Lung, and Blood Institute Amended; Notice of Meeting | |
| 82 FR 6587 - National Heart, Lung, and Blood Institute; Notice of Closed Meeting | |
| 82 FR 6585 - National Human Genome Research Institute; Notice of Closed Meeting | |
| 82 FR 6585 - National Cancer Institute; Notice of Closed Meetings | |
| 82 FR 6587 - Center for Scientific Review; Notice of Closed Meetings | |
| 82 FR 6558 - Designation of a Class of Employees for Addition to the Special Exposure Cohort | |
| 82 FR 6556 - Designation of a Class of Employees for Addition to the Special Exposure Cohort | |
| 82 FR 6485 - Codex Alimentarius Commission: Meeting of the Codex Committee on Food Additives | |
| 82 FR 6582 - Agency Information Collection Activities; Proposed Collection; Public Comment Request | |
| 82 FR 6551 - Notice of Annual Adjustment of the Cap on Average Total Assets That Defines Community Financial Institutions | |
| 82 FR 6645 - Bulk Manufacturer of Controlled Substances Application: Noramco, Inc. | |
| 82 FR 6506 - Inquiry To Learn Whether Businesses Assert Business Confidentiality Claims Regarding Waste Import and Export | |
| 82 FR 6596 - Proposed Flood Hazard Determinations | |
| 82 FR 6532 - Proposed Settlement Agreement, Clean Air Act Petition for Review | |
| 82 FR 6591 - Changes in Flood Hazard Determinations | |
| 82 FR 6509 - Response to December 9, 2013, Clean Air Act Section 176A Petition From Connecticut, Delaware, Maryland, Massachusetts, New Hampshire, New York, Pennsylvania, Rhode Island and Vermont | |
| 82 FR 6591 - Virginia; Amendment No. 4 to Notice of a Major Disaster Declaration | |
| 82 FR 6602 - North Carolina; Amendment No. 16 to Notice of a Major Disaster Declaration | |
| 82 FR 6725 - Requested Administrative Waiver of the Coastwise Trade Laws: Vessel SAIL BE HAPPY; Invitation for Public Comments | |
| 82 FR 6724 - Requested Administrative Waiver of the Coastwise Trade Laws: Vessel GRAVITY; Invitation for Public Comments | |
| 82 FR 6725 - Requested Administrative Waiver of the Coastwise Trade Laws: Vessel HAVORN; Invitation for Public Comments | |
| 82 FR 6413 - Air Plan Approval; Washington: General Regulations for Air Pollution Sources, Southwest Clean Air Agency Jurisdiction | |
| 82 FR 6722 - Requested Administrative Waiver of the Coastwise Trade Laws: Vessel MAJESTIK; Invitation for Public Comments | |
| 82 FR 6722 - Requested Administrative Waiver of the Coastwise Trade Laws: Vessel SHAUN T; Invitation for Public Comments | |
| 82 FR 6684 - 60-Day Notice of Proposed Information Collection: Passport Demand Forecasting Survey | |
| 82 FR 6724 - Requested Administrative Waiver of the Coastwise Trade Laws: Vessel SERENITY; Invitation for Public Comments | |
| 82 FR 6721 - Requested Administrative Waiver of the Coastwise Trade Laws: Vessel MIRA MAR; Invitation for Public Comments | |
| 82 FR 6723 - Agency Requests for Renewal of a Previously Approved Information Collection(s): Application for Conveyance of Port Facility Property | |
| 82 FR 6533 - Proposed Reissuance of the NPDES General Permit for Facilities Related to Oil and Gas Extraction in the Territorial Seas of Texas | |
| 82 FR 6641 - Harriet Tubman National Historical Park | |
| 82 FR 6609 - Agency Information Collection Activities: Application for Waiver of Grounds of Inadmissibility, Form I-601; Revision of a Currently Approved Collection. | |
| 82 FR 6685 - 60-Day Notice of Proposed Information Collection: Evacuee Manifest and Promissory Note | |
| 82 FR 6571 - Advice About Eating Fish, From the Environmental Protection Agency and Food and Drug Administration; Revised Fish Advice; Availability | |
| 82 FR 6484 - Information Collection Request; Guaranteed Farm Loan Program | |
| 82 FR 6484 - Information Collection Request; Direct Loan Servicing-Regular | |
| 82 FR 6651 - Office of Career, Technical, and Adult Education; Rehabilitation Services Administration; Agency Information Collection Activities; Comment Request; Workforce Innovation and Opportunity Act (WIOA) Common Performance Reporting | |
| 82 FR 6250 - Safety Zone; Pleasure Beach Bridge, Bridgeport, CT | |
| 82 FR 6492 - United States Travel and Tourism Advisory Board: Meeting of the United States Travel and Tourism Advisory Board | |
| 82 FR 7149 - Federal Policy for the Protection of Human Subjects | |
| 82 FR 6388 - Amendment of Regulations Implementing Section 504 of the Rehabilitation Act of 1973-Nondiscrimination Based on Disability in Federally Assisted Programs or Activities | |
| 82 FR 6370 - Definition of Dependent | |
| 82 FR 7582 - Transfers of Certain Property by U.S. Persons to Partnerships With Related Foreign Partners | |
| 82 FR 6368 - Transfers of Certain Property by U.S. Persons to Partnerships With Related Foreign Partners | |
| 82 FR 7094 - Federal Housing Administration: Strengthening the Home Equity Conversion Mortgage Program | |
| 82 FR 6560 - Medicare Program; Meeting of the Medicare Evidence Development and Coverage Advisory Committee-March 22, 2017 | |
| 82 FR 6244 - Regulations Governing Retirement Savings Bonds | |
| 82 FR 6212 - Amendment of Multiple Air Traffic Service (ATS) Routes; North Central United States | |
| 82 FR 6353 - Proposed Modification and Establishment of Air Traffic Service (ATS) Routes; Northcentral United States | |
| 82 FR 6353 - Irish Potatoes Grown in Washington; Continuance Referendum | |
| 82 FR 6212 - Importation of Beef From a Region in Argentina | |
| 82 FR 6367 - Manufacturer Communications Regarding Unapproved Uses of Approved or Cleared Medical Products; Availability of Memorandum; Reopening of the Comment Period | |
| 82 FR 6575 - Medical Product Communications That Are Consistent With the Food and Drug Administration-Required Labeling-Questions and Answers; Draft Guidance for Industry; Availability | |
| 82 FR 6568 - Drug and Device Manufacturer Communications With Payors, Formulary Committees, and Similar Entities-Questions and Answers; Draft Guidance for Industry and Review Staff; Availability | |
| 82 FR 6253 - Student Assistance General Provisions | |
| 82 FR 6252 - Family Educational Rights and Privacy Act | |
| 82 FR 6265 - Recognition of Tribal Organizations for Representation of VA Claimants | |
| 82 FR 6277 - Significant New Use Rules on Certain Chemical Substances; Withdrawal | |
| 82 FR 7376 - Open Licensing Requirement for Competitive Grant Programs | |
| 82 FR 7536 - Transparency of Airline Ancillary Service Fees | |
| 82 FR 6307 - Civil Penalties; 2017 Inflation Adjustments for Civil Monetary Penalties | |
| 82 FR 7042 - National Organic Program (NOP); Organic Livestock and Poultry Practices | |
| 82 FR 6643 - Record of Decision for the 2017-2022 Outer Continental Shelf Oil and Gas Leasing Program Final Programmatic Environmental Impact Statement; MMAA104000 | |
| 82 FR 6623 - Federal Property Suitable as Facilities To Assist the Homeless | |
| 82 FR 7008 - Importation, Interstate Movement, and Environmental Release of Certain Genetically Engineered Organisms | |
| 82 FR 6197 - Agricultural Bioterrorism Protection Act of 2002; Biennial Review and Republication of the Select Agent and Toxin List; Amendments to the Select Agent and Toxin Regulations | |
| 82 FR 6564 - Genome Editing in New Plant Varieties Used for Foods; Request for Comments | |
| 82 FR 6561 - Regulation of Intentionally Altered Genomic DNA in Animals; Draft Guidance for Industry; Availability | |
| 82 FR 6574 - Regulation of Mosquito-Related Products; Draft Guidance for Industry; Availability | |
| 82 FR 6429 - Homeland Security Acquisition Regulation (HSAR); Safeguarding of Controlled Unclassified Information (HSAR Case 2015-001) | |
| 82 FR 6446 - Homeland Security Acquisition Regulation (HSAR); Information Technology Security Awareness Training (HSAR Case 2015-002) | |
| 82 FR 6425 - Homeland Security Acquisition Regulation (HSAR); Privacy Training (HSAR Case 2015-003) | |
| 82 FR 6305 - Onshore Oil and Gas Operations-Annual Civil Penalties Inflation Adjustments | |
| 82 FR 6278 - Possession, Use, and Transfer of Select Agents and Toxins; Biennial Review of the List of Select Agents and Toxins and Enhanced Biosafety Requirements | |
| 82 FR 6294 - National Vaccine Injury Compensation Program: Revisions to the Vaccine Injury Table | |
| 82 FR 6423 - National Vaccine Injury Compensation Program: Statement of Reasons for Not Conducting a Rulemaking Proceeding | |
| 82 FR 6309 - Endangered and Threatened Wildlife and Plants; Final Rule To List Two Guitarfishes as Threatened Under the Endangered Species Act | |
| 82 FR 6456 - Takes of Marine Mammals Incidental to Specified Activities; Taking Marine Mammals Incidental to Space Vehicle and Missile Launch Operations at Pacific Spaceport Complex Alaska, Kodiak Island, Alaska | |
| 82 FR 6248 - Civil Monetary Penalty Inflation Adjustment | |
| 82 FR 6890 - Control of Communicable Diseases | |
| 82 FR 6210 - Almonds Grown in California; Change in Quality Control Requirements | |
| 82 FR 6197 - Prevailing Rate Systems; Definition of Kent County, Michigan, and Cameron County, Texas, to Nonappropriated Fund Federal Wage System Wage Areas | |
| 82 FR 7400 - Health and Environmental Protection Standards for Uranium and Thorium Mill Tailings | |
| 82 FR 6980 - Plant Pest Regulations; Update of Provisions | |
| 82 FR 6472 - Fisheries of the Northeastern United States; Atlantic Sea Scallop Fishery; Framework Adjustment 28 | |
| 82 FR 6826 - Energy Conservation Program: Energy Conservation Standards for Ceiling Fans | |
| 82 FR 6243 - Benefits Payable in Terminated Single-Employer Plans; Interest Assumptions for Paying Benefits | |
| 82 FR 6548 - FY2017 Supplemental Funding for Brownfields Revolving Loan Fund (RLF) Grantees | |
| 82 FR 6216 - Support Document Requirements With Respect to Hong Kong | |
| 82 FR 6218 - Amendments to the Export Administration Regulations Implementing an Additional Phase of India-U.S. Export Control Cooperation | |
| 82 FR 6317 - Standardized Bycatch Reporting Methodology | |
| 82 FR 6221 - International Affairs; Antarctic Marine Living Resources Convention Act | |
| 82 FR 6259 - Changes in Requirements for Affidavits or Declarations of Use, Continued Use, or Excusable Nonuse in Trademark Cases | |
| 82 FR 6588 - Office of Refugee Resettlement; Statement of Organization, Functions, and Delegations of Authority | |
| 82 FR 6273 - Fertility Counseling and Treatment for Certain Veterans and Spouses | |
| 82 FR 6276 - Inspection Service Authority; Civil Monetary Penalty Inflation Adjustment | |
| 82 FR 7276 - Energy Conservation Program: Energy Conservation Standards for General Service Lamps | |
| 82 FR 7322 - Energy Conservation Program: Energy Conservation Standards for General Service Lamps | |
| 82 FR 6732 - Revision of the Nutrition Facts Labels for Meat and Poultry Products and Updating Certain Reference Amounts Customarily Consumed |
Agricultural Marketing Service
Agricultural Research Service
Animal and Plant Health Inspection Service
Farm Service Agency
Food Safety and Inspection Service
Forest Service
Economic Development Administration
Foreign-Trade Zones Board
Industry and Security Bureau
International Trade Administration
National Oceanic and Atmospheric Administration
Patent and Trademark Office
Federal Energy Regulatory Commission
Centers for Disease Control and Prevention
Centers for Medicare & Medicaid Services
Food and Drug Administration
Health Resources and Services Administration
National Institutes of Health
Refugee Resettlement Office
Substance Abuse and Mental Health Services Administration
Coast Guard
Federal Emergency Management Agency
U.S. Citizenship and Immigration Services
Fish and Wildlife Service
Land Management Bureau
National Park Service
Ocean Energy Management Bureau
Drug Enforcement Administration
Employee Benefits Security Administration
Employment and Training Administration
Occupational Safety and Health Administration
Federal Aviation Administration
Federal Motor Carrier Safety Administration
Federal Transit Administration
Maritime Administration
Pipeline and Hazardous Materials Safety Administration
Fiscal Service
Internal Revenue Service
Consult the Reader Aids section at the end of this issue for phone numbers, online resources, finding aids, and notice of recently enacted public laws.
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U.S. Office of Personnel Management.
Final rule.
This rule amends the geographic boundaries of two nonappropriated fund (NAF) Federal Wage System (FWS) wage areas. Based on recommendations of the Federal Prevailing Rate Advisory Committee (FPRAC), the U.S. Office of Personnel Management (OPM) is defining Kent County, Michigan, as an area of application county to the Macomb, MI, NAF FWS wage area and Cameron County, Texas, as an area of application county to the Nueces, TX, NAF FWS wage area. These changes are necessary due to NAF FWS employees working in Kent and Cameron Counties, and the counties are not currently defined to NAF wage areas.
Madeline Gonzalez, by telephone at (202) 606-2858 or by email at
On August 24, 2016, OPM issued a proposed rule (81 FR 57809) to define Kent County, Michigan, as an area of application county to the Macomb, MI, NAF FWS wage area and Cameron County, Texas, as an area of application county to the Nueces, TX, NAF FWS wage area.
FPRAC, the national labor-management committee responsible for advising OPM on matters concerning the pay of FWS employees, reviewed and recommended this change by consensus.
The proposed rule had a 30-day comment period, during which OPM received no comments.
I certify that these regulations will not have a significant economic impact on a substantial number of small entities because they will affect only Federal agencies and employees.
Administrative practice and procedure, Freedom of information, Government employees, Reporting and recordkeeping requirements, Wages.
Accordingly, OPM is amending 5 CFR part 532 as follows:
5 U.S.C. 5343, 5346; § 532.707 also issued under 5 U.S.C. 552.
Animal and Plant Health Inspection Service, USDA.
Final rule.
In accordance with the Agricultural Bioterrorism Protection Act of 2002, we are amending and republishing the list of select agents and toxins that have the potential to pose a severe threat to animal or plant health, or to animal or plant products. The Act
Effective February 21, 2017.
Dr. Freeda Isaac, National Director, Agriculture Select Agent Services, APHIS, 4700 River Road, Unit 2, Riverdale, MD 20737-1231; (301) 851-3300, Option 3.
The Public Health Security and Bioterrorism Preparedness and Response Act of 2002 (referred to below as the Bioterrorism Response Act) provides for the regulation of certain biological agents that have the potential to pose a severe threat to both human and animal health, to animal health, to plant health, or to animal plant health, or to animal and plant products. The Animal and Plant Health Inspection Service (APHIS) has the primary responsibility for implementing the provisions of the Act within the United States Department of Agriculture (USDA). Veterinary Services (VS) select agents and toxins are those that have been determined to have the potential to pose a severe threat to animal health or animal products. Plant Protection and Quarantine (PPQ) select agents and toxins are those that have the potential to pose a severe threat to plant health or plant products. Overlap select agents and toxins are those that have been determined to pose a severe threat to both human and animal health or to human health and animal products. Overlap select agents are subject to regulation by both APHIS and the Centers for Disease Control and Prevention (CDC), which has the primary responsibility for implementing the provisions of the Bioterrorism Response Act for the Department of Health and Human Services (HHS).
Subtitle B (which is cited as the “Agricultural Bioterrorism Protection Act of 2002” and referred to below as the Act), section 212(a), provides, in part, that the Secretary of Agriculture (the Secretary) must establish by regulation a list of each biological agent and each toxin that the Secretary determines has the potential to pose a severe threat to animal or plant health, or to animal or plant products. Paragraph (a)(2) of section 212 requires the Secretary to review and republish the list every 2 years and to revise the list as necessary. In this document, we are amending and republishing the list of select agents and toxins based on the findings of our fourth biennial review of the list.
In determining whether to include an agent or toxin on the list, the Act requires that the following criteria be considered:
• The effect of exposure to the agent or the toxin on animal and plant health, and on the production and marketability of animal or plant products;
• The pathogenicity of the agent or the toxin and the methods by which the agent or toxin is transferred to animals or plants;
• The availability and effectiveness of pharmacotherapies and prophylaxis to treat and prevent any illness caused by the agent or toxin; and
• Any other criteria that the Secretary considers appropriate to protect animal or plant health, or animal or plant products.
We use the term “select agents and toxins” throughout the preamble of this rule. Unless otherwise specified, the term “select agents and toxins” will refer to all agents or toxins listed by APHIS. When it is necessary to specify the type of select agent or toxin, we will use the following terms: “PPQ select agents and toxins” (for the plant agents and toxins listed in 7 CFR 331.3), “VS select agents and toxins” (for the animal agents and toxins listed in 9 CFR 121.3), or “overlap select agents and toxins” (for the overlap agents and toxins listed in both 9 CFR 121.4 and 42 CFR 73.4).
On January 19, 2016, we published in the
We solicited comments concerning our proposal for 60 days ending March 21, 2016. We received 24 comments by that date. They were from researchers, scientific organizations, industry groups, laboratories, and universities. Eighteen were supportive of the proposed action. The remaining six comments are discussed below by topic.
We proposed to amend the list of PPQ select agents and toxins listed in 7 CFR 331.3 by removing three PPQ select agents and toxins from the list:
We also proposed to remove three overlap select agents and toxins from the list set out in 9 CFR 121.4(b):
After carefully considering the technical input of subject matter experts and recommendations from Federal advisory groups, we have decided not to finalize the proposed changes to the list of select agents and toxins at this time.
In 7 CFR 331.1 and 9 CFR 121.1, we proposed to add definitions for
One commenter suggested that we specify that a “validated method” was used for inactivation. The commenter said that the addition of the word “validated” would ensure that tested and appropriate methods of inactivation would be utilized.
We are eliminating the definition for
The same commenter suggested that we add definitions of
Given that we are adding a definition of
While we did not receive any further comments regarding definitions, in response to comments received by CDC and in the interests of maintaining parity between the APHIS and CDC regulations, we are adding a definition for
We proposed to amend 7 CFR 331.3(d)(2), 9 CFR 121.3(d)(2), and 9 CFR 121.4(d)(2), which exclude nonviable select agents or nonfunctional toxins from the requirements of the regulations, in order to clarify our policy that an entity must use a validated procedure to render a select agent nonviable or regulated nucleic acids non-infectious for future use. This means that the method must be scientifically sound and that it will produce consistent results each time it is used.
One commenter stated that we need to consistently address toxins throughout the regulations and suggested adding language specifying that required methods would also render a select toxin as nonfunctional.
We did not include language concerning toxins because, unlike select agents, toxins do not replicate. An inactivation failure with a toxin therefore represents a lower level of risk and thus does not justify the potential additional recordkeeping and reporting burden for registered entities at this time. We may revisit this issue in the future.
We proposed that inactivation include the use of one of the following: The exact conditions of a commonly accepted method that has been validated as applied (
The same commenter also suggested that we require that the inactivation process be repeatable.
We agree with the commenter that the inactivation process has to be validated so that the results are repeatable. The definition of
We also proposed that the entity develop a site-specific kill curve in order to define the conditions of inactivation for each select agent or regulated nucleic acid. If there are strain-to-strain variations in the resistance of a select agent to the inactivation procedure, then a specific kill curve would have to be developed for each strain that undergoes the inactivation procedure. A new kill curve would have to be created upon any change in procedure or inactivation equipment. In addition, a validated sterility testing protocol would have to be conducted in order to ensure that the inactivation method has rendered a select agent nonviable or regulated nucleic acids non-infectious.
Several commenters raised objections regarding development and use of the kill curve. We have considered these comments and determined that the kill curve and safety margin requirements are not applicable to all inactivation procedures and should therefore not be included in the regulations. We are instead requiring that registered entities develop a validated inactivation procedure by establishing parameters for quantities of starting material and measures of uncertainty for repeated successful inactivation. This is a broad performance standard that will allow for flexibility given the variety of select agents and toxins under regulation.
One commenter said that, without more specific direction, the subjectivity of individual inspectors would be the principal factor in determining acceptable inactivation verification.
We will not review or approve inactivation protocols. We believe this activity should be approved at the entity, which will allow for researchers to continue to develop new inactivation procedures. However, inspectors will verify that the entity has developed a validated inactivation procedure and will review viability testing results during the entity's inspection.
Another commenter asked that we provide minimum requirements for the sterility testing protocol and specify whether or not this must be site-specific or if validated methods of sterility testing given in published journal articles may be followed.
We recognize that the limits of detection of the viability testing procedures and expected variation from run to run, even when following an inactivation procedure precisely precludes demonstrating full sterility of an inactivated sample. These sources of error must be considered when the entity establishes performance parameters for inactivation procedures. While complete sterility is not a feasible goal for material that is intended for further use, we expect that the risk of live agent in materials that are removed from containment and are thus no longer subject to select agent requirements will be as low as realistically possible from both a safety and security perspective. We will be addressing the need for onsite validation of both inactivation protocols and viability testing in guidance.
The same commenter cited the guidance document entitled “Non-viable Select Agents and Nonfunctional Select Toxins and Rendering Samples Free of Select Agents and Toxins,”
We have modified the reporting requirements to require the responsible official to investigate any viability of material that was subjected to a validated inactivation protocol to
Two commenters asked about the minimum percentage of samples required to be tested to constitute a “representative sample.” Another commenter suggested that inactivated lots be stored with documentation that demonstrates that the lot has met the established standard, but added that it is impractical to conduct validated sterility testing on every sample that is inactivated. The commenter claimed that implementing such a requirement would waste specimens where limited volumes are available, be costly in terms of technical time and resources, and is scientifically unjustified.
Successful implementation of the required validated inactivation procedure and the subsequent data derived from viability testing using that procedure will determine the extent of sampling required. We have removed the sterility testing requirement to allow entities flexibility in establishing and utilizing individualized, validated inactivation procedures.
We also proposed to require that an entity conduct an annual review of their site-specific standard operating procedures to ensure that select agents or regulated nucleic acids that can produce infectious forms of any select agent virus are inactivated by a safety margin and revise as necessary.
Two commenters questioned our use of the term “safety margin.” The commenters requested that we remove or define the term, as its meaning is unclear. The commenters further stated that the need for including a safety margin is unclear and appears superfluous if the intent of the requirement is to define the conditions that achieve conditions that render 100 percent of the select agent non-viable or noninfectious.
We are not defining “safety margin” as the proposed regulatory text using this term will not be incorporated into the final rule.
Finally, we proposed that written records be kept for any select agent that has been rendered nonviable or regulated nucleic acids that have been rendered non-infectious.
Two commenters asked for clarification of the actions constituting review, including description of any documentation that will be expected to demonstrate compliance with the requirement. The commenters wanted to know if it was our expectation that the kill curve and sterility testing be repeated and verified annually, or if this is a review of data and written procedures.
In response, we have modified the language regarding review of site-specific standard operating inactivation procedures to clarify that the entity should review these procedures to determine if they are being adhered to by staff. The annual review requirement does not necessarily involve revalidating inactivation procedures. This review may simply take the form of an evaluation of the site-specific standard operating inactivation procedures to ensure the inactivation conditions used and upper agent limits found in validation data are consistent and that the entity staff are following the site-specific standard operating inactivation procedures. At times an entity may need to revalidate inactivation procedures during the annual review. For example, review may be needed if the entity finds that staff are not adhering to standard operating procedures or if the entity wants to deviate from the established, validated inactivation procedure.
While we did not receive any further comments on this issue, in response to comments received by CDC and in the interests of maintaining parity between the APHIS and CDC regulations, we have made the following changes:
• Establishing that surrogate strains that are known to possess properties equivalent to select agents may be used to validate the required inactivation procedures under certain conditions;
• Replacing the term “extract” with “material containing a select agent” to clarify that the inactivation requirements apply to such materials as serums or liquid cultures from which select agents are typically removed via filtration without first undergoing inactivation. This is intended to more accurately describe an element of a two-step process: An inactivation step to destroy the select agent and a second step intended to remove any remaining, viable select agent; and
• Clarification of when an entity may submit a waiver request to the Administrator as well as the procedure for such determinations.
Finally, in 7 CFR 331.3(d)(2), 9 CFR 121.3(d)(2), and 9 CFR 121.4(d)(2), we are replacing the term “nonfunctional toxin” with “nontoxic toxin.” We have determined that the term “nonfunctional” is overbroad and has caused confusion. Our intent was to exclude toxins that can no longer exert their toxic effect and cause disease. For example, Botulinum neurotoxin has three functional domains: Binding domain, translocation domain, and catalytic domain. Each functional domain may be solely manipulated such that the toxin is no longer toxic and does not cause disease even though the other two domains may remain functional. Note that the example provided is for a CDC toxin due to the fact that APHIS does not currently regulate any select toxins.
The provisions of 7 CFR 331.5, 9 CFR 121.5, and 9 CFR 121.6 concern conditions under which entities may be exempted from the requirements of the regulations. We proposed to add language to paragraph (a) in 7 CFR 331.5, 9 CFR 121.5, and 9 CFR 121.6 that specifies that entities may be required to report identification of agents or toxins to other appropriate authorities when required by Federal, State, or local law. Specifically, we proposed to add provisions that state that we do not regulate material containing select agents or toxins when it is in a patient care setting and is not being collected or otherwise tested or retained, nor do we regulate waste generated during delivery of patient care. However, once delivery of patient care for the select agent or toxin infection has concluded, waste would become subject to the requirements of the regulations. If an entity cannot meet these requirements, then the material may be transferred to another entity according to the select agent regulations or destroyed using an approved method. The decision to retain, transfer, or destroy any specimens must be made within 7 calendar days of the conclusion of patient care.
One commenter disagreed with adding such a provision to 9 CFR 121.5. The commenter said that VS should have authority to regulate waste and carcasses from animals (
The provisions the commenter refers to relate to the care of human patients only. However, it should be noted that any waste or carcasses from animals infected with a select agent, provided the select agent or toxin has not been intentionally introduced, cultivated, collected, or otherwise extracted from its natural source, are already listed as excluded in §§ 121.3(d)(1) and 121.4(d)(1) of the regulations.
While we did not receive any further comments on this issue, in response to comments received by CDC and in the interests of maintaining parity between the APHIS and CDC regulations, we are amending the text to clarify the following:
• That patient care refers to actions by health care professionals;
• To clarify that destruction and transfer requirements apply solely to waste generated in the course of patient care and not specimens or samples taken from the patient; and
• That specimens taken from a patient are not subject to the regulations during the period in which they are directly associated with the diagnosis, but all specimens taken and kept more than 7 days after the conclusion of patient care are subject to the regulations.
The regulations require registered entities to develop and implement a number of plans in order to ensure the safety and security of the select agents they handle. These are:
• A security plan, as described by the regulations in 7 CFR 331.11 and 9 CFR 121.11, that provides for measures sufficient to safeguard the select agent or toxin against unauthorized access, theft, loss, or release;
• A biocontainment plan, in the case of PPQ select agents, or a biosafety plan, in the case of VS and overlap select agents, as described in the regulations in 7 CFR 331.12 and 9 CFR 121.12, that provides for measures sufficient to contain the select agent or toxin (
• An incident response plan, as described in the regulations in 7 CFR 331.14 and 9 CFR 121.14, that provides for measures that the registered entity will implement in the event of theft, loss, or release of a select agent or toxin; inventory discrepancies; security breaches (including information systems); severe weather and other natural disasters; workplace violence; bomb threats and suspicious packages; and emergencies such as fire, gas leak, explosion, power outage, etc. The response procedures must account for hazards associated with the select agent or toxin and appropriate actions to contain such agent or toxin.
All of these plans require annual review and revision as necessary. Drills or exercises must also be conducted at least annually to test and evaluate the effectiveness of the plans. The plans must be reviewed and revised, as necessary, after any drill or exercise and after any incident. We proposed to require that these drills or exercises be documented to include how the drill or exercise tested and evaluated the plan, any problems identified, any corrective action taken, and the names of the individuals who participated in the drill or exercise. This will provide a more thorough accounting of required activities as well as increasing the efficacy of the plans via testing and entity-directed improvements. We proposed to add these requirements to 7 CFR 331.11(h), 331.12(e), 331.14(f), 9 CFR 121.11(h), 121.12(e), and 121.14(f).
One commenter stated that the requirement to record the names of the individuals who participated in a given drill or exercise should be limited to registered entity personnel and not include first responders or others who participate. The commenter suggested that a list of the participating external agencies (
We agree with the commenter's suggestion and have updated the regulations in order to clarify that only the names of individuals at the registered entity are required to be listed. The entity may choose to list the names of external agencies (
Comments on more specific proposed changes to these plans may be found below.
Paragraph (a) of 7 CFR 331.12 and 9 CFR 121.12 requires that the biocontainment or biosafety plan contain sufficient information and documentation to describe the biosafety and containment procedures for each select agent or toxin that the registered entity will possess. The plan must also include a description of the biosafety and containment procedures for any animals (including arthropods) or plants intentionally or accidentally exposed to or infected with a select agent. We proposed to additionally require that laboratory-specific biocontainment and/or biosafety manuals must be accessible to individuals working in those laboratories. This change will help to foster an enhanced culture of responsibility by ensuring that appropriate biocontainment and/or biosafety resources are available to all staff with access to select agents and toxins within a select agent laboratory.
One commenter suggested that the specific practice of making manuals accessible is already employed by registered entities. The commenter therefore questioned the need for a separate requirement.
We agree with the commenter and have removed the requirement.
Two commenters urged that, “a description of the biosafety and containment procedures for any animals (including arthropods) or plants intentionally or accidentally exposed to or infected with a select agent” should clearly refer not only to animals within the laboratory but also wildlife, domestic, and stray animals outside of the buildings if they are potentially exposed via accidental release. The commenter added that there should be a system in place to detect such incidents if they occur.
The term “any animals” includes both laboratory animals as well as the wild, domestic, and stray animals described by the commenters. We will, however, add specific clarification to the guidance documents associated with the biocontainment and biosafety plans.
One commenter requested clarification regarding the term “laboratory.” The commenter wanted to know whether the term refers to a single room, a building, or to a group of rooms (
We have clarified the language to state that “biosafety and containment procedures specific to use of the select agent or toxin by the principal investigator must be available to each individual involved with that project.” This more appropriately ties the creation and distribution of biocontainment and biosafety manuals to specific projects, select agents, and people.
We also proposed to add specific provisions to the biocontainment and biosafety plans that would require completion of a written risk assessment for each procedure.
Two commenters stated that these requirements are unnecessary and would prove excessively burdensome to researchers and the responsible official and should be removed. The commenters said that the new requirements regarding validation of inactivation procedures would serve the same security function. The commenters added that APHIS already has opportunity to review and require amendment of an entity's biocontainment or biosafety plan as a condition of registration or as a result of inspection.
We agree with the commenter that this level of detail would prove unnecessarily burdensome. We have instead added language to 7 CFR 331.12(a)(1) and 9 CFR 331.12(a)(1) to explicitly require that the biocontainment and biosafety plans include a description of the hazardous characteristics of each agent or toxin listed on the entity's registration and the biosecurity or biosafety risk associated with laboratory procedures related to the select agent or toxin.
One commenter asked that we define “risk assessment,” given that it is a very broad term and therefore open to interpretation. This commenter and another requested that we provide basic templates for these new required sections and indicate where registered entities and entities seeking registration may find these templates.
We have revised and condensed the proposed language as a result of this and other comments. It no longer includes the term “risk assessment.”
We proposed to amend the regulations in 7 CFR 331.15 and 9 CFR 121.15, which concern provision of mandatory training for staff and visitors who work in or visit areas where select agents or toxins are handled or stored. We proposed to require that all individuals who have received approval to have access to select agents and toxins must undergo training regardless of whether they have access to those select agents or toxins. The training would have to be completed within a year of that individual's approval or prior to entry into an area where select agents and toxins are used or stored, whichever occurs first.
Two commenters objected to the proposed addition, stating that we should include a description of the level of training necessary for personnel in varying positions with highly disparate job duties and responsibilities. The commenters requested that we clarify that required training will be conducted at a level appropriate to the registered person's role and level of access to select agents.
We agree with the commenters' point and have altered the required training language to clearly delineate the types of training required for individuals with varying access levels.
One commenter asked that we clearly specify the requirements for both initial and annual training. The commenter also asked that we consider making training a prerequisite for access to select agents and toxins.
While we made no changes to our regulatory language based on this comment, the document entitled, “Guidance for Meeting the Training Requirements of the Select Agent Regulations”
The regulations in 7 CFR 331.17 and 9 CFR 121.17 concern required recordkeeping procedures for regulated entities as those records relate to select agents and toxins. Paragraph (a)(3)(x) requires that registered entities record the destruction of any toxins by specifically noting the quantity of toxin destroyed, the date of such action, and by whom. However, there is not an equivalent requirement regarding the destruction of select agents. We proposed to add this requirement in order to ensure consistency with the toxin provisions and ensure proper tracking of select agents from acquisition to destruction.
While we did not receive any comments on this issue, in response to comments received by CDC and in the interests of maintaining parity between the APHIS and CDC regulations, we are amending the text to stipulate that registered entities must maintain a record of the select agent used, purpose of use, and, when applicable, final disposition (including destruction) for each select agent held in long-term storage.
We also proposed to state that any records created that contain information related to an entity's registration or its select agents and toxins must be provided promptly upon request. We proposed to specify that such records may include, but are not limited to, biocontainment certifications, laboratory notebooks, institutional biosafety and/or animal use committee minutes and approved protocols, and records associated with occupational health and suitability programs.
One commenter expressed concern regarding the requirement to keep laboratory notebooks for inspection purposes. The commenter stated that items may include proprietary intellectual property and requested clarification regarding the information needed from the notebooks. The commenter asked that we amend the regulatory language in order to protect intellectual property interests and specify if any information would be required from laboratory notebooks apart from that collected for inventory purposes.
We agree with the commenter and we have clarified that only information related to the requirements of the regulations must be produced upon request. Such information may be found in biocontainment certifications, laboratory notebooks, institutional biosecurity/biosafety and/or animal use committee minutes and approved protocols, and records associated with occupational health and suitability programs. Accordingly, we will only be reviewing relevant portions of any laboratory notebooks or documents and only if they contain information related to any requirements of the regulations.
To ensure the accuracy of handwritten records, we also proposed to specify that such records must be legible.
Another commenter suggested that we require that records be written in ink and not pencil and should be signed and dated when appropriate.
We acknowledge this suggestion as good practice. However, in the interests of not being overly prescriptive, we are leaving the interpretation of “legible” up to individual registered entities.
Paragraph (a)(1) in both 7 CFR 331.17 and 9 CFR 121.17 requires entities to maintain an accurate, current inventory for each select agent (including viral genetic elements, recombinant and/or synthetic nucleic acids, and organisms containing recombinant and/or synthetic nucleic acids) held in long-term storage. We continue to receive comments critical of that portion of the regulations. Criticism is typically focused on the belief that a container-based inventory requirement is not a
However, the Public Health Security and Bioterrorism Preparedness and Response Act of 2002 obliges APHIS and CDC to include a requirement for “the prompt notification of the Secretary, and appropriate Federal, State, and local law enforcement agencies, of the theft or loss of listed agents and toxins” in the regulations. We therefore solicited comment regarding what regulatory requirement or requirements should be implemented such that a registered entity could quickly determine whether a select agent had been lost or stolen from long-term storage without that registered entity first having an accurate, current inventory for each select agent held in long-term storage. Additionally, we solicited ideas concerning ways in which the current regulations could be amended to address the possibility of theft of a select agent from a container held in long-term storage.
One commenter stated that, while they understand the need for such inventory and notification requirements, an enormous amount of time and effort is spent during inspections validating that inventories are accurate. The commenter said that this has resulted in the loss of valuable virus isolates due to unintentional thawing, failure of ultralow temperature freezers due to repeated opening and the resulting loss of ultralow temperature, and inefficient use of employee time. The commenter said that measuring the volumes of stored vials of bacteria and viruses in the manner that toxins or other non-replicative select agents are inventoried is illogical. The commenter acknowledged that it is important to indicate the nature of the pathogens stored and the numbers of vials in freezer stocks, but even the most fastidious recordkeeping could not demonstrate that vials of replicative organisms had not been accessed. The commenter stated that current select agent practices allow for these stocks to be maintained in tamper-evident stocks (
We appreciate this comment and will continue to consider how the recognition of theft and loss might be addressed through alternative approaches.
We are also adding a definition of
Therefore, for the reasons given in the proposed rule and in this document, we are adopting the proposed rule as a final rule with the changes discussed in this document.
This final rule has been determined to be significant for the purposes of Executive Order 12866 and, therefore, has been reviewed by the Office of Management and Budget.
In accordance with 5 U.S.C. 604, we have performed a final regulatory flexibility analysis, which is summarized below, regarding the economic effects of this rule on small entities. Copies of the full analysis are available on the
Sections 201 and 212(a)(2) of the Act require a biennial review and republication of the select agent and toxin list, with revisions as appropriate in accordance with this law. This final rule will implement the recommendations of the fourth biennial review of select agent regulations and has finalized changes that will increase their usability as well as provide for enhanced program oversight. These amendments include new provisions regarding the inactivation of select agents, specific biosafety and toxin requirements and clarification of regulatory language concerning security, training, and records. The final rule will require that entities develop a validated inactivation procedure by establishing parameters for quantities of starting material and measures of uncertainty for repeated successful inactivation. This is a broad performance standard that will allow for flexibility given the variety of select agents and toxins under regulation to define conditions of inactivation for each select agent or regulated infectious nucleic acid and maintain written records of having done so. Costs of complying with this amendment are expected to be modest.
Currently, there are 291 entities registered with APHIS and CDC. Of these entities, there are 240 registered to possess Tier 1 select agents and toxins, including 78 academic, 29 commercial, 80 State government, 37 Federal government, and 16 private (non-profit) institutions, most of which are considered to be small entities. Based on current recordkeeping and reporting requirements, an additional 10 to 20 hours per year may be required for maintaining records associated with select agents or material containing select agents or regulated nucleic acids that can produce infectious forms of any select agent virus that have been subjected to a validated inactivation procedure or a procedure for removal of viable select agents. At an imputed cost of $33.40 per hour (GS-12, step 2), this additional time requirement per entity will cost between $334 and $668 per year, or in total for all registered entities between $80,000 and $160,000. Assuming that costs of the rule could be considered to be significant if they exceeded 1 percent of revenue earned by the affected entities, revenues would need to average less than $33,400 to $66,800 for this to be the case. While the vast majority of the entities in industries potentially affected by this rule, other than post-secondary institutions, can be considered small, average annual revenues are well above this range.
Due to the reasons summarized here and explained in the analysis accompanying this rule, the Administrator certifies that this action will not have a significant economic impact on a substantial number of small entities.
This final rule has been reviewed under Executive Order 12988, Civil Justice Reform. This rule: (1) Preempts all State and local laws and regulations that are inconsistent with this rule; (2) has no retroactive effect; and (3) does not require administrative proceedings before parties may file suit in court challenging this rule.
This rule has been reviewed in accordance with the requirements of Executive Order 13175, Consultation and Coordination with Indian Tribal Governments. Executive Order 13175 requires Federal agencies to consult and coordinate with tribes on a government-to-government basis on policies that have tribal implications, including regulations, legislative comments or proposed legislation, and other policy statements or actions that have substantial direct effects on one or more Indian tribes, on the relationship between the Federal Government and
The Animal and Plant Health Inspection Service has assessed the impact of this rule on Indian tribes and determined that this rule does not, to our knowledge, have tribal implications that require tribal consultation under E.O. 13175. If a Tribe requests consultation, the Animal and Plant Health Inspection Service will work with the Office of Tribal Relations to ensure meaningful consultation is provided where changes, additions and modifications identified herein are not expressly mandated by Congress.
In accordance with section 3507(d) of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
The Animal and Plant Health Inspection Service is committed to compliance with the E-Government Act to promote the use of the Internet and other information technologies, to provide increased opportunities for citizen access to Government information and services, and for other purposes. For information pertinent to E-Government Act compliance related to this rule, please contact Ms. Kimberly Hardy, APHIS' Information Collection Coordinator, at 301-851-2483.
Agricultural research, Laboratories, Plant diseases and pests, Reporting and recordkeeping requirements.
Agricultural research, Animal diseases, Laboratories, Medical research, Reporting and recordkeeping requirements.
Accordingly, 7 CFR part 331 and 9 CFR part 121 are amended as follows:
7 U.S.C. 8401; 7 CFR 2.22, 2.80, and 371.3.
The additions and revision read as follows:
(d) * * *
(2) Nonviable select agents or nontoxic toxins.
(3) A select agent or toxin that has been subjected to decontamination or a destruction procedure when intended for waste disposal.
(4) A select agent or regulated nucleic acids that can produce infectious forms of any select agent virus that has been subjected to a validated inactivation procedure that is confirmed through a viability testing protocol. Surrogate strains that are known to possess equivalent properties with respect to inactivation can be used to validate an inactivation procedure; however, if there are known strain-to-strain variations in the resistance of a select agent to an inactivation procedure, then an inactivation procedure validated on a lesser resistant strain must also be validated on the more resistant strains.
(5) Material containing a select agent that is subjected to a procedure that removes all viable select agent cells, spores, or virus particles if the material is subjected to a viability testing protocol to ensure that the removal method has rendered the material free of all viable select agent.
(6) A select agent or regulated nucleic acids that can produce infectious forms of any select agent virus not subjected to a validated inactivation procedure or material containing a select agent not subjected to a procedure that removes all viable select agent cells, spores, or virus particles if the material is determined by the Administrator to be effectively inactivated or effectively removed. To apply for a determination an individual or entity must submit a written request and supporting scientific information to APHIS. A written decision granting or denying the request will be issued.
(7) A PPQ select toxin identified in an original food sample or clinical sample.
(8) Waste generated during the delivery of patient care by health care professionals from a patient diagnosed with an illness or condition associated with a select agent, where that waste is decontaminated or transferred for destruction by complying with State and Federal regulations within 7 calendar days of the conclusion of patient care.
(e) * * *
(3) An individual or entity may make a written request to the Administrator for reconsideration of a decision denying an application for the exclusion of an attenuated strain of a select agent or a select toxin modified to be less potent or toxic. The written request for reconsideration must state the facts and reasoning upon which the individual or entity relies to show the decision was incorrect. The Administrator will grant or deny the request for reconsideration as promptly as circumstances allow and will state, in writing, the reasons for the decision.
The revisions read as follows:
(a) * * *
(1) Unless directed otherwise by the Administrator, within 7 calendar days after identification of the select agent or toxin, the select agent or toxin is transferred in accordance with § 331.16 or destroyed on-site by a recognized sterilization or inactivation process.
(3) The identification of the agent or toxin is reported to APHIS or CDC, the specimen provider, and to other appropriate authorities when required by Federal, State, or local law by telephone, facsimile, or email. This report must be followed by submission of APHIS/CDC Form 4 to APHIS or CDC within 7 calendar days after identification.
The addition reads as follows:
(b) As a condition of registration, each entity is required to be in compliance with the requirements of this part for select agents and toxins listed on the registration regardless of whether the entity is in actual possession of the select agent or toxin. With regard to toxins, the entity registered for possession, use, or transfer of a toxin must be in compliance with the requirements of this part regardless of the amount of toxins currently in its possession.
The additions read as follows:
(a) * * *
(7) Ensure that individuals are provided the contact information for the USDA Office of Inspector General Hotline and the HHS Office of Inspector General Hotline so that they may anonymously report any biosafety/biocontainment or security concerns related to select agents and toxins.
(8) Investigate to determine the reason for any failure of a validated inactivation procedure or any failure to remove viable select agent from material. If the responsible official is unable to determine the cause of a deviation from a validated inactivation procedure or a viable select agent removal method; or receives any report of any inactivation failure after the movement of material to another location, the responsible official must report immediately by telephone or email the inactivation or viable agent removal method failure to APHIS or CDC.
(9) Review, and revise as necessary, each of the entity's validated inactivation procedures or viable select agent removal methods. The review must be conducted annually or after any change in principal investigator, change in the validated inactivation procedure or viable select agent removal method, or failure of the validated inactivation procedure or viable select agent removal method. The review must be documented and training must be conducted if there are any changes to the validated inactivation procedure, viable select agent removal method, or viability testing protocol.
(e) * * * A responsible official must immediately notify the responsible official of the visiting entity if the person's access to select agents or toxins has been terminated.
The additions read as follows:
(d) * * *
(7) * * *
(vi) Any loss of computer, hard drive or other data storage device containing information that can be used to gain access to select agents or toxins; and
(h) * * * Drills or exercises must be documented to include how the drill or exercise tested and evaluated the plan, any problems that were identified and corrective action(s) taken, and the names of registered entity personnel participants.
The addition and revision read as follows:
(a) An individual or entity required to register under this part must develop and implement a written biocontainment plan that is commensurate with the risk of the select agent or toxin, given its intended use.
(1) The hazardous characteristics of each agent or toxin listed on the entity's registration and the biocontainment risk associated with laboratory procedures related to the select agent or toxin;
(2) Safeguards in place with associated work practices to protect entity personnel, the public, and the environment from exposure to the select agent or toxin including, but not limited to: Personal protective equipment and other safety equipment; containment equipment including, but not limited to, biological safety cabinets, animal caging systems, and centrifuge safety containers; and engineering controls and other facility safeguards;
(3) Written procedures for each validated method used for disinfection, decontamination, or destruction, as appropriate, of all contaminated or presumptively contaminated materials including, but not limited to: Cultures and other materials related to the propagation of select agents or toxins, items related to the analysis of select agents and toxins, personal protective equipment, arthropod containment systems, extracted plant and/or arthropod tissues, laboratory surfaces and equipment, and effluent material; and
(4) Procedures for the handling of select agents and toxins in the same
(e) * * * Drills or exercises must be documented to include how the drill or exercise tested and evaluated the plan, any problems that were identified and corrective action(s) taken, and the names of registered entity personnel participants.
The additions read as follows:
(a) * * * The current incident response plan must be submitted for initial registration, renewal of registration, or when requested.
(f) * * * Drills or exercises must be documented to include how the drill or exercise tested and evaluated the plan, any problems that were identified and corrective action(s) taken, and the names of registered entity personnel participants.
The addition and revision read as follows:
(a) An individual or entity required to register under this part must provide information and training on biocontainment, biosafety, security (including security awareness), and incident response to:
(1) Each individual with access approval from the Administrator or HHS Secretary. The training must address the particular needs of the individual, the work they will do, and the risks posed by the select agents or toxins. The training must be accomplished prior to the individual's entry into an area where a select agent is handled or stored, or within 12 months of the date the individual was approved by the Administrator or the HHS Secretary for access, whichever is earlier.
(2) Each individual not approved for access to select agents and toxins by the Administrator or HHS Secretary before that individual enters areas under escort where select agents or toxins are handled or stored (
(e) The responsible official must ensure and document that individuals are provided the contact information of the USDA Office of Inspector General Hotline and the HHS Office of Inspector General Hotline so that they may anonymously report any safety or security concerns related to select agents and toxins.
(b) A transfer may be authorized if:
The addition and revisions read as follows:
(a) * * *
(1) * * *
(v) The select agent used, purpose of use, and, when applicable, final disposition;
(8) For select agents or material containing select agents or regulated nucleic acids that can produce infectious forms of any select agent virus that have been subjected to a validated inactivation procedure or a procedure for removal of viable select agent:
(i) A written description of the validated inactivation procedure or viable select agent removal method used, including validation data;
(ii) A written description of the viability testing protocol used;
(iii) A written description of the investigation conducted by the entity responsible official involving an inactivation or viable select agent removal failure and the corrective actions taken;
(iv) The name of each individual performing the validated inactivation or viable select agent removal method;
(v) The date(s) the validated inactivation or viable select agent removal method was completed;
(vi) The location where the validated inactivation or viable select agent removal method was performed; and
(vii) A certificate, signed by the principal investigator, that includes the date of inactivation or viable select agent removal, the validated inactivation or viable select agent removal method used, and the name of the principal investigator. A copy of the certificate must accompany any transfer of inactivated or select agent removed material.
(b) The individual or entity must implement a system to ensure that all records and databases created under this part are accurate and legible, have controlled access, and that their authenticity may be verified.
(c) The individual or entity must promptly produce upon request any information that is related to the requirements of this part but is not otherwise contained in a record required to be kept by this section. The location of such information may include, but is not limited to, biocontainment certifications, laboratory notebooks, institutional biosafety and/or animal use committee minutes and approved protocols, and records associated with occupational health and suitability programs. All records created under this part must be maintained for 3 years.
7 U.S.C. 8401; 7 CFR 2.22, 2.80, and 371.4.
The additions and revisions read as follows:
(d) * * *
(2) Nonviable VS select agents or nontoxic VS toxins.
(3) A select agent or toxin that has been subjected to decontamination or a destruction procedure when intended for waste disposal.
(4) A select agent or regulated nucleic acids that can produce infectious forms of any select agent virus that has been subjected to a validated inactivation procedure that is confirmed through a viability testing protocol. Surrogate strains that are known to possess equivalent properties with respect to inactivation can be used to validate an inactivation procedure; however, if there are known strain-to-strain variations in the resistance of a select agent to an inactivation procedure, then an inactivation procedure validated on a lesser resistant strain must also be validated on the more resistant strains.
(5) Material containing a select agent that is subjected to a procedure that removes all viable select agent cells, spores, or virus particles if the material is subjected to a viability testing protocol to ensure that the removal method has rendered the material free of all viable select agent.
(6) A select agent or regulated nucleic acids that can produce infectious forms of any select agent virus not subjected to a validated inactivation procedure or material containing a select agent not subjected to a procedure that removes all viable select agent cells, spores, or virus particles if the material is determined by the Administrator to be effectively inactivated or effectively removed. To apply for a determination an individual or entity must submit a written request and supporting scientific information to APHIS. A written decision granting or denying the request will be issued.
(7) A VS select toxin identified in an original food sample or clinical sample.
(8) Waste generated during the delivery of patient care by health care professionals from a patient diagnosed with an illness or condition associated with a select agent, where that waste is decontaminated or transferred for destruction by complying with State and Federal regulations within 7 calendar days of the conclusion of patient care.
(9) Any low pathogenic strains of avian influenza virus, avian paramyxovirus serotype-1 (APMV-1) viruses which do not meet the criteria for Newcastle disease virus,
(e) * * *
(3) An individual or entity may make a written request to the Administrator for reconsideration of a decision denying an application for the exclusion of an attenuated strain of a select agent or a select toxin modified to be less potent or toxic. The written request for reconsideration must state the facts and reasoning upon which the individual or entity relies to show the decision was incorrect. The Administrator will grant or deny the request for reconsideration as promptly as circumstances allow and will state, in writing, the reasons for the decision.
The additions and revision read as follows:
(d) * * *
(2) Nonviable overlap select agents or nontoxic overlap toxins.
(3) A select agent or toxin that has been subjected to decontamination or a destruction procedure when intended for waste disposal.
(4) A select agent or regulated nucleic acids that can produce infectious forms of any select agent virus that has been subjected to a validated inactivation procedure that is confirmed through a viability testing protocol. Surrogate strains that are known to possess equivalent properties with respect to inactivation can be used to validate an inactivation procedure; however, if there are known strain-to-strain variations in the resistance of a select agent to an inactivation procedure, then an inactivation procedure validated on a lesser resistant strain must also be validated on the more resistant strains.
(5) Material containing a select agent that is subjected to a procedure that removes all viable select agent cells, spores, or virus particles if the material is subjected to a viability testing protocol to ensure that the removal method has rendered the material free of all viable select agent.
(6) A select agent or regulated nucleic acids that can produce infectious forms of any select agent virus not subjected
(7) An overlap select toxin identified in an original food sample or clinical sample.
(8) Waste generated during the delivery of patient care by health care professionals from a patient diagnosed with an illness or condition associated with a select agent, where that waste is decontaminated or transferred for destruction by complying with State and Federal regulations within 7 calendar days of the conclusion of patient care.
(e) * * *
(3) An individual or entity may make a written request to the Administrator or HHS Secretary for reconsideration of a decision denying an application for the exclusion of an attenuated strain of a select agent or a select toxin modified to be less potent or toxic. The written request for reconsideration must state the facts and reasoning upon which the individual or entity relies to show the decision was incorrect. The Administrator or HHS Secretary will grant or deny the request for reconsideration as promptly as circumstances allow and will state, in writing, the reasons for the decision.
(a) Diagnostic laboratories and other entities that possess, use, or transfer a VS select agent or toxin that is contained in a specimen presented for diagnosis or verification will be exempt from the requirements of this part for such agent or toxin contained in the specimen, provided that:
(1) Unless directed otherwise by the Administrator, within 7 calendar days after identification of the select agent or toxin, the select agent or toxin is transferred in accordance with § 121.16 or destroyed on-site by a recognized sterilization or inactivation process;
(2) The agent or toxin is secured against theft, loss, or release during the period between identification of the agent or toxin and transfer or destruction of such agent or toxin, and any theft, loss, or release of such agent or toxin is reported;
(3) Unless otherwise directed by the Administrator, the clinical or diagnostic specimens collected from a patient infected with a select agent are transferred in accordance with § 121.16 or destroyed on-site by a recognized sterilization or inactivation process within 7 calendar days after delivery of patient care by heath care professionals has concluded; and
(4) The identification of the agent or toxin is reported to APHIS or CDC, the specimen provider, and to other appropriate authorities when required by Federal, State, or local law by telephone, facsimile, or email. This report must be followed by submission of APHIS/CDC Form 4 to APHIS or CDC within 7 calendar days after identification.
The addition and revisions read as follows:
(a) * * *
(1) Unless directed otherwise by the Administrator, within 7 calendar days after identification of the select agent or toxin, the select agent or toxin is transferred in accordance with § 121.16 or destroyed on-site by a recognized sterilization or inactivation process;
(3) Unless otherwise directed by the Administrator or HHS Secretary, the clinical or diagnostic specimens collected from a patient infected with a select agent are transferred in accordance with § 121.16 or destroyed on-site by a recognized sterilization or inactivation process within 7 calendar days after delivery of patient care by heath care professionals has concluded; and
(4) The identification of the agent or toxin is reported to APHIS or CDC, the specimen provider, and to other appropriate authorities when required by Federal, State, or local law by telephone, facsimile, or email. This report must be followed by submission of APHIS/CDC Form 4 to APHIS or CDC within 7 calendar days after identification.
The addition reads as follows:
(b) As a condition of registration, each entity is required to be in compliance with the requirements of this part for select agents and toxins listed on the registration regardless of whether the entity is in actual possession of the select agent or toxin. With regard to toxins, the entity registered for possession, use, or transfer of a toxin must be in compliance with the requirements of this part regardless of the amount of toxins currently in its possession.
The additions read as follows:
(a) * * *
(7) Ensure that individuals are provided the contact information for the USDA Office of Inspector General Hotline and the HHS Office of Inspector General Hotline so that they may anonymously report any biosafety/biocontainment or security concerns related to select agents and toxins.
(8) Investigate to determine the reason for any failure of a validated
(9) Review, and revise as necessary, each of the entity's validated inactivation procedures or viable select agent removal methods. The review must be conducted annually or after any change in principal investigator, change in the validated inactivation procedure or viable select agent removal method, or failure of the validated inactivation procedure or viable select agent removal method. The review must be documented and training must be conducted if there are any changes to the validated inactivation procedure, viable select agent removal method, or viability testing protocol.
(e) * * * A responsible official must immediately notify the responsible official of the visited entity if the person's access to select agents and toxins has been terminated.
The additions read as follows:
(d) * * *
(7) * * *
(vi) Any loss of computer, hard drive or other data storage device containing information that could be used to gain access to select agents or toxins; and
(h) * * * Drills or exercises must be documented to include how the drill or exercise tested and evaluated the plan, any problems that were identified and corrective action(s) taken, and the names of registered entity personnel participants.
The addition and revision read as follows:
(a) An individual or entity required to register under this part must develop and implement a written biosafety plan that is commensurate with the risk of the select agent or toxin, given its intended use.
(1) The hazardous characteristics of each agent or toxin listed on the entity's registration and the biosafety risk associated with laboratory procedures related to the select agent or toxin;
(2) Safeguards in place with associated work practices to protect entity personnel, the public, and the environment from exposure to the select agent or toxin including, but not limited to: Personal protective equipment and other safety equipment; containment equipment including, but not limited to, biological safety cabinets, animal caging systems, and centrifuge safety containers; and engineering controls and other facility safeguards;
(3) Written procedures for each validated method used for disinfection, decontamination, or destruction, as appropriate, of all contaminated or presumptively contaminated materials including, but not limited to: Cultures and other materials related to the propagation of select agents or toxins, items related to the analysis of select agents and toxins, personal protective equipment, animal caging systems and bedding (if applicable), animal carcasses or extracted tissues and fluids (if applicable), laboratory surfaces and equipment, and effluent material; and
(4) Procedures for the handling of select agents and toxins in the same spaces with non-select agents and toxins to prevent unintentional contamination.
(e) * * * Drills or exercises must be documented to include how the drill or exercise tested and evaluated the plan, any problems that were identified and corrective action(s) taken, and the names of registered entity personnel participants.
The additions read as follows:
(a) * * * The current incident response plan must be submitted for initial registration, renewal of registration, or when requested.
(f) * * * Drills or exercises must be documented to include how the drill or exercise tested and evaluated the plan, any problems that were identified and corrective action(s) taken, and the names of registered entity personnel participants.
The addition and revision read as follows:
(a) An individual or entity required to register under this part must provide information and training on biocontainment, biosafety, security (including security awareness), and incident response to:
(1) Each individual with access approval from the Administrator or HHS Secretary. The training must address the particular needs of the individual, the
(2) Each individual not approved for access to select agents and toxins by the Administrator or HHS Secretary before that individual enters areas under escort where select agents or toxins are handled or stored (
(e) The responsible official must ensure and document that individuals are provided the contact information of the USDA Office of Inspector General Hotline and the HHS Office of Inspector General Hotline so that they may anonymously report any safety or security concerns related to select agents and toxins.
The addition and revision read as follows:
(b) A transfer may be authorized if:
(l) Transfer the amounts only after the transferor uses due diligence and documents that the recipient has a legitimate need (
The addition and revisions read as follows:
(a) * * *
(1) * * *
(v) The select agent used, purpose of use, and, when applicable, final disposition;
(8) For select agents or material containing select agents or regulated nucleic acids that can produce infectious forms of any select agent virus that have been subjected to a validated inactivation procedure or a procedure for removal of viable select agent:
(i) A written description of the validated inactivation procedure or viable select agent removal method used, including validation data;
(ii) A written description of the viability testing protocol used;
(iii) A written description of the investigation conducted by the entity responsible official involving an inactivation or viable select agent removal failure and the corrective actions taken;
(iv) The name of each individual performing the validated inactivation or viable select agent removal method;
(v) The date(s) the validated inactivation or viable select agent removal method was completed;
(vi) The location where the validated inactivation or viable select agent removal method was performed; and
(vii) A certificate, signed by the principal investigator, that includes the date of inactivation or viable select agent removal, the validated inactivation or viable select agent removal method used, and the name of the principal investigator. A copy of the certificate must accompany any transfer of inactivated or select agent removed material.
(b) The individual or entity must implement a system to ensure that all records and databases created under this part are accurate and legible, have controlled access, and that their authenticity may be verified.
(c) The individual or entity must promptly produce upon request any information that is related to the requirements of this part but is not otherwise contained in a record required to be kept by this section. The location of such information may include, but is not limited to, biocontainment certifications, laboratory notebooks, institutional biosafety and/or animal use committee minutes and approved protocols, and records associated with occupational health and suitability programs. All records created under this part must be maintained for 3 years.
Agricultural Marketing Service, USDA.
Affirmation of interim rule as final rule.
The Department of Agriculture (USDA) is adopting, as a final rule, without change, an interim rule implementing a recommendation from the Almond Board of California (Board) that relaxed the quality control requirements prescribed under the California almond marketing order (order). The Board locally administers the order and is comprised of growers and handlers operating within California. The interim rule relaxed incoming quality requirements by increasing the inedible kernel tolerance from 0.50 percent to 2 percent. This relaxation decreases California almond handlers' disposition obligation. This change also allows handlers more flexibility in their operations while continuing to maintain quality control and ensuring compliance with the order's requirements.
Effective January 20, 2017.
Andrea Ricci, Marketing Specialist or Jeffrey Smutny, Regional Director, California Marketing Field Office,
Small businesses may obtain information on complying with this and other marketing order regulations by viewing a guide at the following Web site:
This rule is issued under Marketing Order No. 981, as amended (7 CFR part 981), regulating the handling of almonds grown in California, hereinafter referred to as the “order.” The order is effective under the Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-674), hereinafter referred to as the “Act.”
The Department of Agriculture (USDA) is issuing this rule in conformance with Executive Orders 12866, 13563, and 13175.
Section 981.442 of the order regulates almond quality, including the percentage of inedible (low quality) kernels required to be disposed of by handlers. Previously, the weight of inedible kernels in excess of 0.50 percent of kernel weight of almonds received by each handler constituted the handler's disposition obligation. Handlers must satisfy their obligation by disposing of the inedible kernels in Board-accepted, non-human outlets such as animal feed or oil.
In the past several years, total inedible kernel percentages have been trending lower. This is partially due to good agricultural practices used by growers and better technologies in handler facilities. At the same time, the market value of almonds has increased significantly. As a result, some of the Board-accepted outlets have started to clean and repurpose almonds disposed under the obligation causing concern that product is being sold for human consumption without following the order's outgoing quality requirements. Increasing the inedible kernel tolerance to 2 percent provides handlers more control over low quality product, helping ensure any product destined for human consumption is compliant with the order's outgoing quality requirements. In an interim rule published in the
Pursuant to requirements set forth in the Regulatory Flexibility Act (RFA) (5 U.S.C. 601-612), the Agricultural Marketing Service (AMS) has considered the economic impact of this action on small entities. Accordingly, AMS has prepared this final regulatory flexibility analysis.
The purpose of the RFA is to fit regulatory actions to the scale of businesses subject to such actions in order that small businesses will not be unduly or disproportionately burdened. Marketing orders issued pursuant to the Act, and the rules issued thereunder, are unique in that they are brought about through group action of essentially small entities acting on their own behalf.
There are approximately 6,800 almond growers in the production area and approximately 100 handlers subject to regulation under the marketing order. Small agricultural producers are defined by the Small Business Administration (SBA) as those having annual receipts of less than $750,000, and small agricultural service firms are defined as those whose annual receipts are less than $7,500,000 (13 CFR 121.201).
The National Agricultural Statistics Service (NASS) reported in its 2012 Agricultural Census that there were 6,841 almond farms in the production area (California), of which 6,204 had bearing acres. The following computation provides an estimate of the proportion of producers (farms) and agricultural service firms (handlers) that would be considered small under the SBA definitions.
The NASS Census data indicates that out of the 6,204 California farms with bearing acres of almonds, 4,471 (72 percent) have fewer than 100 bearing acres.
For the almond industry's most recently reported crop year (2015), NASS reported an average yield of 2,130 pounds per acre, and a season average grower price of $2.84 per pound. A 100-acre farm with an average yield of 2,130 pounds per acre would produce about 213,000 pounds of almonds. At $2.84 per pound, that farm's production would be valued at $604,920. Since Census of Agriculture indicates that the majority of California's almond farms are smaller than 100 acres, it could be concluded that the majority of growers had annual receipts from the sale of almonds in 2015 of less than $604,920, which is below the SBA threshold of $750,000. Thus, over 70 percent of California's almond growers would be considered small growers according to SBA's definition.
According to information supplied by the Board, approximately 30 percent of California's almond handlers shipped almonds valued under $7,500,000 during the 2014-15 crop year, and would, therefore, be considered small handlers according to the SBA definition.
This rule continues in effect the revision of § 981.442(a)(4)(i), which relaxed incoming quality requirements by increasing the inedible kernel tolerance from 0.50 percent to 2 percent. This relaxation decreases California almond handlers' disposition obligation, and also allows handlers more flexibility in their operations while continuing to maintain quality control and ensuring compliance with the order's requirements. Authority for this action is provided in § 981.42(a) of the order.
Regarding the impact of this action on affected entities, increasing the inedible kernel tolerance reduces disposition obligation on handlers and provides handlers with more flexibility and control over the low quality product. This rule is not expected to change handler inspection costs, as handlers currently are required to have all lots inspected to determine the percentage of inedible kernels.
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35), the order's information collection requirements have been previously approved by the Office of Management and Budget (OMB) and assigned OMB No. 0581-0178 (Vegetable and Specialty Crops.) No changes are necessary in those requirements as a result of this action. Should any changes become necessary, they would be submitted to OMB for approval.
This rule will not impose any additional reporting or recordkeeping requirements on either small or large almond handlers. As with all Federal marketing order programs, reports and forms are periodically reviewed to reduce information requirements and duplication by industry and public sector agencies. In addition, USDA has not identified any relevant Federal rules that duplicate, overlap, or conflict with this rule.
Further, the Board's meeting was widely publicized throughout the almond industry and all interested
Comments on the interim rule were required to be received on or before October 17, 2016. Two comments were received. One commenter stated that this change will allow almond handlers to have more flexibility with their operations. The other commenter stated the increase in tolerance should lead to a decrease in price. Marketing orders do not regulate price. Therefore, for the reasons given in the interim rule, we are adopting the interim rule as a final rule, without change.
To view the interim rule, go to:
This action also affirms information contained in the interim rule concerning Executive Orders 12866, 12988, 13175, and 13563; the Paperwork Reduction Act (44 U.S.C. Chapter 35); and the E-Gov Act (44 U.S.C. 101).
After consideration of all relevant material presented, it is found that finalizing the interim rule, without change, as published in the
Almonds, Marketing agreements, Nuts, Reporting and recordkeeping requirements.
Animal and Plant Health Inspection Service, USDA.
Final rule; technical amendment.
In a final rule published in the
Effective January 19, 2017.
Dr. Roberta Morales, Import Risk Analyst, Regional Evaluation Services, National Import Export Services, VS, APHIS, 920 Main Campus Drive, Suite 200, Raleigh, NC; (919) 855-7735;
In a final rule
Animal diseases, Imports, Livestock, Meat and meat products, Milk, Poultry and poultry products, Reporting and recordkeeping requirements.
Accordingly, we are amending 9 CFR part 94 as follows:
7 U.S.C. 450, 7701-7772, 7781-7786, and 8301-8317; 21 U.S.C. 136 and 136a; 31 U.S.C. 9701; 7 CFR 2.22, 2.80, and 371.4.
Federal Aviation Administration (FAA), DOT.
Final rule, technical amendment.
The FAA is amending seven high altitude Area Navigation (RNAV) Q-routes (Q-140, Q-816, Q-818, Q-822, Q-824, Q-917, and Q-935) that cross the United States (U.S.)/Canada border in the north central U.S. to update the geographic latitude/longitude coordinates for five Canadian waypoints listed in the Q-route descriptions contained in the FAA and Canadian aeronautical databases.
Effective date 0901 UTC, April 27, 2017. The Director of the Federal Register approves this incorporation by reference action under title 1, Code of Federal Regulations, part 51, subject to the annual revision of FAA Order 7400.11 and publication of conforming amendments.
FAA Order 7400.11A, Airspace Designations and Reporting Points, and subsequent amendments can be viewed online at
FAA Order 7400.11, Airspace Designations and Reporting Points, is published yearly and effective on September 15.
Colby Abbott, Airspace Policy Group, Office of Airspace Services, Federal Aviation Administration, 800 Independence Avenue SW., Washington, DC 20591; telephone: (202) 267-8783.
The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. Subtitle I, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of the airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it would amend the route structure as required to preserve the safe and efficient flow of air traffic.
On September 26, 2014, the FAA published in the
This rule makes the corrections to be in concert with FAA and Canadian aeronautical databases.
This document amends FAA Order 7400.11A, Airspace Designations and Reporting Points, dated August 3, 2016, and effective September 15, 2016. FAA Order 7400.11A is publicly available as listed in the
The FAA is amending Title 14, Code of Federal Regulations (14 CFR) part 71 by modifying RNAV routes Q-140, Q-816, Q-818, Q-822, Q-824, Q-917, and Q-935. The route modifications correct the OMRAK, PEPLA, TAGUM, TANKO, and VIGLO waypoint geographic coordinates used in the routes to match the FAA and Canadian aeronautical database information. The amendments ensure safe and efficient across border connectivity.
The RNAV route modifications accomplished by this action are outlined below.
Q-140: Change the PEPLA waypoint geographic coordinates from “lat. 43°47′51.00″ N., long. 080°01′02.00″ W.” to read “lat. 43°47′50.98″ N., long. 080°00′53.56″ W.”
Q-816: Change the OMRAK waypoint geographic coordinates from “lat. 43°16′06.00″ N., long. 082°16′25.00″ W.” to read “lat. 43°16′15.45″ N., long. 082°15′52.31″ W.”
Q-818: Change the TANKO waypoint geographic coordinates from “lat. 43°01′32.00″ N., long. 082°22′43.00″ W.” to read “lat. 43°01′32.48″ N., long. 082°23′02.38″ W.”
Q-822: Change the TANKO waypoint geographic coordinates from “lat. 43°01′32.00″ N., long. 082°22′43.00″ W.” to read “lat. 43°01′32.48″ N., long. 082°23′02.38″ W.”
Q-824: Change the TAGUM waypoint geographic coordinates from “lat. 43°28′47.00″ N., long. 082°10′37.00″ W.” to read “lat. 43°28′54.05″ N., long. 082°09′46.39″ W.”
Q-917: Change the VIGLO waypoint geographic coordinates from “lat. 45°23′28.00″ N., long. 082°25′11.00″ W.” to read “lat. 45°23′48.00″ N., long. 082°25′11.00″ W.”, and the PEPLA waypoint geographic coordinates from “lat. 43°47′51.00″ N., long. 080°01′02.00″ W.” to read “lat. 43°47′50.98″ N., long. 080°00′53.56″ W.”
Q-935: Change the OMRAK waypoint geographic coordinates from “lat. 43°16′06.00″ N., long. 082°16′25.00″ W.” to read “lat. 43°16′15.45″ N., long. 082°15′52.31″ W.”
High altitude United States RNAV Q-routes are published in paragraph 2006 and high altitude Canadian RNAV Q-routes are published in paragraph 2007 of FAA Order 7400.11A dated August 3, 2016, and effective September 15, 2016, which is incorporated by reference in 14 CFR 71.1. The high altitude United States and Canadian RNAV Q-routes listed in this rule will be subsequently published in the Order.
The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore: (1) is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under Department of Transportation (DOT) Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that only affects air traffic procedures and air navigation, it is certified that this rule, when promulgated, does not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.
The FAA has determined that this action of modifying seven high altitude RNAV Q-routes qualifies for categorical exclusion under the National Environmental Policy Act and its implementing regulations at 40 CFR part 1500, and in accordance with FAA Order 1050.1F.
Airspace, Incorporation by reference, Navigation (air).
In consideration of the foregoing, the Federal Aviation Administration amends 14 CFR part 71 as follows:
49 U.S.C. 106(f), 106(g), 40103, 40113, 40120; E.O. 10854, 24 FR 9565, 3 CFR, 1959-1963 Comp., p. 389.
Bureau of Industry and Security, Commerce.
Final rule.
This rule requires persons intending to export or reexport
This rule also requires persons intending to reexport
The rule is effective April 19, 2017.
Tracey Patts, Foreign Policy Division, Bureau of Industry and Security, Phone: (202) 482-4252.
The government of the Hong Kong Special Administrative Region maintains an import and export control system. The “Import and Export (Strategic Commodities) Regulations” are an integral part of that system. Schedules in those regulations identify articles that may not be imported or exported without a license from Hong Kong's Director-General of Trade and Industry. Those schedules and much of the CCL are based on the control lists published by four multilateral export control regimes. Export control classification number (ECCN) entries on the CCL identify one or more reason(s) for which listed items are controlled. Four of these reasons for control are based on the four multilateral export control regimes, as follows: The Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and Technologies (NS on the CCL), the Missile Technology Control Regime (MT on the CCL), the Nuclear Suppliers Group (NP column 1 on the CCL), and the Australia Group (CB on the CCL). Because the Hong Kong schedules and most of the CCL are developed from these same four sources, large portions of both sets of documents cover the same items.
The government of the Hong Kong Special Administrative Region uses information from the import licenses that it issues to identify articles that require an export license. This rule imposes new support documentation requirements affecting items subject to the EAR that are exported or reexported to Hong Kong or are reexported from Hong Kong. BIS is taking this action to provide greater assurance that U.S. origin items that are subject to the multilateral control regimes noted above will be properly authorized by the United States to their final destination, even when those items first pass through Hong Kong. This rule does not impose any new license requirements.
This rule requires exporters and reexporters using a BIS license or a license exception to export or reexport to Hong Kong items controlled for NS, MT, NP column 1, or CB reasons to obtain certain documents that verify the items' status under the Hong Kong Import and Export (Strategic Commodities) Regulations. The exporter or reexporter must obtain from its client or consignee a copy of a valid import license issued to the Hong Kong importer by the Hong Kong government authorizing import of the item(s) to be shipped to Hong Kong, or a copy of a written statement issued by the Hong Kong government stating that no import license is required to import the item(s) into Hong Kong. The exporter or reexporter must have the copies in its possession, and any Hong Kong import license must not have expired at the time of the export or reexport to Hong Kong. For purposes of this requirement, a written statement issued by the Hong Kong government includes either a written communication to a license applicant informing the applicant that the item does not require a license or a statement available to the general public (including a statement on a Web site by the Hong Kong government) that a license is not required for the item.
This rule also requires reexporters in Hong Kong intending to reexport from Hong Kong items subject to the EAR that are controlled for NS, MT, NP column 1, or CB reasons to obtain from the Hong Kong government a license authorizing export from Hong Kong of the items, or a copy of a written statement issued by the Hong Kong government stating that no export license is required from Hong Kong to export the items. If a Hong Kong license is issued, the reexport must be in accordance with the terms of that license and must be completed during the validity period of the Hong Kong-issued export license. For purposes of this requirement, a written statement issued by the Hong Kong government includes a written communication to a license applicant informing the applicant that the item does not require a license or a statement available to the general public (including a statement on a Web site by the Hong Kong government) that a license is not required for the item.
Since August 21, 2001, the Export Administration Act of 1979, as amended, has been in lapse. However, the President, through Executive Order 13222 of August 17, 2001, 3 CFR, 2001 Comp., p. 783 (2002), as amended by Executive Order 13637 of March 8, 2013, 78 FR 16129 (March 13, 2013), and as extended by the Notice of August 4, 2016, 81 FR 52587 (August 8, 2016), has continued the EAR in effect under the International Emergency Economic Powers Act. BIS continues to carry out the provisions of the Export Administration Act, as appropriate and to the extent permitted by law, pursuant to Executive Order 13222 as amended by Executive Order 13637.
1. Executive Orders 13563 and 12866 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). This rule has been determined to be not significant for purposes of Executive Order 12866.
2. Notwithstanding any other provision of law, no person is required to respond to, nor shall any person be subject to a penalty for failure to comply with, a collection of information subject to the requirements of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
3. This rule does not contain policies with Federalism implications as that term is defined under Executive Order 13132.
4. The provisions of the Administrative Procedure Act (5 U.S.C. 553) requiring notice of proposed rulemaking, the opportunity for public participation, and a 30-day delay in effective date, are inapplicable because this regulation involves a military and foreign affairs function of the United States (5 U.S.C. 553(a)(1)). Therefore, we are issuing this action as a final rule. This action will foster effective administration of and compliance with the export control regulations of the Hong Kong Special Administrative Region with respect to U.S.-origin items. Those regulations apply to items that are listed on the control lists of multilateral export control regimes of which the United States is a member. Effective control over such items imported into Hong Kong by the government of the Hong Kong Special Administrative Region serves the United States' national security and foreign policy interests directly, because many of these items are controlled due to their national security significance or their potential to be used in activities that would promote proliferation of weapons of mass destruction or in regional destabilizing activities.
This rule also enhances the effectiveness of the multilateral control regimes, which serves United States interests in two ways. First, widespread consistent implementation of those regime-based export controls promotes peace and stability throughout the world generally. Second, this rule signals to other nations, regime member states and non-members alike, the United States' determination that distribution of U.S. origin items throughout the world will be in accordance with its regime commitments.
Moreover, BIS expects that in nearly all instances, this rule requires only that a party in Hong Kong obtain a license that is already required under Hong Kong law. In those instances, no new action is required by persons reexporting from Hong Kong and the only new action with respect to exports and reexports to Hong Kong is for the person in Hong Kong to send a copy of the license to its supplier. In the limited instances where the CCL covers items with one or more of the reasons for control noted above that are not listed on the Hong Kong control, such as when the Hong Kong Government and the United States Government update their control lists in response the changes in the multilateral export control regime lists at different times, the party in Hong Kong will have to obtain a written statement from the Hong Kong Government that a Hong Kong license is not required. However, the rule gives the party in Hong Kong several options for providing the required information. Various documents, including the Hong Kong government's specific response to a license application informing the applicant that a license is not required and more general statements downloaded from a Hong Kong Government Web site, will be adequate to fulfill this requirement. One document may be used for multiple shipments as long as the document remains accurate.
Despite the importance of prompt publication and effectiveness to our foreign policy goals as noted above, BIS recognizes that some exporters and reexporters will need time to obtain the required documentation from their customers for all transactions subject to this rule. Therefore, the effective date of this final rule is ninety days after publication.
Administrative practice and procedure, Exports, Reporting and recordkeeping requirements.
Administrative practice and procedure, Business and industry, Confidential business information, Exports, Reporting and recordkeeping requirements.
For the reasons set forth in the preamble, parts 740, 742, and 762 of the Export Administration Regulations (15 CFR parts 730 through 774) are amended as follows:
50 U.S.C. 4601
(a) * * *
(19) The exporter or reexporter to Hong Kong of any item subject to the EAR and controlled on the CCL for NS, MT, NP Column 1, or CB reasons has not received one of the following with respect to the item:
(i) A copy of an import license issued to the Hong Kong importer by the Government of the Hong Kong Special Administrative Region, pursuant to the Hong Kong Import and Export (Strategic Commodities) Regulations, that covers all items to be exported or reexported pursuant to that license exception for which a Hong Kong import license is required and that is valid on the date of the export or reexport that is subject to the EAR; or
(ii) A copy of a written statement issued by the Government of the Hong Kong Special Administrative Region that no import license is required to import into Hong Kong the item(s) to be exported or reexported. The statement may have been issued directly to the Hong Kong importer or it may be a written statement available to the general public. The statement may be used for more than one export or reexport to Hong Kong so long as it remains an accurate statement of Hong Kong law.
(20) The reexporter from Hong Kong of any item subject to the EAR controlled on the CCL for NS, MT, NP column 1, or CB reasons has not received one of the following with respect to the item:
(i) An export license issued by the Government of the Hong Kong Special Administrative Region, pursuant to the Hong Kong Import and Export (Strategic Commodities) Regulations, that covers all items to be reexported pursuant to that license exception for which a Hong Kong export license is required and that is valid on the date of the reexport that is subject to the EAR; or
(ii) A copy of a written statement issued by the Government of the Hong Kong Special Administrative Region that no Hong Kong export license is required for the item(s) to be rexported.
50 U.S.C. 4601
(b)
(1) The People's Republic of China (PRC) other than the Hong Kong Special Administrative Region (see §§ 748.10 and 748.11(a)(2));
(2) “600 Series Major Defense Equipment” (see § 748.11);
(3) Firearms and related commodities to member countries of the Organization of American States (see § 748.12); and
(4) The Hong Kong Special Administrative Region of the People's Republic of China (
On a case-by-case basis, BIS may require license applicants to obtain a support document for any license application.
For End-Use Certificate requirements under the Chemical Weapons Convention, see § 745.2 of the EAR.
(e) * * *
(1) * * * The documents issued by the Government of the Hong Kong Special Administrative region that are required pursuant to § 748.13 are not used to evaluate license applications. They must be obtained before shipment and need not be obtained before submitting a license application.
(a)
(i) A copy of an import license issued to the Hong Kong importer by the Government of the Hong Kong Special Administrative Region, pursuant to the Hong Kong Import and Export (Strategic Commodities) Regulations, that covers the items to be exported or reexported pursuant to that BIS license for which a Hong Kong import license is required and that is valid on the date of the export or reexport that is subject to the EAR; or
(ii) A copy of a written statement issued by the Government of the Hong Kong Special Administrative Region that no import license is required to import into Hong Kong the item(s) to be exported or reexported to Hong Kong. The statement may have been issued directly to the Hong Kong importer or it may be a written statement available to the general public. The statement may be used for more than one export or reexport to Hong Kong so long as it remains an accurate statement of Hong Kong law.
(2)
(i) An export license issued by the Government of the Hong Kong Special Administrative Region, pursuant to the Hong Kong Import and Export (Strategic Commodities) Regulations, that covers all items to be rexported pursuant to that BIS license for which a Hong Kong export license is required and that is valid on the date of the reexport that is subject to the EAR; or
(ii) A copy of a written statement issued by the Government of the Hong Kong Special Administrative Region that no export license is required from Hong Kong for the item(s) to be reexported. The statement may have been issued directly to the Hong Kong reexporter or it may be a written statement available to the general public. The statement may be used for more than one reexport from Hong Kong so long as it remains an accurate statement of Hong Kong law.
(b)
50 U.S.C. 4601
(b) * * *
(54) § 748.13, Certain Hong Kong import and export licenses.
Bureau of Industry and Security, Commerce.
Final rule.
In this final rule, the Bureau of Industry and Security (BIS) amends the Export Administration Regulations (EAR) to implement the India-U.S. Joint Statement of June 7, 2016 (June Statement), which recognized the United States and India as Major Defense Partners. This rule amends the EAR by establishing a licensing policy of general approval for exports or
This rule is effective January 19, 2017.
Alexander Lopes, Director, Office of Nonproliferation Controls and Treaty Compliance, Bureau of Industry and Security, Phone: (202) 482-3825.
As announced by President Obama and India's Prime Minister Singh in a U.S.-India Joint Statement on November 8, 2010, the United States and India formally committed to work together to strengthen the global nonproliferation and export control framework and further transform bilateral export control cooperation to realize the full potential of the global strategic partnership between the two countries. The leaders agreed to take mutual steps to expand cooperation in civil space, defense, and other high-technology sectors. The steps agreed to by the United States included the removal of Indian defense and space-related entities from the Entity List (Supplement No. 4 to part 744 of the EAR) and the realignment of India in U.S. export control regulations. Additionally, the 2010 Joint Statement announced that the United States “intend[ed] to support India's full membership in the four multilateral export control regimes (Nuclear Suppliers Group, Missile Technology Control Regime, Australia Group, and Wassenaar Arrangement) in a phased manner, and to consult with regime members to encourage the evolution of regime membership criteria,” while maintaining these regimes' core principles, “as the Government of India took steps towards the full adoption of the regimes' export control requirements to reflect its prospective membership, with both processes moving forward together.”
To date, BIS has published two rules implementing the President's and Prime Minister's commitments. The first rule, published on January 25, 2011 (76 FR 4228), revised certain export and reexport controls for India, including the removal of nine Indian entities from the Entity List. In addition, BIS amended the EAR to remove India from Country Groups D:2, D:3 and D:4, and added India to Country Group A:2.
In the second rule, published January 23, 2015 (80 FR 3463), BIS amended the EAR, in furtherance of the United States' commitment to the bilateral understanding, by removing India from Crime Control (CC) columns 1 and 3 and from Regional Stability (RS) column 2 on the Commerce Country Chart in Supplement No. 1 to Part 738 of the EAR, because the Government of India had taken appropriate steps to ensure that U.S.-origin items controlled for CC and RS reasons are not reexported from India without a license. Although the second rule removed the license requirement for the majority of items controlled for CC or RS reasons and destined for India, a license requirement remained for items controlled under export control classification numbers (ECCNs) 6A003.b.4.b and 9A515.e for RS column 2 reasons when destined to India.
In addition, BIS published on August 17, 2016, a third rule (81 FR 54721) that was not specific to the bilateral understanding but nonetheless removed a related requirement to include a destination control statement on shipping documents for items controlled for CC columns 1 and 3, and RS column 2 reasons when the items are exported to India.
In this rule, BIS implements an additional step in furtherance of the U.S.-India bilateral understanding and global strategic partnership. On June 7, 2016, the United States and India issued a Joint Statement entitled, “The United States and India: Enduring Global Partners in the 21st Century.” Specifically, in this rule, BIS implements the understanding between the United States and India expressed in the June Statement regarding U.S. export control policy toward India by establishing a new paragraph (b)(8) in § 742.4 (National Security) and a new paragraph (b)(5) in § 742.6 (Regional Stability). These new provisions establish licensing policies of general approval for exports or reexports to or transfers within India of items subject to the EAR, including “600 series” military items, for civil or military end uses in India or for the ultimate end use by the Government of India, for reexport to a Country Group A:5 country, or for return to the United States, so long as such items are not for use in nuclear, “missile,” or chemical or biological weapons activities. This rule does not amend any other licensing policies in part 742 such as those with respect to Missile Technology items. The rule also does not amend any licensing policies pertaining to naval nuclear propulsion. The Country Group A:5 countries are listed in Supplement Number 1 to part 740 and are often informally referred to as the “STA-36” countries because they are the list of countries to which exports under License Exception Strategic Trade Authorization are authorized pursuant to the conditions and limitations of section 740.20(b)(3).
In addition, BIS amends the end user and end use provisions of the Validated End User (VEU) authorization in § 748.15 (Authorization Validated End-User (VEU)), paragraphs (a) (eligible end user provision) and (d) (end-use restrictions), to allow that items obtained under authorization VEU in India may be used for civil or military end uses other than those that involve items controlled for MT reasons, or if for use in nuclear, “missile,” or chemical or biological weapons activities. Section 748.15(c) does not change the January 23, 2015 (80 FR 3463), amendment to the EAR regarding the export and reexport of Crime Control (CC) columns 1 and 3 items to India. Conforming changes are made to paragraph (7)(ii) in Supplement No. 8 to Part 748 (Information Required in Requests for Validated End-User (VEU) Authorization). No other material changes are made in this rule to the VEU program, such as the process for approving a VEU, VEU compliance obligations, the rules pertaining to VEUs in China, or the process of identifying approved VEUs and eligible items and facilities in Supplement No. 7 to Part 748.
Although the Export Administration Act expired on August 20, 2001, the President, through Executive Order 13222 of August 17, 2001, 3 CFR, 2001 Comp., p. 783 (2002), as amended by Executive Order 13637 of March 8, 2013, 78 FR 16129 (March 13, 2013), and as extended most recently by the Notice of August 4, 2016, 81 FR 52587 (August 8, 2016), has continued the EAR in effect under the International Emergency Economic Powers Act. BIS continues to carry out the provisions of the Export Administration Act, as appropriate and to the extent permitted by law, pursuant to Executive Order 13222 as amended by Executive Order 13637.
1. Executive Orders 13563 and 12866 direct agencies to assess all costs and
2. Notwithstanding any other provision of law, no person is required to respond to, nor shall any person be subject to a penalty for failure to comply with, a collection of information subject to the requirements of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
3. This rule does not contain policies with Federalism implications as that term is defined under Executive Order 13132.
4. The provisions of the Administrative Procedure Act (5 U.S.C. 553) requiring notice of proposed rulemaking and the opportunity for public participation, and a delay in effective date, are inapplicable because this regulation involves a military or foreign affairs function of the United States (
Exports, Terrorism.
Administrative practice and procedure, Exports, Reporting and recordkeeping requirements.
Accordingly, 15 CFR parts 742 and 748 of the EAR (15 CFR parts 730 through 774) are amended as follows:
50 U.S.C. 4601
(b) * * *
(8) For India, there is a general policy of approval for license applications to export, reexport, or transfer items, including “600 series” items, for civil or military end uses in India, for ultimate end use by the Government of India, for reexport to countries in Country Group A:5, or for return to the United States, so long as such items are not for use in nuclear, “missile,” or chemical or biological weapons activities.
(b) * * *
(7) For India, there is a general policy of approval for license applications to export, reexport, or transfer items, including “600 series” items, for civil or military end uses in India, for ultimate end use by the Government of India, for reexport to countries in Country Group A:5, or for return to the United States, so long as such items are not for use in nuclear, “missile,” or chemical or biological weapons activities.
50 U.S.C. 4601
(a) * * *
(2) In evaluating an end user for eligibility under authorization VEU, the ERC will consider a range of information, including such factors as: The entity's record of exclusive engagement in appropriate end-use activities; the entity's compliance with U.S. export controls; the need for an on-site review prior to approval; the entity's capability of complying with the requirements of authorization VEU; the entity's agreement to on-site reviews by representatives of the U.S. Government to ensure adherence to the conditions of the VEU authorization; and the entity's relationships with U.S. and foreign companies. In addition, when evaluating the eligibility of an end user, the ERC will consider the status of
(d)
(7) * * *
(ii) Understands and will abide by all authorization VEU end-use restrictions, including the requirement that items received under authorization VEU will only be used for authorized end-uses and may not be used for any activities described in part 744 of the EAR;
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Final rule.
This final rule sets forth changes to the regulations that implement conservation measures adopted by the Commission for the Conservation of Antarctic Marine Living Resources (CCAMLR or Commission). This final rule streamlines and clarifies the regulations for Antarctic marine living resources, shifts deadlines for advance notice of intended fishing activities, distinguishes between first receivers and dealers of Antarctic marine living resources (AMLR), reduces the time for advance notice of imports of
This rule is effective February 21, 2017.
Mi Ae Kim, Office of International Affairs and Seafood Inspection, NMFS (phone 301-427-8365, or email
The United States is a Contracting Party to the Convention on the Conservation of Antarctic Marine Living Resources (Convention). Under Article VII of the Convention, contracting parties established and agreed to maintain the Commission to give effect to the Convention's objective—conservation of AMLR. The United States, along with 23 other countries and the European Union, are members of the Commission and meet annually to formulate, adopt and revise conservation measures. Article IX(6) of the Convention requires the Commission to notify conservation measures to all members and, 180 days thereafter, such measures become binding. If a member objects to a measure within 90 days of notification, the measure is not binding on that member and, should that occur, Article IX(6)(d) of the Convention includes a procedure that allows other members to notify that they can no longer accept that measure.
The Antarctic Marine Living Resources Convention Act of 1984 (AMLRCA), codified at 16 U.S.C. 2431,
Through the “Illegal, Unreported, and Unregulated Fishing Enforcement Act” (IUU Fishing Enforcement Act), Public Law 114-81 (2015), Congress amended AMLRCA section 306, 16 U.S.C. 2435, which specifies unlawful activities; section 307, 16 U.S.C. 2436, which provides the Secretary of Commerce authority to promulgate regulations that are necessary and appropriate to implement AMLRCA; and section 308(a), 16 U.S.C. 2437(a), which specifies the penalties available for violations of the Act. Public Law 114-81 (2015), Title I, 106(1)-(2).
At each annual meeting, the Commission may adopt new conservation measures or revise existing measures. While all conservation measures are subject to revision at the annual meeting, some (particularly those in the fishery regulation category)
Through this action, NMFS reorganizes, streamlines, and updates the regulations that implement AMLRCA and Commission-adopted conservation measures. These revisions incorporate regulatory changes that were finalized on August 3, 2016 (80 FR 51126) regarding the collection of trade documentation within the government-wide International Trade Data System and required electronic information collection. Certain sections are rearranged so that regulations applicable to the trade of AMLR are grouped together while other sections that are obsolete are removed. This action removes sections that implement annual measures which will be implemented through vessel permits if applicable to the permitted fishing activities.
On July 21, 2016, NMFS published a notice of proposed rulemaking for this action (81 FR 47325) to reorganize and update the regulations implementing U.S. obligations under the Convention. The preamble of the proposed rule (81 FR 47325) provides a detailed description of the changes to these regulations as well as NMFS's implementation of annual or biennial measures as conditions to vessel permits instead of through regulations. Responses to public comments received on the proposed rule are set forth below.
With the exception of minor, non-substantive editorial corrections, this final rule includes no changes to the regulatory text that was published in the proposed rule.
NMFS received two public comments on the proposed rule which are addressed below.
Section 300.101 of the rule defines “annual or biennial measure” as a conservation measure that: (1) Applies to the operation of the Convention's commercial or exploratory fisheries such as gear, catch, and effort restrictions and time and area closures; (2) generally expires after one or two fishing season(s); and (3) does not require the development of policy options or a regulatory framework. This approach will apply only to conservation measures that do not require the development of policy options or a regulatory framework. NMFS will provide for notice-and-comment rulemaking when implementation of a conservation measure implicates other requirements of domestic law or when NMFS needs to interpret or expand upon a conservation measure.
Under this final rule, an application for a vessel permit must be submitted by April 1 for the fishing season that will commence on or after December 1 of that year. Therefore, as part of the vessel permit application process and through the permit itself once issued by NMFS, the applicant would have notice of applicable measures in advance of the start of the fishing season. Moreover, annual and biennial measures, along with all CCAMLR conservation measures currently in force are updated every year following the Commission's annual meeting and made available on the Commission's Web site,
This rule is published under the authority of Antarctic Marine Living Resources Convention Act, codified at 16 U.S.C. 2431
The Chief Counsel for Regulation of the Department of Commerce certified to the Chief Counsel for Advocacy of the Small Business Administration (SBA) at the proposed rule stage that this rule is not expected to have a significant economic impact on a substantial number of small entities (81 FR 47330, July 21, 2016). The factual basis for the certification was published in the proposed rule and is not repeated here. No comments were received regarding this certification. As a result, a regulatory flexibility analysis is not required and none has been prepared.
This rule contains a Paperwork Reduction Act (PRA) collection-of-
This rule also contains a new PRA collection-of-information that requires advance notification of transshipments of AMLRs, bait, fuel, or other goods and materials to the CCAMLR Secretariat and submission of a confirmation of the notification to NMFS Headquarters, including information on the vessels involved in the transshipment and the details of the materials being transshipped. The new information collection requirements have been approved by OMB under control number 0648-0742.
Notwithstanding any other provision of the law, no person is required to respond to, and no person shall be subject to penalty for failure to comply with, a collection-of-information subject to the requirements of the PRA, unless that collection-of-information displays a currently valid OMB control number.
Reporting and recordkeeping requirements.
Antarctica, Antarctic marine living resources, Catch documentation scheme, Fisheries, Fishing, Intergovernmental relations, Reporting and recordkeeping requirements.
For the reasons set out in the preamble, NMFS amends 15 CFR part 902 and 50 CFR part 300 as follows:
44 U.S.C. 3501
(b) * * *
16 U.S.C. 951
16 U.S.C. 2431
(a) This subpart implements the Antarctic Marine Living Resources Convention Act of 1984 (AMLRCA or Act), 16 U.S.C. 2431
(b) This subpart regulates—
(1) The harvesting of Antarctic marine living resources and other associated activities by any person subject to the jurisdiction of the United States or by any vessel of the United States.
(2) The import, export, and re-export into the United States of any Antarctic marine living resource.
In addition to the terms defined in § 300.2, in the Act, and in the Convention on the Conservation of Antarctic Marine Living Resources, done at Canberra, Australia, May 7, 1980 (Convention) the terms used in this subpart have the following meanings for purposes of this subpart. If a term is defined differently in § 300.2, than in the Act, or Convention, the definition in this section shall apply.
(1) Applies to the operation of the Convention's commercial or exploratory fisheries such as gear, catch, and effort restrictions and time and area closures;
(2) Generally expires after one or two fishing season(s); and
(3) Does not require the development of policy options or a regulatory framework.
(1) The populations of finfish, mollusks, crustaceans, and all other species of living organisms, including birds, found south of the Antarctic Convergence;
(2) All parts or products of those populations and species set forth in paragraph (1) of this definition.
(1) One or more stocks of fish that are treated as a unit for purposes of conservation and management and that are identified on the basis of geographical, scientific, technical, recreational, and economic characteristics.
(2) Any fishing for such stocks.
(a) Other conventions and treaties to which the United States is a party and other Federal statutes and implementing regulations may impose additional restrictions on the harvesting and importation into the United States of AMLRs.
(b) The ACA implements the Antarctic Treaty Agreed Measures for the Conservation of Antarctic Fauna and Flora (12 U.S.T. 794). The ACA and its implementing regulations (45 CFR part 670) apply to certain defined activities of U.S. citizens south of 60° S. lat.
(c) The Marine Mammal Protection Act of 1972 (16 U.S.C. 1361
(d) Rule making exceptions. When implementing conservation measures adopted and notified by CCAMLR, NMFS may apply the following exceptions to Administrative Procedure Act (APA) rulemaking requirements at 5 U.S.C. 553(b)-(d):
(1) The foreign affairs function exception of the APA, 5 U.S.C. 553(a)(1); or
(2) The exception under subsection 307(b) of AMLRCA, 16 U.S.C. 2436(b), that provides that, notwithstanding 5 U.S.C. 553(b)-(d), NMFS may publish in the
(i) That has been in effect for 12 months or less, beginning on the date that the Commission notifies the United States of the conservation measure under Article IX of the Convention; and
(ii) With respect to which the Secretary of State does not notify the Commission in accordance with section 305(a)(1) of AMLRCA within the time period allotted for objections under Article IX of the Convention.
(e) Annual or biennial measures. NMFS may implement annual or biennial measures adopted by CCAMLR as conditions to vessel permits issued under section 300.107, instead of through rulemaking.
(a) This section applies to any person, using a vessel for research purposes, who intends to catch more than 1 tonne of finfish or krill or use gear other than longline, trawl, or pot to catch
(b) Any person planning to use a vessel for research purposes, when the estimated research catch is expected to be less than 50 tonnes of finfish in a season, and no more than the amounts specified in Table 1, must notify the Assistant Administrator at least 2 months in advance of the planned research using the CCAMLR Format for Notification of Research Vessel Activity, Format 1. A copy of the format is available from NMFS Headquarters. The format requires:
(1) Name and registration number of vessel;
(2) Division and subarea in which research is to be carried out;
(3) Estimated dates of entering and leaving the Convention Area;
(4) Purposes of research; and
(5) Fishing equipment to be used (bottom trawl, midwater trawl, longline, crab pots, other).
(c) Any person planning to use any vessel for research purposes, when the estimated research catch is expected to be more than 50 tonnes or greater than the amounts specified in Table 1 must report the details of the research plan to NMFS using CCAMLR Format 2 for Notification of Research Vessel Activity. The format must be submitted to Assistant Administrator at least 7 months in advance of the planned start date for the research. A copy of the format is available from NMFS Headquarters. The format requires:
(1) Description of the main objective of the research;
(2) Description of the fishery operations;
(3) Description of the survey design, data collection, and analysis;
(4) Proposed catch limit;
(5) Description of the research capability; and
(6) Description of the reporting for evaluation and review.
(d) Where the expected catch is more than 50 tonnes of fish or greater than the amounts specified in Table 1, the planned fishing for research purposes shall not proceed until the Assistant Administrator authorizes the person in writing that he or she may proceed. Such authorization may be provided after completion of review of the scientific research plan by the CCAMLR Scientific Committee and Commission.
(e) A summary of the results of any research subject to these provisions must be provided to the Assistant Administrator within 150 days of the completion of the research and a full report must be provided within 11 months.
(f) Catch, effort, and biological data resulting from the research must be reported using the reporting format for research vessels in accordance with relevant conservation measures, with a copy to NMFS Headquarters.
(a)
(2) All shipments of
(3) Imports of fresh or frozen
(b)
(c)
(2)
(3)
(4)
(5)
(6)
(i)
(ii)
(7)
(8)
(i) Accurately maintain all reports and records required by their first receiver permit and this subpart at their place of business;
(ii) Maintain the original permit at their place of business;
(iii) Make their permit, and all required reports and records, available for inspection upon the request of an authorized officer; and
(iv) Within the time specified in the permit, submit a copy of such reports and records to NMFS at an address designated by NMFS.
(d)
(e) A person may not import a marine mammal into the United States unless authorized and accompanied by an import permit issued under the Marine Mammal Protection Act and/or the Endangered Species Act.
(a) A NMFS-issued preapproval certificate is required to import each shipment of frozen
(b)
(c)
(d)
(e)
(f)
(g)
(2)
(3) The provision of false information in a preapproval application, or the failure to report a change in the information contained in a preapproval application, voids the application or preapproval as applicable.
(h) NMFS will not issue a preapproval certificate for any shipment of
(1) Identified as originating from a high seas area designated by the Food and Agriculture Organization of the United Nations as Statistical Area 51 or Statistical Area 57 in the eastern and western Indian Ocean outside and north of the Convention Area;
(2) Determined to have been harvested or transshipped in contravention of any CCAMLR Conservation Measure in force at the time of harvest or transshipment;
(3) Determined to have been harvested or transshipped by a vessel identified by CCAMLR as having engaged in illegal, unreported and unregulated (IUU) fishing; or
(3) Accompanied by inaccurate, incomplete, invalid, or improperly validated CDS documentation or by a SVDCD.
(a)
(2) No shipment of
(3)
(b)
(2) Prior to offloading
(i) Electronically convey, by the most rapid means possible, catch and other information to NMFS and record on the DCD a confirmation number received from NMFS;
(ii) Obtain on the DCD (or copies thereof) the signature(s) of the following persons: If catch is offloaded for transshipment, the master of the vessel(s) to which the catch is transferred; or if catch is offloaded for landing, the signature of both the responsible official(s) designated by NMFS in the vessel permit and the recipient of the catch at the port(s) of landing; and
(iii) Sign the DCD (or copies thereof), electronically convey by the most rapid means possible each copy to NMFS and provide a copy to each recipient of the catch.
(3) The master of the harvesting vessel must submit the original DCD (and all copies thereof with original signatures) to NMFS no later than 30 days after the end of the fishing season for which the vessel permit was issued and retain copies of the DCD for a period of 2 years.
(c)
(2) Prior to landing
(i) Obtain on each DCD (or copies thereof) the signature(s) of both the responsible official(s) designated by NMFS in the vessel permit and the recipient of the catch at the port(s) of landing; and
(ii) Sign each DCD (or copies thereof), and electronically convey by the most rapid means possible each copy to NMFS and to the flag state(s) of the offloading vessel(s) and provide a copy to each recipient of
(3) The master of the transshipping vessel must submit all DCDs with original signatures to NMFS no later than 30 days after offloading and retain copies for a period of 2 years.
(d)
(e)
(i) Obtain a preapproval certificate issued under § 300.105 for each shipment. Among the information required on the application, applicants must provide the document number and export reference number on the DED or DRED corresponding to the intended import shipment and, if requested by NMFS, additional information for NMFS to verify that the harvesting vessel reported to the C-VMS continuously and in real-time, from port-to-port, regardless of where the fish were harvested;
(ii) Ensure that the quantity of toothfish listed on the DED (or the
(iii) Provide copies of the DED or DRED as needed to persons who re-export
(2) Imports of fresh
(f)
(i) Submit to NMFS a complete and accurate application for a NMFS
(ii) Obtain validation by a responsible official(s) designated by NMFS and receive an electronically-generated DRED.
(2) When applying for a re-export approval, a person must reference or include the approval number issued by NOAA, for the original validated
(g)
(i) Submit to NMFS a complete and accurate NMFS application for a DED; and
(ii) Obtain validation by a responsible official(s) designated by NMFS and receive an electronically-generated DED.
(2) Any person who exports
(h)
(1) Retain a copy of all CDS documents at the person's place of business for a period of 2 years from the date on the documents and provide copies as needed to NMFS; and
(2) Make the IFTP and all CDS documents and other records and reports required by this subpart available for inspection upon request of an authorized officer.
(a)
(1) Every vessel of the United States that attempts to harvest or harvests any AMLR must have a vessel permit authorizing the harvest issued under this subpart, unless the attempt or harvest occurs during recreational fishing or is covered by an individual permit. Boats launched from a vessel issued a vessel permit do not require a separate permit, but are covered by the permit issued to the launching vessel. Any enforcement action that results from the activities of a launched boat will be taken against the owner and operator of the launching vessel.
(2) Any vessel of the United States that receives or attempts to receive any harvested AMLR from another vessel at sea, regardless of whether such transshipment occurs in the Convention Area or that receives, or attempts to receive any other goods or materials from another vessel in the Convention Area, must have a vessel permit authorizing transshipment issued under this subpart. Transshipment vessels must comply with the permitting provisions of this section. This requirement does not apply to scientific research vessels or to transshipments covered under an individual permit.
(3) Permits issued under this section do not authorize vessels or persons subject to the jurisdiction of the United States to harass, capture, harm, kill, harvest, or import marine mammals. No marine mammals may be taken in the course of commercial fishing operations unless the taking is authorized under the Marine Mammal Protection Act and/or the Endangered Species Act pursuant to an exemption or permit granted by the appropriate agency.
(b)
(2) The owners and operators of each such vessel are responsible for the acts of their employees and agents constituting violations, regardless of whether the specific acts were authorized or forbidden by the owners or operators, and regardless of knowledge concerning their occurrence.
(3) The owner of a vessel issued a vessel permit under this subpart must report any sale, change in ownership, or other disposition of the vessel to the Assistant Administrator as soon as possible but no later than 15 days after the change.
(4) The owner and operator of a harvesting vessel issued a permit to fish for krill in the Convention Area using trawl gear must install a seal excluder device and may not possess onboard or deploy trawl gear without a seal excluder device installed.
(c)
(1) A separate, fully completed and accurate application is required for each vessel for which a permit is requested.
(2) NMFS must receive applications for vessel permits no later than April 1 for the fishing season that will commence on or after December 1 of that year.
(3) Applications for a permit to harvest krill must, to the extent possible, identify the products to be derived from the anticipated krill catch.
(4) NMFS will only accept permit applications for vessels that have been issued an International Maritime Organization (IMO) number.
(5) NMFS may charge a fee to recover the administrative expense of permit issuance. NMFS will determine the fee in accordance with procedures in the NOAA finance handbook, available from NMFS, for calculating administrative costs of special products and services and user fees.
(d)
(1) Decrease the size of any harvested population to levels below those that ensure its stable recruitment. For this purpose, the Convention provides that its size should not be allowed to fall below a level close to that which ensures the greatest net annual increment.
(2) Upset the ecological relationships between harvested, dependent, and related populations of AMLRs and the restoration of depleted populations to levels that will ensure stable recruitment.
(3) Cause changes or increase the risk of changes in the marine ecosystem that are not potentially reversible over 2 or 3 decades, taking into account the state of available knowledge of the direct and indirect impact of harvesting, the effects of the introduction of alien species, the effects of associated activities on the marine ecosystem and the effects of environmental changes, with the aim of making possible the sustained conservation of AMLRs.
(4) Violate the Convention or any conservation measures in force with respect to the United States under the Convention. The Convention and the schedule of conservation measures in force can be found on the CCAMLR Web site:
(e)
(f)
(g)
(h)
(2)
(ii)
(i)
(j)
(k)
(1) Names, registration numbers, and IMO numbers;
(2) International radio call signs;
(3) Flag State;
(4) Type of vessels, length, gross registered tonnage and carrying capacity;
(5) Proposed time and position, in latitude and longitude, of transshipment; and
(6) Details of the type and amount of catches and/or other goods, such as food stores and fuel, involved in the transshipment.
(l)
(1) Accurately maintain on board the vessel all CCAMLR reports and records required by its permit.
(2) Make such reports and records available for inspection upon the request of an authorized officer or CCAMLR inspector.
(3) Within the time specified in the vessel permit, submit a copy of such reports and records to NMFS.
(4) Install a NMFS-approved EMTU on board U.S. flagged vessels harvesting AMLR for use in real-time C-VMS port-to-port reporting to a NMFS-designated land-based fisheries monitoring center or centers. The requirements for the installation and operation of the VMS are set forth in § 300.112.
(5) Provide advance notice of the vessel's entry into port using the CCAMLR Port Inspection Report, including the written declaration that the vessel has not engaged in or supported illegal, unreported and unregulated (IUU) fishing in the Convention Area and has complied with relevant CCAMLR requirements. The CCAMLR Port Inspection Report, and instructions for its submission, is available from NMFS Headquarters.
(a)
(2) Boats, skiffs and craft carried by the vessel for fishing operations shall bear the same mark as the vessel, except that a numerical suffix specific for the boat, skiff, or craft must follow the IRCS.
(3) The vessel identification must be in a color in contrast to the background and must be permanently affixed to the vessel in block Roman alphabet letters and Arabic numerals using good quality marine paints. The letters and numbers shall be: At least 1 meter in height (h) for the IRCS placed on the hull, superstructure and/or inclined surfaces and at least 0.3 meter for marks placed on deck. The length of the hyphen shall be half the height of the letters and numbers. The width of the stroke for all letters, numbers and the hyphen shall be h/6. The space between letters and/or numbers shall not exceed h/4 nor be less than h/6. The space between adjacent letters having sloping sides (
(4) The marks and the background shall be maintained in good condition at all times.
(b)
(c)
(2) The operator of each harvesting vessel must ensure that deployed longlines and strings of traps or pots, and gillnets are clearly marked at all times at the surface at each terminal end with a buoy displaying the vessel identification of the harvesting vessel to which the gear belongs (see paragraph (a) of this section), a light visible for 2 miles at night in good visibility, and a radio buoy.
(3) Unmarked or incorrectly identified fishing gear may be considered abandoned and may be disposed of in accordance with applicable CCAMLR Conservation Measures in force with respect to the United States by any authorized officer or CCAMLR inspector.
(d)
(1) Keep the vessel and gear identification clearly legible and in good condition at all times;
(2) Ensure that nothing on the vessel obstructs the view of the markings from an enforcement or inspection vessel or aircraft; and
(3) Ensure that the proper navigational lights and shapes are displayed for the vessel's activity and are properly functioning.
(a) A new fishery, for purposes of this section, is a fishery that uses bottom trawls on the high seas of the Convention Area or a fishery for a species, using a particular method, in a statistical subarea or division for which:
(1) Information on distribution, abundance, demography, potential yield and stock identity from comprehensive research/surveys or exploratory fishing has not been submitted to CCAMLR;
(2) Catch and effort data have never been submitted to CCAMLR; or
(3) Catch and effort data from the two most recent seasons in which fishing occurred have not been submitted to CCAMLR.
(b) Persons intending to develop a new fishery shall notify the Assistant Administrator no later than April 1 for the fishing season that will commence on or after December 1 and shall not initiate the fishery pending NMFS and CCAMLR review or until a vessel permit has been used under this subpart.
(c) The notification shall be accompanied by a complete vessel permit application required under § 300.107 and information on:
(1) The nature of the proposed fishery, including target species, methods of fishing, proposed region and maximum catch levels proposed for the forthcoming season;
(2) Biological information on the target species from comprehensive research/survey cruises, such as distribution, abundance, demographic data and information on stock identity;
(3) Details of dependent and related species and the likelihood of them being affected by the proposed fishery;
(4) Information from other fisheries in the region or similar fisheries elsewhere that may assist in the evaluation of potential yield; and
(5) If the proposed fishery will be undertaken using bottom trawl gear, the known and anticipated impacts of this gear on vulnerable marine ecosystems, including benthos and benthic communities.
(a) An exploratory fishery, for purposes of this section, is a fishery that was previously defined as a new fishery under § 300.109.
(b) A fishery continues to be classified by CCAMLR as an exploratory fishery until sufficient information is available to:
(1) Evaluate the distribution, abundance, and demography of the target species, leading to an estimate of the fishery's potential yield;
(2) Review the fishery's potential impacts on dependent and related species; and
(3) Allow the CCAMLR Scientific Committee to formulate and provide advice to the Commission on appropriate harvest catch levels and fishing gear.
(c) The operator of any vessel engaging in an exploratory fishery must submit, by the date specified in the vessel permit issued under § 300.107, catch, effort, and related biological, ecological, and environmental data as required by a data collection plan for the fishery formulated by the CCAMLR Scientific Committee.
(d) In addition to the requirements in § 300.107, any person planning to enter an exploratory fishery must notify the Assistant Administrator no later than April 1 for the fishing season that will commence on or after December 1 and shall not enter the fishery pending NMFS and CCAMLR review or until a vessel permit has been used under this subpart. The Assistant Administrator will not issue a permit to enter an exploratory fishery until after the requirements of § 300.107 have been met and CCAMLR has considered the notification.
(e) The notification shall be accompanied by a complete vessel permit application required under § 300.107 and information on:
(1) The nature of the exploratory fishery, including target species, methods of fishing, proposed region and maximum catch levels proposed for the forthcoming season;
(2) Specification and full description of the types of fishing gear to be used;
(3) Biological information on the target species from comprehensive research/survey cruises, such as distribution, abundance, demographic data and information on stock identity; details of dependent and related species and the likelihood of their being affected by the proposed fishery;
(4) Information from other fisheries in the region or similar fisheries elsewhere that may assist in the evaluation of potential yield;
(5) If the proposed fishery will be undertaken using bottom trawl gear, information on the known and anticipated impacts of this gear on vulnerable marine ecosystems, including benthos and benthic communities; and
(6) Any other information the Assistant Administrator requires to fully implement the relevant conservation measures.
(a) Except as otherwise specified, this section applies to both national observers and international observers, as well as to vessels of the United States carrying, or required to carry, such observers.
(b) All vessels of the United States fishing in the Convention Area must carry one or more scientific observers as required by CCAMLR conservation measures or as specified in a vessel permit issued under this subpart.
(c) All vessels of the United States conducting longline sink rate testing outside the Convention Area and pursuant to CCAMLR protocols must carry one or more scientific observers as specified in the vessel permit issued under this subpart.
(d)
(e)
(1)
(2)
(i) A valid Commercial Fishing Vessel Safety Decal issued within the past 2 years that certifies compliance with regulations found in 33 CFR chapter I and 46 CFR chapter I;
(ii) A certificate of compliance issued pursuant to 46 CFR 28.710; or
(iii) A valid certificate of inspection pursuant to 46 U.S.C. 3311.
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(i) Measuring decks, codends, and holding bins;
(ii) Providing the observers with a safe work area adjacent to the sample collection site;
(iii) Collecting bycatch when requested by the observers;
(iv) Collecting and carrying baskets of fish when requested by observers; and
(v) Allowing observers to determine the sex of fish when this procedure will not decrease the value of a significant portion of the catch.
(10)
(ii) Notify observers at least 3 hours before observers are transferred, such that the observers can collect personal belongings, equipment, and scientific samples.
(iii) Provide a safe pilot ladder and conduct the transfer to ensure the safety of observers during transfers.
(iv) Provide an experienced crew member to assist observers in the small boat or raft in which any transfer is made.
(f)
(g)
(1) Have a Bachelor's degree or higher from an accredited college or university with a major in one of the natural sciences; or
(2) Have successfully completed a minimum of 30 semester hours or equivalent in applicable biological sciences with extensive use of dichotomous keys in at least one course.
(h)
(i)
(A) Any ownership, mortgage holder, or other secured interest in a vessel, shoreside or floating stationary processor facility involved in the catching, taking, harvesting or processing of fish;
(B) Any business involved with selling supplies or services to any vessel, shoreside or floating stationary processing facility; or
(C) Any business involved with purchasing raw or processed products from any vessel, shoreside or floating stationary processing facilities.
(ii) Must not solicit or accept, directly or indirectly, any gratuity, gift, favor, entertainment, loan, or anything of monetary value from anyone who either conducts activities that are regulated by NMFS or has interests that may be substantially affected by the performance or nonperformance of the observers' official duties.
(iii) Must not serve as observers on any vessel or at any shoreside or floating stationary processing facility owned or operated by a person who previously employed the observers.
(iv) Must not solicit or accept employment as a crew member or an employee of a vessel, shoreside processor, or stationary floating processor while employed by an observer provider.
(2) Provisions for remuneration of observers under this section do not constitute a conflict of interest.
(j)
(2) Perform their assigned duties as described in the CCAMLR Scientific Observers Manual and must complete the CCAMLR Scientific Observer Logbooks and submit them to the CCAMLR Data Manager at the intervals specified by the Data Manager.
(3) Accurately record their sampling data, write complete reports, and report accurately any observations of suspected violations of regulations relevant to conservation of marine resources or their environment.
(4) Not disclose collected data and observations made on board the vessel
(5) Refrain from engaging in any illegal actions or any other activities that would reflect negatively on their image as professional scientists, on other observers, or on the CCAMLR Scheme of International Scientific Observation as a whole. This includes, but is not limited to:
(i) Refrain from engaging in the use, possession, or distribution of illegal drugs; or
(ii) Refrain from engaging in physical sexual contact with personnel of the vessel or processing facility to which the observer is assigned, or with any vessel or processing plant personnel who may be substantially affected by the performance or non-performance of the observer's official duties.
(k)
(2)
(3)
(a)
(b)
(c)
(d)
(e)
(f)
(a)
(2) If a CEMP site is also a site specially protected under the Antarctic Treaty (or the Protocol on Environmental Protection to the Antarctic Treaty and its Annexes, such as the sites listed in 45 CFR 670.29), an applicant seeking to enter such site must apply to the Director of the NSF for a permit under applicable provisions of the ACA or any superseding legislation. The permit granted by NSF shall constitute a joint CEMP/ACA Protected Site permit and any person holding such a permit must comply with the appropriate CEMP site management plan. In all other cases, an applicant seeking a permit to enter a CEMP site must apply to the Assistant Administrator for a CEMP permit in accordance with the provisions of this section.
(b)
(2) The CEMP permit holder and agents designated under a CEMP permit are responsible for the acts of their employees and agents constituting violations, regardless of whether the specific acts were authorized or forbidden by the CEMP permit holder or agents, and regardless of knowledge concerning their occurrence.
(c)
(1) The Antarctic Treaty, including the Agreed Measures for the Conservation of Antarctic Fauna and Flora (including the Protocol on the Environmental Protection to the Antarctic Treaty and its Annexes), as implemented by the ACA and any superseding legislation. (Persons interested in conducting activities subject to the Antarctic Treaty or the Protocol should contact the Office of Polar Programs, NSF).
(2) The Convention for the Conservation of Antarctic Seals.
(3) The Convention and its Conservation Measures in force, implemented under the Act.
(d)
(e)
(1) The specific activities meet the requirements of the Act;
(2) There is sufficient reason, established in the CEMP permit application, that the scientific purpose for the intended entry cannot be served elsewhere; and
(3) The actions permitted will not violate any provisions or prohibitions of the site's management plan submitted in compliance with the CCAMLR Conservation Measure describing the procedure for according protection to CEMP sites.
(f)
(1) A detailed justification that the scientific objectives of the applicant cannot be accomplished elsewhere and a description of how said objectives will be accomplished within the terms of the site's management plan.
(2) A statement signed by the applicant that the applicant has read and fully understands the provisions and prohibitions of the site's management plan. Prospective applicants may obtain copies of the relevant management plans and the CCAMLR Conservation Measure describing the procedure for according protection to CEMP sites by requesting them from NMFS Headquarters.
(g)
(h)
(i)
(j)
(1) A CEMP permit may be revoked or suspended based on a violation of the permit, the Act, or this subpart.
(2) Failure to report a change in the information submitted in a CEMP permit application within 10 days of the change is a violation of this subpart and voids the application or permit, as applicable. Title 15 CFR part 904 governs permit sanctions under this subpart.
(k)
(l)
In addition to the prohibitions in § 300.4, it is unlawful for any person to:
(a) Harvest any AMLR without a permit for such activity as required by § 300.107.
(b) Import into, or export or re-export from, the United States any AMLR: Taken by a vessel of the United States without a permit issued under this subpart or by a foreign-flagged vessel without valid authorization from the applicable flag state to harvest those resources; without accurate, complete, valid and properly validated CDS documentation as required by § 300.106; without an IFTP as required by § 300.104; or in violation of the terms and conditions for such import, export or re-export as specified on the IFTP.
(c) Engage in or benefit from harvesting or other associated activities in violation of the provisions of the Convention or in violation of a conservation measure in force with respect to the United States under Article IX of the Convention.
(d) Ship, transport, offer for sale, sell, purchase, import, export, re-export or have custody, control or possession of, any AMLR that was harvested in violation of a conservation measure in force with respect to the United States under Article IX of the Convention or in violation of any regulation promulgated under the Act, without regard to the citizenship of the person that harvested, or vessel that was used in the harvesting of, the AMLR.
(e) Refuse to allow any CCAMLR inspector or authorized officer to board a vessel of the United States or a vessel subject to the jurisdiction of the United States for the purpose of conducting any search, investigation, or inspection authorized by the Act, this subpart, or any permit issued under the Act.
(f) Refuse to provide appropriate assistance, including access as necessary to communications equipment, to any CCAMLR inspector or authorized officer.
(g) Refuse to sign a written notification of alleged violations of CCAMLR conservation measures in force prepared by a CCAMLR inspector.
(h) Assault, resist, oppose, impede, intimidate, or interfere with a CCAMLR inspector or authorized officer in the conduct of any boarding, search, investigation, or inspection authorized by the Act, this subpart, or any permit issued under the Act.
(i) Use any vessel to engage in harvesting, or receive, import, export or re-export, AMLRs after the revocation, or during the period of suspension, of an applicable permit issued under the Act.
(j) Fail to identify, falsely identify, fail to properly maintain, or obscure the identification of a harvesting vessel or its gear as required by this subpart.
(k) Fish in an area where fishing is prohibited by the Commission, other than for scientific research purposes in accordance with § 300.103.
(l) Violate or attempt to violate any provision of this subpart, the Act, any other regulation promulgated under the Act or the conditions of any permit issued under the Act.
(m) Provide incomplete or inaccurate information about the harvest, transshipment, landing, import, export, or re-export of applicable species on any document required under this subpart.
(n) Receive AMLR from a vessel, without holding an AMLR first receiver permit as required under § 300.104, or receive AMLR from a fishing vessel that does not hold a valid vessel permit issued under § 300.107.
(o) Import, export or re-export
(p) Import shipments of frozen
(q)
(2) Interfere with or bias the sampling procedure employed by an observer, including physical, mechanical, or other sorting or discarding of catch before sampling.
(3) Tamper with, destroy, or discard an observer's collected samples, equipment, records, photographic film, papers, or personal effects without the express consent of the observer.
(4) Prohibit or bar by command, impediment, threat, coercion, or by refusal of reasonable assistance, an observer from collecting samples, conducting product recovery rate determinations, making observations, or otherwise performing the observer's duties.
(5) Harass an observer by conduct that has sexual connotations, has the purpose or effect of interfering with the observer's work performance, or otherwise creates an intimidating, hostile, or offensive environment.
(6) Fish for or process fish without observer coverage required under § 300.111.
(7) Require, pressure, coerce, or threaten an observer to perform duties normally performed by crew members, including, but not limited to, cooking, washing dishes, standing watch, vessel maintenance, assisting with the setting or retrieval of gear, or any duties associated with the processing of fish, from sorting the catch to the storage of the finished product.
(8) Refuse to provide appropriate assistance, including access as necessary to communications equipment, to an observer.
(r)
(2) Fail to install, activate, repair or replace an EMTU prior to leaving port as specified in this subpart.
(3) Fail to operate and maintain an EMTU on board the vessel at all times as specified in this subpart.
(4) Tamper with, damage, destroy, alter, or in any way distort, render useless, inoperative, ineffective, or inaccurate the EMTU required to be installed on a vessel or the EMTU position reports transmitted by a vessel as specified in this subpart.
(5) Fail to contact OLE or follow OLE instructions when automatic position reporting has been interrupted as specified in this subpart.
(6) Register an EMTU to more than one vessel at the same time.
(7) Connect, or leave connected, additional equipment to an EMTU without the prior approval of the OLE.
(8) Make a false statement, oral or written, to an authorized officer regarding the installation, use, operation, or maintenance of an EMTU or communication service provider.
(9) Fail to report to NMFS and to CCAMLR's C-VMS from port-to-port on any trip during which AMLR are, or are expected to be, harvested regardless of whether the vessel operates, or is expected to operate, inside the Convention Area.
(s) Trawl for krill in Convention Area fisheries without a seal excluder device or possess trawl gear without a seal excluder device installed onboard a vessel permitted, or required to be permitted, under this subpart to harvest krill with trawl gear.
(t) Harvest any AMLR in the Convention Area without a vessel permit required by this subpart.
(u) Ship, transport, offer for sale, sell, purchase, import, export, re-export or have custody, control, or possession of, any frozen
In addition to the facilitation of enforcement provisions of § 300.5, the following requirements apply to this subpart.
(a)
(2) The owner and operator of each harvesting vessel must provide to authorized officers and CCAMLR inspectors all records and documents pertaining to the harvesting activities of the vessel, including but not limited to production records, fishing logs, navigation logs, transfer records, product receipts, cargo stowage plans or records, draft or displacement calculations, customs documents or records, and an accurate hold plan reflecting the current structure of the vessel's storage and factory spaces.
(3) Before leaving vessels that have been inspected, the CCAMLR inspector will give the master of the vessel a Certificate of Inspection and a written notification of any alleged violations of CCAMLR conservation measures in effect and will afford the master the opportunity to comment on it. The ship's master must sign the notification to acknowledge receipt and the opportunity to comment on it.
(4) Any person issued a first receiver permit under this subpart, or an IFTP under § 300.322, must as a condition of that permit, allow an authorized officer access to any facility from which they engage in the first receipt, import, export or re-export of AMLR for the purpose of inspecting the facility and any fish, equipment or records therein.
(b)
(c)
Any person or harvesting vessel found to be in violation of the Act, this subpart, or any permit issued under this subpart will be subject to the civil and criminal penalty provisions and forfeiture provisions prescribed in the Act, 15 CFR part 904, and other applicable laws.
Internal Revenue Service (IRS), Treasury.
Final regulations.
This document contains final regulations regarding the application of the modified carryover basis rules of section 1022 of the Internal Revenue Code (Code). Specifically, the final regulations modify provisions of the Treasury Regulations involving basis rules by including a reference to section 1022 where appropriate. The regulations will affect property transferred from certain decedents who died in 2010. The regulations reflect changes to the law made by the Economic Growth and Tax Relief Reconciliation Act of 2001 and the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010.
Mayer R. Samuels at (202) 317-6859 (not a toll-free number).
This document contains amendments to 26 CFR part 1 under various provisions of the Code in response to statutory changes made by the Economic Growth and Tax Relief Reconciliation Act of 2001, Public Law 107-16 (EGTRRA) and the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, Public Law 111-312 (TRUIRJCA).
Section 501(a) of EGTRRA enacted section 2210 of the Code, which made chapter 11 (the estate tax) inapplicable to the estate of any decedent who died after 2009. Section 542 of EGTRRA also enacted section 1022. While section 1014 generally provides that the recipient's basis in property passing from a decedent is the fair market value of the property on the decedent's date of death, section 1022 sets forth a modified carryover basis system applicable after 2009 generally providing that the recipient's basis in property acquired from a decedent is the lesser of the decedent's adjusted basis in the property or the fair market value of the property on the decedent's date of death. Section 901(a) of EGTRRA, known as the “sunset clause”, provided that all provisions of and amendments made by EGTRRA do not apply to estates of decedents dying, gifts made, or generation-skipping transfers after December 31, 2010. The sunset clause effectively limited the application of sections 501(a) and 542 of EGTRRA to 2010.
Section 301(a) of TRUIRJCA, which became law on December 17, 2010, retroactively reinstated the estate tax and repealed section 1022 with respect to the estates of decedents who died in 2010. However, section 301(c) of TRUIRJCA allowed the executor of the estate of a decedent who died in 2010 to elect to apply the Code and regulations thereunder as though section 301(a) of TRUIRJCA did not apply with respect to chapter 11 and with respect to property acquired or passing from the decedent (within the meaning of section 1014(b) of the Code). Thus, section 301(c) of TRUIRJCA allowed the executor of the estate of a decedent who died in 2010 to elect not to have the provisions of chapter 11 apply to the decedent's estate, but rather to have the provisions of section 1022 apply (a Section 1022 Election).
To provide executors with guidance regarding the making of a Section 1022 Election and certain other collateral issues arising from the determination of basis under section 1022, on August 29, 2011, the Treasury Department and the IRS issued Notice 2011-66 (2011-35 IRB 184) and Revenue Procedure 2011-41 (2011-35 IRB 188). Although section 1022 was applicable only to decedents dying in calendar year 2010, basis determined pursuant to that section will continue to be relevant until all of the property whose basis is determined under that section has been sold or otherwise disposed of in a transaction in which gain or loss is recognized. Accordingly, on May 11, 2015, the Treasury Department and the IRS published in the
After consideration of the comments received on the proposed regulations, this Treasury decision adopts the proposed regulations without modification as final regulations. However, the final regulations adopt certain nonsubstantive, clarifying changes. The comments received on the proposed regulations are discussed in the remainder of this preamble.
One commenter noted that the proposed regulations proposed to amend § 1.742-1 to provide that the basis of a partnership interest acquired from a decedent is determined under section 1022 if the decedent died in 2010 and the decedent's executor made a Section 1022 Election with respect to the decedent's estate. The commenter noted that there was no similar amendment proposed to be made to § 1.1367-1(j), relating to the basis of stock of an S corporation where a portion of the value of the stock is attributable to items constituting income in respect of a decedent (IRD). The commenter recommended that the final regulations amend § 1.1367-1(j) with language referencing section 1022.
After considering this comment, the Treasury Department and the IRS have determined that no change is necessary. Section 1.1367-1(j) states, “[t]he basis determined under section 1014 of any stock in an S corporation is reduced by the portion of the value of the stock that is attributable to items constituting income in respect of a decedent.” This regulation section, with its required basis adjustment for IRD, is limited to situations in which section 1014 applies. Section 1.1367-1(j) does not apply when a Section 1022 Election is made because there is no basis adjustment under section 1022 to the date of death value of S corporation stock. Without an adjustment to date of death value, no further adjustment to the basis of S corporation stock is required to account for IRD. Therefore, the final regulations do not adopt this comment.
A commenter noted that the proposed regulations only propose amendments to finalized regulations, and not to proposed regulations or temporary regulations. That commenter specifically requested guidance with respect to proposed regulation § 1.465-69(a) (which provides that a successor to a decedent's amount at risk in an activity is increased by the amount by which the successor's basis in the activity is increased under section 1014) and temporary regulation § 16A.1255-2(b)(2) (which provides that if, as of the date a person acquires section 126 property from a decedent, the basis of the property is determined under section 1014, then on that date the aggregate of excludable portions under
Another commenter asked why the preamble to the proposed regulations omitted any discussion of the revisions made to regulations under six particular sections of the Code, and requested an explanation as to why changes to those regulatory provisions were considered less significant than the changes for which an explanation was given. Generally, the Treasury Department and the IRS included descriptions of the proposed changes in that preamble that involved more than a mere insertion of a reference to section 1022 in addition to an existing reference to section 1014. In such cases, it was determined that an explanation or clarification of the substance or effect of the proposed revision would be helpful. In the case of the proposed amendments to regulations under the six Code sections mentioned by the commenter, the only change proposed was the mere insertion of references to section 1022 in addition to existing references to section 1014. Accordingly, the Treasury Department and the IRS determined that no further explanation of those changes was necessary.
A commenter also asked why the proposed regulations did not incorporate the treatment of items under the various Code sections addressed in Revenue Procedure 2011-41, 2011-35 IRB 188. That revenue procedure provides a safe harbor that determines the effect on the application of various Code sections of a Section 1022 Election. The provisions relating to that safe harbor are available only if the executor of the estate makes a Section 1022 Election and takes no position contrary to a provision in that revenue procedure. Nothing in these final regulations changes or invalidates the provisions of Revenue Procedure 2011-41, so the safe harbor will remain available to qualifying taxpayers. Consequently, it is unnecessary to incorporate the revenue procedure into these regulations.
Certain IRS regulations, including this one, are exempt from the requirements of Executive Order 12866, as supplemented and reaffirmed by Executive Order 13563. Therefore, a regulatory impact assessment is not required. The Regulatory Flexibility Act (5 U.S.C. chapter 6) does not apply to these final regulations because the final regulations do not impose a collection of information requirement on small entities. Therefore, a Regulatory Flexibility Analysis is not required. Pursuant to section 7805(f) of the Code, the notice of proposed rulemaking preceding this regulation has been submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on its impact on small business, and no comments were received.
The principal author of these final regulations is Mayer R. Samuels, Office of the Associate Chief Counsel (Passthroughs and Special Industries). Other personnel from the Treasury Department and the IRS participated in their development.
Income taxes, Reporting and recordkeeping requirements.
Accordingly, 26 CFR part 1 is amended as follows:
26 U.S.C. 7805 * * *
(b) * * *
(2) * * *
(vii) * * *
(B) * * * If a transferee's basis is determined under section 1014 or section 1022, any expenditures incurred by the decedent within the measuring period that are treated as having been incurred by the transferee under paragraph (c)(3)(ii) of this section shall decrease the transferee's basis for purposes of the substantial rehabilitation test.
(g)
(b) * * *
(1) * * * Such basis shall also reflect any adjustments to basis provided under sections 1015, 1016, and 1022.
(d)
(c) * * *
(1) * * *
(iv) The property is not acquired by purchase if the basis of the property in the hands of the person acquiring it is determined in whole or in part by reference to the adjusted basis of such property in the hands of the person from whom acquired, is determined under section 1014(a), relating to property acquired from a decedent, or is determined under section 1022, relating to property acquired from certain decedents who died in 2010. * * *
The revision and addition read as follows:
(a) * * * Except as provided in paragraphs (b), (c), and (d) of this section, the provisions of §§ 1.179-1 through 1.179-5 apply for property placed in service by the taxpayer in taxable years ending after January 25, 1993. * * *
(d)
(h) * * *
(5) * * *
(i) The acquisition of a section 197(f)(9) intangible if the acquiring taxpayer's basis in the intangible is determined under section 1014(a) or 1022; or
(12) * * *
(viii)
(l) * * *
(5)
(a) * * *
(3) The benefit of the general rule is available only to the original transferee but does not apply to any original transferee (for example, a donee or a person acquiring property from a decedent where the basis of property is determined under section 1014 or 1022) who acquired the property in any manner other than by purchase or exchange.
* * * The provisions of § 1.267(d)-1(a)(3) relating to section 1022 are effective on and after January 19, 2017.
(a)
(b)
(e) * * * Section 306 stock ceases to be so classified if the basis of such stock is determined by reference to its fair market value on the date of the decedent-stockholder's death under section 1014 or the optional valuation date under section 2032. Section 306 stock continues to be so classified if the basis of such stock is determined under section 1022.
The provisions of §§ 1.306-1 through 1.306-3 are applicable on or after June 22, 1954. The provisions of § 1.306-3 relating to section 1022 are effective on and after January 19, 2017.
(b) * * *
(5) * * *
(i) * * *
(A) The basis of the stock in the hands of the purchaser is not determined in whole or in part by reference to the adjusted basis of such stock in the hands of the person from whom the stock is acquired, is not determined under section 1014(a) (relating to property acquired from a decedent), or is not determined under section 1022 (relating to the basis of property acquired from certain decedents who died in 2010);
* * * The provisions of § 1.336-1(b)(5)(i)(A) relating to section 1022 are effective on and after January 19, 2017.
(d) * * *
(1) * * *
(i) * * *
(A) * * *
(
(g)
(d) * * *
(6) Effective/applicability date.
(d) * * *
(5) * * *
(ii) * * *
(D) The transferee's basis in the indebtedness is determined under
(6)
The revisions and addition read as follows:
(c) * * *
(4)(i)(
(ii) If a statutory option is not exercised by the estate of the individual to whom the option was granted, or by the person who acquired such option by bequest or inheritance or by reason of the death of such individual, the option shall be considered to be property that constitutes a right to receive an item of income in respect of a decedent to which the rules of sections 691 and 1014(c) (or section 1022(f), if applicable) apply.
(f)
(3)
The revision and addition read as follows:
(k) * * *
(2) * * * If the special rules provided in this paragraph (k) are applicable to a share of stock upon the death of an employee, then the basis of the share in the hands of the estate or the person receiving the stock by bequest or inheritance shall be determined under section 1014 or under section 1022, if applicable, and shall not be increased by reason of the inclusion upon the decedent's death of any amount in the decedent's gross income under this paragraph (k). * * *
(l) * * * The provisions of this section relating to section 1022 are effective on and after January 19, 2017.
(c) * * *
(2) * * * For determination of basis in the hands of the survivor where joint ownership is terminated by the death of one of the owners, see section 1014 or section 1022, if applicable.
(g) * * *
(3)
(c) * * *
(2)
(4) * * * If the recapture amount with respect to a disposition of property (the first disposition) is limited under paragraph (c)(1) or (c)(3) of this section, or under paragraph (c)(2) of this section because the basis of the property in the hands of the transferee is determined under section 1022, and the transferee subsequently disposes of the property in a transaction to which paragraph (a) of this section applies, the prior understated inclusion determined under paragraph (b)(2) of this section is computed by taking into account the amounts attributable to the period of the transferor's ownership of the property prior to the first disposition. * * *
(f)
(d) * * *
(5) * * *
(ii) * * *
(
(
(
(
(c) * * *
(1)(i) * * * For purposes of this paragraph (c), the term
Sections 1.617-3 and 1.617-4 apply on and after January 19, 2017. For rules before January 19, 2017, see §§ 1.617-3 and 1.617-4 as contained in 26 CFR part 1 revised as of April 1, 2016.
(c)
(2)
(a) Sections 1.684-1 through 1.684-4 apply to transfers of property to foreign trusts and foreign estates after August 7, 2000, except as provided in paragraph (b) of this section.
(b) In the case a U.S. transferor decedent dying in 2010, § 1.684-3(c) applies to transfers of property to foreign trusts, foreign estates, and nonresident aliens after December 31, 2009, and before January 1, 2011.
(a) * * * The provisions of section 1014(a), relating to the basis of property acquired from a decedent, and section 1022, relating to the basis of property acquired from certain decedents who died in 2010, do not apply to these amounts in the hands of the estate and such persons. See sections 1014(c) and 1022(f).
(c)
(a)
(b)
(k) * * *
(2) * * *
(ii)
(l)
The revisions read as follows:
(a) * * *
(4) * * *
(i) * * *
(C)
(b) * * *
(4) * * *
(i) * * * Where a partnership interest is transferred as a result of the death of a partner, under section 1014(c) or section 1022(f), the transferee's basis in its partnership interest is not adjusted for that portion of the interest, if any, that is attributable to items representing income in respect of a decedent under section 691. * * *
(e)
(2)
(d) * * *
(2) * * * For purposes of this section, the period during which a shareholder has held stock includes the period he is considered to have held it by reason of the application of section 1223 and, if his basis is determined in whole or in part under the provisions of section 1014(d) (relating to special rule for DISC stock acquired from decedent) or section 1022 (relating to property acquired from certain decedents who died in 2010), the holding period of the decedent. * * *
(f)
(a) * * * Section 1001(e) and paragraph (f) of this section prescribe the method of computing gain or loss upon the sale or other disposition of a term interest in property the adjusted basis (or a portion) of which is determined pursuant, or by reference, to section 1014 (relating to the basis of property acquired from a decedent), section 1015 (relating to the basis of property acquired by gift or by a transfer in trust), or section 1022 (relating to the basis of property acquired from certain decedents who died in 2010).
(f) * * *
(1)
(i) Is determined pursuant to sections 1014, 1015, or 1022; and
(ii) Is also a portion of the adjusted uniform basis of the entire property, a subsequent sale or other disposition of such term interest by the corporation will be subject to the provisions of section 1001(e) and this paragraph (f) to the extent that the basis of the term interest so sold or otherwise disposed of is determined by reference to its basis in the hands of the transferor as provided by section 362(a). See paragraph (f)(2) of this section for rules relating to the characterization of stock received by the transferor of a term interest in property in connection with a transaction to which section 351 applies. That portion of the adjusted uniform basis of the entire property that is assignable to such interest at the time of its sale or other disposition shall be determined under the rules provided in § 1.1014-5. Thus, gain or loss realized from a sale or other disposition of a term interest in property shall be determined by comparing the amount of the proceeds of such sale with that part of the adjusted basis of such interest that is not a portion of the adjusted uniform basis of the entire property.
(i)
(a)
(d)
(a) * * *
(1) The basis of property acquired from a decedent, as determined under section 1014(a) or section 1022, is uniform in the hands of every person having possession or enjoyment of the property at any time under the will or other instrument or under the laws of descent and distribution. * * *
(2) * * * Accordingly, there is a common acquisition date for all titles to property acquired from a decedent within the meaning of section 1014 or section 1022, and, for this reason, a common or uniform basis for all such interests. * * *
(d)
(b)
(2)
(b) * * * Similarly, the period for which property acquired from a decedent who died in 2010 was held by the decedent must be included in determining the period during which the property was held by the recipient, if the recipient's basis in the property is determined under section 1022.
(l)
(c) * * *
(2) * * *
(ii) The transactions referred to in paragraph (c)(2)(i) of this section are:
(A) A disposition that is in part a sale or exchange and in part a gift (see § 1.1245-4(a)(3));
(B) A disposition (other than a disposition to which section 1245(b)(6)(A) applies) that is described in section 1245(b)(3) (relating to certain tax-free transactions);
(C) An exchange described in § 1.1245-4(e)(2) (relating to transfers described in section 1081(d)(1)(A)); or
(D) A transfer at death where the basis of property in the hands of the transferee is determined under section 1022.
(d)
(a) * * *
(3) Even though property may not be of a character subject to the allowance for depreciation in the hands of the taxpayer, such property may nevertheless be section 1245 property if the taxpayer's basis for the property is determined by reference to its basis in the hands of a prior owner of the property and such property was of a character subject to the allowance for depreciation in the hands of such prior owner, or if the taxpayer's basis for the property is determined by reference to the basis of other property that in the hands of the taxpayer was property of a character subject to the allowance for depreciation, or if the taxpayer's basis for the property is determined under section 1022 and such property was of a character subject to the allowance for depreciation in the hands of the decedent. Thus, for example, if a father uses an automobile in his trade or business during a period after December 31, 1961, and then gives the automobile to his son as a gift for the son's personal use, the automobile is section 1245 property in the hands of the son.
(d)
(a) * * *
(1) * * * For purposes of this paragraph (a), the term
(i)
(c) * * *
(5) A transfer at death where the basis of the property in the hands of the transferee is determined under section 1022.
(h)
(a) * * *
(1) * * * For purposes of this paragraph (a), the term
(b) * * *
(2) * * *
(ii) A transaction described in section 1041(a);
(iii) A disposition described in § 1.1254-2(c)(3) (relating to certain tax-free transactions); or
(iv) A transfer at death where basis of property in the hands of the transferee is determined under section 1022.
(e) * * *
(4) * * * If stock is acquired in a transfer that is a gift, in a transfer that is a part sale or exchange and part gift, in a transfer that is described in section 1041(a), or in a transfer at death where the basis of property in the hands of the transferee is determined under section 1022, the amount of section 1254 costs with respect to the property held by the corporation in the acquiring shareholder's hands immediately after the transfer is an amount equal to—
(c) * * *
(2) * * *
(iv) * * * If an interest in a partnership is transferred in a transfer that is a gift, in a transfer that is a part sale or exchange and part gift, in a transfer that is described in section 1041(a), or in a transfer at death where the basis of property in the hands of the transferee is determined under section 1022, the amount of the transferee partner's section 1254 costs with respect to property held by the partnership immediately after the transfer is an amount equal to—
(a) Sections 1.1254-1 through 1.1254-3 and 1.1254-5 are effective with respect to any disposition of natural resource recapture property occurring after March 13, 1995. The rule in § 1.1254-1(b)(2)(iv)(A)(
(b) The provisions of §§ 1.1254-2(a)(1), 1.1254-3(b)(2), 1.1254-4(e)(4), and 1.1254-5(c)(2)(iv) that relate to section 1022 are effective on and after January 19, 2017.
(d) * * *
(4)
(j)
(b)(1) For this section to apply, the taxpayer with respect to whom the erroneous treatment occurred must be:
(i) The taxpayer with respect to whom the determination is made; or
(ii) A taxpayer who acquired title to the property in the erroneously treated transaction and from whom, mediately or immediately, the taxpayer with respect to whom the determination is made derived title in such a manner that he will have a basis ascertained by reference to the basis in the hands of the taxpayer who acquired title to the property in the erroneously treated transaction; or
(iii) A taxpayer who had title to the property at the time of the erroneously treated transaction and from whom, mediately or immediately, the taxpayer with respect to whom the determination is made derived title, if the basis of the property in the hands of the taxpayer with respect to whom the determination is made is determined under section 1015(a) (relating to the basis of property acquired by gift) or section 1022 (relating to the basis of property acquired from certain decedents who died in 2010).
(2) No adjustment is authorized with respect to the transferor of the property in a transaction upon which the basis of the property depends, when the determination is with respect to the original transferee or a subsequent transferee of the original transferee.
(d)
Pension Benefit Guaranty Corporation.
Final rule.
This final rule amends the Pension Benefit Guaranty Corporation's regulation on Benefits Payable in Terminated Single-Employer Plans to prescribe interest assumptions under the regulation for valuation dates in February 2017. The interest assumptions are used for paying benefits under terminating single-employer plans covered by the pension insurance system administered by PBGC.
Effective February 1, 2017.
Deborah C. Murphy (
PBGC's regulation on Benefits Payable in Terminated Single-Employer Plans (29 CFR part 4022) prescribes actuarial assumptions—including interest assumptions—for paying plan benefits under terminating single-employer plans covered by title IV of the Employee Retirement Income Security Act of 1974. The interest assumptions in the regulation are also published on PBGC's Web site (
PBGC uses the interest assumptions in Appendix B to Part 4022 to determine whether a benefit is payable as a lump sum and to determine the amount to pay. Appendix C to Part 4022 contains interest assumptions for private-sector pension practitioners to refer to if they wish to use lump-sum interest rates determined using PBGC's historical methodology. Currently, the rates in Appendices B and C of the benefit payment regulation are the same.
The interest assumptions are intended to reflect current conditions in the financial and annuity markets. Assumptions under the benefit payments regulation are updated monthly. This final rule updates the benefit payments interest assumptions for February 2017.
The February 2017 interest assumptions under the benefit payments regulation will be 1.25 percent for the period during which a benefit is in pay status and 4.00 percent during any years preceding the benefit's placement in pay status. In comparison with the interest assumptions in effect for January 2017, these interest assumptions are unchanged.
PBGC has determined that notice and public comment on this amendment are impracticable and contrary to the public interest. This finding is based on the need to determine and issue new interest assumptions promptly so that the assumptions can reflect current market conditions as accurately as possible.
Because of the need to provide immediate guidance for the payment of benefits under plans with valuation dates during February 2017, PBGC finds that good cause exists for making the assumptions set forth in this amendment effective less than 30 days after publication.
PBGC has determined that this action is not a “significant regulatory action” under the criteria set forth in Executive Order 12866.
Because no general notice of proposed rulemaking is required for this amendment, the Regulatory Flexibility Act of 1980 does not apply. See 5 U.S.C. 601(2).
Employee benefit plans, Pension insurance, Pensions, Reporting and recordkeeping requirements.
In consideration of the foregoing, 29 CFR part 4022 is amended as follows:
29 U.S.C. 1302, 1322, 1322b, 1341(c)(3)(D), and 1344.
Issued in Washington, DC.
Bureau of the Fiscal Service, Fiscal Service, Treasury.
Final rule.
Currently, the Bureau of the Fiscal Service (Fiscal Service) of the United States Department of the Treasury (Treasury), issues nonmarketable, electronic retirement savings bonds to an individual retirement account (IRA) custodian designated by Fiscal Service to act as a custodian for Roth IRAs under Treasury's
This offering does not affect the terms of retirement savings bonds issued to the custodian of Treasury's retirement savings program,
This Final Rule is effective January 19, 2017.
Approximately one third of private-sector employees in the United States lack access to a retirement savings plan through their employers.
Miscellaneous changes have been made to the sections pertaining to retirement savings bonds issued to the custodian of Treasury's retirement savings program,
Subpart D contains miscellaneous provisions (§§ 347.40 through 347.42) that apply to retirement savings bonds issued to the custodians, on behalf of participants, in Treasury's and the states' programs.
Because this rule relates to United States securities, which are contracts between Treasury and the owners of the securities, this rule falls within the contract exception to the Administrative Procedures Act (APA) at 5 U.S.C. 553(a)(2). As a result, the notice, public comment, and delayed effective date provisions of the APA are inapplicable to this rule.
This rule is not a major rule pursuant to the Congressional Review Act (CRA), 5 U.S.C. 801
This final rule contains a new collection of information that is subject to the Paperwork Reduction Act (PRA), 44 U.S.C. 3501
The provisions of the Regulatory Flexibility Act, 5 U.S.C. 601
This rule is not a significant regulatory action pursuant to Executive Order 12866.
Government securities, Savings bonds.
For the reasons set forth in the preamble, we amend 31 CFR part 347 as follows:
5 U.S.C. 301; 12 U.S.C. 90; 31 U.S.C. 3105.
The Secretary of the Treasury (the Secretary), under the authority of Title 31, Chapter 31, offers retirement savings bonds to the IRA custodian for Treasury's retirement savings program and to the Auto-IRA custodians for certain state Auto-IRA programs. The nonmarketable bonds are issued to and held by the custodians, on behalf of participants, in Treasury's program and state programs. This offering will continue until terminated by the Secretary or the Secretary's designee. Treasury's Fiscal Assistant Secretary is authorized to act on behalf of the Secretary on all matters contained in these regulations. The Commissioner of the Fiscal Service, as designee of the Secretary, is delegated the responsibility to administer this part through the Bureau of the Fiscal Service (Fiscal Service).
The regulations in this part apply to retirement savings bonds issued, on behalf of participants, to the IRA custodian for Treasury's retirement savings program and to the Auto-IRA custodians for state Auto-IRA programs.
(a) Fiscal Service is responsible for administering Treasury's retirement savings program and for issuing the retirement savings bonds to the IRA custodian for Treasury's retirement savings program and to the Auto-IRA custodians for certain state Auto-IRA programs. The states are responsible for administering their Auto-IRA retirement savings programs, including the designation of Auto-IRA custodians to perform all operational responsibilities associated with the retirement savings bonds issued by Fiscal Service.
(b) Communications concerning transactions relating to an individual's IRA should be addressed to the appropriate custodian.
The additions and revisions read as follows:
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(j)
(a) Retirement savings bonds are issued to the IRA custodian for Treasury's retirement savings program. No other registrations under this subpart are permitted.
(b) In the event Fiscal Service designates a successor IRA custodian, Fiscal Service may reissue retirement savings bonds held by the predecessor custodian to the successor custodian.
Each retirement savings bond issued to the IRA custodian must be credited to a single Roth IRA established through Treasury's retirement savings program with the custodian.
The amount that initially may be contributed or added to a retirement savings bond in a calendar year by the IRA custodian on behalf of any participant is limited by the applicable annual contribution limits provided under the Internal Revenue Code and regulations. The total value of a retirement savings bond that may be held by the IRA custodian in an IRA on behalf of any participant shall not exceed $15,000.
Fiscal Service is authorized to establish minimum amounts for initial and additional contributions to a retirement savings bond under this subpart.
Payment of retirement savings bonds will be made to the IRA custodian upon the custodian's submission of a request for redemption to Fiscal Service. The custodian shall request the redemption of all retirement savings bonds at their respective maturity. The custodian shall request the full or partial redemption of a bond held on behalf of a participant upon the request of the participant or other authorized person entitled to amounts in the IRA. Retirement savings bond redemptions will be rounded to the nearest one cent.
Retirement savings bonds under this subpart earn interest at the same annual percentage rate as securities issued to the Government Securities Investment Fund (G Fund) in the Thrift Savings Plan for federal employees. The Secretary calculates the G Fund interest rate pursuant to 5 U.S.C. 8438(e)(2). The retirement savings bond interest rate compounds daily at 1/360 of the annual percentage rate. Retirement savings bonds will cease to accrue interest on the date of their maturity.
The maturity date for retirement savings bonds is indeterminate and may
(a)
(b)
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
(11)
(c)
Each retirement savings bond issued to an Auto-IRA custodian must be credited to an IRA under the state Auto-IRA program with the custodian.
The amount that initially may be contributed or added to a retirement savings bond in a calendar year by an Auto-IRA custodian on behalf of any participant is limited by the applicable annual contribution limits provided under the Internal Revenue Code and regulations. The total value of a retirement savings bond that may be held by an Auto-IRA custodian in an IRA on behalf of any participant shall not exceed $15,000 for each state Auto-IRA program.
Fiscal Service is authorized to establish minimum amounts for initial and additional contributions to a retirement savings bond under this subpart.
The issuance and redemption of a retirement savings bond is conditioned on an Auto-IRA custodian certifying compliance with these regulations and with any additional program instructions identified by Fiscal Service that pertain to that bond.
(a)
(b)
Retirement savings bonds under this subpart earn interest at the same annual percentage rate as securities issued to the Government Securities Investment Fund (G Fund) in the Thrift Savings Plan for federal employees. The Secretary calculates the G Fund interest rate pursuant to 5 U.S.C. 8438(e)(2). The retirement savings bond interest rate compounds daily at 1/360 of the annual percentage rate. Retirement savings bonds will cease to accrue interest on the date of their maturity or call.
The maturity date for retirement savings bonds is indeterminate and may be different for each bond issued, but shall not exceed the sum of an original maturity period of 20 years and an extended maturity period of 10 years. A retirement savings bond purchased by the Auto-IRA custodian on behalf of a participant will mature at the earlier of 30 years from the date the bond is first issued to the custodian on behalf of the participant or when its value reaches $15,000.
The Commissioner of the Fiscal Service may decide, in his or her sole discretion, to take any of the following actions with respect to the retirement savings bonds offered under this subpart. Such actions are final. Specifically, the Commissioner reserves the right under this subpart:
(a) As a condition of Fiscal Service's issuance of retirement savings bonds to an Auto-IRA custodian under a state Auto-IRA program, to require a state Auto-IRA program to provide information to Fiscal Service concerning the state Auto-IRA program and retirement savings bonds offered under this subpart, including a certification by a senior official to the completeness and accuracy of the information requested;
(b) To refuse to issue retirement savings bonds to an Auto-IRA custodian in any particular case or class of cases;
(c) To suspend or cease offering retirement savings bonds to an Auto-IRA custodian;
(d) To call for redemption of any outstanding retirement savings bond; or
(e) To determine any appropriate remedy under this subpart.
The Commissioner of the Fiscal Service may waive or modify any provision or provisions of the regulations in this part. He or she may do so in any particular case or class of cases for the convenience of the United States or in order to relieve any person or persons of unnecessary hardship:
(a) If such action would not be inconsistent with law or equity;
(b) If it does not impair any material existing rights; and
(c) If he or she is satisfied that such action would not subject the United States to any substantial expense or liability.
The Commissioner of the Fiscal Service may require:
(a) Such additional evidence to support a requested action as he or she may consider necessary or advisable; or
(b) A bond of indemnity, with or without surety, in any case in which he or she may consider such a bond necessary for the protection of the interests of the United States.
The Secretary may at any time, or from time to time, prescribe additional, supplemental, amendatory, or revised rules and regulations governing retirement savings bonds.
Under Secretary of Defense (Comptroller), Department of Defense.
Final rule.
This final rule is being issued to adjust for inflation each civil monetary penalty (CMP) provided by law within the jurisdiction of the United States Department of Defense (Department of Defense). The Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Debt Collection Improvement Act of 1996 and the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (the 2015 Act), requires the head of each agency to adjust for inflation its CMP levels in effect as of November 2, 2015, under a revised methodology that was effective for 2016 and for each year thereafter.
This rule is effective January 19, 2017 and is applicable beginning on January 13, 2017.
Brian Banal, 703-571-1652.
The Federal Civil Penalties Inflation Adjustment Act of 1990, Public Law 101-410, 104 Stat. 890 (28 U.S.C. 2461, note), as amended by the Debt Collection Improvement Act of 1996, Public Law 104-134, April 26, 1996, and further amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (the 2015 Act), Public Law 114-74, November 2, 2015, required agencies to annually adjust the level of CMPs for inflation to improve their effectiveness and maintain their deterrent effect. The 2015 Act required that not later than July 1, 2016, and not later than January 15 of every year thereafter, the head of each agency must adjust each CMP within its jurisdiction by the inflation adjustment described in the 2015 Act. The inflation adjustment is determined by increasing the maximum CMP or the range of minimum and maximum CMPs, as applicable, for each CMP by the cost-of-living adjustment, rounded to the nearest multiple of $1. The cost-of-living adjustment is the percentage (if any) for each CMP by which the Consumer Price Index (CPI) for the month of October preceding the date of the adjustment (January 15), exceeds the CPI for the month of October in the previous calendar year.
The initial catch up adjustments for inflation to the Department of Defense's CMPs were published as an interim final rule in the
Pursuant to 5 U.S.C. 553(b)B, there is good cause to issue this rule without prior public notice or opportunity for public comment because it would be impracticable and unnecessary. The Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (Section 701(b)) requires agencies, effective 2017, to make annual adjustments for inflation to CMPs notwithstanding section 553 of title 5, United States Code. Additionally, the methodology used, effective 2017, for adjusting CMPs for inflation is established in statute, with no discretion provided to agencies regarding the substance of the adjustments for inflation to CMPs. The Department of Defense is charged only with performing ministerial computations to determine the dollar amount of adjustments for inflation to CMPs.
Further, there are no significant costs associated with the regulatory revisions that would impose any mandates on the Department of Defense, Federal, State or local governments, or the private sector. Accordingly, prior public notice and an opportunity for public comment are not required for this rule. The benefit of this rule is the Department of Defense anticipates that civil monetary penalty collections may increase in the future due to new penalty authorities and other changes in this rule. However, it is difficult to accurately predict the extent of any increase, if any, due to a variety of factors, such as budget and staff resources, the number and quality of civil penalty referrals or leads, and the length of time needed to investigate and resolve a case.
Executive Orders 13563 and 12866 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, distribute impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This rule has not been designated a “significant regulatory action,” because it does not: (1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy; a section of the economy; productivity; competition; jobs; the environment; public health or safety; or State, local, or tribal governments or communities; (2) create a serious inconsistency or otherwise interfere with an action taken or planned by another Agency; (3) materially alter the budgetary impact of entitlements, grants, user fees, or loan programs, or the rights and obligations of recipients thereof; or (4) raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in these Executive Orders.
Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) (2 U.S.C. 1532) requires agencies to assess anticipated costs and benefits before issuing any rule the mandates of which require spending in any year of $100 million in 1995 dollars, updated annually for inflation. In 2016, that threshold is approximately $146 million. This rule will not mandate any requirements for State, local, or tribal governments, nor will it affect private sector costs.
Because notice of proposed rulemaking and opportunity for comment are not required pursuant to 5 U.S.C. 553, or any other law, the analytical requirements of the Regulatory Flexibility Act (5 U.S.C. 601,
The Department of Defense determined that provisions of the Paperwork Reduction Act of 1995, Public Law 104-13, 44 U.S.C. Chapter 35, and its implementing regulations, 5 CFR part 1320, do not apply to this rule because there are no new or revised recordkeeping or reporting requirements.
Executive Order 13132 establishes certain requirements that an agency must meet when it promulgates a rule that imposes substantial direct requirement costs on State and local governments, preempts State law, or otherwise has Federalism implications. This final rule will not have a substantial effect on State and local governments.
Administrative practice and procedure, Penalties.
Accordingly, 32 CFR part 269 is amended as follows.
28 U.S.C. 2461 note.
(d) Inflation adjustment. Maximum civil monetary penalties within the jurisdiction of the Department are adjusted for inflation as follows:
Coast Guard, DHS.
Temporary final rule.
The Coast Guard is establishing a temporary safety zone on the navigable waters of Pleasure Beach, Bridgeport, CT for Pleasure Beach Bridge. This temporary final rule is necessary to provide for the safety of life on navigable waters. Entry into, transit through, mooring, or anchoring within the safety zone is prohibited unless authorized by Captain of the Port (COTP), Sector Long Island Sound.
This rule is effective without actual notice from January 19, 2017 until June 30, 2017. For the purposes of enforcement, actual notice will be used from January 1, 2017 until January 19, 2017.
To view documents mentioned in this preamble as being available in the docket, go to
If you have questions on this rule, contact Petty Officer Jay TerVeen, Prevention Department, U.S. Coast Guard Sector Long Island Sound, telephone (203) 468-4446, email
This rulemaking establishes a safety zone for the waters around Pleasure Beach Bridge, Bridgeport, CT. Corresponding regulatory history is discussed below.
The Coast Guard was made aware on December 9, 2015, of damage to Pleasure Beach Bridge, the result of which created a hazard to navigation. On December 22, 2015, the Coast Guard published a temporary final rule entitled, “Safety Zone; Pleasure Beach Bridge, Bridgeport, CT” in the
We are issuing this rule, and under 5 U.S.C. 553(d)(3), and for the same reasons stated in the preceding paragraph, the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the
The legal basis for this temporary rule is 33 U.S.C. 1231.
On December 09, 2015, the Coast Guard was made aware of damage sustained to Pleasure Beach Bridge, Bridgeport, CT that has created a hazard to navigation. After further analysis of the bridge structure, the Coast Guard concluded that the overall condition of the structure created a continued hazard to navigation. The COTP Sector LIS has determined that the safety zone established by this temporary final rule is necessary to provide for the safety of life on navigable waterways.
The safety zone established by this rule will cover all navigable waters of the entrance channel to Johnsons Creek in the vicinity of Pleasure Beach Bridge, Bridgeport, CT. This safety zone will be bound inside an area that starts at a point on land at position 41-10.2 N., 073-10.7 W. and then east along the shoreline to a point on land at position 41-9.57 N., 073-9.54 W. and then south across the channel to a point on land at position 41-9.52 N., 073-9.58 W. and then west along the shoreline to a point on land at position 41-9.52 N., 073-10.5 W. and then north across the channel back to the point of origin.
This rule prohibits vessels from entering, transiting, mooring, or anchoring within the area specifically designated as a safety zone during the period of enforcement unless authorized by the COTP or designated representative.
The Coast Guard will notify the public and local mariners of this safety zone through appropriate means, which may include, but are not limited to, publication in the
We developed this rule after considering numerous statutes and executive orders related to rulemaking. Below we summarize our analyses based on these statutes and executive orders and we discuss First Amendment rights of protestors.
Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits. Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This rule has not been designated a “significant regulatory action,” under Executive Order 12866. Accordingly, it has not been reviewed by the Office of Management and Budget. The Coast Guard determined that this rulemaking is not a significant regulatory action for the following reasons: (1) Persons or vessels desiring to enter the safety zone may do so with permission from the COTP Sector LIS or a designated representative; and (2) the Coast Guard will notify the public of the enforcement of this rule via appropriate means, such as via Local Notice to Mariners and Broadcast Notice to Mariners to increase public awareness of this safety zone.
The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as amended, requires Federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.
While some owners or operators of vessels intending to transit the safety zone may be small entities, for the reasons stated in section V.A above, this rule will not have a significant economic impact on any vessel owner or operator.
Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the person listed in the
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 proposed rule or any policy or action of the Coast Guard.
This rule will not call for a new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).
A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. We have analyzed this rule under that Order and have determined that it is consistent with the fundamental federalism principles and preemption requirements described in Executive Order 13132.
Also, this rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. If you believe this rule has implications for federalism or Indian tribes, please contact the person listed in the
The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 (adjusted for inflation) or more in any one year. Though this rule will not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.
We have analyzed this rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This temporary rule involves the establishment of a safety zone. It is categorically excluded from further review under paragraph 34(g) of Figure 2-1 of the Commandant Instruction. An environmental analysis checklist supporting this determination, a Categorical Exclusion Determination, and EA Checklist, will be in the docket for review. We seek any comments or information that may lead to the discovery of a significant environmental impact from this rule.
The Coast Guard respects the First Amendment rights of protesters. Protesters are asked to contact the person listed in the
Harbors, Marine safety, Navigation (water), Reporting and recordkeeping requirements, Security measures, Waterways.
For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 165 as follows:
33 U.S.C. 1231; 50 U.S.C. 191; 33 CFR 1.05-1, 6.04-1, 6.04-6, and 160.5; and Department of Homeland Security Delegation No. 0170.1.
(a)
(b)
(c)
(d)
(2) In accordance with the general regulations in 33 CFR 165.23, entry into or movement within this zone is prohibited unless authorized by the COTP, Long Island Sound.
(3) Operators desiring to enter or operate within the safety zone should contact the COTP Sector Long Island Sound at 203-468-4401 (Sector Sector Long Island Sound Command Center) or the designated representative via VHF channel 16 to obtain permission to do so.
(4) Any vessel given permission to enter or operate in the safety zone must comply with all directions given to them by the COTP Sector Long Island Sound, or the designated on-scene representative.
(5) Upon being hailed by a U.S. Coast Guard vessel by siren, radio, flashing light or other means, the operator of the vessel shall proceed as directed.
Office of the Chief Privacy Officer, Office of Management, Department of Education.
Final rule.
The Secretary amends the Family Educational Rights and Privacy Act (FERPA) regulations to change the name of the office designated enforcement functions by the Secretary from the Family Policy Compliance Office to the Office of the Chief Privacy Officer. The purpose of this amendment is to reflect additional resources committed to protecting student privacy and to increase internal efficiency.
These regulations are effective February 21, 2017.
Kathleen Styles, U.S. Department of Education, 400 Maryland Avenue SW., Room 2E315, Washington, DC 20202. Telephone: (855) 249-3072 or via email:
If you use a telecommunications device for the deaf (TDD) or a text telephone (TTY), call the Federal Relay Service (FRS), toll free, at 1-800-877-8339.
FERPA, 20 U.S.C. 1232g(g), requires the Secretary to establish or designate an office within the Department of Education (Department) for the purpose of investigating, processing, reviewing, and adjudicating violations and complaints. As part of an expansion of student privacy operations at the Department, the designated office will change from the Family Policy Compliance Office to the Office of the Chief Privacy Officer. This change will not directly impact the public. This change is being made:
1. To allow the Department to more effectively make use of new resources dedicated to student privacy;
2. To permit efficiencies relating to specialization of work; and
3. To clarify responsibilities within the Department.
Under Executive Order 12866, the Secretary must determine whether this regulatory action is “significant” and, therefore, subject to the requirements of the Executive order and subject to review by the Office of Management and Budget (OMB). Section 3(f) of Executive Order 12866 defines a “significant regulatory action” as an action likely to result in a rule that may—
(1) Have an annual effect on the economy of $100 million or more, or adversely affect a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities in a material way (also referred to as an “economically significant” rule);
(2) Create serious inconsistency or otherwise interfere with an action taken or planned by another agency;
(3) Materially alter the budgetary impacts of entitlement grants, user fees, or loan programs or the rights and obligations of recipients thereof; or
(4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles stated in the Executive order.
This final regulatory action is not a significant regulatory action subject to review by OMB under section 3(f) of Executive Order 12866.
We have also reviewed these regulations under Executive Order 13563, which supplements and explicitly reaffirms the principles, structures, and definitions governing regulatory review established in Executive Order 12866. To the extent permitted by law, Executive Order 13563 requires that an agency—
(1) Propose or adopt regulations only on a reasoned determination that their benefits justify their costs (recognizing that some benefits and costs are difficult to quantify);
(2) Tailor its regulations to impose the least burden on society, consistent with obtaining regulatory objectives and taking into account—among other things and to the extent practicable—the costs of cumulative regulations;
(3) In choosing among alternative regulatory approaches, select those approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity);
(4) To the extent feasible, specify performance objectives, rather than the behavior or manner of compliance a regulated entity must adopt; and
(5) Identify and assess available alternatives to direct regulation, including economic incentives—such as user fees or marketable permits—to encourage the desired behavior, or provide information that enables the public to make choices.
Executive Order 13563 also requires an agency “to use the best available techniques to quantify anticipated present and future benefits and costs as accurately as possible.” The Office of Information and Regulatory Affairs of OMB has emphasized that these techniques may include “identifying changing future compliance costs that might result from technological innovation or anticipated behavioral changes.”
We are issuing these final regulations only on a reasoned determination that their benefits justify their costs. In choosing among alternative regulatory approaches, we selected those approaches that maximize net benefits. Based on the analysis that follows, the Department believes that these final regulations are consistent with the principles in Executive Order 13563.
We also have determined that this regulatory action does not unduly interfere with State, local, and tribal governments in the exercise of their governmental functions.
In accordance with both Executive orders, the Department has assessed the potential costs and benefits, both quantitative and qualitative, of this regulatory action. The potential costs associated with this regulatory action are those resulting from statutory requirements and those we have determined as necessary for administering the Department's programs and activities.
Upon review of the cost, we have determined there is no financial or resource burden associated with these changes.
Under the Administrative Procedure Act (5 U.S.C. 553), the Department generally offers interested parties the opportunity to comment on proposed regulations. However, these amendments merely reflect changes in internal organization and procedure. The changes do not establish or affect substantive policy. Therefore, under 5 U.S.C. 553(b)(B), the Secretary has determined that proposed regulations are unnecessary and contrary to the public interest.
The Secretary certifies that these regulations will not have a significant economic impact on a substantial number of small entities. These regulations contain technical changes to current regulations. The changes will not have a significant economic impact on any of the entities affected because the regulations do not impose excessive burdens or require unnecessary Federal supervision.
These regulations do not contain any information collection requirements.
This program is not subject to Executive Order 12372 and the regulations in 34 CFR part 79.
You may also access documents of the Department published in the
Administrative practice and procedure, Privacy, Reporting and recordkeeping requirements, Students.
For the reasons discussed in the preamble, the Secretary amends title 34 of the Code of Federal Regulations as follows:
20 U.S.C. 1232g, unless otherwise noted.
Office of Postsecondary Education, Department of Education.
Final rule with request for comments.
The Secretary amends the Student Assistance General Provisions regulations governing participation in the student financial assistance programs authorized under Title IV of the Higher Education Act of 1965, as amended (title IV, HEA programs). The amended regulations update the Department's hearing procedures for actions to establish liability against an institution of higher education, and establish procedural rules governing recovery proceedings under the Department's borrower defense regulations.
Submit your comments through the Federal eRulemaking Portal or via postal mail, commercial delivery, or hand delivery. We will not accept comments submitted by fax or by email or those submitted after the comment period. To ensure that we do not receive duplicate copies, please submit your comments only once. In addition, please include the Docket ID at the top of your comments.
If you are submitting comments electronically, we strongly encourage you to submit any comments or attachments in Microsoft Word format. If you must submit a comment in Portable Document Format (PDF), we strongly encourage you to convert the PDF to print-to-PDF format or to use some other commonly used searchable text format.
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•
The Department's policy is to make all comments received from members of the public available for public viewing in their entirety on the Federal eRulemaking Portal at
Annmarie Weisman, U.S. Department of Education, 400 Maryland Avenue SW., Room 6W425, Washington, DC 20202-6244. Telephone: (202) 453-6712 or by email:
If you use a telecommunications device for the deaf (TDD) or a text telephone (TTY), call the Federal Relay Service (FRS), toll free, at 1-800-877-8339.
As discussed below, these regulations do not establish substantive policy, but instead establish procedures that must be followed. As procedural regulations, there is no requirement for a comment period. Although these regulations are final regulations, we are interested in whether you think we should make any changes in these regulations and thus we are inviting your comments. We will consider these comments in determining whether to revise the regulations. To ensure that your comments have maximum effect, we urge you to identify clearly the specific section or sections of the regulations that each of your comments addresses and to arrange your comments in the same order as the regulations. See
We invite you to assist us in complying with the specific requirements of Executive Orders 12866 and 13563 and their overall requirements of reducing regulatory burden that might result from these regulations. Please let us know of any further ways we could reduce potential costs or increase potential benefits while preserving the effective and efficient administration of the Department's programs and activities.
During and after the comment period, you may inspect all public comments about these regulations by accessing
On request, we will supply an appropriate accommodation or auxiliary aid to an individual with a disability who needs assistance to review the comments or other documents in the public rulemaking record for these regulations. If you want to schedule an appointment for this type of accommodation or auxiliary aid, please contact the person listed under
On November 1, 2016, the Department of Education promulgated new regulations governing the William D. Ford Federal Direct Loan Program to establish a new Federal standard and a process for determining whether a borrower has a defense to repayment on a loan based on an act or omission of a school (the borrower defense regulations). If the Department determines that a borrower is eligible for relief under the borrower defense regulations, it has the authority to recover losses stemming from such borrower relief from the institution whose conduct gave rise to the borrower defense. These regulations establish the procedural rules that would govern such borrower defense and institutional recovery proceedings, and are designed to ensure that institutions are afforded a full and fair opportunity to defend themselves in such proceedings.
These regulations amend the Department's existing regulations governing proceedings to assess a fine, limitation, suspension, or termination against an institution by adding procedures for a recovery proceeding under the borrower defense regulations. Such a proceeding may be used when pursuing an action under either the Department's new borrower defense regulation at 34 CFR 685.222 or its precursor at 34 CFR 685.206. These regulations are designed to balance important interests by ensuring that institutions are protected by due process of law prior to the imposition of any monetary liability under the borrower defense regulations, while also ensuring that determinations of the validity of borrower defense claims asserted against institutions are resolved fairly, efficiently, and expeditiously for all parties. In addition, these regulations clarify and update the procedural provisions more broadly applicable to fine, limitation, suspension, and termination proceedings.
Under the borrower defense regulations at 34 CFR 685.222, effective July 1, 2017, the applicable process for filing and reviewing claims will depend on whether a borrower's application is considered by the Department as an individual claim or if the Department identifies the application as factually similar to other applications such that the Department identifies a group of borrowers (potentially including borrowers who have not submitted applications) with similar claims. The process will also depend on whether the relevant institution is “open” or “closed”, as those terms are described in the regulations.
The Department has the authority to pursue claims for recovery for losses that the Department has already incurred in granting individual borrower relief, either as stand-alone actions or in combination with group proceedings where those individual claims presented the same facts and circumstances as the group claims. In those instances, the determination of the validity of the individual's discharge claim does not depend on the hearing official's decision, and the Department does not rescind a discharge already granted to an individual if the Department does not succeed in proving the validity of that claim in this proceeding.
Beginning July 1, 2017, the Department will use these procedural regulations both to determine the validity of borrower claims the Department asserts on behalf of borrowers in group claims against “open” institutions, and to hold the institutions liable for losses on those claims in accordance with 34 CFR 685.222(h). In these instances, the hearing official determines the validity of the borrower claims and, correspondingly, whether relief will be granted to these group borrowers. Borrowers may opt out of the group process. When the Department seeks to recover for losses for claims approved
The Department bears the burden of proof in any recovery action against an institution for all claims the Department asserts. The Department must therefore prove the merit of the claims it asserts for members of the group. A hearing official will determine the merit of the claims, the relief for members of the group, and the liability of the institution. The Department must also prove in the hearing process the merit of claims it asserts for losses on discharges it has already approved as individual claims, although, as previously indicated, individual discharges already granted by the Department will not be affected if the Department is not successful in proving the claim in this proceeding against the institution.
These regulations are only applicable to actions initiated by the Department to fine an institution, to limit, suspend, or terminate the eligibility of an institution or servicer, or to recover from an institution for losses from borrower defense claims, and do not encompass the process by which the Department evaluates individual borrower claims or claims for which the Department does not seek to obtain a recovery. That process is set forth in the borrower defense regulations at 34 CFR 685.222(e). In addition, the Department plans to issue a borrower guide before the borrower defense regulations go into effect to ensure borrowers understand the application process and criteria for seeking debt relief.
Under the Administrative Procedure Act (5 U.S.C. 553), the Department generally offers interested parties the opportunity to comment on proposed regulations. These regulations only govern the procedures for initiating an action against an institution and the hearing rules applicable to such a proceeding. As such, these regulations make procedural changes only and do not establish substantive policy. The regulations are therefore rules of agency practice and procedure, and exempt from notice and comment rulemaking under 5 U.S.C. 553(b)(A). However, the Department is providing a 60-day comment period and invites interested persons to participate in this rulemaking by submitting written comments. The Department may consider the comments received and may conduct additional rulemaking based on the comments.
The APA also generally requires that regulations be published at least 30 days before their effective date, unless the agency has good cause to implement its regulations sooner (5 U.S.C. 553(d)(3)). Again, because these final regulations are merely rules of agency practice and procedure, there is good cause to make them effective on the day they are published. For the same reasons, the Secretary has determined, under section 492(b)(2) of the HEA, 20 U.S.C. 1098a(b)(2), that these regulations should not be subject to negotiated rulemaking.
Under Executive Order 12866, the Secretary must determine whether this regulatory action is “significant” and, therefore, subject to the requirements of the Executive order and subject to review by the Office of Management and Budget (OMB). Section 3(f) of Executive Order 12866 defines a “significant regulatory action” as an action likely to result in a rule that may—
(1) Have an annual effect on the economy of $100 million or more, or adversely affect a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities in a material way (also referred to as an “economically significant” rule);
(2) Create serious inconsistency or otherwise interfere with an action taken or planned by another agency;
(3) Materially alter the budgetary impacts of entitlement grants, user fees, or loan programs or the rights and obligations of recipients thereof; or
(4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles stated in the Executive order.
This final regulatory action is not a significant regulatory action subject to review by OMB under section 3(f) of Executive Order 12866.
We have also reviewed these regulations under Executive Order 13563, which supplements and explicitly reaffirms the principles, structures, and definitions governing regulatory review established in Executive Order 12866. To the extent permitted by law, Executive Order 13563 requires that an agency—
(1) Propose or adopt regulations only on a reasoned determination that their benefits justify their costs (recognizing that some benefits and costs are difficult to quantify);
(2) Tailor its regulations to impose the least burden on society, consistent with obtaining regulatory objectives and taking into account—among other things and to the extent practicable—the costs of cumulative regulations;
(3) In choosing among alternative regulatory approaches, select those approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity);
(4) To the extent feasible, specify performance objectives, rather than the behavior or manner of compliance a regulated entity must adopt; and
(5) Identify and assess available alternatives to direct regulation, including economic incentives—such as user fees or marketable permits—to encourage the desired behavior, or provide information that enables the public to make choices.
Executive Order 13563 also requires an agency “to use the best available techniques to quantify anticipated present and future benefits and costs as accurately as possible.” The Office of Information and Regulatory Affairs of OMB has emphasized that these techniques may include “identifying changing future compliance costs that might result from technological innovation or anticipated behavioral changes.”
We are issuing these final regulations only on a reasoned determination that their benefits justify their costs. In choosing among alternative regulatory approaches, we selected those approaches that maximize net benefits. Based on the analysis that follows, the Department believes that these final regulations are consistent with the principles in Executive Order 13563.
We also have determined that this regulatory action does not unduly interfere with State, local, and tribal governments in the exercise of their governmental functions.
In accordance with both Executive orders, the Department has assessed the potential costs and benefits, both quantitative and qualitative, of this regulatory action. The potential costs associated with this regulatory action
Executive Order 12866 and the Presidential memorandum “Plain Language in Government Writing” require each agency to write regulations that are easy to understand.
The Secretary invites comments on how to make these regulations easier to understand, including answers to questions such as the following:
• Are the requirements in the regulations clearly stated?
• Do the regulations contain technical terms or other wording that interferes with their clarity?
• Does the format of the regulations (grouping and order of sections, use of headings, paragraphing, etc.) aid or reduce their clarity?
• Would the regulations be easier to understand if we divided them into more (but shorter) sections? (A “section” is preceded by the symbol “§ ” and a numbered heading; for example, § 668.81.)
• Could the description of the regulations in the
• What else could we do to make the regulations easier to understand?
To send any comments that concern how the Department could make these regulations easier to understand, see the instructions in the
The Secretary certifies that these regulations will not have a significant economic impact on a substantial number of small entities. The small entities that are affected by these regulations are small postsecondary institutions. These regulations do not have a significant economic impact on these entities because all substantive rules that govern determinations of liability have already been established in the Department's borrower defense regulations promulgated November 1, 2016.
The Paperwork Reduction Act of 1995 does not require you to respond to a collection of information unless it displays a valid OMB control number. We display the valid OMB control number assigned to a collection of information in final regulations at the end of the affected section of the regulations.
This program is not subject to Executive Order 12372 and the regulations in 34 CFR part 79.
The Secretary particularly requests comments on whether these regulations require transmission of information that any other agency or authority of the United States gathers or makes available.
You may also access documents of the Department published in the
Administrative practice and procedure, Aliens, Colleges and universities, Consumer protection, Grant programs—education, Loan programs—education, Reporting and recordkeeping requirements, Selective Service System, Student aid, Vocational education.
For the reasons discussed, the Secretary amends part 668 of title 34 of the Code of Federal Regulations as follows:
20 U.S.C. 1001-1003, 1070a, 1070g, 1085, 1087b, 1087d, 1087e, 1088, 1091, 1092, 1094, 1099c, 1099c-1, 1221e-3, and 3474, unless otherwise noted.
The additions and revision read as follows:
(a) * * *
(5) The determination of—
(i) Borrower defense to repayment claims that are brought by the Department against an institution under § 685.206 or § 685.222; and
(ii) Liability of an institution to the Secretary for losses to the Secretary arising from these claims.
(e) The proceedings described in this subpart provide the institution's sole opportunity for a hearing on the existence and amount of the debt that is required by applicable law prior to the Department collecting the debt from any available funds, including but not limited to offsetting the debt or any liability against funds to be provided to an institution pursuant to any Title IV, HEA program in which that institution participates.
(f) Nothing contained in this subpart limits the right of the Department to gather information, including by subpoena, or conduct any examination, audit, program review, investigation, or other review authorized by other applicable law.
(g) Unless directed by a court of competent jurisdiction, the hearing official, or the Secretary for good cause, if a collateral attack is brought in any court concerning all or any part of any proceeding under this subpart, the challenged proceeding shall continue without regard to the pendency of that court proceeding. No default or other failure to timely act as directed in a proceeding authorized by this subpart shall be excused based on the pendency of such court proceeding.
(b) * * *
(3) If the institution or servicer requests a hearing by the time specified in paragraph (b)(1)(iii) of this section, the designated department official transmits the request for hearing and response to the Office of Hearings and Appeals, which sets the date and the place. The date is at least 15 days after the designated department official receives the request.
(4) A hearing official conducts a hearing in accordance with § 668.89.
The revision reads as follows:
(b) * * *
(3) If the institution or servicer requests a hearing by the time specified in paragraph (b)(1)(iii) of this section, the designated department official transmits the request for hearing and response to the Office of Hearings and Appeals, which sets the date and the place. The date is at least 15 days after the designated department official receives the request. The suspension does not take place until the requested hearing is held.
The revisions read as follows:
(b) * * *
(3) If the institution or servicer requests a hearing by the time specified in paragraph (b)(1)(iii) of this section, the designated department official transmits the request for hearing and response to the Office of Hearings and Appeals, which sets the date and place. The date is at least 15 days after the designated department official receives the request. The limitation or termination does not take place until after the requested hearing is held.
(4) A hearing official conducts a hearing in accordance with § 668.89.
(a)
(i) Informs the institution of the Secretary's intent—
(A) To determine the validity of borrower defense claims on behalf of a group under § 685.222(h), to demonstrate the validity of borrower defense claims already approved, or both, as applicable; and
(B) To recover from the institution by offset, by claim on a letter of credit or other protection provided by the institution, or otherwise, for losses on account of borrower defense claims asserted on behalf of the group and borrower defense claims already approved, as applicable;
(ii) Includes a statement of facts and law sufficient to show that the Department is entitled to grant any borrower defense relief asserted within the statement, and recover for the amount of losses to the Secretary caused by the granting of such relief;
(iii) Specifies the date on which the Secretary intends to take action to recover the amount of losses arising from the granting of such relief, which date will be at least 20 days from mailing of the notice of intent and informs the institution that the Secretary will not take action to recover the amount of such loss on the date specified if the designated department official receives, by that date, a written response from the institution indicating why the Secretary should not recover. The notice shall also inform the institution that if it wishes to request a hearing pursuant to this subpart, the institution must include such a request with its written response; and
(iv) Informs the institution whether the designated Department official intends to proceed with—
(A) A single action; or
(B) An action in two phases—
(
(
(2) Although the hearing official shall have the discretion to bifurcate proceedings with, or without, a motion of either party, any decision by the designated department official to bifurcate the proceeding in accordance with paragraph (a)(1)(iv)(B) of this section may only be modified on motion with good cause shown.
(3) A hearing official conducts a hearing in accordance with § 668.89.
(b)
(2) If the institution submits a response and requests a hearing by the time specified in the notice under paragraph (a)(1)(iii) of this section, the designated department official may, in that official's sole discretion, withdraw the notice or transmit the response and request for hearing to the Office of Hearings and Appeals, which sets the date and the place for the hearing. The date of the hearing is at least 15 days after the designated department official receives the request. No liability shall be imposed on the institution prior to the hearing.
(c)
(d)
(a) A hearing official may convene a prehearing conference if he or she thinks that the conference would be useful, or if the conference is requested by—
(1) The designated department official who brought a proceeding against an institution or third-party servicer under this subpart; or
(2) The institution or servicer, as applicable.
(b) The purpose of a prehearing conference is to allow the parties to settle or narrow the dispute.
(c) If the hearing official, the designated department official, and the institution, or servicer, as applicable, agree, a prehearing conference may consist of—
(1) A conference telephone call;
(2) An informal meeting; or
(3) The submission and exchange of written material.
(d) A non-dispositive motion shall be made, if at all, consistent with any procedures set forth by the hearing official. In the absence of such procedures, non-dispositive motions shall be permitted, and responses to such motions shall be permitted though not required.
(e)(1) A party may make a motion for summary disposition asserting that the undisputed facts, admissions, affidavits, stipulations, documentary evidence, matters as to which official notice may be taken, and any other evidentiary materials properly submitted in connection with a motion for summary disposition establish that—
(i) There is no genuine issue as to any material fact; and
(ii) The moving party is entitled to a decision in its favor as a matter of law.
(2) A motion for summary disposition must be accompanied by a statement of the material facts as to which the moving party contends there is no genuine issue. Such motion must be supported by evidence that the moving party contends support his or her position. The motion must be accompanied by a brief containing the points and authorities supporting the motion.
(f) A motion under consideration by the Secretary or the hearing official shall not stay proceedings before the hearing official unless the Secretary or the hearing official, as appropriate, so orders.
(a) A hearing is an orderly presentation of arguments and evidence conducted by a hearing official. At the discretion of the hearing official, any right to a hearing may be satisfied by one or more of the following: Summary disposition pursuant to § 668.88(e), with or without oral argument; an oral evidentiary hearing conducted in person, by telephone, by video conference, or any combination thereof; or a review limited to written evidence.
(b)(1) Notwithstanding any provision to the contrary, the hearing official sets the procedures to be used in the hearing, and may take steps to expedite the proceeding as appropriate.
(2) The formal rules of evidence and procedures applicable to proceedings in a court of law are not applicable. However, discussions of settlement between the parties or the terms of settlement offers are not admissible to prove the validity or invalidity of any claim or defense.
(3)(i) The proponent of any factual proposition has the burden of proof with respect thereto.
(ii) The designated department official has the burden of persuasion in any fine, suspension, limitation, or termination proceeding under this subpart.
(iii) The designated department official has the burden of persuasion in a borrower defense and recovery action; however, for a borrower defense claim based on a substantial misrepresentation under § 682.222(d), the designated department official has the burden of persuasion regarding the substantial misrepresentation, and the institution has the burden of persuasion in establishing any offsetting value of the education under § 685.222(i)(2)(i).
(4) Discovery, as provided for under the Federal Rules of Civil Procedure, is not permitted.
(5) The hearing official accepts only evidence that is relevant and material to the proceeding and is not unduly repetitious.
(6) The hearing official may restrict the number of witnesses or exclude witnesses to avoid undue delay or presentation of cumulative evidence. Any witness permitted to appear may do so via telephonic, video, or other means, with the approval of the hearing official.
(7) Either party may call qualified expert witnesses. Each party will be limited to calling three expert witnesses, as a matter of right, including any rebuttal or surrebuttal witnesses. Additional expert witnesses shall be allowed only by order of the hearing official, granted only upon a showing of good cause.
(i) At a date set by the hearing official, each party shall serve the other with any report prepared by each of its expert witnesses. Each party shall serve the other party with a list of any rebuttal expert witnesses and a rebuttal report prepared by each such witness not later than 60 days after the deadline for service of expert reports, unless another date is set by the hearing official. A rebuttal report shall be limited to rebuttal of matters set forth in the expert report for which it is offered in rebuttal. If material outside the scope of fair rebuttal is presented, a party may file a motion not later than five days after the deadline for service of rebuttal reports, seeking appropriate relief with the hearing official, including striking all or part of the report, leave to submit a surrebuttal report by the party's own experts, or leave to call a surrebuttal witness and to submit a surrebuttal report by that witness.
(ii) No party may call an expert witness at the hearing unless the party has listed the expert and has provided reports as required by this section.
(iii) Each report shall be signed by the expert and contain a complete statement of all opinions to be expressed and the basis and reasons therefor; the data, materials, or other information considered by the witness in forming the opinions; any exhibits to be used as a summary of or support for the opinions; the qualifications of the witness, including a list of all publications authored or co-authored by the witness within the preceding ten years; the compensation to be paid for the study and testimony; and a listing of any other cases in which the witness has testified or sought to testify as an expert at trial or hearing, or by deposition, within the preceding four years. A rebuttal or surrebuttal report need not include any information already included in the initial report of the witness.
(8)(i) Except as provided in paragraph (b)(8)(ii) of this section, if an institution
(ii) The hearing official shall, upon motion at any stage, exclude all material that was required to be but was not timely submitted in response to a compulsory process described in paragraph (b)(8)(i) of this section, or any reference to such material, unless the institution demonstrates, and the hearing official finds, that by the exercise of due diligence the material could not have been timely submitted in response to the compulsory process, and the institution notified the Department or such other party that issued the order to produce, of the existence of the material immediately upon its discovery. The hearing official shall specify with particularity the evidence relied upon.
(9) When issues not raised in the notice of proposed action are tried without objection at the hearing, they will be treated in all respects as if they had been raised in the notice of proposed action, and no formal amendments are required.
(c) The hearing official makes a transcribed record of the proceeding and makes a copy of the record available to the designated Department official and to the institution or servicer.
The additions read as follows:
(a) * * *
(2)(i) * * *
(ii) In a borrower defense and recovery proceeding conducted in two phases under § 668.87(a)(1)(iv)(B), the hearing official's initial decision determines whether the institution is liable for the act or omission described in the notice of intent to recover, and the hearing official issues an initial decision on liability only.
(c) * * *
(2) * * *
(x) In a borrower defense and recovery proceeding conducted in two phases under § 668.87(a)(1)(iv)(B), if a party appeals an initial decision of the hearing official in the first phase, the Secretary may affirm, modify, or reverse the initial decision, or may remand the case to the hearing official for further proceedings consistent with the Secretary's decision.
United States Patent and Trademark Office, Commerce.
Final rule.
In order to assess and promote the accuracy and integrity of the trademark register, the United States Patent and Trademark Office (USPTO or Office) amends its rules concerning the examination of affidavits or declarations of continued use or excusable nonuse filed pursuant to section 8 of the Trademark Act, or affidavits or declarations of use in commerce or excusable nonuse filed pursuant to section 71 of the Act. Specifically, under the regulations enacted herein, the USPTO may require the submission of information, exhibits, affidavits or declarations, and such additional specimens of use as may be reasonably necessary for the USPTO to ensure that the register accurately reflects marks that are in use in commerce in the United States for all the goods/services identified in the registrations, unless excusable nonuse is claimed in whole or in part. A register that does not accurately reflect marks in use in commerce in the United States for the goods/services identified in registrations imposes costs and burdens on the public. The amended rules will allow the USPTO to require additional proof of use to verify the accuracy of claims that a trademark is in use in commerce in connection with particular goods/services identified in the registration.
This rule is effective on February 17, 2017.
Catherine Cain, Office of the Deputy Commissioner for Trademark Examination Policy, by email at
This will benefit the public because it will facilitate the USPTO's ability to assess and promote the integrity of the trademark register by encouraging accuracy in the identification of goods/services for which use in commerce or continued use is claimed. The accuracy
The amended rules also facilitate the cancellation of registrations for marks that were never in use in commerce or are no longer in use, and for which acceptable claims of excusable nonuse were not submitted, in connection with the identified goods/services. The statutory requirements in sections 8 and 71 exist to enable the USPTO to clear the register of deadwood by cancelling, in whole or in part, registrations for marks that are not in use in commerce for all or some of the goods/services identified in the registration. The rules enacted herein further this statutory purpose.
In 51% of the registrations selected for the pilot, the trademark owners failed to supply additional verified proof of use on specific goods/services for which use in commerce was initially claimed. Of this 51%, in 35% of the registrations, the owner requested that some goods/services that were initially claimed to be in use in commerce be deleted, and the remaining 16% of the registrations were cancelled because the trademark owners failed to respond to the requirements for additional proof or to other issues raised during examination of the section 8 or section 71 affidavit. Ultimately, the section 8 and section 71 affidavits were accepted for 84.4%, or 422 registrations, which included acceptances issued after goods/services queried under the pilot were deleted.
The status reports issued throughout the course of the pilot all supported the need for ongoing efforts aimed at ensuring the accuracy and integrity of the trademark register as to the actual use in commerce of marks in connection with the goods/services identified in the registrations. To that end, the USPTO held a roundtable discussion on December 12, 2014, for various stakeholder groups, requested written comments from interested parties to further explore the topic, and discussed the topic at several other outreach sessions. During the roundtable discussion and outreach sessions, one suggestion that received widespread support was to establish a permanent program similar to the proof-of-use pilot. The USPTO considered this recommendation in proposing the permanent program set forth in the notice of proposed rulemaking published in the
The USPTO published a proposed rule on June 22, 2016, soliciting comments on the proposed amendments. In response, the USPTO received comments from six organizations and eight individual commenters representing law firms, corporations, and individuals. The Office received comments both generally supporting and objecting to the proposed requirements. The commenters who supported the goal of promoting the integrity of the register by encouraging accuracy in the listing of goods/services for which use in commerce is claimed agreed that the rules will facilitate the cancellation of registrations of marks that were never in use in commerce or are no longer in use. In addition, several of those commenters expressed suggestions or concerns regarding the audit program. Similar comments have been grouped together and summarized below, followed by the USPTO's responses. All comments are posted on the USPTO's Web site at
The USPTO agrees that cancellation proceedings before the TTAB provide an avenue for third parties to seek removal of registrations for marks that are not in use in commerce for some or all of the goods/services identified in the registration. However, as discussed above, the accuracy of the trademark register as a reflection of marks that are actually in use in commerce in the United States for the goods/services identified in the registrations listed therein serves an important purpose for the public, which relies on the register to determine whether a chosen mark is available for use or registration. For example, when a party's search of the register discloses a potentially confusingly similar mark, that party may incur a variety of resulting costs and burdens, such as those associated with proceedings to cancel the registration. If a registered mark is not actually in use in commerce in the United States, or is not in use in commerce in connection with all the goods/services identified in the registration, the cost of undertaking a cancellation proceeding may be incurred unnecessarily. In addition, the results of the pilot audit program supported the need for ongoing efforts aimed at ensuring the accuracy and integrity of the trademark register as to the actual use in commerce of marks in connection with the goods/services identified in live registrations. Further, outreach to stakeholder groups and interested parties in the aftermath of the pilot yielded widespread support for establishing a permanent proof-of-use program similar to the pilot. Therefore, the USPTO believes that establishing a permanent program for auditing registrations that include multiple goods/services furthers the public policy of ensuring the accuracy of the trademark register.
The USPTO herein enacts a permanent audit program whereby it will conduct random audits of the combined total of section 8 and section 71 affidavits filed each year in which the mark is registered for more than one good or service per class. The USPTO anticipates that upon initial implementation it would conduct random audits of up to approximately 10% of such affidavits and may increase the percentage going forward, depending on results and as resources allow. As part of the review of the selected affidavits, in addition to the one specimen of use per class currently required, owners will be required to provide additional proof of use in the nature of information, exhibits, affidavits or declarations, and specimens showing use in commerce.
In a selected case, the USPTO will issue an Office action specifying the goods/services for which additional proof of use is required. Upon implementation, the USPTO anticipates requesting proof of use for two additional goods/services per class in the initial Office action. Thereafter, the owner may be required to submit proof of use in commerce for additional goods/services. If there is only one good/service in a class, additional proof of use will be required if the specimen submitted with the section 8 or section 71 affidavit would not also be acceptable to show actual use in commerce. The Office action will also advise trademark owners to delete those goods/services for which they are unable to provide the requested proof of use. It will further advise owners to delete all goods/services not in use in commerce because the Office may issue subsequent actions requiring proof of use on some, or all, remaining goods/services.
As in the pilot program, trademark owners will be afforded the usual response period to the Office action, that is, a response would be due within six months of the issuance date of the Office action, or before the end of the statutory filing period for the section 8 or section 71 affidavit, whichever is later. 37 CFR 2.163(b), 7.39(a). If the trademark owner responds, but is ultimately unable to provide the requested information, exhibits, affidavits or declarations, and specimens, the USPTO would deem the section 8 or section 71 affidavit unacceptable as to the goods/services to which the requirement pertained and will cancel such goods/services from the registration. If no response to the Office action is filed within six months of the issuance date of the Office action, or before the end of the statutory filing period for the section 8 or section 71 affidavit, whichever is later, the USPTO will cancel the entire registration, unless time remains in the grace period under section 8(a)(3) or section 71(a)(3) of the Act. 15 U.S.C. 1058(a)(3), 1141k(a)(3); 37 CFR 2.163, 7.39. If time remains in the grace period, the owner may file a complete new section 8 or section 71 affidavit, with a new fee and grace-period surcharge. 37 CFR 2.161(d)(2), 7.36(b)(3). The USPTO further clarifies that trademark owners may also file a petition to the Director under 37 CFR 2.146(a)(5) and 2.148 to waive 37 CFR 2.163(b) so that a late response to an Office action may be accepted. However, the Director will waive a rule only in an extraordinary situation, where justice requires, and no other party is injured. 37 CFR 2.146(a)(5), 2.148.
The USPTO amends 37 CFR 2.161 and 7.37 to provide that the USPTO may require such information, exhibits, affidavits or declarations, and such additional specimens of use as may be reasonably necessary for the USPTO to assess and promote the accuracy and integrity of the register. The current rules mandate the submission of only one specimen per class in connection with a section 8 or section 71 affidavit unless additional information, exhibits, affidavits or declarations, or specimens are necessary for proper examination of the affidavit itself. 37 CFR 2.161(g), (h), 7.37(g), (h). This final rule will allow the USPTO to require additional proof of use of a mark not only to facilitate proper examination of a section 8 or section 71 affidavit, but also to verify the accuracy of claims that a trademark is in use on or in connection with the goods/services identified in the registration
The USPTO revises § 2.161(h) to add the phrase “or for the Office to assess and promote the accuracy and integrity of the register” at the end of the paragraph.
The USPTO revises § 7.37(h) to add the phrase “or for the Office to assess and promote the accuracy and integrity of the register” at the end of the paragraph.
Accordingly, prior notice and opportunity for public comment for the changes in this rulemaking are not required pursuant to 5 U.S.C. 553(b) or (c), or any other law.
The USPTO publishes this Final Regulatory Flexibility Analysis (FRFA) as required by the Regulatory Flexibility Act (RFA) (5 U.S.C. 601
Items 1-6 below discuss the six items specified in 5 U.S.C. 604(a)(1)-(6) to be addressed in a FRFA. Item 6 below discusses alternatives considered by the Office.
The USPTO amends its rules to require any information, exhibits, affidavits or declarations, and such additional specimens deemed reasonably necessary to assess and promote the accuracy and integrity of the trademark register in connection with the examination of a section 8 or section 71 affidavit. Post registration affidavits under section 8 or section 71, and their accompanying specimens of use, demonstrate a registration owner's continued use of its mark in commerce for the goods/services identified in the registration. The revisions enacted herein will facilitate the USPTO's ability to ensure that the register accurately reflects marks that are in use in commerce that may be regulated by the U.S. Congress for the goods/services identified therein.
The objective of the rulemaking is to allow the USPTO to assess and promote the integrity of the trademark register. The Trademark Act gives the Director discretion regarding the number of specimens to require. 15 U.S.C. 1051(a)(1), (d)(1), 1058(b)(1)(C), 1141k(b)(1)(C). The current rules mandate the submission of only one specimen per class in connection with a section 8 or section 71 affidavit unless additional information, exhibits, affidavits or declarations, or specimens are necessary for proper examination of the affidavit itself. 37 CFR 2.161(g), (h), 7.37(g), (h). However, these rules do not currently allow the Office to require additional specimens or other information or exhibits in order to verify that the mark is in use on additional goods/services listed in the registration. The final rule will allow the USPTO to properly examine the nature and veracity of allegations of use made in connection with the submission of a section 8 or section 71 affidavit, and thereby assess and promote the integrity of the register by verifying that the register accurately reflects the goods/services for which use is claimed for a given registered mark.
The USPTO did not receive any public comments in response to the IRFA. However, the Office received comments about the audit program in general, which are further discussed in the preamble.
The USPTO did not receive any comments filed by the Chief Counsel for Advocacy of the Small Business Administration in response to the proposed rule.
The USPTO does not collect or maintain statistics in trademark cases on small- versus large-entity registrants, and this information would be required in order to estimate the number of small entities that would be affected by the final rule. However, the USPTO believes that the overall impact of the regulations enacted herein on registrants will be relatively minimal.
After registration, trademark owners must make periodic filings with the USPTO to maintain their registrations. A section 8 or section 71 affidavit is a sworn statement in which the registrant specifies the goods/services/collective membership organization for which the mark is in use in commerce and/or the goods/services/collective membership organization for which excusable nonuse is claimed. 15 U.S.C. 1058, 1141k. The purpose of the section 8 and section 71 affidavits is to facilitate the cancellation, by the Director, of registrations of marks no longer in use in connection with the goods/services/collective membership organization identified in the registrations. The final rule applies to any entity filing a section 8 or section 71 affidavit, but only a subset of trademark owners would be required to provide more than one specimen or additional information, exhibits, or specimens in connection with the audit. The USPTO is unable to
The final rule imposes no new recordkeeping requirements on trademark registrants.
Regarding compliance with this final rule, as an initial matter, the USPTO does not anticipate the rules to have a disproportionate impact upon any particular class of small or large entities. Any entity that has a registered trademark in which the mark is registered for more than one good or service per class could potentially be impacted by the final rule.
The USPTO enacts herein a permanent program where it would conduct random audits of section 8 and section 71 affidavits that are filed in which the mark is registered for more than one good or service per class. The USPTO anticipates that upon initial implementation it would conduct random audits of up to approximately 10% of such affidavits and may increase the percentage going forward, depending on results and as resources allow. In those post registration cases where an initial requirement for additional information, exhibits, affidavits or declarations, and specimens is issued in an Office action, although approximately one-third of section 8 and section 71 affidavits are filed pro se, the USPTO assumes that an attorney is representing the registrant, and estimates it will take approximately one hour to comply. To that end, the USPTO provides an online electronic form for responding to Office actions.
Similar to the submission necessary for the statutorily required section 8 and section 71 affidavits, a response to an Office action issued in connection with these affidavits will generally necessitate gathering and submitting one or more specimens of use and an accompanying declaration. Therefore, under the final rule, the type of fact gathering and review of the nature and extent of the use of the mark that underlies a section 8 or section 71 affidavit will already have occurred. Compliance with the requirements enacted herein will only necessitate gathering and submitting the additional evidence to demonstrate and support what has previously been assessed.
Assuming the mark is in use as claimed, the compliance time involves the length of time to secure additional information, exhibits, affidavits or declarations, or specimens and accompanying declaration, plus any time it takes an attorney to communicate with the client in order to obtain what is required and make the necessary filing with the USPTO. As noted above, approximately one-third of section 8 and section 71 affidavits are filed pro se. Trademark owners selected for review are likely to have a shorter compliance time than what the USPTO has estimated, which assumes the involvement of an attorney. The final rule does not mandate the use of legal counsel.
The USPTO has considered whether and how it is appropriate to reduce any burden on small businesses through increased flexibility. The following alternatives were considered, but rejected, by the USPTO.
The USPTO considered an alternative where it would not require additional information, exhibits, affidavits or declarations, and specimens in connection with section 8 or section 71 affidavits, or where it would exempt small entities from such requirements. This alternative would have a lesser economic impact on small entities, but was rejected because it would not accomplish the stated objective of assessing and promoting the integrity of the trademark register by verifying that marks are in use for the goods/services identified in the registration. As noted above, the results of the post registration proof-of-use pilot supported the need for ongoing efforts aimed at assessing and promoting the accuracy and integrity of the register as to the actual use of marks in connection with the goods/services identified in the registrations. Subsequent outreach efforts revealed widespread support for continuing the pilot program on a permanent basis. Exempting small entities would prevent consideration of all section 8 and section 71 affidavits and not achieve the stated objective of assessing and promoting the accuracy and integrity of the register.
The stated objective of the final rule also facilitates the cancellation of registrations for marks that are no longer in use or that were never used, and for which acceptable claims of excusable nonuse were not submitted, in connection with the identified goods/services. The statutory requirements in sections 8 and 71 exist to enable the USPTO to clear the register of deadwood by cancelling, in whole or in part, registrations for marks that are not in use for all or some of the goods/services identified in the registration. The final rule furthers this statutory purpose. Exempting small entities from possible scrutiny regarding use allegations would fail to address marks not used by them, thereby not achieving the objective.
The USPTO considered a second alternative that would extend the time period for compliance by small entities. However, this was rejected because there appears to be no reason that meeting the requirements of the final rule would be more time consuming for small entities. The USPTO's standard six-month time period for responding to Office actions allows sufficient time regardless of small-entity status.
Finally, the USPTO considered an alternative that would streamline or simplify the compliance mechanism for small entities, but it was deemed unnecessary given the ease of responding electronically to Office actions using the Trademark Electronic Application System Response to Post Registration Office Action form. Thus, under the final rule, compliance will be as streamlined and simplified as possible for all affected entities. Moreover, where the objective is to verify the accuracy of a claim of use in a section 8 or section 71 affidavit, the requirements for additional information, exhibits, affidavits or declarations, and specimens demonstrating the manner of use of the mark in connection with the specified goods/services are the least burdensome and most efficient means of achieving the objective of assessing and promoting the accuracy and integrity of the register by verifying allegations of use.
Use of performance rather than design standards is not applicable to the final rulemaking because the USPTO is not issuing any sort of standard. This final rule will require registrants to furnish evidence of use, rather than comply with a performance or design standard.
Notwithstanding any other provision of law, no person is 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 currently valid OMB control number.
Administrative practice and procedure, Trademarks.
Administrative practice and procedure, Trademarks, International registration.
For the reasons stated in the preamble and under the authority contained in 15 U.S.C. 1123 and 35 U.S.C. 2, as amended, the USPTO amends parts 2 and 7 of title 37 as follows:
15 U.S.C. 1113, 15 U.S.C. 1123, 35 U.S.C. 2, Section 10 of Pub. L. 112-29, unless otherwise noted.
(h) The Office may require the owner to furnish such information, exhibits, affidavits or declarations, and such additional specimens as may be reasonably necessary to the proper examination of the affidavit or declaration under section 8 of the Act or for the Office to assess and promote the accuracy and integrity of the register.
15 U.S.C. 1123, 35 U.S.C. 2, unless otherwise noted.
(h) The Office may require the holder to furnish such information, exhibits, affidavits or declarations, and such additional specimens as may be reasonably necessary to the proper examination of the affidavit or declaration under section 71 of the Act or for the Office to assess and promote the accuracy and integrity of the register.
Department of Veterans Affairs.
Final rule.
The Department of Veterans Affairs (VA) is amending its regulations concerning recognition of certain national, State, and regional or local organizations for purposes of VA claims representation. Specifically, this rulemaking allows the Secretary to recognize tribal organizations in a similar manner as the Secretary recognizes State organizations. The final rule allows a tribal organization that is
Dana Raffaelli, Staff Attorney, Benefits Law Group, Office of the General Counsel (022D), Department of Veterans Affairs, 810 Vermont Avenue NW., Washington, DC 20420, (202) 461-7699. (This is not a toll free number.)
On July 20, 2016, VA issued a proposed rule to amend part 14 of title 38, Code of Federal Regulations, to provide for the recognition of tribal organizations that are established and funded by tribal governments so that representatives of the organizations may assist Native American veterans and their families in the preparation, presentation, and prosecution of their VA benefit claims. 81 FR 47087-47094. VA proposed to allow a tribal organization that is established and funded by one or more tribal governments to be recognized for the purpose of providing assistance on VA benefit claims.
VA received 17 comments on the proposed rule. Overall, the comments were supportive of the proposed rule. A couple of commenters stated that they currently meet or will be able to meet the accreditation requirements for recognition as a tribal organization. The actual requests for recognition of specific tribal organizations are outside the scope of this rulemaking. However, VA invites all interested organizations or applicants to consider requesting recognition after this rulemaking takes effect. Please see VA's accreditation Web site for more information on how to request recognition of an organization and how to apply to become accredited as a representative through a recognized organization or as an attorney or agent,
A few commenters misinterpreted the proposed rule as meaning that VA intended to propose that VA's recognition of a tribal organization would be tied to VA's recognition of the corresponding State organization. VA is not tying VA recognition of a tribal organization to a State. Recognition of a tribal organization will stand on its own. After a tribal organization becomes recognized by VA, that organization will be able to request to have its own representatives accredited under 38 CFR 14.629. Therefore, VA declines to make any changes based on these comments.
One commenter stated that there is no need to restrict a tribal government employee to being accredited by either a tribal organization or State organization. Although in the proposed rule, we focused much of our discussion on how a tribal government employee may be accredited through a tribal organization or a State organization, we do not intend for this rulemaking to limit the availability of other avenues to achieve VA accreditation. There are several ways that individuals, including tribal members, tribal government employees, and others who work within and serve tribal or Native American communities, may be accredited by VA to represent claimants. If an individual does not wish to be accredited through a tribal or State organization, the individual may seek accreditation through a National or Regional or Local organization or seek accreditation in his or her individual capacity as either an agent or an attorney under the standards set forth in § 14.629(b). Therefore, VA declines to make any changes based on this comment.
One commenter asked whether a tribal veterans' service representative who worked in multiple states would be required to get approval from all of the States in which they work. If the representative is accredited through the tribal organization and representing claimants on behalf of that organization, then the representative would not need to seek any additional accreditation through a State organization. If the representative is a tribal veterans service officer (TVSO) and the representative's sole accreditation status is through a State organization, the representative should confer with that State organization to see if the State has placed any geographical limits on its accredited representatives. VA does not place any geographical or residency restrictions or limitations on State or tribal organizations as to who may be served by the organization. Therefore, no change is warranted to this rulemaking based on this comment.
A couple of commenters recommended that a tribal organization should have the ability to accredit representatives of State organizations through the tribal organization as well. A VA-recognized tribal organization is welcome to put forth any representatives of its choosing for VA accreditation so long as the organization is able to certify that the potential representative is of good character and reputation, has demonstrated an ability to represent claimants, and is a paid employee working no less than 1,000 hours annually. A recognized tribal organization may also recommend a potential representative for accreditation through the tribal organization by certifying that the individual is accredited and functioning as a representative of another recognized organization, this is commonly referred to as “cross-accreditation.”
One commenter asked if it would be possible for a tribal government to have their employees accredited by a tribal organization and State organization concurrently. VA does not limit an accredited representative to one method of accreditation. Therefore, no change is warranted to this rulemaking based on this comment.
Several commenters appeared to interpret the proposed rule as limiting tribal organizations to representation of only veterans who are Native American and not their dependents or survivors who may not be Native American. It is not VA's intention to limit the type of claimants for VA benefits that any accredited organization, attorney, or agent may represent. The requirements for accreditation require an applying organization to state the number of veterans, survivors, and dependents that will be served by the organization. 38 CFR 14.628(d)(1)(ii)(D). VA makes no changes based on these comments.
Several commenters also expressed concern over the requirements for recognition in § 14.628(d). Specifically, the commenters expressed concern that many tribal organizations may not be
Several commenters requested that VA further define or quantify what would constitute adequate funding and a substantial service commitment to veterans either by showing a sizeable organizational membership or by showing performance of veterans' services to a sizeable number of veterans. VA's purpose is to ensure that VA claimants have responsible, qualified representation and the above noted requirements serve as an indicator that the organization is stable. VA makes these determinations on a case-by-case basis taking into consideration all of the evidence of record. VA's goal is to ensure that VA claimants have access to the representation that they may need, and in order to provide such access, VA needs flexibility to make accreditation determinations based on the totality of the circumstances. Therefore, VA declines to make any changes based on these comments.
Several commenters requested that funding be made available to establish tribal organizations. Section 5902, of title 38, United State Code, which is the law that authorizes VA to recognize organizations for the purpose of providing assistance on VA benefit claims, does not provide for the funding of such organizations to train and maintain representatives. Pursuant to § 14.628(d)(iii)(B), organizations are not precluded from seeking and receiving other sources of State and Federal grant funding so long as the organization's funding is not subject to limitations imposed under any Federal grant or law which would prevent it from representing claimants before VA. Therefore, VA declines to make any changes based on these comments.
Several commenters suggested further outreach and collaboration. On March 3 and 10, 2016, respectively, VA issued letters to tribal leaders and a
One commenter asked VA to include the veterans departments within the tribal governments as eligible for VA recognition. A Veterans Affairs office or department that is established and funded by a tribal government is included in the definition of tribal organization and may apply for recognition under the rule. Another commenter requested that tribal government be included in the definition of tribal organization. A tribal government would not fit the definition of a tribal organization because the primary purpose of a tribal government is generally much broader than serving the needs of Native American veterans. However, the definition of tribal organization allows for a tribal government to establish such an organization that will be for that specific purpose. In this same way, VA recognizes State organizations rather than the State governments themselves. Therefore, no change to this rulemaking is warranted based on these comments.
Another commenter stated that, due to the geographic size of their tribal government, it would make sense for it to become its own regional council. If the commenter is asserting its intention to apply to become a VA accredited organization, VA welcomes all organizations to apply once this rulemaking becomes effective. No change is warranted to this rulemaking based on this comment.
One commenter recommended that, regarding tribal government approval for tribal organization representation, the approval be recognized with a single resolution or other document on behalf of member tribal nations. The commenter stated that obtaining resolutions from each nation would be administratively burdensome. Pursuant to § 14.628, the organization requesting VA accreditation must certify to VA that the organization meets the § 14.628(d) requirements for recognition. As long as VA receives certification from each tribal government approving the tribal organization, VA has no objection to the format of the certification being contained in a single resolution or document. An example may be that the establishment of the tribal organization is contained in one resolution and that resolution is signed, or certified, by all of the appropriate officials. VA makes no changes based on this comment.
One commenter asked that VA provide recognition for urban Indian organizations or urban Indian health programs. The comment is unclear on whether such an organization would be able to apply for VA recognition as a tribal organization. VA declines to add an additional organization category at this time. In addition to the amendments discussed in this rulemaking, an organization may still utilize other avenues to apply for VA recognition such as requesting VA recognition as a regional or local organization. To be recognized as a regional or local organization, an organization must meet the requirements of § 14.628(c) and (d).
The same commenter asked that employees of urban Indian organizations or urban Indian health programs be recognized as accredited representatives. An individual may apply for accreditation as a representative through a VA-recognized organization under standards set forth in § 14.629(a). Alternatively, an individual may also seek accreditation in an individual capacity as either an
One commenter asked VA to require culturally sensitive training for TVSOs. Section 14.628(d)(1)(v)(B) requires that a request for recognition of an organization include a plan for recruiting and training the organization's representatives. In addition, with regard to TVSOs, the organization's certifying official must certify that the TVSO is a paid employee of the tribal government working no less than 1,000 hours annually, has successfully completed a course of training and examination approved by VA, and that the TVSO will receive regular supervision or annual training to assure the TVSO continues to be qualified to represent claimants. 38 CFR 14.629(a)(2)(i)-(iii). The testing or training for TVSOs may include topics such as cultural sensitivity training at the discretion of the organization. VA declines to add a cultural sensitivity training requirement as we believe each organization would be the best judge of the need for cultural sensitivity training for its own representatives. In addition, such an addition would not be a logical outgrowth of the proposed rule. Therefore, VA makes no changes based on this comment.
One commenter stated that, with regard to the Paperwork Reduction Act (PRA) requirements, VA had underestimated the number of applicants/respondents that would apply to become an accredited tribal organization. However, the commenter did not provide a number of how many applicants/respondents they thought VA would receive. VA notified the Office of Management and Budget (OMB) of the commenter's concern and amended its PRA submission to double the number of applicants/respondents from 5 to 10 per year.
One commenter asked to what extent OMB was involved in the formulation of this rule. Executive Order 12866, 58 FR 51735, requires that OMB, specifically the Office of Information and Regulatory Affairs, review regulations before they are submitted for publication in the
One commenter asked to what extent VA believes that all States would support this rulemaking. VA has not received any adverse comments from States on this rulemaking. As previously stated, recognition of a tribal organization is not tied to a State organization. No change to this rulemaking is warranted based on this comment.
One commenter asked what support VA could provide to tribes that do not have enough veterans per capita to participate in the process outlined to coordinate their activities with States or county veterans' service organizations while respecting a tribe's sovereign authority. It is unclear whether the commenter is requesting that VA waive certain accreditation requirements. As previously discussed, VA cannot waive the requirements for accreditation for any organization. A tribe that is unable to establish an organization that is capable of meeting the requirements to be recognized as a tribal organization may be able to have its members apply to become accredited in their individual capacity as claims agents or attorneys or as representatives through another VA-recognized organization. VA makes no changes based on this comment.
One commenter said that educational benefits should be allowed to be used at tribal colleges and universities. This comment is outside the scope of this rulemaking. Therefore, no change is warranted based on this comment.
Finally, VA is correcting a grammatical error in proposed § 14.628(b)(2). In the third sentence, VA mistakenly referred to “tgovernment” when the correct reference should have been to “tribal government.” VA is correcting this error in this rulemaking.
The Paperwork Reduction Act of 1995 (at 44 U.S.C. 3507) requires that VA consider the impact of paperwork and other information collection burdens imposed on the public. Under 44 U.S.C. 3507(a), an agency may not collect or sponsor the collection of information, nor may it impose an information collection requirement unless it displays a currently valid OMB control number.
This final rule will impose the following new information collection requirements. The collection of information in 38 CFR 14.628 requires organizations seeking VA accreditation under § 14.628 to submit certain documentation to certify that the organization meets the requirements for VA accreditation. Pursuant to § 14.628(d), an organization requesting recognition must have as a primary purpose serving veterans. In establishing that it meets this requirement, an organization requesting recognition shall submit a statement establishing the purpose of the organization and that veterans would benefit by recognition of the organization.
The organization must also demonstrate a substantial service commitment to veterans either by showing a sizable organizational membership or by showing performance of veterans' services to a sizable number of veterans. In establishing that it meets this requirement, an organization requesting recognition shall submit: The number of members and number of posts, chapters, or offices and their addresses; a copy of the articles of incorporation, constitution, charter, and bylaws of the organization, as appropriate; a description of the services performed or to be performed in connection with programs administered by VA, with an approximation of the number of veterans, survivors, and dependents served or to be served by the organization in each type of service designated; and a description of the type of services, if any, performed in connection with other Federal and State programs which are designed to assist former Armed Forces personnel and their dependents, with an approximation of the number of veterans, survivors, and dependents served by the organization under each program designated.
An organization requesting recognition must commit a significant portion of its assets to veterans' services and have adequate funding to properly perform those services. In establishing that it meets this requirement, an organization requesting recognition shall submit: A copy of the last financial statement of the organization indicating the amount of funds allocated for conducting particular veterans' services (VA may, in cases where it deems necessary, require an audited financial statement); and a statement indicating that use of the organization's funding is not subject to limitations imposed under any Federal grant or law which would prevent it from representing claimants before VA.
An organization requesting recognition must maintain a policy and capability of providing complete claims service to each claimant requesting representation or give written notice of any limitation in its claims service with advice concerning the availability of alternative sources of claims service. In establishing that it meets this requirement, an organization requesting recognition shall submit evidence of its capability to represent claimants before VA regional offices and before the Board of Veterans' Appeals. If an organization does not intend to represent claimants before the Board of Veterans' Appeals, the organization shall submit evidence of an association or agreement with a recognized service organization for the purpose of representation before the Board of Veterans' Appeals, or the proposed method of informing claimants of the limitations in service that can be provided, with advice concerning the availability of alternative sources of claims service. If an organization does not intend to represent each claimant requesting assistance, the organization shall submit a statement of its policy concerning the selection of claimants and the proposed method of informing claimants of this policy, with advice concerning the availability of alternative sources of claims service.
An organization requesting recognition must take affirmative action, including training and monitoring of accredited representatives, to ensure proper handling of claims. In establishing that it meets this requirement, an organization requesting recognition shall submit: A statement of the skills, training, and other qualifications of current paid or volunteer staff personnel for handling veterans' claims; and a plan for recruiting and training qualified claim representatives, including the number of hours of formal classroom instruction, the subjects to be taught, the period of on-the-job training, a schedule or timetable for training, the projected number of trainees for the first year, and the name(s) and qualifications of the individual(s) primarily responsible for the training.
In addition, the organization requesting recognition shall supply: A statement that neither the organization nor its accredited representatives will charge or accept a fee or gratuity for service to a claimant and that the organization will not represent to the public that VA recognition of the organization is for any purpose other than claimant representation; and the names, titles, and addresses of officers and the official(s) authorized to certify representatives.
As required by the Paperwork Reduction Act of 1995 (at 44 U.S.C. 3507(d)), VA has submitted this information collection to OMB for its review. OMB approved these new information collection requirements associated with the final rule and assigned OMB control number 2900-0850.
The Secretary hereby certifies that this final rule will not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601-612. It does not require any action on the part of any entity but merely provides a new opportunity for tribal organizations to become recognized by VA for the purpose of assisting VA claimants in the preparation, presentation, and prosecution of claims for VA benefits. Therefore, pursuant to 5 U.S.C. 605(b), this rulemaking is exempt from the final regulatory flexibility analysis requirements of section 604.
Executive Order 13175 provides that Federal agencies may not issue a regulation that has tribal implications, that imposes substantial direct compliance costs on tribal governments, and that is not required by statute, unless the Federal government provides the funds necessary to pay the direct compliance costs incurred by the tribal governments or the Federal agency consults with tribal officials early in the process of developing the proposed regulation, develops and publishes in the
On March 3 and 10, 2016, respectively, VA issued letters to tribal leaders and a
One commenter asked if tribal organizations, since they are sovereign nations, would work with their local VA regional offices to include submitting claims through their respective regional offices. VA-recognized tribal organizations will be responsible for providing representation on behalf of their clients in the same manner as all other VA-recognized organizations, which often includes filing claims and evidence in support of their client's claims with the appropriate regional office. For TVSO's whose sole accreditation is through a State organization, VA defers to the State organization on their procedures for submitting claims and evidence to VA. No change is warranted to this rulemaking based on this comment.
The same commenter asked if tribal organizations will “commit to annual/routine training [for their] veterans service officers.” Part of the § 14.628(d) requirements is that an organization seeking accreditation must “[t]ake affirmative action, including training and monitoring of accredited representatives, to ensure proper handling of claims.” 38 CFR 14.628(d)(1)(v). When an organization applies for VA accreditation, the organization must include a plan for recruiting and training the organization's representatives. 38 CFR 14.628(d)(1)(v)(B). No change is warranted to this rulemaking based on this comment.
One commenter wrote that, currently, their tribal representatives are being accredited through their State as well as other national organizations and was curious as to the “road blocks” other tribal organizations were facing. This commenter did not provide any suggestions, and therefore, no change to this rulemaking is warranted.
Several commenters noted that currently Native American veterans face many roadblocks to obtaining representation. One commenter noted that geography, economic, and culture barriers prevent Native American veterans from utilizing currently available representation. These comments were offered in support of the rulemaking, and therefore, no change is warranted.
A few commenters misinterpreted the language provided in the consultation and notice as meaning that VA intended that VA's recognition of a tribal organization would be tied to VA's recognition of the corresponding State organization. One commenter stated that VA should recognize a tribal organization as “equal to” a State organization. VA is not tying VA recognition of a tribal organization to a State and is choosing not to make value judgements as to the importance of the recognition granted to State organizations and Tribal organizations. Recognition of a tribal organization will stand on its own. VA has chosen to use the term
A few commenters misinterpreted the language provided in the consultation and notice as limiting recognition of a tribal veterans' service officer through a State. One commenter asked for clarification on what type of employees would be eligible to become accredited by VA. The commenter stated that employees of a tribal nation as well as a tribal organization should be eligible. We agree, and the final rule allows for both avenues to attain VA accreditation depending on the tribal government's size, relationships with other tribal governments, relationships with States, and the needs of Native American veterans in their area. After a tribal organization becomes recognized by VA, that organization will be able to request to have its own representatives accredited under 38 CFR 14.629. In addition to recognizing tribal organizations and accredit their representatives, VA provides an additional means by which VA may recognize an employee of a tribal government as a tribal veterans' service officer through a State organization. This accreditation is akin to accreditation given to county veterans' service officers through State organizations and is only meant to provide an additional path to VA accreditation. The requirements for a tribal veterans' service officer to become accredited as a representative through a State organization be the same as the requirements for a county veterans' service officer. Therefore, VA makes no changes based on these comments.
One commenter asked what happens to the accreditation of a tribal organization if the Director is relinquished. It seems this comment stems from the misinterpretation previously discussed regarding the accreditation of a tribal organization and the corresponding State organization. The commenter also asked what happens if the State refuses to sponsor the replacement officer. As discussed above, once a tribal organization becomes recognized by VA, that organization can request to have its own representatives accredited under § 14.629. The tribal organization can file with VA to have a replacement officer accredited. Therefore, VA makes no changes based on this comment.
Several commenters also expressed concern over the requirements for recognition in § 14.628(d). Specifically, the commenters expressed concern that many tribal organizations may not be able to satisfy the primary purpose, size, funding, and training requirements, to include providing the required, supporting documentation. One commenter suggested that VA provide the funding for tribes “to engage in this work.” Another commenter suggested including Indian Health Services for funding assistance. A few commenters expressed concern about the requirement that the organization must maintain a policy of either providing complete claims representation or provide “written notice of any limitation in its claims service with advice concerning the availability of alternative sources of claims service.” 38 CFR 14.628(d)(1)(iv). One commenter seemed to believe VA was questioning the level of competence of tribal representatives. VA must ensure that VA accredited organizations can provide long-term, competent representation and has found that the § 14.628(d) requirements are protective of that mission. These requirements apply to all organizations seeking VA recognition. Exempting tribal organizations from meeting the § 14.628(d) requirements is not consistent with the purpose of VA recognition to ensure that veterans are receiving qualified, competent representation on their VA benefit claims. As previously discussed, VA has provided additional means to achieve VA recognition or accreditation for those tribal governments that may have difficulty establishing a tribal organization capable of meeting the § 14.628(d) requirements, to include the ability for one or more tribal governments to establish and fund a tribal organization and the ability of an employee of a tribal government to become accredited as a tribal veterans' service officer through a recognized State organization. Therefore, VA makes no changes based on these comments.
One commenter suggested that VA grant accreditation to tribes through a Memorandum of Understanding and included their tribe's Memorandum of Understanding with their State. The commenter also questioned the role of VA in the accreditation and monitoring process. The laws governing VA accreditation are set out at 38 U.S.C. 5902 and 5904 and 38 CFR 14.626-14.637. These laws apply to all organizations, agents, and attorneys seeking VA accreditation. Pursuant to § 14.628, the organization requesting VA accreditation must certify to VA that the organization meets the § 14.628(d) requirements for recognition. Therefore, a Memorandum of Understanding between VA and a tribe is not sufficient for applying for VA accreditation. Furthermore, VA does monitor its accredited organizations, agents, and attorneys and handles disciplinary matters as they arise. Therefore, VA makes no changes based on this comment.
One commenter suggested that VA engage in additional consultation with Tribes that would be “interested in becoming recognized veterans['] service organizations, but are unable to meet the requirements.” In this rule, VA offers alternative avenues for VA recognition and accreditation for tribal governments that may not be capable of establishing an organization that can meet the VA recognition requirements in the rule on their own. VA declines to make any changes based on this comment.
One commenter also recommended that “VA enter into Memorandums of Understanding with [F]ederally-recognized tribes and tribal organizations for [v]eterans' [s]ervice [o]fficer training and service reimbursement, on individual bases.” Another commenter objected to the fact that there was “no mention of funding to train and maintain such a position.” Section 5902, of title 38, United State Code, which is the law that authorizes VA to recognize organizations for the purpose of providing assistance on VA benefit claims, does not provide for the funding of such organizations to train and maintain representatives. Pursuant to § 14.628(d)(iii)(B), organizations are not precluded from seeking and receiving other sources of State and Federal grant funding so long as the organization's funding is not subject to limitations imposed under any Federal grant or law which would prevent it from representing claimants before VA.
One commenter wrote that VA “. . . should include [F]ederally-recognized tribes, not just tribal organizations funded by tribal governments, as an entity from which applications will be considered to be recognized for . . .” VA accreditation. Another commenter suggested adding “[F]ederally recognized tribes” or “[F]ederally recognized tribal governments” as part of the definition for tribal organizations. Another commenter suggested adding tribal communities. For the purposes of the regulations pertaining to the representation of VA claimants, VA defines a tribal government to mean “the Federally recognized governing body of any Indian tribe, band, nation, or other organized group or community. . .”. VA finds this definition to be inclusive of the comments, and therefore, no change is warranted.
One commenter suggested a legislative amendment to the definition of State in 38 U.S.C. 101(20) to include “[F]ederally recognized tribal governments.” Amending the statutory language is something that only Congress can accomplish. Since VA is defining the term “tribal government” in regulation and providing an avenue for VA recognition of a tribal organization separate from a State organization, VA does not find such a legislative amendment necessary. Therefore, no change is warranted based on this comment.
Several commenters wrote that “[s]pecial attention must be paid to what specifically is meant by a `[t]ribal [o]rganization' ” and that VA should offer a clear definition of the term. The commenters did not offer any suggestions for such definition. As previously discussed, VA is defining this term for the purposes of this rulemaking. Therefore, VA does not make any changes based on this comment.
Several commenters asked VA to clarify whether tribal governments, including veterans departments within these governments, would be eligible for VA recognition. A Department of Veterans Affairs or a Veterans Affairs office that is established and funded by a tribal government is included in the definition of tribal organization. Therefore, no change to this rulemaking is warranted based on these comments.
One commenter asked that VA provide recognition for urban Indian organizations. The comment is unclear on whether such an organization would be able to apply for VA recognition as a tribal organization. VA declines to add an additional organization category at this time. In addition to the amendments discussed in this rulemaking, an organization may still utilize other avenues to apply for VA recognition such as requesting VA recognition as a regional or local organization. To be recognized as a regional or local organization, an organization must meet the requirements of § 14.628(c) and (d).
Further, there are several ways that individuals, including tribal members, tribal government employees, and others who work within and serve tribal or Native American communities, may be accredited by VA to represent claimants. An individual may apply for accreditation as a representative through an existing VA-recognized organization under standards set forth in § 14.629(a). Alternatively, an individual may also seek accreditation in an individual capacity as either an agent or an attorney under the standards set forth in § 14.629(b). Therefore, VA declines to make any changes based on this comment.
A couple of commenters submitted statements certifying that their organization would meet the requirements for accreditation for a tribal organization. Applications for accreditation are outside the scope of this rulemaking. Therefore, no change is warranted based on these comments.
One commenter asked whether accredited tribal representatives would be granted access to software programs containing a veteran's claims file information and whether that access would be on tribal grounds. This issue is outside the scope of this rulemaking. Therefore, no change is warranted based on this comment.
One commenter expressed support for VA recognizing tribal organizations in an equal manner as VA recognizes State organizations but suggested that VA authorize a field office close to tribal administration locations and fund one or two veterans service officer positions. The tribal consultation and this rulemaking are limited in scope to recognition for purposes of VA claims representation. The commenter's suggestion of adding a field office is beyond the scope, and therefore, VA declines to make any changes based on this comment. VA also declines to make any changes to the commenter's suggestion of funding job positions for veterans service officers. Part of the § 14.628(d) requirements is that an organization seeking accreditation must commit a significant portion of its assets to veterans' services and have adequate funding to properly perform those services. 38 CFR 14.628(d)(1)(iii).
A few commenters expressed concern that the rulemaking is limiting VA recognition for the preparation, presentation, and prosecution of claims for VA benefits. One commenter seemed to think VA is depriving veterans from other title 38 benefits. The commenters did not specify what other accreditation they are seeking. As previously discussed, the relevant regulations in 38 CFR part 14 are to recognizing organizations and accrediting individuals to assist in the preparation, presentation, and prosecution of VA benefit claims. Pursuant to section 5902, VA accreditation may not be granted for any other purpose. This rulemaking in no way deprives any veteran of any title 38 benefits. Therefore, no change is warranted based on these comments.
One commenter suggested that office space opportunities should be available to tribal governments and organizations in the same manner as they are available to State organizations. As previously discussed, this rule will, under § 14.635, allow the Secretary to furnish office space and facilities, when available, to both State and tribal organization employees who are also accredited to national organizations for the purpose of assisting claimants in the preparation, presentation, and prosecution of claims for benefits. VA will be furnishing office space to tribal organizations in the same manner as it furnishes such space to State organizations. Therefore, no change is warranted based on this comment.
One commenter noted that VA should allow a tribal government employee to become accredited through an accredited body of their choice. VA in no way is limiting how a particular individual may apply to become an accredited VA representative. As previously discussed, VA is merely providing additional paths to VA accreditation than currently exist. Therefore, VA declines to make any changes to this rulemaking based on this comment.
Several commenters suggested further outreach and collaboration. One commenter suggested that VA form a tribal workgroup to allow representatives from tribal organizations to collaborate on implementing the new program. One commenter provided VA with their tribal consultation policy. Other commenters suggested that VA engage in additional consultation with experts in Indian law and hold an all-tribes call to gather additional input for this rulemaking. VA appreciates this information. As previously noted, VA extended the comment period for an additional 15 days to ensure that all interested parties had an appropriate
One commenter asked for the projected implementation date of this rulemaking. The dates section of this final rule contains the effective date of the rulemaking.
Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and other advantages; distributive impacts; and equity). Executive Order 13563 (Improving Regulation and Regulatory Review) emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. Executive Order 12866 (Regulatory Planning and Review) defines a “significant regulatory action” requiring review by OMB, unless OMB waives such review, as “any regulatory action that is likely to result in a rule that may: (1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities; (2) Create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations or recipients thereof; or (4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in this Executive Order.”
The economic, interagency, budgetary, legal, and policy implications of this regulatory action have been examined, and it has been determined not to be a significant regulatory action under Executive Order 12866. VA's impact analysis can be found as a supporting document at
The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before issuing any rule that may result in expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any one year. This final rule will have no such effect on State, local, and tribal governments, or on the private sector.
There are no Catalog of Federal Domestic Assistance programs numbers and titles associated with this final rule.
Administrative practice and procedure, Claims, Courts, Foreign relations, Government employees, Lawyers, Legal services, Organization and functions (Government agencies), Reporting and recordkeeping requirements, Surety bonds, Trusts and trustees, Veterans.
For the reasons set out in the preamble, the Department of Veterans Affairs amends 38 CFR part 14 as follows:
5 U.S.C. 301; 28 U.S.C. 2671-2680; 38 U.S.C. 501(a), 512, 515, 5502, 5901-5905; 28 CFR part 14, appendix to part 14, unless otherwise noted.
(r)
The addition reads as follows:
(b) * * *
(2)
The Secretary of Veterans Affairs, or designee, approved this document and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs. Gina S. Farrisee, Deputy Chief of Staff, Department of Veterans Affairs, approved this document on January 11, 2017, for publication.
Department of Veterans Affairs.
Interim final rule.
The Department of Veterans Affairs (VA) amends its regulation regarding fertility counseling and treatment available to certain veterans and spouses. VA currently provides certain infertility services other than in vitro fertilization (IVF) to veterans as part of the medical benefits package. IVF is the process of fertilization by manually fertilizing an egg, and then transferring the embryo to the uterus. This interim final rulemaking adds a new section authorizing IVF for a veteran with a service-connected disability that results in the inability of the veteran to procreate without the use of fertility treatment. In addition, we add a new section stating that VA may provide fertility counseling and treatment using assisted reproductive technologies (ART), including IVF, to a spouse of a veteran with a service-connected disability that results in the inability of the veteran to procreate without the use of fertility treatment. VA will provide ART treatment, including IVF, to these veterans and spouses as specified in the Continuing Appropriations and Military Construction, Veterans Affairs, and Related Agencies Appropriations Act, 2017, and Zika Response and Preparedness Act to the extent such services are consistent with the services available to enrolled veterans under the medical benefits package.
Written comments may be submitted by email through
Patricia M. Hayes, Ph.D., Chief Consultant, Women's Health Services, Patient Care Services, Veterans Health Administration, Department of Veterans Affairs, 810 Vermont Ave. NW., Washington, DC 20420. (202) 461-0373. (This is not a toll-free number.)
Section 260 of the Continuing Appropriations and Military Construction, Veterans Affairs, and Related Agencies Appropriations Act, 2017, and Zika Response and Preparedness Act (Public Law 114-223) states that VA may use appropriated funds available to VA for the Medical Services account to provide fertility counseling and treatment using assisted reproductive technology (ART) to a covered veteran or the spouse of a covered veteran, or adoption reimbursement to a covered veteran. This rulemaking expands the types of ART treatment available to certain veterans and makes fertility counseling and treatment including ART treatment available to spouses of those veterans, consistent with this statutory authority. Reimbursement of adoption expenses will be the subject of a separate rulemaking.
According to this law, Veterans who will receive this benefit are those with a service-connected disability that results in the inability of the veteran to procreate without the use of fertility treatment. The ART treatments referred to in this law are those relating to reproductive assistance provided to a member of the Armed Forces who incurs a serious injury or illness on active duty pursuant to title 10 of the United States Code (U.S.C.) section 1074(c)(4)(A), as described in a policy memorandum issued by the Assistant Secretary of Defense for Health Affairs on April 3, 2012, titled “Policy for Assisted Reproductive Services for the Benefit of Seriously or Severely Ill/Injured (Category II or III) Active Duty Service Members,” and the guidance issued to implement such policy, including any limitations on the amount of such benefits available to such a member. See Public Law 114-223, section 260(b)(2) and (3). The implementing guidance is contained in a document attached to the policy memorandum. We will refer to the April 3, 2012, policy memorandum and guidance issued by the Department of Defense (DoD) to implement that policy collectively as DoD policy guidance. DoD has established a system for categorizing injured servicemembers for purposes of coordinating care. Those in Category II have a serious injury or illness, are unlikely to return to duty within a time specified by their Military Department, and may be medically separated from the military. Servicemembers in Category III have a severe or catastrophic injury or illness, are highly unlikely to return to duty, and will most likely be medically separated from the military.
ART is defined at Public Law 114-223, section 260(b)(3) to mean the benefits relating to reproductive assistance in DoD policy guidance, including any limitations on the amount of such benefits in that policy. DoD policy guidance addresses assisted reproductive services available to servicemembers, providing specific guidance on the availability of IVF, as well as a wide range of services that VA considers as fertility treatment. Under this statute, VA is authorized to provide ART benefits, consistent with DoD policy guidance, to a veteran with a service-connected disability that results in the inability of the veteran to procreate without the use of fertility treatment, as well as the spouse of that veteran. The conference report accompanying this legislation makes clear that the implementing guidance developed by the Secretary shall not be materially different from, and in no way more expansive than, DoD's policy. Joint Explanatory Statement. 162 Congressional Record at S6011 (2016).
The Veterans' Health Care Eligibility Reform Act of 1996, Public Law 104-262, mandated that VA implement a national enrollment system to manage the delivery of healthcare services. A key component of managing delivery of healthcare services to eligible veterans is identifying the medical services provided by VA. The medical benefits package, defining the medical services provided to all enrolled veterans by VA, is found at 38 CFR 17.38. VA may provide services under the medical benefits package that are determined by appropriate healthcare professionals to be needed to promote, preserve, or restore the health of the individual and to be in accord with generally accepted standards of medical practice.
As part of the medical benefits package, VA provides many different types of fertility treatments and procedures to veterans. These include infertility counseling, laboratory blood
Pursuant to Public Law 114-223 section 260, VA is adding new § 17.380 which states that IVF may be provided when clinically appropriate to a veteran who has a service-connected disability that results in the inability of the veteran to procreate without the use of fertility treatment, as well as a spouse of such veteran. Per 38 U.S.C. 101(2), the term veteran means a person who served in the active military, naval, or air service, and who was discharged or released therefrom under conditions other than dishonorable. Under this provision, IVF services available to such veterans are the same as those provided by DoD to a member of the Armed Forces who incurs a serious injury or illness on active duty pursuant to 10 U.S.C. 1074(c)(4)(A), as described in DoD policy guidance, including any limitations on the amount of such benefits available to such a member. For the purposes of this section, “a service-connected disability that results in the inability of the veteran to procreate without the use of fertility treatment” means, for a male veteran, a service-connected injury or illness that prevents the successful delivery of sperm to an egg; and, for a female veteran with ovarian function and a patent uterine cavity, a service-connected injury or illness that prevents the egg from being successfully fertilized by a sperm. This definition parallels requirements in DoD policy guidance for an active duty service member who is seriously or severely ill/injured (Category II or III) to receive fertility counseling and treatment using ART. Public Law 114-223 provides appropriations for FY 2017. The benefits authorized under section 260 are thereby limited to FY2017. Paragraph (b) of § 17.380 states that the authority to provide IVF to covered veterans under this section expires September 30, 2017. If the authority is extended, we will amend this section accordingly.
In addition, VA adds a new § 17.412. This new section states that VA may provide fertility counseling and treatment using ART to a spouse of a veteran with a service-connected disability that results in the inability of the veteran to procreate without the use of fertility treatment to the extent such services are available to enrolled veterans under the medical benefits package. It also states that VA may provide IVF to a spouse of a veteran with a service-connected disability that results in the inability of the veteran to procreate without the use of fertility treatment. Such health care services may be provided when clinically appropriate and consistent with the benefits relating to reproductive assistance provided to a member of the Armed Forces who incurs a serious injury or illness on active duty as described in DoD policy guidance.
Paragraph (b) states that authority to provide fertility counseling and treatment including IVF to spouses of covered veterans under this section expires September 30, 2017. If the authority is extended we will amend this section accordingly.
DoD policy guidance addresses various issues including eligibility for ART, testing to predict fertility potential, infertility testing and treatment (including correction of the physical cause of infertility), provisions on the total number of IVF cycles that may be provided, and required processes and procedures. VA intends to issue policy and develop clinical guidelines consistent with DoD policy guidance.
Finally, we also revise the center heading immediately preceding § 17.410 to read “Hospital Care and Medical Services for Spouses and Families.” VA provides medical care to certain families of Camp LeJeune veterans under § 17.410, and the center heading referred to those services. The current rulemaking adds a new section immediately following § 17.410, and VA believes the center heading should be revised to avoid any confusion.
In accordance with U.S.C. 553(b)(B) and (d)(3), the Secretary of Veterans Affairs has concluded that there is good cause to publish this rule as an interim final rule without prior opportunity for public comment and to publish this rule with an immediate effective date. As stated above, this rule makes IVF treatment available to certain veterans, and fertility counseling and treatment using ART to the spouses of those veterans. The Secretary finds that it is impracticable and contrary to the public interest to delay this rule for the purpose of soliciting advance public comment or to have a delayed effective date. This rulemaking will benefit those veterans and spouses most in need of ART services including IVF, and delay might cause a significant hardship for affected veterans and spouses. The Joint Theater Trauma Registry (JTTR) reflects the most common single cause of battle injuries is explosive devices (36.3%). Such trauma frequently results in genitourinary injury. For example, 1 in 5 warriors were evacuated from Operation Enduring Freedom (OEF) combat in October 2011 with a genitourinary injury. This increasingly common trauma can have catastrophic reproductive results. While the JTTR tracks combat trauma only for OEF and Operation Iraqi Freedom, genitourinary or spinal cord injury, or pelvic trauma related to combat injuries was also common in previous combat operations, and these injuries may make it impossible for affected veterans to procreate without the use of fertility treatment. In many cases ART, including IVF, is the only viable option for procreation. Further, since age is a factor in successful fertilization and completion of a pregnancy, rulemaking delay may result in some veterans or spouses losing fertility potential prior to a later effective date. In addition, this rulemaking will ensure that covered veterans leaving service at this time, and their spouses, will experience continuity of care when transferring from health care provided by DoD to that provided by VA, with no difference in the level or types of available ART. For the above reason, the Secretary issues this rule as an interim final rule. VA will consider and address comments that are received within 60 days of the date this interim final rule is published in the
Title 38 of the Code of Federal Regulations, as revised by this final rulemaking, represents VA's implementation of its legal authority on
This interim final rule contains no provisions constituting a collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521).
The Secretary hereby certifies that this interim final rule will not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601-612. This interim final rule will directly affect only individuals and will not directly affect small entities. Therefore, pursuant to 5 U.S.C. 605(b), this rulemaking is exempt from the initial and final regulatory flexibility analysis requirements of 5 U.S.C. 603 and 604.
Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and other advantages; distributive impacts; and equity). Executive Order 13563 (Improving Regulation and Regulatory Review) emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. Executive Order 12866 (Regulatory Planning and Review) defines a “significant regulatory action,” requiring review by the Office of Management and Budget (OMB), unless OMB waives such review, as “any regulatory action that is likely to result in a rule that may: (1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities; (2) Create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in this Executive Order.”
The economic, interagency, budgetary, legal, and policy implications of this regulatory action have been examined, and it has been determined not to be a significant regulatory action under Executive Order 12866. VA's impact analysis can be found as a supporting document at
The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before issuing any rule 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 (adjusted annually for inflation) in any one year. This interim final rule will have no such effect on State, local, and tribal governments, or on the private sector.
The Catalog of Federal Domestic Assistance numbers and titles for the programs affected by this document are 64.007, Blind Rehabilitation Centers; 64.008, Veterans Domiciliary Care; 64.009, Veterans Medical Care Benefits; 64.010, Veterans Nursing Home Care; 64.011, Veterans Dental Care; 64.012, Veterans Prescription Service; 64.013, Veterans Prosthetic Appliances; 64.014, Veterans State Domiciliary Care; 64.015, Veterans State Nursing Home Care; 64.018, Sharing Specialized Medical Resources; 64.019, Veterans Rehabilitation Alcohol and Drug Dependence; 64.022, Veterans Home Based Primary Care; and 64.024, VA Homeless Providers Grant and Per Diem Program.
Administrative practice and procedure, Alcohol abuse, Alcoholism, Claims, Day care, Dental health, Drug abuse, Government contracts, Grant programs—health, Grant programs—veterans, Health care, Health facilities, Health professions, Health records, Homeless, Medical and Dental schools, Medical devices, Medical research, Mental health programs, Nursing homes, Reporting and recordkeeping requirements, Travel and transportation expenses, Veterans.
The Secretary of Veterans Affairs, or designee, approved this document and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs. Gina S. Farrisee, Deputy Chief of Staff, Department of Veterans Affairs, approved this document on December 23, 2016, for publication.
For the reasons set out in the preamble, VA amends 38 CFR part 17 as follows:
38 U.S.C. 501, and as noted in specific sections.
Section 17.38 also issued under 38 U.S.C. 101, 501, 1701, 1705, 1710, 1710A, 1721, 1722, 1782, and 1786.
Sections 17.380 and 17.412 are also issued under sec. 260, Pub. L. 114-223, 130 Stat. 857.
Section 17.415 is also issued under 38 U.S.C. 7301, 7304, 7402, and 7403.
Sections 17.640 and 17.647 are also issued under sec. 4, Pub. L. 114-2, 129 Stat. 30.
Sections 17.641 through 17.646 are also issued under 38 U.S.C. 501(a) and sec. 4, Pub. L. 114-2, 129 Stat. 30.
The revision reads as follows:
(c) * * *
(2) In vitro fertilization. Note: See § 17.380.
(a)(1) In vitro fertilization may be provided when clinically appropriate to—
(i) A veteran who has a service-connected disability that results in the inability of the veteran to procreate without the use of fertility treatment; and,
(ii) The spouse of such veteran, as provided in § 17.412.
(2) For the purposes of this section, “a service-connected disability that results in the inability of the veteran to procreate without the use of fertility treatment” means, for a male veteran, a service-connected injury or illness that prevents the successful delivery of sperm to an egg; and, for a female veteran with ovarian function and a patent uterine cavity, a service-connected injury or illness that prevents the egg from being successfully fertilized by sperm.
(3) In vitro fertilization treatment will be provided under this section when clinically appropriate and to the same extent such treatment is provided to a member of the Armed Forces who incurs a serious injury or illness on active duty pursuant to 10 U.S.C. 1074(c)(4)(A), as described in the April 3, 2012, memorandum issued by the Assistant Secretary of Defense for Health Affairs on the subject of “Policy for Assisted Reproductive Services for the Benefit of Seriously or Severely Ill/Injured (Category II or III) Active Duty Service Members,” and the guidance issued by the Department of Defense to implement such policy, including any limitations on the amount of such benefits available to such a member.
(b) Authority to provide in vitro fertilization treatment to covered veterans under this section expires September 30, 2017.
(a)(1) VA may provide fertility counseling and treatment to a spouse of a veteran described in § 17.380 to the extent such services are available to a veteran under § 17.38, and consistent with the benefits relating to reproductive assistance provided to a member of the Armed Forces who incurs a serious injury or illness on active duty pursuant to 10 U.S.C. 1074(c)(4)(A), as described in the April 3, 2012, memorandum issued by the Assistant Secretary of Defense for Health Affairs on the subject of “Policy for Assisted Reproductive Services for the Benefit of Seriously or Severely Ill/Injured (Category II or III) Active Duty Service Members,” and the guidance issued by the Department of Defense to implement such policy, including any limitations on the amount of such benefits available to such a member.
(2) VA may provide in vitro fertilization to a spouse of a veteran described in § 17.380 when clinically appropriate and consistent with the benefits relating to reproductive assistance provided to a member of the Armed Forces who incurs a serious injury or illness on active duty pursuant to 10 U.S.C. 1074(c)(4)(A), as described in the April 3, 2012, memorandum issued by the Assistant Secretary of Defense for Health Affairs on the subject of “Policy for Assisted Reproductive Services for the Benefit of Seriously or Severely Ill/Injured (Category II or III) Active Duty Service Members,” and the guidance issued by the Department of Defense to implement such policy, including any limitations on the amount of such benefits available to such a member.
(b) Authority to provide fertility counseling and treatment, including in vitro fertilization under this section, expires September 30, 2017.
Postal Service.
Interim final rule.
This rule updates postal regulations to implement the annual inflation adjustments to civil monetary penalties that may be imposed under consumer protection and mailability provisions enforced by the Postal Service pursuant to the Deceptive Mail Prevention and Enforcement Act and the Postal Accountability and Enhancement Act. These adjustments are required under the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015. This notice also includes the statutory civil monetary penalties subject to the 2015 Act.
Steven Sultan, (202) 268-7385.
The Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (2015 Act), Public Law 114-74, 129 Stat. 584, amended the Federal Civil Penalties Inflation Adjustment Act of 1990 (1990 Act), Public Law 101-410, 104 Stat. 890 (28 U.S.C. 2461 note), to improve the effectiveness of civil monetary penalties and to maintain their deterrent effect. Section 3 of the 1990 Act specifically includes the Postal Service in the definition of “agency” subject to its provisions.
Beginning in 2017, the 2015 Act requires the Postal Service to make an annual adjustment for inflation to civil penalties that meet the definition of “civil monetary penalty” under the 1990 Act. The Postal Service must make the annual adjustment for inflation and publish the adjustment in the
The 2015 Act allows the interim final rule and annual inflation adjustments to be published without prior public notice or opportunity for public comment.
Civil monetary penalties may be assessed for postal offenses under sections 106 and 108 of the Deceptive Mail Prevention and Enforcement Act, Public Law 106-168, 113 Stat. 1811, 1814 (
Under 39 U.S.C. 3005(a)(1)-(3), the Postal Service may issue administrative orders prohibiting persons from using the mail to obtain money through false representations or lotteries. Persons who evade, attempt to evade, or fail to comply with an order to stop such prohibited practices may be liable to the United States for a civil penalty under
In lieu of or as part of an order issued under 39 U.S.C. 3005(a)(1)-(3), the Postal Service may assess a civil penalty. Currently, the amount of this penalty, set in 39 U.S.C. 3012(c)(1), is $34,172 for each mailing that is less than 50,000 pieces, $68,345 for each mailing of 50,000 to 100,000 pieces, and an additional $6,834 for each additional 10,000 pieces above 100,000 not to exceed $1,366,890. The new penalties will be: $34,731 for each mailing that is less than 50,000 pieces, $69,463 for each mailing of 50,000 to 100,000 pieces, and an additional $6,946 for each additional 10,000 pieces above 100,000 not to exceed $1,389,252.
Persons sending certain deceptive mail matter described in 39 U.S.C. 3001((h)-(k), including:
• Solicitations making false claims of Federal Government connection or approval;
• Certain solicitations for the purchase of a product or service that may be obtained without cost from the Federal Government;
• Solicitations containing improperly prepared “facsimile checks”; and
• Certain solicitations for “skill contests” and “sweepstakes” sent to individuals who, in accordance with 39 U.S.C. 3017(d), have requested that such materials not be mailed to them);
Under 39 U.S.C. 3017(g)(2), the Postal Service may impose a civil penalty against a person who provides information for commercial use about individuals who, in accordance with 39 U.S.C. 3017(d), have elected not to receive certain sweepstakes and contest information. Currently, this civil penalty may not exceed $2,733,780 per violation. The new penalty may not exceed $2,778,505 per violation.
Currently, under 39 U.S.C. 3017(h)(1)(A), any promoter who recklessly mails nonmailable skill contest or sweepstakes matter may be liable to the United States in the amount of $13,669 per violation for each mailing to an individual. The new penalty is $13,893 per violation.
Under 39 U.S.C. 3018(c)(1)(A), the Postal Service may impose a civil penalty payable into the Treasury of the United States on a person who knowingly mails nonmailable hazardous materials or fails to follow postal laws on mailing hazardous materials. Currently, this civil penalty is at least $295, but not more than $117,858 for each violation. The new penalty is at least $300, but not more than $119,786 for each violation.
Administrative practice and procedure, Banks, Banking, Credit, Crime, Infants and children, Law enforcement, Penalties, Privacy, Seizures and forfeitures.
For the reasons set out in this document, the Postal Service amends 39 CFR part 233 as follows:
39 U.S.C. 101, 102, 202, 204, 401, 402, 403, 404, 406, 410, 411, 1003, 3005, 3012, 3017, 3018; 12 U.S.C. 3401-3422; 18 U.S.C. 981, 983, 1956, 1957, 2254, 3061; 21 U.S.C. 881; Pub. L. 101-410, 104 Stat. 890; Omnibus Budget Reconciliation Act of 1996, sec. 662 (Pub.L. 104-208, 110 Stat. 3009-378); Pub. L. 106-168, 113 Stat. 1806; Pub. L. 114-74, 129 Stat. 584.
Environmental Protection Agency (EPA).
Partial withdrawal of direct final rule.
EPA is withdrawing significant new use rules (SNURs) promulgated under the Toxic Substances Control Act (TSCA) for two chemical substances, which were the subject of premanufacture notices (PMNs). EPA published these SNURs using direct final rulemaking procedures, which requires EPA to take certain actions if a notice of intent to submit an adverse comment is received. EPA received notices of intent to submit adverse comments regarding the SNURs identified in this document. Therefore, the Agency is withdrawing the direct final rule SNURs identified in this document, as required under the direct final rulemaking procedures.
This document is effective January 19, 2017.
The docket for this action, identified by docket identification (ID) number EPA-HQ-OPPT-2016-0207, is available at
A list of potentially affected entities is provided in the
In the
For further information regarding EPA's direct final rulemaking procedures for issuing SNURs, see 40 CFR part 721, subpart D, and the
This action withdraws regulatory requirements that have not gone into effect and which contain no new or amended requirements. As such, the Agency has determined that this action will not have any adverse impacts, economic or otherwise. The statutory and Executive Order review requirements applicable to the direct final rule were discussed in the
Pursuant to the Congressional Review Act (5 U.S.C. 801
Environmental protection, Reporting and recordkeeping requirements.
Environmental protection, Chemicals, Hazardous substances, Reporting and recordkeeping requirements.
Therefore, 40 CFR chapter I is amended as follows:
7 U.S.C. 135
15 U.S.C. 2604, 2607, and 2625(c).
Centers for Disease Control and Prevention (CDC), Department of Health and Human Services (HHS).
Final rule.
In accordance with the Public Health Security and Bioterrorism Preparedness and Response Act of 2002 (the Bioterrorism Response Act), the Centers for Disease Control and Prevention (CDC) in the Department of Health and Human Services (HHS) has reviewed the list of biological agents and toxins that have the potential to pose a severe threat to public health and safety. Following the review, HHS has decided: Not to finalize the proposed changes to the list of select agents and toxins at this time; to finalize provisions to address toxin permissible limits and the inactivation of select agents; to finalize specific provisions to the section of the regulations addressing biosafety; and to clarify regulatory language concerning security, training, incident response, and records. In a companion document published in this issue of the
Effective February 21, 2017.
Dr. Samuel S. Edwin, Director, Division of Select Agents and Toxins, Centers for Disease Control and Prevention, 1600
The preamble to this final rule is organized as follows:
On February 27, 2015 we published an Advance Notice of Proposed Rulemaking (ANPRM) (80 FR 10656) that initiated the required biennial review and republication of the HHS list of select agents and toxins. The ANPRM solicited public comments regarding whether any biological agents and toxins should be added or removed from the HHS list of select agents and toxins based on the following criteria:
(1) The effect on human health of exposure to the agent or toxin;
(2) The degree of contagiousness of the agent or toxin, and the methods by which the agent or toxin is transferred to humans;
(3) The availability and effectiveness of pharmacotherapies and immunizations to treat and prevent any illness resulting from infection by the agent or exposure to the toxin; and
(4) Any other criteria, including the needs of children and other vulnerable populations that the commenter considered appropriate.
This notice also asked for public comment on whether HHS should remove the following agents from the HHS list of select agents and toxins:
On January 19, 2016, we published a Notice of Proposed Rulemaking (NPRM) (81 FR 2805). The NPRM solicited public comments regarding whether any biological agents and toxins should be added or removed from the HHS list of select agents and toxins based on the same criteria used in ANPRM:
We also invited comments on the following:
(1) Methods that should be required to validate the rendering of a select agent non-viable or regulated nucleic acids that can produce infectious forms of any select agent virus as non-infectious;
(2) Proposed changes to the aggregate amount of toxin excluded from the requirements of the select agent regulations;
(3) Removal of Diacetoxyscirpenol (DAS) and T-2 from the list;
(4) Whether seven calendar days provides a sufficient amount of time for the entity to destroy or transfer a select agent or toxin after identification;
(5) Specific biosafety measures that should be required to prevent laboratory acquired infections (LAIs) or accidental release of the select agents and toxins from an entity into the community; and
(6) Alternative regulatory requirements that could be constructed such that a registered entity would know whether it had a theft or loss of a select agent or toxin without that registered entity first having “an accurate, current inventory for each select agent . . . held in long term storage.”
(7) Whether short, paralytic alpha-conotoxins containing the following amino acid sequence (X
We received 22 public comments to the ANPRM and 35 public comments to the NPRM that addressed the composition of the HHS list of select agents and toxins. After carefully considering the technical input of subject matter experts, both within the Federal government and from public comments, and recommendations from Federal advisory groups, we have decided not to finalize the proposed changes to the list of select agents and toxins at this time. Upon further consideration, we may decide to finalize changes to the list at a future time.
This final rule makes the following changes to current regulations:
1. New provisions regarding the inactivation of select agents, specific biosafety requirements, and toxin requirements;
2. Other revisions to the regulations to clarify regulatory language concerning security, training, and records.
3. In addition, when HHS added
The HHS final rule will further reduce or minimize the risk of misuse of select agents and toxins that have the potential to pose a severe threat to human health. HHS recognizes that several of the required measures of the regulations may impose certain operational costs upon affected entities. Specifically, the rule will clarify that an entity must use a validated method to render a select agent non-viable or a regulated infectious nucleic acid sample non-infectious for future use. This means the method must be scientifically sound and produce consistent results each time it is used. Appropriate reporting and record keeping is required in order to mitigate threats to human health. In many cases, however, the affected entities already employ some or all of the required measures. Compliance costs actually incurred will therefore vary from one entity to the next.
While information on the specific changes that would need to occur at individual sites and the associated costs was not readily available during proposed rulemaking, some general observations regarding the potential costs were presented. These general cost observations can be found in the Regulatory Impact Analysis. Based on the current recordkeeping and reporting requirements, an additional 10 to 20 hours per year may be required by entities. At an imputed cost of $33.40 per hour, this additional time
Benefits: The objectives of the HHS final rule are to create a means of ensuring enhanced oversight in the transfer, storage, and use of select agents and toxins; clarify that an entity must use a validated method to render a select agent non-viable or a regulated infectious nucleic acid sample non-infectious for future use; and require that entities in possession of such agents and toxins develop and implement effective means of biosafety, information security, and physical security. The overall benefit of the amended regulatory provisions will be a reduced likelihood of the accidental or intentional release of a select agent or toxin; and the avoidance of human morbidity, mortality and the economic loss associated with such a release. The goal of the amended regulations is to enhance the protection of human health and safety.
The table below describes the changes to the current regulation.
We received 22 public comments to the ANPRM and 35 public comments to the NPRM that addressed the composition of the HHS list of select agents and toxins. After carefully considering the technical input of subject matter experts, both within the Federal government and from public comments, and recommendations from Federal advisory groups, we have decided not to finalize the proposed changes to the list of select agents and toxins at this time.
It recently became clear that some inactivation protocols have failed to inactivate
To exclude a select agent or regulated nucleic acids that can produce infectious forms of any select agent virus from the requirements of the select agent regulations, an entity will need to subject the select agent or the nucleic acids to a validated inactivation procedure whose efficacy is confirmed through a viability testing protocol.
Commenters stated that additional definitions should be provided for “validated inactivation procedure,” “sterility testing protocol,” and “safety margin.” We agree with the commenters and are defining the terms as described below. “Validated inactivation procedure” means “a procedure, whose efficacy is confirmed by data generated from a viability testing protocol, to render a select agent non-viable but allows the select agent to retain characteristics of interest for future use; or to render any nucleic acids that can produce infectious forms of any select agent virus non-infectious for future use.”
Further, we have not included a separate definition for “inactivation” as it is now captured in the definition of “validated inactivation procedure.”
We have changed the proposed phrase “sterility testing protocol” to “viability testing protocol” and defined the latter as “a protocol to confirm the validated inactivation procedure by demonstrating the material is free of all viable select agent.” This change reflects the intent that the validated inactivation procedure, or the procedure for removal of viable select agents from material
We are choosing to not define the term “safety margin” and have incorporated the concept of a performance standard instead.
The new definitions will help clarify the regulatory language found in 42 CFR 73.3, 73.4.
Historical inactivation failures by registered entities required us to focus on ways to increase the certainty that inactivated select agents intended for further use do not contain live agent. This is particularly important when the inactivation methods are tempered in order to avoid disrupting some of the physical characteristics of the agent. We proposed adding specific requirements to the exclusion sections of the regulations (42 CFR 73.3(d), 73.4(d)) to address the requirements for rendering select agents, nucleic acids that can produce infectious forms of any select agent virus, or extracts from select agents non-viable.
Sections 73.3(d)(2) (HHS select agents and toxins) and 73.4(d)(2) (Overlap select agents and toxins) both provide that a non-viable select agent is excluded from the requirements of the select agent regulations. We proposed that for a select agent to be non-viable or to render nucleic acids that can produce infectious forms of any select agent virus non-infectious for future use, an entity must use a validated inactivation procedure. Commenters stated there is some confusion between inactivation validation requirements for moving materials to a lower containment level and inactivation validation requirements for waste disposal. We are clarifying that these provisions apply to a select agent that is inactivated for future use as a non-select agent and is not intended for material for waste disposal.
Many commenters stated that the focus on strengthening inactivation requirements was being driven by an incorrect public perception of recent procedural errors that occurred at federally run research laboratories. Without commenting on what is or might be the public's perception with regard to inactivation problems, we disagree with these comments because the focus on inactivation failures with select agents is based on the realization that past inactivation activities have proved to be inadequate.
We proposed that an entity would be required to develop a site-specific kill curve to identify conditions of inactivation for each select agent. Commenters stated that although the generation of kill curves is appropriate for inactivation procedures using heat, irradiation and filtration, it is not generally applicable to determining infectivity of nucleic acids. Commenters stated that for inactivation procedures where a “kill curve is not applicable, inactivation conditions are selected and then replicated to obtain 100% inactivation within a statistical certainty.”
We agree with the commenters and are withdrawing the proposal to require a kill curve and safety margin because these would not be applicable to all inactivation procedures. Further, the variety of agents and inactivation procedures makes it likely that prescriptive requirements would have unintended negative consequences on research. We are, nonetheless, finalizing requirements for a validated inactivation procedure and viability testing. We are requiring that for a select agent or regulated nucleic acid that can produce infectious forms of any select agent virus to be excluded from the requirements of the select agent regulations, an entity will be responsible for achieving a certain performance standard that is confirmed through a viability testing protocol. Surrogate strains that are known to possess equivalent properties with respect to inactivation can be used to validate an inactivation procedure. However, if there are known strain-to-strain variations in the resistance of a select agent to an inactivation procedure, then an inactivation procedure validated on a lesser resistant strain must also be validated on the more resistant strains. Additional guidance regarding this performance standard has been developed and is available at
Many commenters asked HHS to state clearly if the standard for select agent inactivation is complete sterility (
We proposed that entities subject representative samples of an inactivated select agent to a validated sterility testing protocol to ensure that the inactivation procedure has rendered the select agent non-viable. Commenters stated that it is not always practical to conduct validation on each sample that is inactivated. Often samples are in limited quantities and validation studies will leave very little or no sample for the experimental purpose. Commenters also stated that the requirement to subject representative samples to sterility testing using a validated protocol requires further clarification. Commenters stated that it is reasonable to require this type of testing when the inactivation procedure is first established and if any changes to the inactivation protocol are made. However, commenters stated that it cannot be reasonably done on each sample in laboratory research if the inactivation protocol has not changed. They stated that implementing such a requirement would waste specimens where limited volumes are available, would be costly in terms of technical time and resources, and is scientifically unjustified.
We agree with the commenters that the varied needs and conditions for inactivation preclude setting a specific standard for viability testing at this time. We have removed the proposed sterility testing requirement for select agents and nucleic acids that can produce infectious forms of any select agent virus and have incorporated this concept into the performance standard. The requirement to develop a validated inactivation procedure and subsequent validation data derived from viability testing will determine the extent of sampling required. This activity will provide the associated measures of uncertainty with the sampling protocol chosen.
We proposed adding exclusion requirements that extracts from a select agent could not be excluded from the requirements of the select agent regulations until an individual or entity met the following requirements: (1) Any extract is subjected to a process that removes all viable cells, spores, or virus particles; (2) any extract is subjected to a validated sterility testing protocol; (3) any viability of an extract that was subjected to a validated inactivation
Some commenters expressed concern with having to subject every extract from a select agent, such as nucleic acids, to sterility testing. We agree with the commenters and are replacing the term “extract” with “material containing a select agent” to clarify that the requirements apply to material containing a select agent such as serum or liquid culture where select agents are typically removed via filtration without a previous inactivation step. The term “extract” is commonly used in conjunction with nucleic acids extracted from a select agent. We are using the term “extract” in the final rule to reflect the application of two processing steps: An inactivation step to destroy the select agent (
We proposed that if there are strain-to-strain variations in resistance of a select agent to the inactivation procedure, then a specific kill curve must be developed for each strain that undergoes the inactivation procedure. We received comments asking us to clarify language to specify under what circumstances strain-to-strain differences must be validated. Commenters also stated that this is an unnecessary use of resources especially when agents, based on their morphological characteristics, are susceptible to similar inactivating agents. Commenters suggested at a minimum the language should state that this requirement only applies when there are known strain-to-strain variations in resistance of a select agent to the inactivation procedure.
We agree with the commenters and added in the term “known” strain-to-strain variation and, as stated previously, have removed the kill curve requirement.
Commenters also inquired whether surrogate strains can be used to develop inactivation procedures. We agree with the commenters that surrogate strains known to possess equivalent properties with respect to inactivation as a select agent can be used to develop inactivation procedures. We have revised the requirement to include the provision that “Surrogate strains that are known to possess equivalent properties with respect to inactivation can be used to validate an inactivation procedure; however, if there are known strain-to-strain variations in the resistance of a select agent to an inactivation procedure, then an inactivation procedure validated on a lesser resistant strain must also be validated on the more resistant strains.”
Commenters were concerned about performing viability testing on materials such as a single diagnostic sample that is determined to contain a select agent and where there is a limited amount of material with which to work. For example, consider an entity using a commercially available RNA extraction kit on a diagnostic sample to obtain RNA for sequencing, and the sample is identified to contain highly pathogenic avian influenza (HPAI). In this situation, the entire single sample would be used when trying to demonstrate that the inactivation procedure was effective. We agree with the commenters. As noted above, surrogate select agent strains that are known to possess equivalent properties with respect to inactivation as the select agent can be used to develop validated inactivation procedures. In this example, low pathogenic avian influenza (LPAI) could be used to validate the inactivation procedure for diagnostic samples that are identified as containing HPAI, if LPAI possesses equivalent properties with respect to inactivation as HPAI. In addition, we are clarifying that these provisions do not apply to diagnostic samples until they are identified to contain a select agent and are inactivated for future use as a non-select agent.
Many commenters asked who would determine the validity of an inactivation protocol. The responsibility for this activity remains with the entity, which will allow for researchers to continue to develop new inactivation procedures. Entities retain the responsibility to evaluate their inactivation procedures, to include consideration of the biosafety and security risks posed by the inactivated material. The Federal Select Agent Program (FSAP) inspectors will verify that the entity has developed a validated inactivation procedure and may review validation data during an entity's inspection. We made no changes based on these comments.
Many commenters stated that the intent behind the annual review provisions was not clear. We agree with the commenters and modified the provisions to state that an entity “Review, and revise as necessary, each of the entity's validated inactivation procedures or viable agent removal method. The review must be conducted annually or after any change in Principal Investigator, change in the validated inactivation procedure or viable agent removal method, or failure of the validated inactivation procedure or viable agent removal method. The review must be documented and training must be conducted if there are any changes to the validated inactivation procedure, viable agent removal method, or viability testing protocol.” We made these changes because the annual review of an entity's validated inactivation procedures or viable agent removal method is key to a successful inactivation program. The annual review requirement does not necessarily involve revalidating inactivation procedures. This review could simply be the evaluation of the site-specific standard operating procedures for validated inactivation of select agents to ensure the inactivating conditions used and upper agent concentration limits found in validation data are consistent, and that entity staff are following the site-specific standard operating procedures for validated inactivation of select agents.
However, sometimes an entity will need to revalidate inactivation procedures during the annual review. For example, if the entity identifies that staff are not adhering to standard operating procedures for validated inactivation of select agents, or if the entity wants to deviate from the validated inactivation procedure, the
Many commenters stated that the intent of the inactivation failure reporting requirements was not clear and reporting every inactivation failure to CDC or APHIS was burdensome. We agree with the commenters and have modified reporting requirements to require the RO to “Investigate to determine the reason for any failure of a validated inactivation procedure or any failure to remove viable agent from material. If the Responsible Official is unable to determine the cause of a deviation from a validated inactivation procedure or a viable agent removal method; or receives a report of any inactivation failure after the movement of material to another location, the Responsible Official must report immediately by telephone or email the inactivation failure or viable agent removal method failure to CDC or APHIS.” The intent of this modification is to create an environment at the entity where inactivation or select agent removal failures are investigated to determine the reason for the failure as opposed to merely re-subjecting the material to the inactivation or select agent removal method. It is the position of the FSAP that each failure represents either human error in conducting the validated procedure or an inadequate inactivation method or an inadequate select agent removal method if no human error can be discovered. Both situations demand careful attention by the entity to ensure training and/or reevaluation of the inactivation procedure in order to minimize the likelihood that the situation would reoccur in the future. The revised regulatory language only requires reporting of inactivation or select agent removal failures to FSAP when the RO cannot establish that the failure resulted from human error or when an entity receives a report of any inactivation failure after the movement of material to another location.
We also proposed that written records be kept for select agents that have been subjected to a procedure to render them non-viable, or regulated nucleic acids that can produce infectious forms of any select agent virus that have been subjected to a procedure to render them incapable of producing infectious forms of any select agent virus. Some commenters stated that the proposal was not clear how long these records must be kept and who is responsible for keeping these records. We made no changes based on these comments as these records are subject to the records retention requirement in section 17 of the select agent regulations and must be kept for three years by a registered individual or entity.
Some commenters asked about the conditions of submitting a waiver to the inactivation provisions of the select agent regulations. An entity may submit a request to FSAP to apply an alternative inactivation procedure. The entity is to provide justification regarding the alternative procedure including a description of what material is to be waived, the inactivation protocol and viability test to be used, validation data, and any other supporting information/references, such as scientific references. Accordingly, we revised the provision found in sections 3(d)(6) and 4(d)(6) to include information on how to apply for a waiver that reads “. . . To apply for such a determination a registered individual or entity must submit a written request and supporting scientific information to FSAP. A written decision granting or denying the request will be issued.” Additional guidance has been developed and is available at:
To ensure the language is consistent with the exclusion language found in 73.3(e) which describes the exclusion of toxins that have been modified to be
We are adding a more specific documentation requirement to the toxin exclusion provision found in section 73.3(d)(3)(i) of the select agent regulations to require the transferor of an unregulated amount of a select toxin to document the identity of the recipient and the legitimate need (
As proposed, we are increasing the toxin exclusion aggregate amounts. We received 10 comments supporting the increase in the toxin exclusion aggregate amounts. We received three general comments opposing the increase of the exclusion aggregate amounts and two additional comments opposing the increase of the ricin exclusion aggregate amount. One commenter stated that no changes were necessary. Another commenter had concerns regarding whether the risk assessment scenarios were relevant to the goal of reducing any significant harm able to be caused by illegitimate use of any lethal amounts of toxin. We are making no changes based on these comments.
DHS developed toxin parameters and attack scenarios for potential inhalation and ingestion exposures to select toxins to protect the homeland against the potential release of weaponized biological toxins. The DHS group analyzed a range of release sizes (in mg) for each select toxin in order to estimate the number of people that would be exposed to each toxin amount by ingestion of milk (using published TD[50] or LD[50]) and/or indoor inhalation (using published LD[50]). Revised toxin exclusion aggregate amounts were proposed based on the data generated by the models to expose <10 or <100 people by inhalation or ingestion to the LD[50] or TD[50] levels of toxin. A commenter stated that (1) the scenarios proposed appear to consider a high-consequence event or exposure to a given toxin and that the interpretation of what constitutes a high-consequence event or exposure is impacted not only in the number of people affected but in
As proposed, we are excluding from the requirements of the regulations a select toxin identified in an original food sample and clinical samples. Original food samples and clinical samples are those specimens that are submitted to laboratories for diagnosis or verification purposes to identify or verify a biological agent or toxin. For example, an original food sample could be a container of potato salad or juice. An original clinical sample could be serum or stool from a patient. Laboratories that test food and clinical samples for the presence of toxins generally do not know the level of toxin in a sample and do not extract and purify a toxin as part of their studies. Therefore, our proposal to exclude select toxin identified in an original food sample or clinical sample identified is consistent with the rationale for the current exclusion for animals exposed to toxins (42 CFR 73.3(d)(4)). This exclusion was based on recommendations by toxin subject matter experts. We received one comment that supported this exclusion.
In the NPRM, we proposed to exclude all toxins that are only produced as a byproduct of a study of the toxin producing host organism so long as the toxin had not been intentionally collected, purified, or otherwise extracted, and the material containing the toxin was inactivated and properly disposed of within 30 days of the initiation of the culture. Based on the input from subject matter experts, the final regulatory language narrows the exception to only Botulinum neurotoxin produced as a byproduct in the study of Botulinum neurotoxin producing species of
To clarify how the select agent regulations apply to activities associated with the diagnosis and care for individuals infected with a select agent, we proposed that waste generated during the delivery of patient care is not considered regulated under the select agent regulations. One commenter recommended that we define patient care as part of the diagnosis definition. Specifically, the commenter suggested we define diagnosis as “the analysis of specimens for the purpose of identifying or confirming the presence or characteristics of a select agent or toxin provided that such analysis is associated with the determination or provision of patient treatment in a patient care setting, or directly related to protecting the public health or safety, animal health or animal products, or plant health or plant products. Clinical or diagnostic specimen retention times as required for patient treatment are included within the determination of the point in time when patient care has concluded.” Another commenter stated “the challenges of differentiating between patient care and experimental research when treating infectious diseases are complex and nuanced and any effort to introduce regulation of medical care involving select agents and toxins has the potential to introduce inconsistencies and confusion.” The proposed exclusion language in the NPRM was “Waste generated during the delivery of patient care from a patient infected with a select agent that is decontaminated with a validated method within seven calendar days of the conclusion of patient care.” We revised the proposed language based on the two comments to state: “Waste generated during the delivery of patient care by health care professionals from a patient diagnosed with an illness or condition associated with a select agent, where such waste is, within seven days of the conclusion of patient care, decontaminated, or transferred for destruction in compliance with state and Federal regulations.”
We revised the proposed exemption language in 42 CFR 73.5(a)(3), and 42 CFR 73.6(a)(3) to provide that, unless otherwise directed by the HHS Secretary or APHIS Administrator, as appropriate, “the clinical or diagnostic specimens collected from a patient infected with a select agent are transferred in accordance with § 73.16 or destroyed on-site by a recognized sterilization or inactivation process within seven days after delivery of patient care by health care professionals has concluded.”
For specimens generated from the patient, the specimens are not subject to the select agent regulations for only the period that they are directly associated with the diagnosis. In accordance with sections five and six of the select agent regulations, within seven calendar days after identification, a specimen is subject to the select agent regulations
Since a registered or reference laboratory typically confirms the identification of a select agent or toxin for public health and agriculture, we proposed to require that a registered or reference laboratory inform the specimen provider of the identification as a condition for a clinical or diagnostic laboratory to maintain their exemption under 42 CFR 73.5(a), and 42 CFR 73.6(a). Two commenters stated they did not believe basic good practices require regulations. We made no changes based on these comments because this provision will ensure that the reference laboratory notifies the specimen provider of the identification of the select agent or toxin. It is important that the specimen provider is aware that they are in possession of the agent or toxin and must meet the requirements outlined in 42 CFR 73.5, 73.6 (
In the current select agent regulations, in order for clinical or diagnostic laboratories to maintain their exemption under 42 CFR 73.5(a), and 42 CFR 73.6(a), the clinical or diagnostic laboratory must, either immediately or within seven calendar days, report the identification of a select agent or toxin to APHIS or CDC unless directed otherwise by HHS Secretary or APHIS Administrator. In the NPRM, we proposed to amend the language in 42 CFR 73.5(a), and 42 CFR 73.6(a) to state: “Unless directed otherwise by the Secretary, within seven calendar days after identification of the select agent or toxin (except for Botulinum neurotoxin (BoNT) and/or Staphylococcal enterotoxins (Subtypes A-E)), or within 30 calendar days after identification of Botulinum neurotoxin and/or Staphylococcal enterotoxin (Subtypes A-E), the select agent or toxin is transferred in accordance with § 73.16 or destroyed on-site by a recognized sterilization or inactivation process.” We sought comments concerning (1) the extension of the exemption time period to 30 days for BoNT and Staphylococcal enterotoxin (Subtypes A-E) to allow clinical and diagnostic laboratories sufficient time to complete their investigations without having to transfer or destroy the sample, and (2) whether seven calendar days provided sufficient amount of time for the entity to destroy or transfer other select agents or toxins after identification. We received one comment to extend the amount of time for other select agents or toxins to 10 calendar days since destruction may not occur on-site, therefore allowing the secure transport to the ultimate site of disposition. We made no changes to adjust the seven calendar day requirement for agents or toxins other than BoNT and Staphylococcal enterotoxin (Subtypes A-E) because the other agents or toxins do not involve the identification of both agent and toxin as part of diagnosis. Therefore, these situations are not as complicated and do not warrant additional time for reporting identification.
We are codifying in regulation the current FSAP policy that an entity is required to meet all of the regulatory requirements for those select agents and toxins listed on an entity's registration regardless of whether the select agent or toxin is in the actual possession of an entity, and without regard to the actual amounts of toxins in the possession of an entity. We received no comments regarding this proposal and have made no changes to the language in the proposed rule.
Section 73.9(a)(6) of the select agent regulations currently states that the RO must ensure that an annual inspection is conducted for each laboratory where select agents and toxins are stored or used. This requirement also provides that the results of each inspection must be documented, and any deficiencies identified during an inspection must be corrected. We proposed adding a requirement that the RO must also document the corrective actions taken by the entity to address any identified deficiencies. We received one comment that supported this proposed requirement and are finalizing the requirement as proposed.
In its December 2014 report, the Federal Experts Security Advisory Panel (FESAP) recommended adding a specific regulatory requirement addressing how individuals are informed of the availability of procedures for accessing the HHS or USDA Office of Inspector General Hotlines to anonymously report a safety or security concern. In response to that recommendation, we proposed adding a requirement that the RO must ensure that individuals at their entity are provided the contact information of the HHS Office of Inspector General Hotline and USDA Office of Inspector General Hotline so that an individual is able to anonymously report a biosafety or security concern related to select agents and toxins. We received no comments regarding this proposed addition and are finalizing the requirement as proposed.
Section 73.10(e) of the select agent regulations currently provides that a person with a valid approval from the HHS Secretary or APHIS Administrator to have access to select agents and toxins may request, through his or her RO, that the HHS Secretary or APHIS Administrator provide their approved access status to another registered individual or entity for a specified period of time. This allows a person with approved access at a registered entity to have approved access to a select agent at another registered entity. To ensure that the RO of the entity hosting such a visitor is aware if a visiting individual loses access approval to select agents and toxins, we added a requirement that the RO at the home entity must immediately notify the RO of the visiting entity if a person's access to select agents or toxins has been terminated. We received one comment that supported this addition to the regulations and are finalizing the requirement as proposed.
The select agent regulations require a registered entity to develop and implement a number of plans in order to ensure the safety and security of the select agents and toxins they handle. These are:
• A security plan that provides for measures sufficient to safeguard a select agent or toxin against unauthorized access, theft, loss, or release (42 CFR 73.11);
• A biosafety plan that provides for measures sufficient to contain a select agent or toxin (42 CFR 73.12); and
• An incident response plan that provides for measures that the registered entity will implement in the event of theft, loss, or release of a select agent or toxin; inventory discrepancies; security breaches (including information systems); severe weather and other natural disasters; workplace violence; bomb threats and suspicious packages; and emergencies such as fire, gas leak, explosion, power outage, or others. (42 CFR 73.14).
The select agent regulations require that drills or exercises must be conducted at least annually to test and evaluate the effectiveness of the plans, and that the plans must be reviewed and revised, as necessary, after any drill or exercise, and after any incident. We proposed to require that these drills or exercises be documented to include how the drill or exercise tested and evaluated the plan, any problems identified and corrective actions that were taken, and the names of the individuals who participated in the drill or exercise. Three commenters stated that there was no need to codify the documentation of how a drill or exercise evaluated a plan and corrective actions in regulations because they believed this requirement is already being documented. We are making no changes based on the comments because this requirement will provide a more thorough accounting of required activities via testing and entity-directed improvements.
Another commenter requested clarification regarding the recording of the names of individuals who participate in drills or exercises. The commenter believed the requirement should be limited to registered entity personnel and not include first responders or other non-entity participants, but list only the participating external agencies (
Similar to the existing requirement for the security plan, we proposed to add a requirement that the biosafety and incident response plans be submitted for initial registration, renewal of registration, or when requested by FSAP. We received two comments regarding these proposals which supported this requirement. However, one commenter questioned the need for additional requirements as this is already done routinely. While we agreed with the commenter that some, or even most, entities already provide the plans routinely, we are making no changes to the proposed language so that all entities will be required to submit their biosafety and incidence response plans, consistent with the existing requirement for the security plan.
We proposed amending the requirement that a security plan contain a description of how the entity authorizes the means of entry into areas where select agents or toxins are stored or used, to add a requirement that the security plan must include a description of centralized access control management systems (
Paragraphs (d)(7)(i) through (d)(7)(v) of section 11 (security) of the select agent regulations encompass a list of events that individuals with access approval from the HHS Secretary or the APHIS Administrator must immediately report to the RO. We proposed to add a new requirement that the RO must be notified of any loss of computer, hard drive, or other data storage device containing information that could be used to gain access to select agents or toxins. We received one comment requesting clarification on the time frame for notification. We made no changes based on the comment since the regulations under subsection (d) already provide that notification must be immediate. The notification will facilitate notification of the Federal Bureau of Investigation (FBI) if deemed necessary by the RO as the loss of such equipment may be criminal in nature.
We proposed amending the regulatory language in section 73.12 of the select agent regulations to update the name change of the National Institutes of Health (NIH) “Guidelines for Research Involving Recombinant or Synthetic Nucleic Acid Molecules” (Ref. 2). We received no comments and are finalizing this change as proposed.
The biosafety section of the select agent regulations contains a reference to the Occupational Safety and Health Administration (OSHA) regulations found in 29 CFR 1910.1200 and 1910.1450. These sections provide specific requirements for handling hazardous chemicals in the laboratories. These regulations also provide recommendations for safely working with chemicals including toxins and give non-mandatory recommendations for prudent practices in laboratories handling chemical hazards. Since the current edition of the CDC/NIH “Biosafety in Microbiological and Biomedical Laboratories” Appendix I (Ref. 3) now provides guidelines for work with toxins of biological origin, we proposed removal of the reference to these OSHA regulations. We note, however, that regulated entities are still required to meet the OSHA regulatory requirements where applicable. We received no comments and are finalizing this change as proposed.
In the NPRM, we proposed adding the requirement that “biosafety and containment procedures specific to each registered laboratory must be available to each individual working in that laboratory.” We proposed adding this language to ensure that laboratory personnel working with select agents and toxins have access to relevant biosafety information and are therefore aware of the risks associated with these agents. One commenter requested clarification regarding the term “laboratory” and whether the term referred to a single room or a building or to a group of rooms (
In the NPRM, we proposed adding specific provisions to the biosafety section that would require (1) a written risk assessment for each registered select agent or toxin; (2) written safety procedures to protect entity personnel, the public, and the environment from exposure to the select agent or toxin; (3) written decontamination procedures; and (4) written waste management procedures. We received 13 comments that stated that “risk assessments” should be defined and the proposed requirement of having these for each procedure involving a select agent or toxin that addresses the hazards associated with the agent or toxin must be clarified because risk assessments are completed through institutional review committees by collaborative processes with Principal Investigators and biosafety professionals. One commenter stated that a risk assessment was always a requirement. We agree with the commenters that “risk assessment for each procedure” should not be required and agreed that having a risk assessment was already addressed in the regulations as outlined in Section 12(a) that “An individual or entity required to register under this part must develop and implement a written biosafety plan that is commensurate with the risk of the select agent or toxin, given its intended use.” However, we have clarified in the final regulatory language found in section 12(a)(1) of the select agent regulations that the biosafety plan include “the hazardous characteristics of each agent or toxin listed on the entity's registration and the biosafety risk associated with laboratory procedures related to the select agent or toxin.”
The majority of the commenters stated that the approach outlined in the NPRM discussion of section 12(a) would lead to decreased compliance and an increase in paperwork burden. One commenter stated that many biosafety plans are already upwards of 50 pages, and increasing the length further may greatly decrease the likelihood that researchers will continue to read these plans and use them as a resource. Another commenter stated that regulatory language should be omitted to prevent creating a redundant process such as those provisions already covered under training and incident response. We agree with commenters and have removed the training and incident response language that was noted in the NPRM because these provisions are already covered by other sections in the regulations (
One commenter stated we should consider requiring the adoption of shared algorithms developed by the American Society for Microbiology (ASM) for use by clinical laboratories. These algorithms are presented as frequently asked questions (FAQs) from ASM to assist laboratories. We made no changes based on this comment because FSAP already provides FAQs to assist entities with meeting the biosafety requirements of the regulations.
Another commenter recommended that we also offer the suggestion that entities consider implementing programs whereby personnel are required to work with another trained person (
We proposed to amend section 15 of the select agent regulations to require that training be completed within 12 months of that individual's anniversary of receiving access approval from the HHS Secretary or the APHIS Administrator, or prior to his or her entry into an area where any select agents and toxins are used or stored, whichever occurs first. This change is necessary in order to ensure that individuals at registered entities receive timely training. We received no specific comments regarding this proposed change. However, seven commenters stated that we should include a description of the level of training necessary for personnel in varying positions with highly disparate job duties and responsibilities. The commenters requested that we clarify that the required training will be conducted at a level appropriate to the registered person's role and level of access to select agents. We made no changes based on this comment because the current regulatory language is clear that “the training must address the particular needs of the individual, the work they will do, and the risks posed by the select agents or toxins.” The training for the individuals should be determined by the entity based on at the level of which the individual will have access to select agents or toxins. The training that each person receives should be designed to ensure that they can carry out their responsibilities without causing harm to themselves, or to their fellow co‐workers, or to the public. We did clarify the regulatory language regarding training for an individual who must be escorted to specify that their training must be accomplished prior to the individual's entry into a registered area.
One commenter also asked that we consider making “training a pre-requisite for access to select agents and toxins, and not a requirement for just being FSAP approved.” The regulations in 42 CFR 73.15(a)(1) already requires that each approved individual receive information and training on biosafety, security (including security awareness), and incident response before that individual has access to any select agents and toxins. The same commenter
Based on our inspections of registered entities, we observed that not all entities maintain records of the final disposition of select agents when consumed or destroyed, and this impedes validation of inventory holdings. Section 73.17 of the select agent regulations currently does not include a requirement for documenting the final disposition of a select agent. To ensure the proper tracking of a select agent from acquisition to final disposition, we are adding a requirement for entity records to include the final disposition (including destruction) for each select agent that has been held in long-term storage. One commenter expressed concern that a requirement for a record of destruction of select agents would place an undue burden on investigators and recommended that this requirement be excluded from the final rule. However, the commenter did agree that an entity should be required to maintain a current and accurate inventory of all select agents in their possession and document when an agent is no longer in their possession. We agree with the commenter that final disposition needs to be part of the entity's recordkeeping requirement. We disagree with the commenter that this will place undue burden on investigators because this information can be included with an entity's existing recordkeeping system (
Section 73.17 of the select agent regulations currently states that records and databases need to be accurate. To ensure that the accuracy of handwritten records can be verified, we proposed to clarify that a handwritten record must be legible (
We proposed to expand the scope of records required to be maintained to include any records that contain information related to the requirements of the regulations. We received five comments that expressed concerns about the information being kept in laboratory notes. The commenters stated that the information is “proprietary in nature,” contains intellectual property information and should not be required to be provided to FSAP inspectors. We understand the concerns of the commenters and clarified the language to indicate that it is only information related to requirements of the select agent regulations that must be produced on request. Such information may be found in the biocontainment certifications, laboratory notebooks, institutional biosafety and/or animal use committee minutes and approved protocols, and records associated with occupational health and suitability programs. Accordingly, we will only review relevant portions of any laboratory notebooks or documents, and only if they contain information related to any requirements of the regulations under sections 73.5, 73.7, 73.9, 73.11, 73.12, 73.14, 73.15, 73.16, 73.17, and 73.19 of the select agent regulations. Two commenters stated that certain records are “protected under the HIPAA Privacy Rule.” FSAP would expect any information provided to FSAP regarding an individual's health would be provided in accord with the HIPAA Privacy Rule, including the use and disclosure of protected health information to public health authorities authorized by law to collect or receive such information for preventing or controlling disease, injury, or disability.
In the NPRM we also solicited information and ideas as to how a regulatory requirement could be constructed such that a registered entity would know whether a select agent or toxin had been lost or stolen, without that registered entity first having “an accurate, current inventory for each select agent . . . held in long-term storage.” In addition, we requested ideas as to how the current regulations could be amended to address the threat of the theft of a select agent from a container held in long-term storage. We received three comments that addressed this request. One commenter suggested that FSAP inspectors review the record of select agents held in long-term storage and accept the attestation of the responsible investigators of their accuracy. Another commenter stated we should continue with FSAP's current select agent practices to allow for these stocks to be maintained in tamper-evident containers (
The Public Health Security and Bioterrorism Preparedness and Response Act of 2002 requires HHS and USDA to review and republish the list of select agents and toxins every two years. In drafting this final rule, we considered the action proposed in the NPRM of removing the six select agents and one toxin where its costs and benefits were discussed. If those policies were adopted, it would result in savings ranging from approximately $15,300 for a small commercial BSL-3 laboratory to approximately $165,000 for a larger university with BSL-2/3 laboratories for laboratories no longer regulated. Based on the review of FSAP database, approximately eleven small entities would no longer be regulated and would not be required to register with FSAP. If the entities withdrew their registration, it would result in an estimated saving of $168,300 annually. On the other hand, this policy could increase the likelihood of entities working with these removed select agents and toxin not having the
Under Executive Order (E.O.) 12866, Regulatory Planning and Review (58 FR 51735, October 4, 1993), CDC is required to determine whether this regulatory action would be “significant” and therefore subject to review by the Office of Management and Budget (OMB) and the requirements of the Executive Orders (E.O.). E.O. 12866 defines “significant regulatory action” as any regulatory action that is likely to result in a rule that may:
• Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or state, local, or tribal governments or communities;
• Create a serious inconsistency or otherwise interfere with an action taken or planned by another agency;
• Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients; or,
• Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in E.O. 12866.
E.O. 13563, Improving Regulation and Regulatory Review, (76 FR 3821, January 21, 2011), updates some of the provisions of E.O. 12866 in order to promote more streamlined regulatory actions. This E.O. charges, in part, that, while protecting “public health, welfare, safety, and our environment” that regulations must also “promote predictability and reduce uncertainty” in order to promote economic growth. Further, regulations must be written in plain language and be easy to understand.
We have prepared an economic analysis for this rule. The economic analysis provides a cost-benefit analysis, as required by E.O. 12866, and a final regulatory flexibility analysis (See Section III.B. of this Preamble) that examines the potential economic effects of this rule on small entities, as required by the Regulatory Flexibility Act. The economic analysis is summarized below. Copies of the full analysis are available in the docket at
We have determined that this final rule is significant for the purposes of Executive Order 12866 and, therefore, this final rule has been reviewed by OMB.
The Public Health Security and Bioterrorism Preparedness and Response Act of 2002 (Pub. L. 107-188) provides for the regulation of certain biological agents and toxins that have the potential to pose a severe threat to human, animal, or plant health, or to animal or plant products. APHIS and CDC have primary responsibility for implementing the provisions of the Act within the Department of Agriculture and the Department of Health and Human Services, respectively. Within APHIS, Veterinary Services (VS) select agents and toxins are those that have been determined to have the potential to pose a severe threat to animal health or animal products, and Plant Protection and Quarantine (PPQ) select agents and toxins are those that have been determined to have the potential to pose a severe threat to plant health or plant products. HHS select agents and toxins are those that have been determined to have the potential to pose a severe threat to human health. APHIS and CDC coordinate regulatory activities for overlap select agents and toxins that have been determined to pose a severe threat to human and animal health or products.
Sections 201 and 212(a)(2) of the Act require a biennial review and republication of the select agent and toxin list, with revisions as appropriate in accordance with this law. These final rules will implement the recommendations of the fourth biennial review of select agent regulations and have finalized changes that will increase their usability as well as provide for enhanced program oversight. These amendments include new provisions regarding the inactivation of select agents, specific biosafety and toxin requirements and clarification of regulatory language concerning security, training, and records.
The final rule will require that entities develop validated inactivation procedures for select agents or regulated infectious nucleic acid and maintain written records of having done so. Costs of complying with this amendment are expected to be modest.
Currently, there are 286 entities registered with APHIS and CDC including 91 academic, 53 commercial, 81 State government, 45 Federal government, and 16 private (non-profit) institutions, most of which are considered to be small entities. Based on current record keeping and reporting requirements, an additional 10 to 20 hours per year may be required for maintaining records associated with select agents or material containing select agents or regulated nucleic acids that can produce infectious forms of any select agent virus that have been subjected to a validated inactivation procedure or a procedure for removal of viable select agents. At an imputed cost of $33.40 per hour (GS-12, step 2), this additional time requirement per entity will cost between $334 and $668 per year, or in total for all registered entities between $80,000 and $160,000. The final rule will not have a significant economic impact on a substantial number of small entities. Costs associated with this rule do not include costs related to training, overhead, updates to facilities, etc. We assume in this rule that all costs associated with such factors for entities performing inactivation procedures have already been incurred prior to rulemaking.
The benefits of strengthened safeguards against the unintentional or deliberate release of a select agent or toxin greatly exceed compliance costs of the rules. As an example of losses that can occur, the October 2001 anthrax attacks caused five fatalities and 17 illnesses, disrupted business and government activities (including $2 billion in lost revenues for the Postal Service), and required more than $23 million to decontaminate one Senate office building and $3 billion to decontaminate postal facilities and procure mail-sanitizing equipment. Deliberate introduction greatly increases the probability of a select agent becoming established and causing wide-ranging and devastating impacts to the economy, other disruptions to society, and diminished confidence in public and private institutions.
The amended regulations will enhance the protection of human, animal, and plant health and safety. The final rules will reduce likelihood of the accidental or intentional release of a
We have examined the impacts of the proposed rule under RFA (5 U.S.C. 601-612). Unless we certify that the proposed rule is not expected to have a significant economic impact on a substantial number of small entities, RFA, as amended by the Small Business Regulatory Enforcement Fairness Act (SBREFA), requires agencies to analyze regulatory options that would minimize any significant economic impact of a rule on small entities. We certify that this proposed rule will not have a significant economic impact on a substantial number of small entities within the meaning of the RFA because these registered entities are already required to comply with the select agent regulations. The small entities would only incur some costs if they are performing inactivation procedures and are not maintaining records. The additional costs that may be incurred are small in comparison to the long-term benefits of additional protection against the release of select agents and toxins that would result in devastating effects to the economy.
This regulatory action is not a major rule as defined by Sec. 804 of the Small Business Regulatory Enforcement Fairness Act of 1996. This proposed rule will not result in an annual effect on the economy of $100,000,000 or more; a major increase in cost or prices; or significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based companies to compete with foreign-based companies in domestic and export markets.
In accordance with section 3507(d) of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
This rule has been reviewed under E.O. 12988, Civil Justice Reform. Once the final rule is in effect, CDC notes that: (1) All State and local laws and regulations that are inconsistent with this rule will be preempted; (2) No retroactive effect will be given to this rule; and (3) Administrative proceedings will not be required before parties may file suit in court challenging this rule.
HHS/CDC has reviewed this final rule in accordance with E.O. 13132 regarding Federalism, and has determined that it does not have “federalism implications.” The rule does not “have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.”
Under the Plain Language Act of 2010 (Pub. L. 111-274, October 13, 2010), executive Departments and Agencies are required to use plain language in documents that explain to the public how to comply with a requirement the Federal Government administers or enforces. HHS/CDC has attempted to use plain language in promulgating this rule consistent with the Federal Plain Writing Act guidelines.
Biologics, Packaging and containers, Penalties, Reporting and recordkeeping requirements, and Transportation.
For the reasons discussed in the preamble, we amend 42 CFR part 73 as follows:
42 U.S.C. 262a; sections 201-2014, 221 and 231 of Title II of Public Law 107-188, 116 Stat 637 (42 U.S.C. 262a).
The additions and revisions read as follows:
(b) HHS select agents and toxins:
(d) * * *
(2) Non-viable HHS select agents or nontoxic HHS toxins.
(3) A select agent or toxin that has been subjected to decontamination or a destruction procedure when intended for waste disposal.
(4) A select agent or regulated nucleic acids that can produce infectious forms of any select agent virus that has been subjected to a validated inactivation procedure that is confirmed through a viability testing protocol. Surrogate strains that are known to possess equivalent properties with respect to inactivation can be used to validate an inactivation procedure; however, if there are known strain-to-strain variations in the resistance of a select agent to an inactivation procedure, then an inactivation procedure validated on a lesser resistant strain must also be validated on the more resistant strains.
(5) Material containing a select agent that is subjected to a procedure that removes all viable select agent cells, spores, or virus particles if the material is subjected to a viability testing protocol to ensure that the removal method has rendered the material free of all viable select agent.
(6) A select agent or regulated nucleic acids that can produce infectious forms of any select agent virus not subjected to a validated inactivation procedure or material containing a select agent not subjected to a procedure that removes all viable select agent cells, spores, or virus particles if the material is determined by the HHS Secretary to be effectively inactivated or effectively removed. To apply for a determination an individual or entity must submit a written request and supporting scientific information to CDC. A written decision granting or denying the request will be issued.
(7) Except as required in § 73.16(l), the aggregate amount of the toxin under the control of a principal investigator, treating physician or veterinarian, or commercial manufacturer or distributor does not, at any time, exceed the following amounts: 1000 mg of Abrin; 1 mg of Botulinum neurotoxins; 100 mg of Conotoxins (Short, paralytic alpha conotoxins containing the following amino acid sequence X
(i) The toxin is transferred only after the transferor uses due diligence and documents the identification of the recipient and the legitimate need (
(9) An HHS select toxin identified in an original food sample or clinical sample.
(10) For those laboratories that are not exempt under § 73.5(a) and § 73.6(a), Botulinum neurotoxin that is produced as a byproduct in the study of Botulinum neurotoxin producing species of
(11) Waste generated during the delivery of patient care by health care professionals from a patient diagnosed with an illness or condition associated with a select agent, where that waste is decontaminated or transferred for destruction by complying with state and Federal regulations within seven calendar days of the conclusion of patient care.
(e) * * *
(3) An individual or entity may make a written request to the HHS Secretary for reconsideration of a decision denying an application for the exclusion of an attenuated strain of a select agent or a select toxin modified to be less potent or toxic. The written request for reconsideration must state the facts and reasoning upon which the individual or entity relies to show the decision was incorrect. The HHS Secretary will grant or deny the request for reconsideration as promptly as circumstances allow and will state, in writing, the reasons for the decision.
The revision and additions read as follows:
(b) Overlap select agents and toxins:
(d) * * *
(2) Non-viable overlap select agents or nontoxic overlap toxins.
(3) A select agent or toxin that has been subjected to decontamination or a destruction procedure when intended for waste disposal.
(4) A select agent or regulated nucleic acids that can produce infectious forms of any select agent virus that has been subjected to a validated inactivation procedure that is confirmed through a viability testing protocol. Surrogate strains that are known to possess equivalent properties with respect to inactivation can be used to validate an inactivation procedure; however, if there are known strain-to-strain variations in the resistance of a select agent to an inactivation procedure, then an inactivation procedure validated on a lesser resistant strain must also be validated on the more resistant strains.
(5) Material containing a select agent that is subjected to a procedure that removes all viable select agent cells, spores, or virus particles if the material is subjected to a viability testing protocol to ensure that the removal method has rendered the material free of all viable select agent.
(6) A select agent or regulated nucleic acids that can produce infectious forms of any select agent virus not subjected to a validated inactivation procedure or material containing a select agent not subjected to a procedure that removes all viable select agent cells, spores, or virus particles if the material is determined by the HHS Secretary or Administrator to be effectively inactivated or effectively removed. To apply for a determination an individual or entity must submit a written request and supporting scientific information to CDC or APHIS. A written decision granting or denying the request will be issued.
(7) An overlap select toxin identified in an original food sample or clinical sample.
(8) Waste generated during the delivery of patient care by health care professionals from a patient diagnosed with an illness or condition associated with a select agent, where that waste is decontaminated or transferred for destruction by complying with state and Federal regulations within seven calendar days of the conclusion of patient care.
(e) * * *
(3) An individual or entity may make a written request to the HHS Secretary or Administrator for reconsideration of a decision denying an application for the exclusion of an attenuated strain of a select agent or a select toxin modified to be less potent or toxic. The written request for reconsideration must state the facts and reasoning upon which the individual or entity relies to show the decision was incorrect. The HHS Secretary or Administrator will grant or deny the request for reconsideration as promptly as circumstances allow and will state, in writing, the reasons for the decision.
The revisions and addition read as follows:
(a) * * *
(1) Unless directed otherwise by the HHS Secretary, within seven calendar days after identification of the select agent or toxin (except for Botulinum neurotoxin and/or
(3) Unless otherwise directed by the HHS Secretary, the clinical or diagnostic specimens collected from a patient infected with a select agent are transferred in accordance with § 73.16 or destroyed on-site by a recognized sterilization or inactivation process within seven calendar days after delivery of patient care by health care professionals has concluded, and
(4) The identification of the agent or toxin is reported to CDC or APHIS, the specimen provider, and to other appropriate authorities when required by Federal, State, or local law by telephone, facsimile, or email. This report must be followed by submission of APHIS/CDC Form 4 to APHIS or CDC within seven calendar days after identification.
The revision and addition read as follows:
(a) * * *
(3) Unless otherwise directed by the HHS Secretary or Administrator, the clinical or diagnostic specimens collected from a patient infected with a select agent are transferred in accordance with § 73.16 or destroyed on-site by a recognized sterilization or inactivation process within seven calendar days after delivery of patient care by health care professionals has concluded, and
(4) The identification of the agent or toxin is reported to CDC or APHIS, the specimen provider, and to other appropriate authorities when required by Federal, State, or local law by telephone, facsimile, or email. This report must be followed by submission of APHIS/CDC Form 4 to APHIS or CDC within seven calendar days after identification.
(b) As a condition of registration, each entity is required to be in compliance with the requirements of this part for select agents and toxins listed on the registration regardless of whether the entity is in actual possession of the select agent or toxin. With regard to toxins, the entity registered for possession, use or transfer of a toxin must be in compliance with the requirements of this part regardless of the amount of toxin currently in its possession.
(a) * * *
(7) Ensure that individuals are provided the contact information for the HHS Office of Inspector General Hotline and the USDA Office of Inspector General Hotline so that they may anonymously report any biosafety or security concerns related to select agents and toxins.
(8) Investigate to determine the reason for any failure of a validated inactivation procedure or any failure to remove viable select agent from material. If the Responsible Official is unable to determine the cause of a deviation from a validated inactivation procedure or a viable select agent removal method; or receives a report of any inactivation failure after the movement of material to another location, the Responsible Official must report immediately by telephone or email the inactivation or viable agent removal method failure to CDC or APHIS.
(9) Review, and revise as necessary, each of the entity's validated inactivation procedures or viable select agent removal methods. The review must be conducted annually or after any change in Principal Investigator, change in the validated inactivation procedure or viable select agent removal method, or failure of the validated inactivation procedure or viable select agent removal method. The review must be documented and training must be conducted if there are any changes to the validated inactivation procedure, viable select agent removal method, or viability testing protocol.
(e) * * * A Responsible Official must immediately notify the Responsible Official of the visited entity if the person's access to select agents and toxins has been terminated.
The additions read as follows:
(d) * * *
(7) * * *
(vi) Any loss of computer, hard drive or other data storage device containing information that could be used to gain access to select agents or toxins.
(h) * * * Drills or exercises must be documented to include how the drill or exercise tested and evaluated the plan, any problems that were identified and corrective action(s) taken, and the names of registered entity personnel participants.
The revision and addition read as follows:
(a) An individual or entity required to register under this part must develop and implement a written biosafety plan that is commensurate with the risk of the select agent or toxin, given its intended use. The biosafety plan must contain sufficient information and documentation to describe the biosafety and containment procedures for the select agent or toxin, including any animals (including arthropods) or plants intentionally or accidentally exposed to or infected with a select agent. The current biosafety plan must be submitted for initial registration, renewal of registration, or when requested. The biosafety plan must include the following provisions:
(1) The hazardous characteristics of each agent or toxin listed on the entity's registration and the biosafety risk associated with laboratory procedures related to the select agent or toxin;
(2) Safeguards in place with associated work practices to protect entity personnel, the public, and the environment from exposure to the select agent or toxin including, but not limited to: Personal protective equipment and other safety equipment; containment equipment including, but not limited to, biological safety cabinets, animal caging systems, and centrifuge safety containers; and engineering controls and other facility safeguards;
(3) Written procedures for each validated method used for disinfection, decontamination or destruction, as appropriate, of all contaminated or presumptively contaminated materials including, but not limited to: Cultures and other materials related to the propagation of select agents or toxins, items related to the analysis of select agents and toxins, personal protective equipment, animal caging systems and bedding (if applicable), animal carcasses or extracted tissues and fluids (if applicable), laboratory surfaces and equipment, and effluent material; and
(4) Procedures for the handling of select agents and toxins in the same spaces with non-select agents and toxins to prevent unintentional contamination.
(e) * * * Drills or exercises must be documented to include how the drill or exercise tested and evaluated the plan, any problems that were identified and corrective action(s) taken, and the names of registered entity personnel participants.
The additions read as follows:
(a) * * * The current incident response plan must be submitted for initial registration, renewal of registration, or when requested.
(f) * * * Drills or exercises must be documented to include how the drill or exercise tested and evaluated the plan, any problems that were identified and corrective action(s) taken, and the names of registered entity personnel participants.
(a) An individual or entity required to register under this part must provide information and training on biocontainment, biosafety, security (including security awareness), and incident response to:
(1) Each individual with access approval from the HHS Secretary or
(2) Each individual not approved for access to select agents and toxins by the HHS Secretary or Administrator before that individual enters areas under escort where select agents or toxins are handled or stored (
(e) The Responsible Official must ensure and document that individuals are provided the contact information of the HHS Office of Inspector General Hotline and the USDA Office of Inspector General Hotline so that they may anonymously report any safety or security concerns related to select agents and toxins.
(l) * * *
(1) Transfer the amounts only after the transferor uses due diligence and documents that the recipient has a legitimate need (
The revision and additions read as follows:
(a) * * *
(1) * * *
(v) The select agent used, purpose of use, and, when applicable, final disposition,
(8) For select agents or material containing select agents or regulated nucleic acids that can produce infectious forms of any select agent virus that have been subjected to a validated inactivation procedure or a procedure for removal of viable select agent:
(i) A written description of the validated inactivation procedure or viable select agent removal method used, including validation data;
(ii) A written description of the viability testing protocol used;
(iii) A written description of the investigation conducted by the entity Responsible Official involving an inactivation or viable select agent removal failure and the corrective actions taken;
(iv) The name of each individual performing the validated inactivation or viable select agent removal method;
(v) The date(s) the validated inactivation or viable select agent removal method was completed;
(vi) The location where the validated inactivation or viable select agent removal method was performed; and
(vii) A certificate, signed by the Principal Investigator, that includes the date of inactivation or viable select agent removal, the validated inactivation or viable select agent removal method used, and the name of the Principal Investigator. A copy of the certificate must accompany any transfer of inactivated or select agent removed material.
(b) The individual or entity must implement a system to ensure that all records and data bases created under this part are accurate and legible, have controlled access, and authenticity may be verified.
(c) The individual or entity must promptly produce upon request any information that is related to the requirements of this part but is not otherwise contained in a record required to be kept by this section. The location of such information may include, but is not limited to, biocontainment certifications, laboratory notebooks, institutional biosafety and/or animal use committee minutes and approved protocols, and records associated with occupational health and suitability programs. All records created under this part must be maintained for 3 years.
Health Resources and Services Administration (HRSA), HHS.
Final rule.
On July 29, 2015, the Secretary of Health and Human Services (the Secretary) published in the
This rule is effective February 21, 2017.
Dr. Narayan Nair, Acting Director, Division of Injury Compensation Programs, Healthcare Systems Bureau, HRSA, 5600 Fishers Lane, Room 8N146B, Rockville, MD 20857, or by telephone (855) 266-2427. This is a toll-free number.
The National Childhood Vaccine Injury Act of 1986, title III of Public Law 99-660 (42 U.S.C. 300aa-10
To gain entitlement to compensation under this program, a petitioner must establish that a vaccine-related injury or death has occurred, either by proving that a vaccine actually caused or significantly aggravated an injury (causation-in-fact) or by demonstrating the occurrence of what is referred to as a “Table Injury.” That is, a petitioner may show that the vaccine recipient suffered an injury of the type enumerated in the regulations at 42 CFR 100.3—the “Vaccine Injury Table”—corresponding to the vaccination in question and that the onset of such injury took place within a time period also specified in the Table. If so, the injury is presumed to have been caused by the vaccination and the petitioner is entitled to compensation (assuming that other requirements are satisfied) unless the Respondent affirmatively shows that the injury was caused by some factor other than the vaccination (
In prior Table revisions, the Secretary determined that the appropriate framework for making changes to the Table is to make specific findings as to the illnesses or conditions that can reasonably be determined, in some circumstances, to be caused or significantly aggravated by the vaccines under review and the circumstances under which such causation or aggravation can reasonably be determined to occur. The Secretary continues this approach through the use of the 2012 IOM report, the work of the nine workgroups who reviewed the IOM findings, and consideration of the ACCV's recommendations. After consultation with the ACCV, the Secretary may modify the Table by promulgating regulations, with notice and opportunity for a public hearing and at least 180 days of public comment.
After the IOM released its 2012 report, 9 HHS workgroups comprising HRSA and Centers for Disease Control and Prevention (CDC) medical staff reviewed IOM's conclusions for 158 vaccine-adverse events, as well as any newly published scientific literature not contained in the report, and developed a set of proposed changes to the Table and its definitional counterpart, the Qualifications and Aids to Interpretation (QAI). For the vast majority of the vaccine-adverse event pairs reviewed (135), the IOM determined that the evidence was inadequate to accept or reject a causal relationship. Considering the remaining IOM conclusions and the ACCV Guiding Principles, the Secretary in this final rule is adopting certain additions or changes to the Table where the scientific evidence either convincingly supports or favors acceptance of a causal relationship between certain conditions and covered vaccines, which are unchanged from the proposed rule. As required by the Act, the changes in the proposed rule were presented to the ACCV, which reviewed and concurred with the Table changes set forth in this final rule.
Additionally, the Secretary, following the recommendation of the ACCV, is finalizing the Table change, as proposed, to add the injury of Guillain-Barré Syndrome (GBS) for seasonal influenza vaccinations, which is consistent with the approach taken in the Countermeasures Injury Compensation Program (CICP). Studies have demonstrated a causal association between the monovalent 2009 H1N1 vaccine and the 1976 swine flu vaccine and GBS. These causal associations were the basis of the 2015 decision by the Secretary in the CICP Pandemic Influenza A Countermeasures Injury Table Final Rule (80 FR 47411) to include GBS as an injury associated with the 2009 H1N1 influenza. With respect to that vaccine, the Secretary found that there was compelling, reliable, and valid medical and scientific evidence of an association between the 2009 H1N1 vaccine and GBS, which is required to add an injury to the CICP's Injury Table. To date, the H1N1 antigen has been included in all seasonal influenza vaccines beginning with the 2010-2011 flu season. HHS notes that seasonal influenza vaccine formulations, unlike other vaccines, include multiple antigens that change from year-to-year, and enhanced surveillance activities to detect the incidence of GBS that occurred during the 2009 H1N1 pandemic may not occur with each virus strain change. In light of this information and other information as discussed in the proposed rule, the ACCV recommended that the Secretary add GBS consistent with one of its Guiding Principles: That where there is credible evidence to both support and reject a change to the Table, the change should, whenever possible, be made to the benefit of petitioners.
In addition, in the final rule, the Secretary adopts the proposed rule's new paragraph (b),
In this final rule, in addition to the changes described in the proposed rule, the Secretary has made the following non-substantive changes to the proposed rule for purposes of clarity:
a. Added headings to (c)(2)(ii) and (c)(3)(ii).
b. Moved text from the end of paragraph (c)(3)(ii)(C) to create a new (c)(3)(ii)(D).
c. Changed paragraphs (c)(11) and (12) by revising the sentence regarding organs other than the skin by adding “the” before ” disease”, inserting “and” after “organ”, and moving “, not just mildly abnormal laboratory values” to the end of the sentence.
d. Revised paragraph (c)(15)(i) by changing “nine weeks” to “9 weeks”.
e. Changed paragraph (e)(1) (“Coverage Provisions”) for purpose of clarity and consistency with 42 U.S.C. 300aa-14(c)(4) by adding “only” before “to petitions for compensation.”
The modified Table applies only to petitions filed under the VICP after the effective date of this final rule. Also, petitions must be filed within the applicable statute of limitations. The general statute of limitations applicable to petitions filed under the VICP, set forth in 42 U.S.C. 300aa-16(a),
For any vaccine-adverse event pairs for which future scientific evidence develops to support a finding of a causal relationship, the Secretary will consider future rulemaking to revise the Table accordingly.
The NPRM provided a 180-day comment period that resulted in the receipt of 14 written comments—13 from individuals and one from a national organization. In addition, a public hearing on the proposed rule was held on January 14, 2016, during which a representative from the above mentioned national organization presented comments. The organization's oral comments were an expansion of the organization's previously submitted written comments. The Secretary carefully considered all received comments in the development of this final rule. Below is a summary of the comments and the Secretary's responses:
As previously indicated, the Table revisions were based primarily on the 2012 IOM report which was developed after the IOM committee conducted a comprehensive review of the scientific literature on vaccines and adverse events. The committee charged with undertaking this review consisted of 16 members with expertise in the following fields: Pediatrics, internal medicine, neurology, immunology, immunotoxicology, neurobiology, rheumatology, epidemiology, biostatistics, and law. The members of the review committee were subject to stringent conflict of interest criteria by the IOM. In addition, the proposed Table changes were developed by HHS workgroups and reviewed by the ACCV, the membership of which, by statute, reflects a variety of stakeholders with different perspectives.
The Secretary is not aware of any reliable and persuasive evidence demonstrating that syncope occurs following administration of a vaccine via a needleless jet device. While it may be plausible for syncope to occur with this route of administration, given the lack of evidence of syncope following administration of a vaccine via a needleless jet device, the Secretary will not include syncope as a Table injury for vaccines that are administered by a needleless jet device at this time. However, this does not preclude a claim alleging syncope after the administration of a vaccine via needleless jet device from being filed with the program as a non-Table injury.
The commenter also stated that the proposed revisions create a restrictive and exclusionary guideline, unfairly discriminating against children and adults born with certain genes or pre-existing conditions which may be triggered or significantly aggravated following vaccination. The Secretary understands these concerns and agrees that individuals should not be disqualified from potentially receiving VICP compensation due to biodiversity and individual susceptibilities. Certain individuals may not meet the QAI definition, as it is impossible to develop a scientifically sound definition that allows for inclusion of every circumstance, particularly those that may arise when unique and sometimes complex pre-vaccination medical conditions exist.
While the initial Table and QAI were based on studies using DTwP vaccine, the acellular (aP) diphtheria, tetanus, and pertussis (DTaP) vaccine has been the primary formulation used in the United States since 1997 when it was recommended for routine use in children younger than 7 years of age. Current DTaP vaccines were developed because of concerns of reactogenicity with whole cell pertussis.
To date, no adequate scientific study has been published that demonstrates a causal relationship between either acellular pertussis vaccines or MMR vaccines and encephalopathy or encephalitis. As a result, in its most recent evaluation of adverse events after vaccines (2012), the IOM found that the evidence was inadequate to accept or reject a causal association between either acellular pertussis containing vaccines or MMR vaccines and encephalopathy or encephalitis. Of the large scale studies that have been conducted on DTaP, none have shown an increased risk of encephalopathy or encephalitis after receiving the DTaP vaccine. Furthermore, these studies have demonstrated a significant reduction in the number of common adverse events with acellular pertussis, such as crying and fevers, and less common ones, such as febrile seizures.
With regard to the MMR vaccine, because natural infection of measles, mumps and/or rubella virus is thought to lead to neurologic illness by damaging neurons through direct viral infection and/or reactivation, it is theorized that the same mechanisms may be responsible for vaccine-associated encephalopathy and encephalitis. However, of the studies examined and described by the IOM in its 2012 report, none identified causality between the MMR vaccine and encephalopathy or encephalitis. Similarly, the IOM concluded that the mechanistic evidence for an association is weak, based on knowledge about natural infection and only a few case reports. Accordingly, the Secretary does not agree that brain inflammation or acute and chronic encephalopathy have been acknowledged as a serious complication of either the DTaP or MMR vaccines. However, for the reasons discussed in the NPRM, the Secretary chose to retain these conditions in the revisions to the Table and QAI.
1. Thimerosal Exposure in Infants and Developmental Disorders: A Retrospective Cohort Study in the United Kingdom Does Not Support a Causal Association by Nick Andrews et al. Pediatrics. September 2004. Vol 114: pp. 584-591.
2. Pervasive Developmental Disorders in Montreal, Quebec, Canada: Prevalence and Links with Immunizations by Eric Frombonne et al. Pediatriacs. July 2006. Vol 118: e139-e150.
3. Association between Thimerosal-Containing Vaccine and Autism by Anders Hviid et al. Journal of the American Medical Association. October 2003. Vol 290: pp. 1763-1766.
4. Immunization Safety Review: Vaccines and Autism. Institute of Medicine. The National Academies Press: 2004.
5. Prenatal and Infant Exposure to Thimerosal from Vaccines and Immunoglobulins and Risk of Autism by Cristofer Price et al. Pediatrics. September 2010. Vol 126: pp. 656-664,
6. Continuing Increases in Autism Reported to California's Developmental Services System by Robert Schechter et al. Archives of General Psychiatry. January 2008. Vol 65: pp. 19-24.
7. Early Thimerosal Exposure and Neuropsychological Outcomes at 7 to 10 Years by William Thompson et al. The New England Journal of Medicine. September 2007. Vol 357: pages 1281-1292.
Executive Order 12866 directs agencies to assess all costs and benefits of available regulatory alternatives and, when rulemaking is necessary, to select regulatory approaches that provide the greatest net benefits (including potential economic, environmental, public health, safety, distributive, and equity effects). In addition, under the Regulatory Flexibility Act, if a rule has a significant economic effect on a substantial number of small entities the Secretary must specifically consider the economic effect of a rule on small entities and analyze regulatory options that could lessen the impact of the rule.
Executive Order 12866 requires that all regulations reflect consideration of alternatives, costs, benefits, incentives, equity, and available information. Regulations must meet certain standards, such as avoiding an unnecessary burden. Regulations that are “significant” because of cost, adverse effects on the economy, inconsistency with other agency actions, effects on the budget, or novel legal or policy issues require special analysis.
The Secretary has determined that no resources are required to implement the requirements in this rule. Compensation will be made in the same manner. This final rule only lessens the burden of proof for potential petitioners. Therefore, in accordance with the Regulatory Flexibility Act of 1980 (RFA), and the Small Business Regulatory Enforcement Act of 1996, which amended the RFA, the Secretary certifies that this rule will not have a significant impact on a substantial number of small entities.
The Secretary has also determined that this final rule does not meet the criteria for a major rule as defined by Executive Order 12866 and would have no major effect on the economy or Federal expenditures. We have determined that the final rule is not a “major rule” within the meaning of the statute providing for Congressional Review of Agency Rulemaking, 5 U.S.C. 801. Similarly, it will not have effects on State, local, and tribal governments and on the private sector such as to require consultation under the Unfunded Mandates Reform Act of 1995.
The provisions of this rule do not, on the basis of family well-being, affect the following family elements: Family safety; family stability; marital commitment; parental rights in the education, nurture and supervision of their children; family functioning; disposable income or poverty; or the behavior and personal responsibility of youth, as determined under section 654(c) of the Treasury and General Government Appropriations Act of 1999.
This rule is not being treated as a “significant regulatory action” as defined under section 3(f) of Executive Order 12866. Accordingly, the rule has not been reviewed by the Office of Management and Budget.
As stated above, this final rule will modify the Vaccine Injury Table and its Qualifications and Aids to Interpretation based on legal authority.
This final rule will have the effect of making it easier for future petitioners alleging injuries that meet the criteria in the Vaccine Injury Table to receive the Table's presumption of causation (which relieves them of having to prove that the vaccine actually caused or significantly aggravated the injury).
This final rule has no information collection requirements.
Biologics, Health insurance, Immunization.
Therefore, for the reasons stated in the preamble, the Department of Health and Human Services amends 42 CFR part 100 as follows:
Secs. 312 and 313 of Public Law 99-660 (42 U.S.C. 300aa-1 note); 42 U.S.C. 300aa-10 to 300aa-34; 26 U.S.C. 4132(a); and sec. 13632(a)(3) of Public Law 103-66.
(a) In accordance with section 312(b) of the National Childhood Vaccine Injury Act of 1986, title III of Public Law 99-660, 100 Stat. 3779 (42 U.S.C. 300aa-1 note) and section 2114(c) of the Public Health Service Act, as amended (PHS Act) (42 U.S.C. 300aa-14(c)), the following is a table of vaccines, the injuries, disabilities, illnesses, conditions, and deaths resulting from the administration of such vaccines, and the time period in which the first symptom or manifestation of onset or of the significant aggravation of such
(b)
(2) In determining whether or not an injury is a condition set forth in paragraph (a) of this section, the Court shall consider the entire medical record.
(3) An idiopathic condition that meets the definition of an illness, disability, injury, or condition set forth in paragraph (c) of this section shall be considered to be a condition set forth in paragraph (a) of this section.
(c)
(1)
(2)
(i)
(
(
(B) For adults and children 18 months of age or older, an acute encephalopathy is one that persists at least 24 hours and is characterized by at least two of the following:
(
(
(
(C) The following clinical features in themselves do not demonstrate an acute encephalopathy or a significant change in either mental status or level of consciousness: Sleepiness, irritability (fussiness), high-pitched and unusual screaming, poor feeding, persistent inconsolable crying, bulging fontanelle, or symptoms of dementia.
(D) Seizures in themselves are not sufficient to constitute a diagnosis of encephalopathy and in the absence of other evidence of an acute encephalopathy seizures shall not be viewed as the first symptom or manifestation of an acute encephalopathy.
(ii)
(A) An underlying condition or systemic disease shown to be unrelated to the vaccine (such as malignancy, structural lesion, psychiatric illness, dementia, genetic disorder, prenatal or
(B) An acute event shown to be unrelated to the vaccine such as a head trauma, stroke, transient ischemic attack, complicated migraine, drug use (illicit or prescribed) or an infectious disease.
(3)
(i)
(A) Evidence of neurologic dysfunction consists of either:
(
(
(B) Evidence of an inflammatory process in the brain (central nervous system or CNS inflammation) must include cerebrospinal fluid (CSF) pleocytosis (>5 white blood cells (WBC)/mm
(
(
(
(ii)
(A) An underlying malignancy that led to a paraneoplastic encephalitis;
(B) An infectious disease associated with encephalitis, including a bacterial, parasitic, fungal or viral illness (such as herpes viruses, adenovirus, enterovirus, West Nile Virus, or human immunodeficiency virus), which may be demonstrated by clinical signs and symptoms and need not be confirmed by culture or serologic testing; or
(C) Acute disseminated encephalomyelitis (ADEM). Although early ADEM may have laboratory and clinical characteristics similar to acute encephalitis, findings on MRI are distinct with ADEM displaying evidence of acute demyelination (scattered, focal, or multifocal areas of inflammation and demyelination within cerebral subcortical and deep cortical white matter; gray matter involvement may also be seen but is a minor component); or
(D) Other conditions or abnormalities that would explain the vaccine recipient's symptoms.
(4)
(ii) For purposes of paragraph (a) of this section, the following shall not be considered to be a Table intussusception:
(A) Onset that occurs with or after the third dose of a vaccine containing rotavirus;
(B) Onset within 14 days after an infectious disease associated with intussusception, including viral disease (such as those secondary to non-enteric or enteric adenovirus, or other enteric viruses such as Enterovirus), enteric bacteria (such as Campylobacter jejuni), or enteric parasites (such as Ascaris lumbricoides), which may be demonstrated by clinical signs and symptoms and need not be confirmed by culture or serologic testing;
(C) Onset in a person with a preexisting condition identified as the lead point for intussusception such as intestinal masses and cystic structures (such as polyps, tumors, Meckel's diverticulum, lymphoma, or duplication cysts);
(D) Onset in a person with abnormalities of the bowel, including congenital anatomic abnormalities, anatomic changes after abdominal surgery, and other anatomic bowel abnormalities caused by mucosal hemorrhage, trauma, or abnormal intestinal blood vessels (such as Henoch Scholein purpura, hematoma, or hemangioma); or
(E) Onset in a person with underlying conditions or systemic diseases associated with intussusception (such as cystic fibrosis, celiac disease, or Kawasaki disease).
(5)
(i) Chronic arthritis may be found in a person with no history in the 3 years prior to vaccination of arthropathy (joint disease) on the basis of:
(A) Medical documentation recorded within 30 days after the onset of objective signs of acute arthritis (joint swelling) that occurred between 7 and 42 days after a rubella vaccination; and
(B) Medical documentation (recorded within 3 years after the onset of acute arthritis) of the persistence of objective signs of intermittent or continuous arthritis for more than 6 months following vaccination; and
(C) Medical documentation of an antibody response to the rubella virus.
(ii) The following shall not be considered as chronic arthritis: Musculoskeletal disorders such as diffuse connective tissue diseases (including but not limited to rheumatoid arthritis, juvenile idiopathic arthritis, systemic lupus erythematosus, systemic sclerosis, mixed connective tissue disease, polymyositis/determatomyositis, fibromyalgia, necrotizing vasculitis and vasculopathies and Sjogren's Syndrome), degenerative joint disease, infectious agents other than rubella (whether by direct invasion or as an immune reaction), metabolic and endocrine diseases, trauma, neoplasms, neuropathic disorders, bone and cartilage disorders, and arthritis associated with ankylosing spondylitis, psoriasis, inflammatory bowel disease, Reiter's Syndrome, blood disorders, or arthralgia (joint pain), or joint stiffness without swelling.
(6)
(i) Pain in the affected arm and shoulder is a presenting symptom and occurs within the specified time-frame;
(ii) Weakness;
(A) Clinical diagnosis in the absence of nerve conduction and electromyographic studies requires weakness in muscles supplied by more than one peripheral nerve.
(B) Nerve conduction studies (NCS) and electromyographic (EMG) studies localizing the injury to the brachial plexus are required before the diagnosis can be made if weakness is limited to muscles supplied by a single peripheral nerve.
(iii) Motor, sensory, and reflex findings on physical examination and the results of NCS and EMG studies, if performed, must be consistent in confirming that dysfunction is attributable to the brachial plexus; and
(iv) No other condition or abnormality is present that would explain the vaccine recipient's symptoms.
(7)
(8)
(9)
(10)
(i) No history of pain, inflammation or dysfunction of the affected shoulder prior to intramuscular vaccine administration that would explain the alleged signs, symptoms, examination findings, and/or diagnostic studies occurring after vaccine injection;
(ii) Pain occurs within the specified time-frame;
(iii) Pain and reduced range of motion are limited to the shoulder in which the intramuscular vaccine was administered; and
(iv) No other condition or abnormality is present that would explain the patient's symptoms (
(11)
(12)
(13)
(14)
(15)
(ii) The most common subtype in North America and Europe, comprising more than 90 percent of cases, is acute inflammatory demyelinating polyneuropathy (AIDP), which has the pathologic and electrodiagnostic features of focal demyelination of motor and sensory peripheral nerves and nerve roots. Another subtype called acute motor axonal neuropathy (AMAN) is generally seen in other parts of the world and is predominated by axonal damage that primarily affects motor nerves. AMAN lacks features of demyelination. Another less common subtype of GBS includes acute motor and sensory neuropathy (AMSAN), which is an axonal form of GBS that is similar to AMAN, but also affects the sensory nerves and roots. AIDP, AMAN, and AMSAN are typically characterized by symmetric motor flaccid weakness, sensory abnormalities, and/or autonomic dysfunction caused by autoimmune damage to peripheral nerves and nerve roots. The diagnosis of AIDP, AMAN, and AMSAN requires:
(A) Bilateral flaccid limb weakness and decreased or absent deep tendon reflexes in weak limbs;
(B) A monophasic illness pattern;
(C) An interval between onset and nadir of weakness between 12 hours and 28 days;
(D) Subsequent clinical plateau (the clinical plateau leads to either stabilization at the nadir of symptoms, or subsequent improvement without significant relapse; however, death may occur without a clinical plateau); and,
(E) The absence of an identified more likely alternative diagnosis.
(iii) Fisher Syndrome (FS), also known as Miller Fisher Syndrome, is a subtype of GBS characterized by ataxia, areflexia, and ophthalmoplegia, and overlap between FS and AIDP may be seen with limb weakness. The diagnosis of FS requires:
(A) Bilateral ophthalmoparesis;
(B) Bilateral reduced or absent tendon reflexes;
(C) Ataxia;
(D) The absence of limb weakness (the presence of limb weakness suggests a diagnosis of AIDP, AMAN, or AMSAN);
(E) A monophasic illness pattern;
(F) An interval between onset and nadir of weakness between 12 hours and 28 days;
(G) Subsequent clinical plateau (the clinical plateau leads to either
stabilization at the nadir of symptoms, or subsequent improvement without significant relapse; however, death may occur without a clinical plateau);
(H) No alteration in consciousness;
(I) No corticospinal track signs; and
(J) The absence of an identified more likely alternative diagnosis.
(iv) Evidence that is supportive, but not required, of a diagnosis of all subtypes of GBS includes electrophysiologic findings consistent with GBS or an elevation of cerebral spinal fluid (CSF) protein with a total CSF white blood cell count below 50 cells per microliter. Both CSF and electrophysiologic studies are frequently normal in the first week of illness in otherwise typical cases of GBS.
(v) To qualify as any subtype of GBS, there must not be a more likely alternative diagnosis for the weakness.
(vi) Exclusionary criteria for the diagnosis of all subtypes of GBS include the ultimate diagnosis of any of the following conditions: chronic immune demyelinating polyradiculopathy (CIDP), carcinomatous meningitis, brain stem encephalitis (other than Bickerstaff brainstem encephalitis), myelitis, spinal cord infarct, spinal cord compression, anterior horn cell diseases such as polio or West Nile virus infection, subacute inflammatory demyelinating polyradiculoneuropathy, multiple sclerosis, cauda equina compression, metabolic conditions such as hypermagnesemia or hypophosphatemia, tick paralysis, heavy metal toxicity (such as arsenic, gold, or thallium), drug-induced neuropathy (such as vincristine, platinum compounds, or nitrofurantoin), porphyria, critical illness neuropathy, vasculitis, diphtheria, myasthenia gravis, organophosphate poisoning, botulism, critical illness myopathy, polymyositis, dermatomyositis, hypokalemia, or hyperkalemia. The above list is not exhaustive.
(d)
(ii) Individuals who return to their baseline neurologic state, as confirmed by clinical findings, within less than 6 months from the first symptom or manifestation of onset or of significant aggravation of an acute encephalopathy or encephalitis shall not be presumed to have suffered residual neurologic damage from that event; any subsequent chronic encephalopathy shall not be presumed to be a sequela of the acute encephalopathy or encephalitis.
(2)
(3)
(4)
(i) Decreased or absent response to environment (responds, if at all, only to loud voice or painful stimuli);
(ii) Decreased or absent eye contact (does not fix gaze upon family members or other individuals); or
(iii) Inconsistent or absent responses to external stimuli (does not recognize familiar people or things).
(5)
(e)
(2) Hepatitis B, Hib, and varicella vaccines (Items VIII, IX, and X of the Table) are included in the Table as of August 6, 1997.
(3) Rotavirus vaccines (Item XI of the Table) are included in the Table as of October 22, 1998.
(4) Pneumococcal conjugate vaccines (Item XII of the Table) are included in the Table as of December 18, 1999.
(5) Hepatitis A vaccines (Item XIII of the Table) are included on the Table as of December 1, 2004.
(6) Trivalent influenza vaccines (Included in item XIV of the Table) are included on the Table as of July 1, 2005. All other seasonal influenza vaccines (Item XIV of the Table) are included on the Table as of November 12, 2013.
(7) Meningococcal vaccines and human papillomavirus vaccines (Items XV and XVI of the Table) are included on the Table as of February 1, 2007.
(8) Other new vaccines (Item XVII of the Table) will be included in the Table as of the effective date of a tax enacted to provide funds for compensation paid with respect to such vaccines. An amendment to this section will be published in the
Bureau of Land Management, Interior.
Final rule.
This rule adjusts the level of civil monetary penalties contained in the Bureau of Land Management's regulations governing onshore oil and gas operations as required by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (the “Act”). The adjustments made by this final rule constitute the annual inflation adjustments contemplated by the Act, and are consistent with applicable Office of Management and Budget (OMB) guidance.
This rule is effective on January 19, 2017.
Steven Wells, Division Chief, Fluid Minerals Division, 202-912-7143, for information regarding the BLM's Fluid Minerals Program. For questions relating to regulatory process issues, please contact Jennifer Noe, Division of Regulatory Affairs, at 202-912-7442. Persons who use a telecommunications device for the deaf (TDD) may call the Federal Information Relay Service (FIRS) at 1-800-877-8339, 24 hours a day, 7 days a week to contact the above individuals.
On November 2, 2015, the President signed the Act into law (Sec. 701 of Pub. L. 114-74). The Act requires agencies to:
1. Adjust the level of civil monetary penalties with an initial “catch-up” adjustment through an interim final rulemaking in 2016;
2. Make subsequent annual adjustments for inflation beginning in 2017; and
3. Report annually in Agency Financial Reports on these inflation adjustments.
In July 2016, the BLM issued an interim final rule that adjusted the level of civil monetary penalties with the initial “catch-up” adjustment, which is reflected in the table below in the “Previous Penalty” column.
With this final rule, the BLM is adjusting civil monetary penalties for inflation. The adjustments made by this rule are consistent with the requirements of the Act and OMB guidance.
The purpose of these adjustments is to maintain the deterrent effect of civil penalties found in existing regulations, in order to further the policy goals of the underlying statutes. The BLM has reviewed its existing regulations and determined that only the civil monetary penalties found at 43 CFR 3163.2 are subject to the Act's requirements.
The adjustments made by this final rule constitute the first annual adjustment contemplated by the Act, and include the following changes to the penalties:
OMB issued guidance on calculating the annual adjustment for 2017 in accordance with the Act.
Executive Order 12866 provides that the Office of Information and Regulatory Affairs in the Office of Management and Budget will review all significant rules. The Office of Information and Regulatory Affairs has determined that this rule is not significant. Executive Order 13563 reaffirms the principles of E.O. 12866 while calling for improvements in the nation's regulatory system to promote predictability, to reduce uncertainty, and to use the best, most innovative, and least burdensome tools for achieving regulatory ends. The executive order directs agencies to consider regulatory approaches that reduce burdens and maintain flexibility and freedom of choice for the public where these approaches are relevant, feasible, and consistent with regulatory objectives. E.O. 13563 emphasizes further that regulations must be based on the best available science, and that the rulemaking process must allow for public participation and an open exchange of ideas. We have developed this rule in a manner consistent with these requirements.
The Regulatory Flexibility Act (RFA) requires an agency to prepare a regulatory flexibility analysis for rules unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. The RFA applies only to rules for which an agency is required to first publish a proposed rule. See 5 U.S.C. 603(a) and 604(a). The Act requires agencies to adjust civil penalties annually for inflation through a final rule (see § 4(b)(2) of the Act). Because the final rule in this case does not include publication of a proposed rule, the RFA does not apply to this final rule.
This rule is not a major rule under 5 U.S.C. 804(2), the Small Business Regulatory Enforcement Fairness Act. This rule:
(a) Does not have an annual effect on the economy of $100 million or more.
(b) Will not cause a major increase in costs or prices for consumers, individual industries, Federal, State, or local government agencies, or geographic regions.
(c) Does not have significant adverse effects on competition, employment, investment, productivity, innovation, or the ability of U.S.-based enterprises to compete with foreign-based enterprises.
This rule will potentially affect individuals and companies who hold leases on Federal or Indian lands. The BLM believes that the vast majority of potentially affected entities will be small businesses as defined by the Small Business Administration. However, the BLM does not believe the rule will pose a significant economic impact on the industry, including any small entities, for two reasons. First, any lessee can avoid being assessed civil penalties by operating in compliance with BLM rules and regulations. Second, payments for penalties adjusted as a result of this rule will be negligible compared with the $23 billion worth of crude oil and natural gas produced from Federal and Indian leases in FY 2015.
This rule does not impose an unfunded mandate on State, local, or tribal governments, or the private sector of more than $100 million per year. The rule does not have a significant or unique effect on State, local, or tribal governments or the private sector. A statement containing the information required by the Unfunded Mandates Reform Act (2 U.S.C. 1531
This rule does not effect a taking of private property or otherwise have takings implications under Executive Order 12630. A takings implication assessment is not required.
Under the criteria in section 1 of Executive Order 13132, this rule does not have sufficient federalism implications to warrant the preparation of a federalism summary impact statement. A federalism summary impact statement is not required.
This rule complies with the requirements of Executive Order 12988. Specifically, this rule:
(a) Meets the criteria of section 3(a) requiring that all regulations be reviewed to eliminate errors and ambiguity and be written to minimize litigation; and
(b) Meets the criteria of section 3(b)(2) requiring that all regulations be written in clear language and contain clear legal standards.
The Department of the Interior strives to strengthen its government-to-government relationship with Indian tribes through a commitment to consultation with Indian tribes and recognition of their right to self-governance and tribal sovereignty. We have evaluated this rule under the Department's consultation policy and under the criteria in Executive Order 13175 and have determined that it has no substantial direct effects on federally recognized Indian tribes and that consultation under the Department's tribal consultation policy is not required.
This rule does not contain information collection requirements, and a submission to OMB under the Paperwork Reduction Act (44 U.S.C. 3501
A detailed statement under the National Environmental Policy Act of 1969 (NEPA) is not required because the rule is covered by a categorical exclusion. This rule is excluded from the requirement to prepare a detailed statement because it is a regulation of an administrative nature. (For further information see 43 CFR 46.210(i).) We have also determined that the rule does not involve any of the extraordinary circumstances listed in 43 CFR 46.215 that would require further analysis under NEPA.
This rule is not a significant energy action under the definition in Executive Order 13211. Therefore, a Statement of Energy Effects is not required.
The BLM is promulgating this rule as a final rule because the Act expressly directs us to do so. In accordance with the Act, agencies must adjust civil monetary penalties notwithstanding Section 553 of the Administrative Procedure Act (APA) (see § 4(b)(2) of the Act). This means that the notice and opportunity to comment procedures of the APA do not apply and are not required for agencies to issue regulations implementing the annual adjustment. In addition, since the Act does not give the BLM any discretion to vary the amount of the annual inflation adjustment for any given penalty to reflect any views or suggestions provided by commenters, it would serve no purpose to provide an opportunity for public comment on this rule.
Administrative practice and procedure; Government contracts; Indians-lands; Mineral royalties; Oil and gas exploration; Penalties; Public lands-mineral resources; Reporting and recordkeeping requirements.
For the reasons given in the preamble, the BLM amends Chapter II of Title 43 of the Code of Federal Regulations as follows:
25 U.S.C. 396d and 2107; 30 U.S.C. 189, 306, 359, and 1751; 43 U.S.C. 1732(b), 1733, 1740; and Sec. 107, Pub. L. 114-74, 129 Stat. 599, unless otherwise noted.
Fish and Wildlife Service, Interior.
Final rule.
The U.S. Fish and Wildlife Service (Service or we) is issuing this final rule, in accordance with the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (Inflation Adjustment Act) and Office of Management and Budget (OMB) guidance, to adjust for inflation the statutory civil monetary penalties that may be assessed for violations of Service-administered statutes and their implementing regulations. We are required to adjust civil monetary penalties annually for inflation according to a formula specified in the Inflation Adjustment Act. This rule replaces the previously issued amounts with the updated amounts after using the 2017 inflation adjustment multiplier provided in the OMB guidance.
This rule is effective January 19, 2017.
This rule may be found on the internet at
Paul Beiriger, Special Agent in Charge, Branch of Investigations, U.S. Fish and Wildlife Service, Office of Law Enforcement, (703) 358-1949.
The regulations in title 50 of the Code of Federal Regulations at 50 CFR part 11 provide uniform rules and procedures for the assessment of civil penalties resulting from violations of certain laws and regulations enforced by the Service.
On November 2, 2015, the President signed into law the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (sec. 701 of Pub. L. 114-74) (Inflation Adjustment Act). The Inflation Adjustment Act requires Federal agencies to adjust the
Under section 4 of the Federal Civil Penalties Inflation Adjustment Act of 1990, 28 U.S.C. 2461 note, as amended by the Inflation Adjustment Act, Pub. L. 114-74, 129 Stat. 584 (2015), each Federal agency is required to issue regulations adjusting for inflation the statutory civil monetary penalties (civil penalties) that can be imposed under the laws administered by that agency. The Inflation Adjustment Act provided for an initial “catch up adjustment” to take effect no later than August 1, 2016, followed by subsequent adjustments to be made no later than January 15 every year thereafter. This final rule adjusts the civil penalty amounts that may be imposed pursuant to each statutory provision beginning on the date specified above in DATES.
On June 28, 2016, the Service published in the
OMB issued a memorandum, M-17-11, entitled “Implementation of the 2017 annual adjustment pursuant to the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015,” which provides the cost-of-living adjustment multiplier for 2017: 1.01636. Therefore, we multiplied each penalty in the table published in the interim rule on June 28, 2016 (81 FR 41862), by 1.01636 to obtain the 2017 annual adjustment. The new amounts are reflected in the table in the rule portion of this document and replace the current amounts in 50 CFR 11.33.
In this final rule, we are affirming our required determinations made in the June 28, 2016, interim rule (81 FR 41862); for descriptions of our actions to ensure compliance with the following statutes and Executive Orders, see that rule:
As stated above, under section 4 of the Federal Civil Penalties Inflation Adjustment Act of 1990, 28 U.S.C. 2461 note, as amended by the Inflation Adjustment Act, Pub. L. 114-74, 129 Stat. 584 (2015), each Federal agency is required to issue regulations adjusting for inflation the statutory civil monetary penalties that can be imposed under the laws administered by that agency. The Inflation Adjustment Act provided for an initial “catch up adjustment” to take effect no later than August 1, 2016, followed by subsequent adjustments to be made no later than January 15 every year thereafter. This final rule adjusts the civil penalty amounts that may be imposed pursuant to each statutory provision beginning on the effective date of this rule. To comply with the Inflation Adjustment Act, we are issuing these regulations as a final rule.
Section 553(b) of the Administrative Procedure Act (5 U.S.C. 551
Administrative practice and procedure, Exports, Fish, Imports, Penalties, Plants, Transportation, Wildlife.
For the reasons described above, we amend part 11, subchapter B of chapter I, title 50 of the Code of Federal Regulations as set forth below.
16 U.S.C. 470aa-470mm, 470aaa-470aaa-11, 668-668d, 1361-1384, 1401-1407, 1531-1544, 3371-3378, 4201-4245, 4901-4916, 5201-5207, 5301-5306; 18 U.S.C. 42-43; 25 U.S.C. 3001-3013; and Sec. 107, Pub. L. 114-74, 129 Stat. 599, unless otherwise noted.
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Final rule.
We, NMFS, issue a final rule to list two foreign marine guitarfish species under the Endangered Species Act (ESA). We considered comments submitted on the proposed listing rule and have determined that the blackchin guitarfish (
This final rule is effective February 21, 2017.
Chief, Endangered Species Division, NMFS Office of Protected Resources (F/PR3), 1315 East West Highway, Silver Spring, MD 20910.
Brendan Newell or Marta Nammack NMFS, Office of Protected Resources (OPR), (301) 427-8403.
On July 15, 2013, we received a petition from WildEarth Guardians to list 81 marine species or subpopulations as threatened or endangered under the ESA. This petition included species from many different taxonomic groups, and we prepared our 90-day findings in batches by taxonomic group. We found that the petitioned actions may be warranted for 24 of the species and 3 of the subpopulations and announced the initiation of status reviews for each of the 24 species and 3 subpopulations (78 FR 63941, October 25, 2013; 78 FR 66675, November 6, 2013; 78 FR 69376, November 19, 2013; 79 FR 9880, February 21, 2014; and 79 FR 10104, February 24, 2014). On September 19, 2016, we published a proposed rule to list the blackchin guitarfish (
We are responsible for determining whether species are threatened or endangered under the ESA (16 U.S.C. 1531
Section 3 of the ESA defines an endangered species as “any species which is in danger of extinction throughout all or a significant portion of its range” and a threatened species as one “which is likely to become an endangered species within the foreseeable future throughout all or a significant portion of its range.” We interpret an “endangered species” to be one that is presently in danger of extinction. A “threatened species,” on the other hand, is not presently in danger of extinction, but is likely to become so in the foreseeable future (that is, at a later time). In other words, the primary statutory difference between a threatened and endangered species is the timing of when a species may be in danger of extinction, either presently (endangered) or in the foreseeable future (threatened).
When we consider whether a species might qualify as threatened under the ESA, we must consider the meaning of the term “foreseeable future.” It is appropriate to interpret “foreseeable future” as the horizon over which predictions about the conservation status of the species can be reasonably relied upon. The foreseeable future
Section 4(a)(1) of the ESA requires us to determine whether any species is endangered or threatened due to any of the following factors: The present or threatened destruction, modification, or curtailment of its habitat or range; overutilization for commercial, recreational, scientific, or educational purposes; disease or predation; the inadequacy of existing regulatory mechanisms; or other natural or manmade factors affecting its continued existence. Under section (4)(b)(1)(A), we are also required to make listing determinations based solely on the best scientific and commercial data available, after conducting a review of the species' status and after taking into account efforts being made by any state or foreign nation to protect the species.
In making a listing determination, we first determine whether a petitioned species meets the ESA definition of a “species.” Next, using the best available information gathered during the status review for the species, we complete a status and extinction risk assessment. In assessing extinction risk for these two guitarfishes, we considered the demographic viability factors developed by McElhany
We then assess efforts being made to protect the species to determine if these conservation efforts are adequate to mitigate the existing threats. Section 4(b)(1)(A) of the ESA requires the Secretary, when making a listing determination for a species, to take into consideration those efforts, if any, being made by any State or foreign nation to protect the species.
In response to our request for comments on the proposed rule, we received five comment letters. Two comment letters were from foreign governments and clarified information about their relevant regulations. One comment letter was from an environmental nonprofit organization supporting our proposed listing decision. Two comment letters were submitted anonymously, each challenging a number of our statements or conclusions in the status review or proposed rule, generally without providing references or evidence that would allow us to investigate further. One commenter also provided some editorial comments, which were incorporated in the status review as appropriate. Summaries of issues raised by the public comments received and our responses are provided below, with references where appropriate.
To reach these conclusions we searched for data and publications related to both species, and guitarfishes in general, in all of the countries and seas that are considered part of either species' historical range. In the status review, we considered and incorporated the best available information, which included peer reviewed scientific articles, regional checklists of ichthyofauna, studies of fishers' knowledge, reports from conservation organizations (
We were already aware of Seck
To specifically address some of the commenter's points about guitarfish, regarding point (6), while both the guitarfish and the angelsharks face threats from commercial fishing, it is not appropriate to directly compare the fishing related threats these species face. For example, the fin trade has contributed to the decline of the guitarfishes but is not a direct threat to the angelsharks, while historical commercial fishing pressure on angelsharks has already made these species so rare that they can no longer support fisheries in most areas. Regarding points (5) and (7), the commenter provided no references to verify the assertions about the two guitarfishes' population structures or abundance throughout their respective ranges or the presence of guitarfish in the Canary Islands, so we are unable to determine the validity of any data upon which the commenter based these assertions. As such, without any new information to consider, we maintain our previous conclusion in the proposed rule that the two guitarfish species are likely to be in danger of extinction in the foreseeable future throughout their ranges and, thus, are threatened species under the ESA.
Additionally, we also wish to clarify some of the information presented for
Response: The commenter provided no references regarding any of these regulations. We found no information about Turkish laws relevant to guitarfishes or sharks and rays in general and the General Fisheries Commission for the Mediterranean National Legislation Database (available at:
As discussed in the status review, fishing for all shark species, including guitarfishes, has been banned since 2003 in Banc d'Arguin National Park. Additional information on regulatory efforts from 1998 to 2003 has been added to the
The fact that Nigeria prohibits the dumping of shark carcasses at sea has also been added to the
We reviewed, and incorporated as appropriate, scientific data from references that were not previously included in the draft status review (Newell 2016) and proposed rule (81 FR 64094; September 19, 2016). We included the following references and communications, which, together with previously cited references, represent the best available scientific and commercial data on
The status review for both guitarfish species was conducted by a NMFS biologist in the Office of Protected Resources. In order to complete the status review, we compiled information on the species' biology, ecology, life history, threats, and conservation status from information contained in the petition, our files, a comprehensive literature search, and consultation with experts. Prior to publication of the proposed rule, the status review was subjected to peer review. Peer reviewer comments are available at
We considered whether any one or a combination of the five threat factors specified in section 4(a)(1) of the ESA contribute to the extinction risk of these species. The comments that we received on the proposed rule and the additional information that became available since the publication of the proposed rule did not change our conclusions regarding any of the section 4(a)(1) factors or their interactions for these species. Therefore, we incorporate herein all information, discussion, and conclusions on the summary of factors affecting the two guitarfish species in the status review (Newell 2016) and proposed rule (81 FR 64094; September 19, 2016).
None of the information we received from public comment on the proposed rule affected our extinction risk evaluations of these two guitarfish species. Therefore, we incorporate herein all information, discussion, and conclusions, with the minor updates noted above, on the extinction risk of the two guitarfish species in the status review (Newell 2016) and proposed rule (81 FR 64094; September 19, 2016).
As part of our evaluation of the status of the guitarfishes, we considered conservation efforts to protect each species and evaluated whether these conservation efforts are adequate to mitigate the existing threats to the point where extinction risk is significantly lowered and the species' status is improved. None of the information we received from public comment on the proposed rule affected our conclusions regarding conservation efforts to protect the two guitarfish species. We incorporate herein all information, discussion, and conclusions on the protective efforts for both guitarfish species in the status review (Newell 2016) and proposed rule (81 FR 64094; September 19, 2016).
There is significant uncertainty regarding the status of the current populations of both
Conservation measures provided for species listed as threatened under the ESA include recovery actions (16 U.S.C. 1533(f)); Federal agency requirements to consult with NMFS under section 7 of the ESA to ensure their actions do not jeopardize the species or result in adverse modification or destruction of critical habitat should it be designated (16 U.S.C. 1536); designation of critical habitat if prudent and determinable (16 U.S.C. 1533(a)(3)(A)); and prohibitions on taking (16 U.S.C. 1538) through a rule promulgated under section 4(d). In addition, recognition of the species' plight through listing promotes conservation actions by Federal and State agencies, foreign entities, private groups, and individuals.
Section 7(a)(2) (16 U.S.C. 1536(a)(2)) of the ESA and NMFS/USFWS regulations require Federal agencies to consult with us to ensure that activities they authorize, fund, or carry out are not likely to jeopardize the continued existence of listed species or destroy or adversely modify critical habitat. It is unlikely that the listing of these species under the ESA will increase the number of section 7 consultations, because these species occur entirely outside of the United States and are unlikely to be affected by Federal actions.
Critical habitat is defined in section 3 of the ESA (16 U.S.C. 1532(5)) as: (1) The specific areas within the geographical area occupied by a species, at the time it is listed in accordance with the ESA, on which are found those physical or biological features (a) essential to the conservation of the species and (b) that may require special management considerations or protection; and (2) specific areas outside the geographical area occupied by a species at the time it is listed upon a determination that such areas are essential for the conservation of the species. Section 4(a)(3)(A) of the ESA (16 U.S.C. 1533(a)(3)(A)) requires that, to the extent prudent and determinable, critical habitat be designated concurrently with the listing of a species. However, critical habitat shall not be designated in foreign countries or other areas outside U.S. jurisdiction (50 CFR 424.12 (g)).
The best available scientific and commercial data as discussed above identify the geographical areas occupied
On July 1, 1994, NMFS and FWS published a policy (59 FR 34272) that requires NMFS to identify, to the maximum extent practicable at the time a species is listed, those activities that would or would not constitute a violation of section 9 of the ESA. Because we are listing
We are listing
A complete list of references used in this final rule is available upon request (see
The 1982 amendments to the ESA, in section 4(b)(1)(A), restrict the information that may be considered when assessing species for listing. Based on this limitation of criteria for a listing decision and the opinion in
As noted in the Conference Report on the 1982 amendments to the ESA, economic impacts cannot be considered when assessing the status of a species. Therefore, the economic analysis requirements of the Regulatory Flexibility Act are not applicable to the listing process. In addition, this final rule is exempt from review under Executive Order 12866. This final rule does not contain a collection-of-information requirement for the purposes of the Paperwork Reduction Act.
In accordance with E.O. 13132, we determined that this final rule does not have significant federalism effects and that a federalism assessment is not required.
Endangered and threatened species, Exports, Imports, Transportation.
For the reasons set out in the preamble, 50 CFR part 223 is amended as follows:
16 U.S.C. 1531-1543; subpart B, § 223.201-202 also issued under 16 U.S.C. 1361
(e) * * *
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Final rule.
This final rule interprets and provides guidance on the requirement of the Magnuson-Stevens Fishery Conservation and Management Act (MSA) that all fishery management plans (FMPs), with respect to any fishery, establish a standardized reporting methodology to assess the amount and type of bycatch occurring in a fishery. The final rule establishes requirements and provides guidance to regional fishery management councils and the Secretary of Commerce regarding the development, documentation, and review of such methodologies, commonly referred to as Standardized Bycatch Reporting Methodologies (SBRMs).
Effective February 21, 2017.
Copies of the Categorical Exclusion/Regulatory Impact Review (RIR)/Final Regulatory Flexibility Act Analysis (FRFAA) prepared for this action can be obtained from: Karen Abrams, National Marine Fisheries Service, 1315 East West Highway, Room 13461, Silver Spring, MD 20910. An electronic copy of the CE/RIR/RFAA documents as well as copies of public comments received can be viewed at the Federal e-rulemaking portal:
Karen Abrams, 301-427-8508, or by email:
Section 303(a)(11) of the Magnuson-Stevens Fishery Conservation and Management Act (MSA) requires that any fishery management plan (FMP) prepared by a regional fishery management council (Council) or the Secretary of Commerce with respect to any fishery establish a standardized reporting methodology to assess the amount and type of bycatch occurring in the fishery, and include conservation and management measures that, to the extent practicable, minimize bycatch and bycatch mortality (16 U.S.C. 1853(a)(11)).
Section 303(a)(11) was added to the MSA by the Sustainable Fisheries Act of 1996 (SFA). The MSA does not define “standardized reporting methodology” or any of the words contained within the phrase. Similar to section 303(a)(11), National Standard 9 (NS9) (16 U.S.C. 1851(a)(9)) requires that conservation and management measures “shall, to the extent practicable, (A) minimize bycatch and (B) to the extent bycatch cannot be avoided, minimize the mortality of such bycatch.” However, NS9 does not address SBRM.
Prior to this rulemaking, NMFS never issued regulations that set forth the basic requirements of the SBRM provision. To implement the 1996 SFA Amendments, NMFS developed NS9 guidelines in 1998, and amended these guidelines in 2008.
Additional background information—including NMFS' rationale for developing this rule, statutory and historical background, and the purpose and scope of the rule—can be found in the proposed rule that published on February 25, 2016 (81 FR 9413). Copies are available from NMFS (
Separate from this rulemaking, which solely addresses reporting methodologies for bycatch as defined under the MSA, NMFS has engaged in a broad range of activities since the 1970s to address its bycatch-related responsibilities under the MSA, the Marine Mammal Protection Act (MMPA), the Endangered Species Act (ESA), and other relevant statutes and international agreements. More specifically, NMFS, the Councils, and multiple partners have implemented management measures to minimize bycatch and bycatch mortality in fisheries (
Section 600.1600 explains the purpose and scope of an SBRM and § 600.1610 clarifies the requirements for establishing and reviewing SBRMs. The rule requires that an FMP identify the required procedure or procedures that constitute the SBRM for the fishery. The rule also requires that the FMP, or fisheries research plan authorized under 16 U.S.C. 1862, explain how the SBRM meets the purpose described under § 600.1600, based on an analysis of (1) the characteristics of the bycatch occurring in the fishery, (2) the feasibility of the methodology from cost, technical and operational perspectives, (3) the uncertainty of the data resulting from the methodology, and (4) how the data resulting from the methodology are used to assess the amount and type of bycatch occurring in the fishery. Finally, the rule provides that a Council should give guidance to NMFS on how to adjust the implementation of the SBRM consistent with the FMP, and requires periodic reviews of SBRMs.
Below is further explanation of the major aspects of the final rule. In addition to streamlining the final rule to improve clarity and organization, NMFS has made several changes in the final rule to respond to public comments. The changes are discussed below and in sections II (Response to Comments) and III (Changes from Proposed Action) of this preamble.
Establishing an SBRM is a requirement of the MSA. Therefore, this rule is based on the MSA's definition of “bycatch,” which includes fish which are harvested in a fishery, but which are not sold or kept for personal use, and includes economic discards and regulatory discards. Such term does not include fish released alive under a recreational catch and release fishery management program. 16 U.S.C. 1802(2). NMFS' NS9 guidelines clarify that “[a] catch-and-release fishery management program is one in which the retention of a particular species is prohibited. In such a program, those fish released alive would not be considered bycatch.” 50 CFR 600.350(c)(2). NMFS received several comments on the rule's definition of “bycatch.” To clarify its intent to rely on the MSA's definition of “bycatch,” NMFS has revised the final rule at § 600.1605(b) to add reference to the MSA definition. Summaries of the comments received on the definition of bycatch and NMFS' responses may be found in section II (Response to Comments) of this preamble.
Based on the statutory language of section 303(a)(11) of the MSA, the final rule clarifies in § 600.1600 that the purpose of an SBRM is to collect, record, and report bycatch data in a fishery that, in conjunction with other information, are used to assess the amount and type of bycatch occurring in the fishery and inform the development of conservation and management measures that, to the extent practicable, minimize bycatch and bycatch mortality. Consistent with this purpose, § 600.1605(a) defines “standardized reporting methodology” with reference to procedures used to collect, record, and report bycatch data in a fishery. Section 600.1605(a) clarifies that bycatch assessment procedures are not part of an SBRM, and thus do not need to be described as part of the methodology in an FMP. A Council may include such a description if it so chooses and could provide this description by incorporating by reference information from a Stock Assessment and Fishery Evaluation (SAFE) report or other documents.
As explained in the proposed rule (
While recognizing the distinction between data collection and bycatch assessment, NMFS affirms the important linkage between these activities. To reinforce this link, NMFS has revised § 600.1610(a)(2)(iv) to require a Council to address how the data resulting from an SBRM are used to assess the amount and type of bycatch in the fishery and to consult with its Science and Statistical Committee (SSC) and/or regional NMFS science centers on SBRM design considerations (
Section 303(a)(11) requires that “Any fishery management plan . . . with respect to any fishery, shall . . . establish a standardized reporting methodology to assess the amount and type of bycatch occurring in the fishery.” 16 U.S.C. 1853(a)(11). Section 303(a)(11) does not require regional or national standardization; rather, the requirement to establish a standardized reporting methodology applies to each FMP with respect to any fishery managed under it. Consistent with the statutory language, this rule defines “standardized reporting methodology” as an established, consistent procedure or procedures used to collect, record, and report bycatch data in a
A Council establishes the SBRM based on the requirements outlined in this rule and the purpose of an SBRM (
Section 600.1610(a)(1) requires every FMP to identify the required procedure or procedures that constitute the SBRM for the fishery. Such procedures may include, but are not limited to, observer programs, electronic monitoring and reporting technologies, and self-reported mechanisms. This rule does not prescribe the use of particular procedures.
Section 600.1610(a)(1) also requires Councils to explain in an FMP, or a fishery research plan authorized under 16 U.S.C. 1862, how the SBRM meets the purpose described in § 600.1600, based on an analysis of requirements (set forth in § 600.1610(a)(2) and described below). The FMP, or fishery research plan under 16 U.S.C. 1862, may reference analyses and information in other FMPs, FMP amendments, SAFE reports, or other documents. Consistent with current practices, the rule encourages Councils to work together and collaborate on SBRMs for fisheries that operate across multiple jurisdictions, as appropriate.
NMFS amended the final rule to refer to 16 U.S.C. 1862, a provision that authorizes the North Pacific Fishery Management Council to prepare a fisheries research plan for any fishery under its jurisdiction (except salmon) that requires observers and establishes a system of fees to pay for the costs of implementing the plan. The North Pacific Council has established a fisheries research plan that requires an observer program as authorized under 16 U.S.C. 1862, and the program constitutes the SBRM for the fisheries covered thereunder. Given that, this rule allows the North Pacific Council to explain in its fisheries research plan how the SBRM for those fisheries meets the statutory purpose of an SBRM.
Finally, § 600.1610(a)(1) explains that, in addition to proposing regulations necessary to implement the standardized reporting methodology, a Council should provide in an FMP, or a fishery research plan authorized under 16 U.S.C. 1862, guidance to NMFS on how to adjust implementation of the methodology consistent with the FMP. That section cites to the National Standard 6 guidelines (50 CFR 600.335), which provide guidance on taking variations and contingencies into account. NMFS notes that, to the extent that adjustments are needed to an SBRM beyond what is established in an FMP, an FMP amendment would be required. This text in § 600.1610(a)(1) replaces § 600.1610(c) (adaptable implementation) because public comments expressed confusion over that proposed provision. NMFS reiterates that every FMP must establish an SBRM. NMFS did not intend to imply otherwise in the proposed § 600.1610(c) (at 81 FR 9413, February 25, 2016). Rather, NMFS' intent in the proposed § 600.1610(c) (at 81 FR 9413, February 25, 2016), and now in § 600.1610(a)(1), is to recognize that fisheries management occurs in a highly variable environment and there are numerous biological, social, and economic variables that may affect the operational aspects of implementing data collection and reporting programs that constitute an SBRM. In light of this, NMFS strongly recommends that Councils provide direction, as needed, to NMFS about how to adjust the implementation of an SBRM consistent with the FMP. NMFS believes that its approach in § 600.1610(a) will promote efficiency and transparency by encouraging a Council to consider implementation and operational issues up-front during the development of an SBRM.
MSA section 303(a)(11) requires that FMPs establish SBRMs, but beyond the fact that an SBRM must meet its statutory purpose, section 303(a)(11) provides no other guidance on the considerations that should go into developing an SBRM. Therefore, NMFS has discretion to interpret section 303(a)(11) and establish reasonable considerations and requirements. Based on NMFS' experience with implementing section 303(a)(11), and taking into consideration public comment on the proposed rule, this final rule requires that all Councils conduct a fishery-specific analysis that addresses the following when establishing or reviewing an SBRM: (1) The characteristics of the bycatch occurring in the fishery, (2) the feasibility of the methodology from cost, technical and operational perspectives, (3) the uncertainty of the data resulting from the methodology, and (4) how the data resulting from the methodology are used to assess the amount and type of bycatch occurring in the fishery. The first and second requirements were included in the proposed rule and have been revised minimally in response to comments. With respect to the third and fourth requirements, NMFS has, in response to public comments, clarified and elaborated upon the proposed requirement that a Council address “the quality of the data associated with the methodology” (
In response to comments, NMFS has removed text that required consideration of the conservation and management objectives regarding bycatch in the fishery (
Section 600.1610(a)(2)(i) provides that a Council must address information about the characteristics of bycatch in the fishery when available, including, but not limited to, the amount of bycatch occurring in the fishery, the importance of bycatch in estimating the fishing mortality of fish stocks, and the effect of bycatch on ecosystems. Section 600.1610(a)(2)(i) recognizes that the amount and type of bycatch occurring in the fishery may vary based on different fishing activities and operations. Bycatch can be affected by several aspects of a fishery, including gear types used, how gear is deployed, gear selectivity, fishing effort, fishing locations, and existing management measures. A Council may consider these operational aspects when selecting the collection, monitoring, and reporting procedures that constitute the SBRM for a fishery.
Section 600.1610(a)(2)(ii) requires that the implementation of an SBRM be feasible from cost, technical, and operational perspectives. Data collection, reporting, and recording procedures can be expensive, logistically challenging to design and implement, involve new and cutting-edge technologies, and necessitate the consideration of the safety of human life at sea. Having carefully considered public comments, NMFS continues to believe that it is reasonable and appropriate for a Council to analyze issues of feasibility when establishing or reviewing an SBRM and to ultimately choose a methodology that is in fact feasible (
Proposed § 600.1610(a)(2)(i) at 81 FR 9413, February 25, 2016, would have required SBRMs to be designed to be implemented with available funding. In response to comments, NMFS has deleted this provision.
As an example, NMFS notes that the resources available for observer programs may vary from year to year. To address this variability in resources, the North Pacific Council uses an Annual Deployment Plan, a component of its fisheries research plan authorized under 16 U.S.C. 1862, to describe how NMFS and the Council will annually deploy observers given changes in funding, costs, and effort consistent with the FMP. As another example, in New England and the Mid Atlantic, if the available funding is insufficient to meet the SBRM performance standard, the SBRM Omnibus Amendment for New England and Mid-Atlantic fisheries (80 FR 37182, June 30, 2015) (currently the subject of litigation) establishes a non-discretionary formulaic process for prioritizing how the available observer sea-days would be allocated to maximize the effectiveness of the SBRM. NMFS reiterates that, regardless of resource constraints, all FMPs must establish an SBRM that meets the purpose described in § 600.1600.
Section 600.1610(a)(2)(iii) requires Councils to address the uncertainty of the data resulting from the SBRM. This section also requires that an SBRM be designed so that the uncertainty associated with the resulting bycatch data can be described, quantitatively or qualitatively. Eliminating data uncertainty is not an end in itself, but the rule recognizes that Councils should seek to minimize uncertainty in the resulting data, recognizing that different degrees of uncertainty may be appropriate for different fisheries.
4. NMFS received numerous public comments requesting that the final rule include specific standards for accuracy, precision, or statistical reliability of bycatch estimates and data.
Section 600.1610(a)(2)(iv) requires a Council to address how the data resulting from an SBRM are used to assess the amount and type of bycatch occurring in the fishery. As explained in the “Purpose of the SBRM” section above, this provision was added in part to clarify and reinforce the link between an SBRM and the assessment of bycatch data. Section 600.1605(a) clarifies that, although bycatch assessment is not part of the SBRM, bycatch assessment must be considered as described in this provision.
Section 600.1610(a)(2)(iv) also incorporates the consultation provision of the proposed rule's § 600.1610(b) (81 FR 9413, February 25, 2016). NMFS received comments during the public comment period asking the agency to clarify the consultation process. In response to comments (
Finally, § 600.1610(a)(2)(iv) requires Councils to consider the scientific methods and techniques available to collect, record, and report bycatch data that could improve the quality of bycatch estimates. As bycatch data collection technologies improve, NMFS anticipates that a Council will consider those technological advances when establishing and reviewing SBRMs in accordance with the review timeline specified in § 600.1610(b).
Section 600.1610(b) states that all FMPs must be consistent with this rule within 5 years of its effective date. To verify consistency with this rule, Councils, in coordination with NMFS, must conduct a review of their existing SBRMs. The review should provide
There are several potential outcomes of the review. NMFS could determine that there are FMPs with existing SBRMs that are consistent with this rule, in which case no FMP amendments would be necessary. Other FMPs may describe SBRMs more expansively than the definition in this final rule. For example, they may contain components that are consistent with this rule, along with additional components that are not precluded by this rule, but are not minimally required. Those FMPs also may not require further amendments if NMFS determines they are consistent with this rule. Still other FMPs may describe procedures or activities that comprise an SBRM, but do not explain them in a manner consistent with this rule. In such cases, changes to an FMP, or a fisheries research plan, may be warranted. Consistent with current practices, NMFS encourages Councils to work together and collaborate on SBRM reviews and potential FMP amendments for fisheries that operate across multiple jurisdictions, as appropriate.
After the initial review, Councils, in coordination with NMFS, should periodically review SBRMs to verify continued compliance with the MSA and this rule. Such a review should be conducted at least once every 5 years. Section 600.1610(b) is consistent with the review and improvement of data collection methods, data sources, and applications described under the NS9 guidelines at 50 CFR 600.350(d)(1).
NMFS solicited public comments on the proposed rule for 60 days (February 25 through April 25, 2016), and during that time made presentations to four of the eight Councils and the Highly Migratory Species Advisory Panel. NMFS received 25 substantive comment letters on the proposed rule during the public comment period. Of those, six were form letters that had 65,961 signatures, and 1,382 of those signatories provided individualized add-on comments. The other 19 substantive comment letters were from non-governmental organizations, industry groups/commissions, Councils, and individuals. Summaries of the substantive comments that we received concerning the proposed rule, and our responses to all of the significant issues they raise, are provided below. Comments of a similar nature were grouped together where appropriate.
This rule does not preclude Councils from developing programs to collect, record, and report information about marine mammal mortality and injury and seabird interactions or unintentional mortality; however, the MSA does not require Councils to do so to be in compliance with the requirements of section 303(a)(11). Marine mammals are protected under the Marine Mammal Protection Act, 16 U.S.C. 1361
NMFS also notes that the National Bycatch Report and its Updates provide a compilation of bycatch information and national and regional overviews to document bycatch in fisheries over time. They are not, however, used for day-to-day management of fisheries. The 2011 First Edition of the Report used data available in 2005, Update 1 (2013) used 2010 data, and Update 2 (2016) used 2011-2013 data. U.S. National Bycatch Report, First Edition Update 2 (February 2016) at p. 9 (
NMFS agrees that release mortality is an important issue, and the agency has taken steps to understand and address this issue. In August 2014, NMFS published a Technical Memorandum entitled
NMFS does not agree that this rule will make it more difficult to assess the bycatch of species between fisheries or within multispecies fisheries; compare or combine data across fisheries or regions; understand ecosystem, regional, or national bycatch trends; or minimize bycatch. Unit conversion is a standard approach to dealing with data disparities. The agency routinely compiles data from varied sources and uses mathematical conversions and analytical tools to understand the data at the necessary scale.
With regard to gear type, as discussed in the preamble (
With respect to the National Bycatch Report, NMFS reiterates that the Report is not required under the MSA. Nevertheless, since 2011, NMFS has issued a National Bycatch Report and its Updates that provide a national- and regional-level look at bycatch.
NMFS recognizes that some district courts have described the SBRM requirement as a bycatch assessment methodology or have asserted that section 303(a)(11) requires the assessment of bycatch in the fishery.
Estimating or assessing bycatch often requires a variety of highly technical data that can vary based on fishery, region of the country, and type of bycatch involved. Relevant data may come from observer program databases, logbooks, commercial landings databases, the NMFS Marine Recreational Information Program database, or other sources. As explained in the preamble of the proposed rule (81 FR 9413, February 25, 2016), a variety of different models or approaches may be used to synthesize these data to assess, evaluate, or estimate bycatch. Given that the assessment/estimating of
Uncertainty in data is a reality of fisheries management.
Best scientific information available includes, but is not limited to, models, data, analyses, and scientific assessments, and new scientific findings constantly advance the state of knowledge.
NMFS notes that SBRMs (16 U.S.C. 1853(a)(11)) and ACLs/AMs (16 U.S.C. 1853(a)(15)) are separate statutory requirements, which should not be conflated.
Under the MSA, Councils are in the first instance responsible for developing FMPs and addressing mandatory FMP requirements, including SBRMs. NMFS has a seat on each Council. NMFS will use its regular procedures for approval of FMPs and FMP amendments to ensure that FMPs and their implementing regulations are consistent with the MSA and other applicable laws. NMFS notes that MSA section 304(c) specifically addresses when NMFS may prepare an FMP.
In this final rule, however, NMFS is not establishing national standards for precision, accuracy, or reliability of bycatch estimates or data. NMFS clarifies in this rule that Councils should seek to minimize uncertainty in the resulting data, recognizing that different degrees of data uncertainty may be appropriate for different fisheries. However, the specific characteristics of each fishery and its bycatch vary widely from region to region and from fishery to fishery. NMFS believes that it is important for Councils to address the characteristics of bycatch in a particular fishery and also address data use, data uncertainty, and feasibility considerations in the context of that fishery. To ensure robust scientific advice in establishing or reviewing SBRMs, § 600.1610(a)(2)(iv) requires a Council to consult with its SSC and/or regional NMFS science centers on reporting methodology design considerations, such as data elements, sampling designs, sample sizes and reporting frequency, all of which contribute to the level of data quality.
The SBRM provision in section 303(a)(11) of the MSA does not specify reliability, accuracy, precision, or other qualifiers regarding bycatch data or estimates. NMFS recognizes that some courts have addressed bycatch estimates or the quality of data in the context of particular FMPs or amendments.
NMFS disagrees that the rule would result in data that is contrary to the NS2 guidelines. NS2 requires that conservation and management measures be based on the best scientific information available. 16 U.S.C. 1851(a)(2). It does not require NMFS to produce statistically reliable data or data that achieves a particular level of precision for the bycatch estimates. In fact, the NS2 guidelines recognize that there may be data limitations in different fisheries.
The NS2 and NS9 guidelines acknowledge that all scientific data come with a level of uncertainty.
NMFS notes that the report focuses on the use of observers for collecting, recording, and reporting bycatch data. The MSA provides that observers may be used, but are not required to be used, for data collection.
To the extent the commenter is recommending studies to support development of national, uniform bycatch reporting requirements, NMFS disagrees with the recommendation, as this rule takes a fishery-specific approach to the SBRM requirement.
Contrary to commenters' assertion,
Commenters assert that NMFS cannot consider NS7 (conservation and management measures shall, where practicable, minimize costs and avoid unnecessary duplication) in interpreting section 303(a)(11) because they are separate statutory provisions. MSA sections 301 (National Standards) and 303 (FMP Contents) are separate provisions, but NMFS disagrees that the agency may not consider them both in developing this rule. FMPs must comply with mandatory FMP requirements under section 303(a)—such as the SBRM provision—
Commenters further argue that even if it is permissible to consider NS7, NS7 requires that costs be minimized “where practicable, not absolutely,” citing
NMFS is charged with fulfilling a wide range of requirements under the MSA, MMPA, ESA, and other statutes. These mandates include, but are not limited to, ending overfishing and rebuilding fish stocks, protecting and recovering threatened and endangered species, reducing bycatch, enforcing laws and regulations, and combating illegal, unreported, and unregulated fishing internationally. Addressing all of these mandates and requirements is a challenging undertaking for NMFS, particularly in light of increasing legal mandates and budget constraints.
When Congress establishes a program or activity, it must decide how to finance it. Typically programs and activities are financed by appropriating funds from the U.S. Treasury. NMFS requests Congressional appropriations through the President's budget request to support statutory and regulatory requirements. Through this annual appropriations process, funding is provided for NMFS' many mandates. In addition to providing the necessary funds, a congressional appropriation establishes a maximum authorized program level, meaning that an agency cannot, absent specific statutory authorization, operate beyond the level that can be paid for by its appropriations. 72 Comp. Gen. 164, 165 (1993). In light of these considerations, and given that procedures to collect, report, and record bycatch data can be extremely costly, NMFS believes that it is important to require that SBRMs be feasible from cost as well as other perspectives.
NMFS acknowledges that Congressional appropriations may change over time, and appropriated funds may, consistent with federal appropriations law, be allocated to implement various statutory mandates and to respond to changes in conditions and priorities across the country. However, even though it may not be possible to anticipate future funding levels for procedures to collect, record, and report bycatch with complete certainty, the Councils would not be developing SBRMs in a vacuum. NMFS has a seat on each Council, and meets regularly with the Council Coordination Committee. The Councils and NMFS are able to consider the trends in costs and in appropriations levels in recent years. For example, NMFS notes that funding for observer programs has been relatively stable over the past two years, with approximately $43.7 million appropriated by Congress for observer programs in FY 2015 and FY 2016.
Data resulting from SBRMs may be used to inform management decisions
NMFS agrees that considering the importance of bycatch as part of fishing mortality is an important consideration when establishing or reviewing SBRMs. More specifically, § 600.1610(a)(2)(i) provides that a Council must address information about the characteristics of bycatch in the fishery when available, including, but not limited to, the amount of bycatch occurring in the fishery, the importance of bycatch in estimating the fishing mortality of fish stocks, and the effect of bycatch on ecosystems. NMFS believes that a fishery-specific evaluation of bycatch as stated above, in conjunction with considerations of feasibility, data use, and data uncertainty will result in an SBRM that meets the purpose as described in § 600.1600.
Consistent with the SBRM established in an FMP, a Council could provide for adjustments in how an SBRM is implemented through regulations (
None of the exceptions for Categorical Exclusions provided by section 5.05c of NAO 216-6 apply. While there is controversy concerning the SBRM rule, the controversy is primarily related to different views on how section 303(a)(11) of the MSA should be interpreted. The rule would not, in itself, have uncertain environmental impacts, unique or unknown risks, or result in cumulatively significant impacts on a fishery, protected species, or habitat, as it does not prescribe specific outcomes for FMPs. When a given Council or the Secretary prepares and submits a new FMP or FMP amendment or other regulatory action, at that time, biological, economic, and social impacts of the amendment/action would be subject to NEPA analysis.
In the first sentence of § 600.1600, “with respect to any fishery” was added after “fishery management plan” to reflect the text of section 303(a) of the MSA. The second sentence of § 600.1600 was revised in response to public comment to clarify the purpose of a standardized reporting methodology.
In § 600.1605(a), NMFS made minor changes to the definition of “standardized reporting methodology.” First, in response to public comment, NMFS removed “subset of a fishery” from the definition. Second, NMFS combined the first and second sentences of the proposed definition. Third, NMFS added a sentence to the end of the definition to clarify the link between an SBRM and the assessment of bycatch.
Section 600.1605(b) was revised to add reference to the MSA's definitions of “bycatch” and “fishery” in 16 U.S.C. 1802. Other minor revisions were made to the citations in § 600.1605(b).
In § 600.1610(a)(1), the first sentence was revised to clarify the information that must be identified in an FMP. The first part of the second sentence of the paragraph was modified for clarity. Instead of “The description must state the required bycatch data collection, recording, and reporting procedures for each fishery, which may include . . .”, the second sentence of § 600.1610(a)(1) now begins: “The required procedures may include. . . .”
In response to comments and to make clear that an SBRM must achieve its statutory purpose, the third sentence of § 600.1610(a)(1) now requires a Council
Consistent with current practices, § 600.1610(a)(1) states that Councils should work together and collaborate on standardized reporting methodologies for fisheries that operate across multiple jurisdictions, as appropriate.
Also in § 600.1610(a)(1), NMFS clarifies that in addition to proposing regulations necessary to implement the standardized reporting methodology, a Council should also provide in its FMP, or a fishery research plan authorized under 16 U.S.C. 1862, guidance to NMFS on how to adjust implementation of a standardized reporting methodology, consistent with the FMP. See National Standard 6 guidelines, 50 CFR 600.335. This text replaces § 600.1610(c) of the proposed rule, which described an adaptable implementation process for SBRMs. NMFS removed § 600.1610(c) and added the new sentence in § 600.1610(a)(1) in response to public comments expressing confusion over the process described in proposed rule's § 600.1610(c) (81 FR 9413, February 25, 2016).
In § 600.1610(a)(2), NMFS clarified what a Council is required to address when establishing or reviewing an SBRM. Also in § 600.1610(a)(2), NMFS broke out the “required factors” and “additional factors” of the proposed rule's paragraphs (a)(2)(i) and (a)(2)(ii) into four subparagraphs to improve the organization and clarity of the paragraph.
In § 600.1610(a)(2)(i), NMFS deleted the requirement that “[d]ata resulting from the methodology must be useful, in conjunction with other sources of data, in meeting the purpose described in § 600.1600 and fishery-specific bycatch objectives.” This requirement is no longer necessary because, as detailed above, § 600.1610(a)(1) requires that all SBRMs meet the purpose described in § 600.1600. NMFS also deleted the requirement that Councils “consider the conservation and management objectives regarding bycatch in the fishery” proposed in § 600.1610(a)(2) in response to public comment expressing confusion about this provision. NMFS believes that it is not necessary to state this as a requirement in § 600.1610(a)(2) because all SBRMs must meet the purpose described in § 600.1600, which includes reference to “inform[ing] the development of conservation and management measures that, to the extent practicable, minimize bycatch and bycatch mortality.”
In § 600.1610(a)(2)(i), NMFS created a distinct subparagraph for the requirement that all Councils address information about the characteristics of bycatch in the fishery. The proposed rule required Councils to “consider information about the characteristics of bycatch in the fishery, when available, such as the amount of bycatch occurring in the fishery, the importance of bycatch in estimating the total mortality of fish stocks, and the importance of bycatch to related ecosystems.” In the final rule, NMFS changed “such as” to “including but not limited to” to clarify that Councils must address all three types of information, where such information is available. In the same sentence, NMFS replaced “total mortality” with “fishing mortality” because bycatch mortality is part of fishing mortality (
In response to public comment, NMFS removed text from § 600.1610(a)(2)(ii) stating that “a Council may also consider the overall magnitude and/or economic impact of the fishery.” NMFS believes that this information is already addressed in NMFS' National Standards 7 and 8 guidelines.
In § 600.1610(a)(2)(ii), NMFS created a distinct subparagraph regarding feasibility. NMFS added “The implementation of a standardized reporting” to the beginning of the sentence requiring that the “methodology must be feasible from cost, technical, and operational perspectives” for purposes of clarity. In response to public comment, NMFS deleted the requirement that a methodology “be designed to be implemented with available funding.” In place of this text, NMFS added a sentence to the end of § 600.1610(a)(2)(ii) that explains in recognition that costs and funding may vary from year to year, a Council must also address how implementation of the standardized reporting methodology may be adjusted while continuing to meet the purpose described under § 600.1600.
In § 600.1610(a)(2)(iii), NMFS created a distinct subparagraph regarding data uncertainty. This subparagraph expands on the requirement in proposed § 600.1610(a)(2)(i) at 81 FR 9413, February 25, 2016, that a Council consider the quality of the data associated with the methodology when establishing or reviewing an SBRM. In place of this requirement, § 600.1610(a)(2)(iii) clarifies that a Council must address the uncertainty of the data resulting from the standardized reporting methodology. The standardized reporting methodology must be designed so that the uncertainty associated with the resulting bycatch data can be described, quantitatively or qualitatively. The Council should seek to minimize uncertainty in the resulting data, recognizing that different degrees of data uncertainty may be appropriate for different fisheries. NMFS made these changes in response to public comment and for purposes of clarity.
In § 600.1610(a)(2)(iv), NMFS created a distinct subparagraph regarding data use. To clarify the link between an SBRM and the assessment of bycatch, this first sentence of this subparagraph states: “A Council must address how data resulting from the standardized reporting methodology are used to assess the amount and type of bycatch occurring in the fishery.” NMFS also moved the proposed consultation provision (in § 600.1610(b) at 81 FR 9413, February 25, 2016) to this subparagraph, in response to public comment and to clarify the consultation process. Therefore, the second sentence of § 600.1610(a)(2)(iv) states: “A Council must consult with its scientific and statistical committee and/or the regional National Marine Fisheries Service science center on reporting methodology design considerations such as data elements, sampling designs, sample sizes, and reporting frequency.” NMFS made the consultation mandatory in the final rule. NMFS also removed reference to “advisory panels,” which was included in the consultation provision of the proposed rule, because the consultation is scientific in nature and is outside the scope of the advisory panel's role.
NMFS moved the text stating that “a Council may also consider...the scientific methods and techniques available to collect and report bycatch data that could improve the quality of bycatch estimates” from proposed § 600.1610(a)(2)(ii) (at 81 FR 9413, February 25, 2016) to § 600.1610(a)(2)(iv), because NMFS believes this provision relates to data
Also in § 600.1610(a)(2)(iv), NMFS added a sentence at the end of the paragraph clarifying that different standardized reporting methodology designs may be appropriate for different fisheries.
To comport with the organizational changes in the final rule, NMFS changed § 600.1610(d) to paragraph (b). To clarify that a Council must undertake a review of their FMPs for consistency with the rule, NMFS added that a Council, in coordination with NMFS, must conduct a review of its FMPs for consistency with this rule. To clarify that a Council does not have to amend an FMP within 5 years of the effective date of the rule if the FMP is in compliance with the rule, NMFS also added that a Council does not need to amend an FMP if NMFS, in consultation with the Council, determines that the FMP is consistent with this rule. Although the Council initiates a review of SBRMs, that review should be done in coordination with NMFS; therefore NMFS added “in coordination with NMFS” to the second and last sentences of § 600.1610(b).
Minor, non-substantive grammatical changes were also made in the final regulatory text to improve clarity.
NMFS has made a determination to apply a Categorical Exclusion to this action under the National Environmental Policy Act. This action qualifies for a Categorical Exclusion because it is a regulation “of an administrative, financial, legal, technical or procedural nature, or the environmental effects of which are too broad, speculative or conjectural to lend themselves to meaningful analysis and will be subject later to the NEPA process, either collectively or case-by-case. . . .”
Pursuant to section 301(b) of the MSA, the NMFS Assistant Administrator has determined that this final rule is consistent with the Magnuson-Stevens Act and other applicable law.
This rule has been determined to be not significant for purposes of Executive Order 12866.
The Chief Council for Regulation of the Department of Commerce certified to the Chief Council for Advocacy of the Small Business Administration during the proposed rule stage that this rule, if adopted, would not have a significant economic impact on a substantial number of small entities. The factual basis for the certification was published in the proposed rule (see page 9417 at 81 FR 9413, February 25, 2016). In summary, this action interprets and provides guidance on section 303(a)(11) of the Magnuson-Stevens Fishery Conservation and Management Act (MSA), which requires that all Fishery Management Plans (FMPs) “establish a standardized reporting methodology to assess the amount and type of bycatch occurring in a fishery” (16 U.S.C. 1853(a)(11)). Because the action does not directly regulate any small entities, it will not directly alter the behavior of any entities operating in federally managed fisheries, and thus no direct economic effects on small entities (as described within the proposed action) are expected to result from this action. Therefore, no small entities will be directly affected by this action, and a reduction in profits for a substantial number of small entities is not expected.
NMFS notes that on January 26, 2016, the Small Business Administration (SBA) issued a final rule revising the small business size standards for several industries, effective February 26, 2016 (81 FR 4469). The rule increased the size standard for Seafood Product Preparation and Packaging (NAICS code 311710) from 500 to 750 employees. Furthermore, on December 29, 2015, NMFS issued a final rule establishing a small business size standard of $11 million in annual gross receipts for all businesses primarily engaged in the commercial fishing industry (NAICS 11411) for Regulatory Flexibility Act (RFA) compliance purposes only.
Administrative practice and procedure, Bycatch, Fisheries, Standardized Reporting Methodology.
For the reasons set out in the preamble, NMFS amends 50 CFR part 600 as follows:
5 U.S.C. 561 and 16 U.S.C. 1801
Section 303(a)(11) of the Magnuson-Stevens Act requires that any fishery management plan (FMP) with respect to any fishery shall establish a standardized reporting methodology to assess the amount and type of bycatch occurring in the fishery. 16 U.S.C. 1853(a)(11). The purpose of a
(a)
(b)
(a)
(2)
(i)
(ii)
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(b)
Office of Personnel Management and Office of Management and Budget.
Proposed rule with request for comments.
The U.S. Office of Personnel Management (OPM) and the U.S. Office of Management and Budget (OMB) jointly propose to implement certain requirements contained in the Senior Professional Performance Act of 2008, incorporate OPM policies and to reorganize information for ease of reading. OPM additionally proposes to make conforming changes and technical corrections, and to update and simplify the processes used based on over a decade of experience with the certification process and recommendations from an interagency workgroup.
OPM must receive comments on or before February 21, 2017.
You may submit comments, identified by “RIN 3206-AL20,” using any of the following methods:
Myriam Mayobre by telephone at (202) 606-8046, by FAX at (202) 606-4264, or by email at
This proposal updates current regulations to account for changes in statute, policies, and processes that have occurred since the current regulation became effective in 2004. This proposal also streamlines the existing process to decrease burden on agencies while ensuring OPM and OMB have information needed for certification.
On October 8, 2008, the President signed into law the Senior Professional Performance Act of 2008 (the Act), Public Law 110-372. The Act made significant changes in the law governing certification of senior employee performance appraisal systems. This rulemaking would revise subpart D of parts 430 and 1330 of title 5, Code of Federal Regulations to reflect the changes resulting from the Act. Other changes to the regulations not related to the Act have been included in this revision to update and simplify the processes used based on over a decade of experience with the certification process and recommendations from an interagency workgroup. OPM convened the workgroup in December 2014 as a result of a President's Management Agenda recommendation made in 2011 by a separate workgroup, to follow up on recommendations made by a Chief Human Capital Officers workgroup held in February 2014, and as part of the current Presidential Management Agenda initiatives to improve the Senior Executive Service (SES). The workgroup was comprised of agency subject matter experts who were tasked to review the certification process and provide recommendations regarding the certification criteria and streamlining the process.
While OPM and OMB jointly propose to amend parts 430 and 1330 of title 5, Code of Federal Regulations, OPM additionally proposes to make the following changes to parts 317, 430 Subpart C, and 534 of title 5, Code of Federal Regulations, for which OPM alone is responsible. OPM proposes changes in 5 CFR 317.501(b)(2) and 317.503(g)(3) to fix erroneous internal cross-references to certain regulations affecting those sections. OPM also proposes certain changes to final regulations on 5 CFR 430 subpart C—Managing Senior Executive Performance published September 25, 2015, 80 FR 57693 to update citations to the proposed regulation. Revisions to 5 CFR 430.309(e)(2) would further clarify higher level review.
OPM is proposing conforming changes to pay regulations at 5 CFR 534 subparts D and E. For the most part, these changes update citations from the current regulations with citations to the same or similar material in the proposed regulations or change the existing references in current regulation to “suspension” of an appraisal system certification with the term “termination” of certification. In 5 CFR 534 subpart D, OPM also proposes to revise 5 CFR 534.404(e)(1) to clarify that certification of an appraisal system does not provide an immediate opportunity to adjust the pay of current senior executives. Rather, pay adjustments for current senior executives must be based on an annual summary rating and, therefore, occur only after the completion of a rating cycle under the newly certified appraisal system. This should occur on the normal appraisal cycle and include a period of performance under the certified system that is at least equal to the agency's minimum appraisal period. OPM also proposes to add new paragraph 534.404(c)(6) to address a technical issue associated with the 12-month rule and enable authorized agency officials to grant a pay adjustment up to 2 days before the expiration date of the 12-month restriction on pay adjustments that applies to a senior executive. This will allow agencies to make a pay adjustment consistent with an otherwise applicable annual performance and pay adjustment cycle. OPM finds this appropriate to support agencies in maintaining a cycle that provides for granting pay adjustments based upon performance on the first day of the same bi-weekly pay period each year (
The proposed regulations implement the provision in the Act that authorizes agencies to apply higher maximum rates of basic pay for employees in senior-level (SL) and scientific or professional (ST) positions (
The proposed regulation implements a section of the Act providing that certification may be granted beginning at any point in the year for a period not to exceed 24 months. Under rare and exceptional circumstances, the Director of OPM may extend certification for up to 6 additional months. Full certification will be granted for a period of 24 months. Provisional certification will be granted for a period of 12 months.
Since certification no longer expires at the end of a calendar year, there is no need for OPM to extend provisional certification into the following calendar year. That extension enabled agencies to maintain certification long enough to make pay adjustments using the higher maximum rate of the newly adjusted pay range and continued their access to the higher pay rate of EX-II.
OPM proposes to remove sections of the regulation that governed the renewal of an already fully certified system and described a process for automatic renewal based on an OPM/OMB review of the required agency annual report. OPM determined that this information alone is insufficient to assess whether an agency's system continues to meet the certification criteria. An agency that intends to maintain its certification must submit a request for certification in accordance with proposed sections 430.407 and 1330.407.
OPM proposes to change the requirement of current sections 430.404(a)(6) and 1330.404(a)(6) that only the agency head or the official designated under paragraph (a)(5) of those sections may provide oversight of the agency's appraisal system and its results. The proposed regulations also add Communication of Results (
OPM proposes to remove the references that distinguish requests for full certification from requests for provisional certification. As the certification process has evolved, OPM has found that submission of the same information is needed for all agency requests for certification. Based on review of an agency request, OPM, with OMB concurrence, may then grant full or provisional certification as appropriate. Reasons for which an agency would receive provisional rather than full certification are specified in the proposed regulations. OPM also proposes to remove the requirement for agencies to submit, as part of their certification requests, the process they use for ensuring ratings are not distributed arbitrarily or on a rotational basis. OPM believes this falls within the responsibilities of the oversight official to ensure the appraisal system is administered appropriately. OPM continues to require, as part of the oversight criterion, that an agency identify the official responsible for certifying that the senior employee appraisal process makes meaningful distinctions based on relative performance. OPM recognizes the ability to make meaningful distinctions in performance starts with the development of performance standards and requirements that clearly describe the different expectations at various performance levels. Agencies should consult their strategic plans and objectives when developing performance requirements to ensure alignment with mission outcomes and organizational results. This first critical step falls to the rating official, in consultation with the senior employee, followed by the accurate application of these standards/requirements when assessing performance. The proper development of performance standards/requirements and the accurate assessment of performance compared to these standards/requirements should lead to meaningful distinctions in ratings. OPM has found that the role of the oversight official provides the appropriate level for ensuring ratings make meaningful distinctions on the basis of actual differences in levels of performance. Furthermore, OPM proposes to remove the requirement for an agency to submit, as part of its certification request, the process for reviewing performance standards, requirements, expectations, or ratings of employees supervised by senior employees, because OPM believes this too is a review that should be included in the responsibilities of the Oversight Official.
The proposed regulations introduce a new procedural framework that provides for shared responsibilities in assessing certification criteria. Instead of OPM assessing all criteria, OPM will assess Aligned Results, Performance Distinctions, and Pay Differentiation. OPM will seek OMB concurrence on its findings. Agencies will verify Organizational Assessment and Guidelines, Oversight, and Communication. The criteria verified by the agency will, however, be subject to periodic spot checks by OPM to ensure continued compliance. Spot checks will not be announced in advance and when they occur, agencies will submit to OPM the documentation they used as the basis of their verification of the applicable criteria. In addition, the proposed regulations allow for an agency to demonstrate compliance with the Aligned Results criterion through a peer review process. This peer review process will provide the option for an agency with full certification to either have its performance plans reviewed by another agency with a fully certified appraisal system or submit the performance plans to OPM. Agencies that maintain full certification may continuously use this peer review method to demonstrate compliance with the Aligned Results criterion subject to spot checks by OPM. To maintain the integrity of the peer review process, agencies will not be allowed to conduct reciprocal reviews.
OPM proposes to remove Consultation, Balance, and Accountability criteria from the
OPM proposes to modify the definition of Relative Performance to clarify that a senior employee's performance is compared to the performance expectations established for his or her position, including their contribution to agency performance as appropriate. The definition of Relative Performance also specifies that it does not permit peer ranking or peer comparison for rating purposes. OPM also proposes to remove Outstanding Performance from the definitions to avoid confusion with the commonly used Level 5 rating label—Outstanding. As used in the certification regulations, Outstanding Performance originally was intended to allow for separately identifying the highest performers even within the highest performance level, usually Level 5, which often uses the label Outstanding. Some additional terms have been defined, as noted in the table of changes. OPM also proposes to revise the title of this subpart from Performance Appraisal Certification for Pay Purposes to Performance Appraisal System Certification for accuracy.
Agencies will also be required to submit, as part of the certification request, the applicable agency SES or SL/ST pay setting and adjustment policy required under 5 CFR part 534 and the policy and procedures for granting performance awards under § 534.405 for SES or §§ 451.101(e) and 451.104(a)(3) for SL/ST. In order to assess whether an agency is meeting the pay differentiation criterion for certification, OPM often finds it necessary to examine the pay policy to understand the context within which the reported pay adjustments have been authorized and performance awards have been granted. OPM also proposes that agencies make pay adjustments and performance awards for senior employees in a timely manner. These pay adjustments and awards for SES must have an effective date no later than 5 months after the end of the applicable appraisal period. For senior professionals, agencies must make pay adjustments, in compliance with requirements in § 534.505(b), at the same time as the adjustment to the General Schedule. This is the only time during the year annual increases in basic pay for senior professionals are permissible. Performance awards must be paid as soon as practicable after the end of the appraisal period. These timeliness requirements support the principles of performance-based compensation by ensuring the pay and awards are as close as practicable to the ratings upon which they are based.
OPM proposes to remove paragraphs addressing the limits on basic pay and aggregate total compensation because they are contained in 5 CFR part 534, subparts D and E and § 530.203(b) respectively.
These proposed regulations make the following major changes:
1. Proposed revisions make conforming changes as a result of Public Law 110-372, Senior Professional Performance Act of 2008.
• Adds that an agency with an applicable certified appraisal system may apply the higher maximum rate of basic pay for senior professionals covered by the certified system.
• Implements the provision of the Act where certification may be granted beginning at any point in the year for a period not to exceed 24 months as opposed to a calendar-year basis.
2. Proposed revisions address recommendations stemming from over a decade of experience with certification as well as from an interagency work group tasked to design an improved certification process to support the President's Management Agenda recommendation to improve the SES.
• Provides for shared responsibilities in assessing certification criteria in which OPM assesses Aligned Results, Performance Distinctions, and Pay Differentiation and agencies will verify all other criteria.
• Adds new option for Peer Review—this would allow fully certified agencies to engage in a review of other fully certified agencies' performance plans to determine whether they meet the criterion for “Aligned Results,” while prohibiting concurrent reciprocal reviews.
• Requires timely pay adjustments and performance awards for senior employees; for SES, not later than 5 months after the end of the appraisal period.
In addition to the general request for comments on the proposed regulation, we would appreciate feedback focused specifically on the following questions:
• How could agencies best assess and highlight their organizational performance—strengthening alignment to individual SES performance requirements—to distinguish between SES performance levels and/or to objectively set high performance expectations for individual SES?
• Are there additional ways, or alternatives, OMB and OPM should consider to make the SES and SL/ST performance appraisal system certification process less resource-intensive, while still achieving the goal of tying performance to agency outcomes, and making meaningful distinctions amongst individuals' performance levels?
The following table lists all the proposed changes to the current regulations. The “current rule” column lists the regulations in the current subpart D. The “proposed rule” column indicates where matters addressed in the current regulation are addressed in the proposed regulation and where new material is being added. The third column explains each change.
I certify that these regulations will not have a significant economic impact on a substantial number of small entities, because they will apply only to Federal agencies and employees.
This rule has been reviewed by the U.S. Office of Management and Budget in accordance with E.O. 12866.
Government employees.
Decorations, Government employees.
Government employees, Hospitals, Students, and Wages.
Accordingly, OPM and OMB are proposing jointly to amend parts 430 and 1330 of title 5 of the Code of Federal Regulations, and OPM proposes to amend parts 317, 430, and 534 of title 5, Code of Federal Regulations as follows:
5 U.S.C. 3392, 3393, 3395, 3397, 3592, 3593, 3595, 3596, 8414, and 8421.
(b) * * *
(2) Before an agency may fill an SES vacancy by an initial career appointment, it must post a vacancy announcement in USAJOBS for at least 14 calendar days, including the date of publication. Each agency's SES vacancy announcement must comply with criteria in § 330.104 of subpart A of this chapter, except for criteria pertaining to
(g) * * *
(3) The break in SES service was the result of military duty or compensable injury, and the time credited under paragraph (d)(3) of this section was not sufficient to complete the probationary period.
5 U.S.C. chapter 43 and 5307(d).
(e) * * *
(2) * * * The agency must provide each senior executive an opportunity for review of the initial summary rating by an employee, or (with the consent of the senior executive) a commissioned officer in the uniformed services on active duty in the agency, in a higher level in the agency than the official who prepared the initial rating.
(ii) When an agency cannot provide review by a higher-level official for a senior executive who receives an initial summary rating from the agency head because no such official exists in the agency, the agency must offer an alternative review as it determines appropriate; however, neither HLR nor alternative review may be provided by a member of the PRB that will make a recommendation under § 430.311(b)(2) concerning the senior executive or by an official who participated in determining the initial summary rating.
(iii) If a senior executive declines review by agency-designated higher-level officials, the agency may offer an alternative review but is not obligated to do so unless the only official in a higher level than the initial rater is the head of the agency. * * *
5 U.S.C. chapter 43 and 5307(d).
(a) This subpart implements 5 U.S.C. 5307(d), which provides for certification of performance appraisal systems that as designed and applied make meaningful distinctions based on relative performance with respect to—
(1) Members of the Senior Executive Service (SES) paid under 5 U.S.C. 5382 and 5383; and
(2) Employees in senior-level (SL) and scientific or professional (ST) positions paid under 5 U.S.C. 5376.
(b) The regulations in this subpart strengthen the application of performance-based-pay principles to senior employees. Specifically, the statutory provisions that these regulations implement authorize an agency to apply a higher maximum rate of basic pay in setting and adjusting rates of basic pay for senior employees (consistent with 5 CFR part 534, subparts D and E) and apply a higher annual aggregate limitation on pay (consistent with 5 CFR part 530, subpart B) to its senior employees, when OPM, with OMB concurrence, has certified that the design and application of the agency's appraisal systems for these employees make meaningful distinctions based on relative performance. This subpart establishes the certification criteria and procedures that OPM will apply in considering agency requests for such certification.
In this subpart—
(1) the critical elements, performance requirements, and performance standards that constitute the senior executive performance plans, as defined in § 430.303, established for senior executives;
(2) the performance elements and standards that constitute the performance plans, as defined in § 430.203, established for senior professionals; or
(3) other appropriate means authorized under performance appraisal systems not covered by 5 U.S.C. chapter 43 for communicating what a senior employee is expected to do and the measures that demonstrate success, including contribution to agency performance where appropriate.
(a) OPM, with OMB concurrence, will certify an agency appraisal system under § 430.408 when a review of that system's design (
(b) Each certification granted shall cover a specific period of time and is not renewable.
(c) Agencies subject to 5 U.S.C. chapter 43 and 5 CFR part 430 seeking certification of their appraisal systems must submit systems that have been approved by OPM under § 430.210 or § 430.314, as applicable.
(d) Agencies not subject to the appraisal provisions of 5 U.S.C. chapter 43 and 5 CFR part 430 seeking certification of their appraisal system(s) under this subpart must submit appropriate documentation to demonstrate that each system complies with the appropriate legal authority that governs the establishment, implementation, and application of that system.
(e) For senior professionals, an agency must establish an appraisal system(s), as defined in § 430.402, that meets the requirements of 5 CFR part 430, subpart B, and is separate from the system(s) established to cover its SES members under 5 CFR part 430, subpart C. At its discretion, an agency may include system features in its senior professional appraisal system(s) that are the same as, or similar to, the features of its SES appraisal system(s), as appropriate. For the purpose of certification under this subpart, such senior professional appraisal system(s) with 10 or more senior professionals covered by the system(s), must include a requirement for centralized review of senior professionals' ratings of record and proposed pay and performance awards actions.
To be certified, an agency's applicable appraisal system(s) for senior executives or senior professionals must meet the following certification criteria, as verified by OPM, with OMB concurrence:
(a)
(2) Performance plans must contain performance expectations, including at least one critical element focusing on business results, that—
(i) Apply to their respective areas of responsibility and control;
(ii) Reflect expected agency and/or organizational outcomes and outputs, performance targets or metrics, policy/program objectives, and/or milestones;
(iii) Identify specific programmatic crosscutting, external, and partnership-oriented goals or objectives, as applicable; and
(iv) Are stated in terms of observable, measurable, and/or demonstrable performance (
(3) OPM may establish additional procedures to allow agencies to conduct peer reviews of the performance plans to determine whether the plans meet this criterion. When conducting peer review, agencies may not conduct concurrent reciprocal reviews.
(b)
(2) Agency application of performance appraisal systems must—
(i) Result in meaningful distinctions based on relative performance; and
(ii) Take into account the assessment of the agency's performance against relevant program performance measures, as described in § 430.405(a), employee performance expectations, and such other relevant factors as may be appropriate.
(3) Authorized agency officials, as designated through agency delegated authority, must appraise senior employee performance accurately and realistically so that senior employees who have demonstrated the highest performance and/or exceptional contribution to the agency's performance receive the highest annual summary ratings or ratings of record, as applicable.
(4) Agencies with equivalent appraisal systems not otherwise subject to this part must provide for clearly distinguishing and identifying the rating that reflects the highest level of performance.
(5) Agencies may not equate the requirement to make distinctions based on relative performance to permitting a forced distribution of annual summary ratings or ratings of record, which is prohibited under §§ 430.208(c) and 430.305(a)(5). However, methods used to make distinctions among employees or groups of employees such as comparing, categorizing, and ranking employees or groups on the basis of their performance may be used for purposes other than assigning a summary level including, but not limited to, award determinations.
(c)
(2) Agencies must ensure differentiation is evident separately in the pay adjustments, performance awards, and rates of pay;
(3) Agencies must ensure they make pay adjustments and performance awards for senior employees in a timely manner.
(i) For senior executives, the pay adjustments authorized under 5 CFR 534.404(b)(3) and the performance awards authorized under 5 U.S.C. 5384 must have effective dates not later than 5 months after the end of the applicable appraisal period;
(ii) For senior professionals, agencies must make pay adjustments in accordance with the requirements in § 534.505(b) and pay performance awards as soon as practicable after the end of the appraisal period; and
(4) Agencies must develop processes for making pay decisions and granting awards affecting senior employees that comply with Governmentwide law, regulation, and guidance. To make these processes transparent agencies must provide access to the appraisal and pay policies that govern the decisions and communicate the results as required in § 430.405(c).
To be certified, an agency's applicable appraisal system(s) for senior executives or senior professionals must meet the following certification criteria, as verified by the agency in accordance with instructions provided by OPM:
(a)
(1) Address agency performance overall and with respect to each of its particular missions, components, programs, policy areas, and support functions—such as reports of the agency's GPRAMA goals, annual performance plans and targets, program performance measures, and other appropriate indicators;
(2) Be communicated by the agency head, or an individual specifically designated by the agency head for such purpose, to affected senior employees, their rating and reviewing officials, and PRB and SPRP members;
(3) Be provided at the conclusion of the appraisal period but before individual senior employee performance ratings are recommended, so that they inform individual performance appraisals; and
(4) Not take the form of quantitative limitations on the number of ratings at any given rating level.
(b)
(1) The senior employee rating process makes meaningful distinctions based on relative performance;
(2) The results of the senior employee appraisal process take into account the agency's assessment of its performance against program performance measures, as well as other relevant considerations, as appropriate;
(3) Performance awards, pay adjustments, and levels of pay based on the results of the rating process accurately reflect and recognize distinctions in individual performance and/or contribution to the agency's performance; and
(4) Final decisions include PRB or SPRP recommendations regarding senior employee ratings and must—
(i) Be consistent with 5 CFR part 430, subparts B and C; and
(ii) Appropriately reflect the employee's performance expectations, relevant program performance measures, and such other relevant factors as the PRB or SPRP may find appropriate.
(c)
To be certified, an agency's appraisal system must meet the requirements of 5 CFR part 430, subparts B or C, as applicable, or other applicable legal authority. Agencies are responsible for ensuring their senior employee appraisal systems provide for—
(a)
(b)
(1) Expected results; and
(2) Those technical, leadership and/or managerial competencies or behaviors that contribute to, and are necessary to distinguish, levels of performance. In addition, for senior employees in supervisory positions, their performance expectations also must address appropriate measures or indicators of stakeholder and/or employee perspective when applicable, such that stakeholder/employee feedback is sought and used to inform decisions.
(c)
(1) The performance expectations for individual subordinate employees clearly link to organizational mission, GPRAMA strategic goals, or other program or policy objectives; and
(2) The appraisal of their subordinate employees is based on established performance expectations that differentiate among the various levels of performance. An appraisal must be a realistic assessment of the employees' actual performance, including their contribution to organizational goals as measured in GPRAMA and other organizational plans.
(d)
To receive system certification, an agency must provide documentation demonstrating that its appraisal system(s), in design, implementation, and application, meet the certification criteria in §§ 430.404 and 430.405 as well as the procedural requirements set forth in this section.
(a) In order for an agency's appraisal system to be certified, the agency head or designee must submit documentation in accordance with OPM instructions, including—
(1) A written request, which may include signed electronic formats, for certification of its appraisal system(s) to the Director of OPM, or an OPM official assigned to accept certification requests;
(2) Separate certification requests for systems applying to senior executives, senior professionals, and Offices of the Inspector General;
(3) A full description of the appraisal system(s) to be certified, including—
(i) Organizational and employee coverage information; and
(ii) Rating levels as described in § 430.404(b)(1) and (4) that establish
(4) A sample of senior employee performance plans as specified by OPM, except as provided in paragraph (b) of this section;
(5) Documentation of organizational performance results and an explanation of how these results support the rating distribution in accordance with OPM instructions;
(6) Data required by the annual reporting requirement in § 430.409;
(7) Documentation of the pay policy and procedures for setting and adjusting pay and granting performance awards that includes—
(i) For the agency's senior executives covered by 5 CFR part 534, subpart D, the plan for setting and adjusting the rate of basic pay described in § 534.404(g);
(ii) For the agency's senior professionals covered by 5 CFR part 534, subpart E, the written procedures for setting and adjusting the rate of basic pay described in § 534.505; and
(iii) Policies established for award programs authorized under § 534.405 or responsibilities identified in § 451.106, as appropriate; and
(8) Any additional information that OPM and OMB may require to make a determination regarding certification.
(b) Agencies that participate in a peer review under § 430.404(a) must submit such documentation as OPM requires.
OPM will certify performance appraisal systems, with OMB concurrence, only for those agencies that comply with all related laws and regulations.
(a)
(1) Grant full certification, which covers a period of 24 months, of an agency's senior employee appraisal system(s) when the agency has—
(i) Demonstrated in the initial submission of its documentation, and without making any revisions directed by OPM, that it has designed and fully operationalized the certification criteria defined in §§ 430.404 and 430.405;
(ii) Met the documentation requirements in § 430407; and
(iii) Demonstrated appropriate system application through the data reports required in § 430.409 based on the 2 most recently completed performance cycles (2 years of data).
(2) Grant provisional certification, which covers a period of 12 months, of an agency's senior employee appraisal system(s) when the agency has—
(i) Designed a senior employee appraisal system(s) that meets the certification criteria in §§ 430.404 and 430.405; and
(ii) Revised one or more senior employee performance plans in accordance with instructions from OPM in order to meet the certification requirements in § 430.404(a); or
(iii) Demonstrated appropriate system application through the data reports required in § 430.409 based on only the most recently completed performance cycle (1 year of data).
(3) Grant provisional certification to an agency more than once.
(b)
(2) When requesting an extension, the agency head or designee must submit a written request, which may include signed electronic formats, to OPM outlining why the agency needs the extension and how the extension will support effective performance management. OPM will consider requests for extensions on a case-by-case basis.
Agencies must provide OPM with the annual summary ratings or ratings of record, as applicable, and rates of basic pay, pay adjustments, and performance and cash awards for their senior employees in accordance with instructions for OPM's annual data call and at any other time as needed to support a certification request.
(a) Any time OPM determines that an agency's certified appraisal system is no longer in compliance with certification criteria, OPM, with OMB concurrence, may terminate such certification.
(b) An agency's system certification is terminated automatically when OPM withdraws performance appraisal system approval or mandates corrective action because of misapplication of the system as authorized under § 430.210(c) or § 430.314(c).
(c) OPM will notify the agency head at least 30 calendar days in advance of the termination and the reason(s) for the termination, as well as any expected corrective action.
(d) Upon such termination, and until its system certification is reinstated, the agency must—
(1) Set a senior employee's rate of basic pay under 5 CFR part 534, subparts D or E as applicable, at a rate that does not exceed the rate for level III of the Executive Schedule.
(2) Limit aggregate compensation received in a calendar year by a senior employee to the rate for level I of the Executive Schedule.
(e) Performance awards, pay adjustments, and levels of pay in effect prior to such termination will remain in effect unless OPM finds that any such decision and subsequent action was in violation of law, rule, or regulation.
(f) OPM, with OMB concurrence, may reinstate certification to an agency whose certification has been terminated only after the agency demonstrates it has taken appropriate corrective action. A restored certification will terminate on the same date as the original certification. An agency with a terminated certification may choose to submit a new certification request once it has corrected the issue(s) that led to the termination.
(g) OPM may reinstate the certification of an appraisal system that has been terminated automatically under paragraph (b) of this section upon the agency's compliance with the applicable OPM-mandated corrective action(s).
5 U.S.C. 1104, 3161(d), 5307, 5351, 5352, 5353, 5376, 5382, 5383, 5384, 5385, 5541, 5550a, sec. 1125 of the National Defense Authorization Act for FY 2004, Pub. L. 108-136, 117 Stat. 1638 (5 U.S.C. 5304, 5382, 5383, 7302; 18 U.S.C. 207); and Pub. L. 110-372, 122 Stat. 4043 (5 U.S.C. 5304, 5307, 5376).
(b)
The revisions and additions to read as follows:
(b) * * *
(4) * * *
(ii) A pay increase under paragraph (b)(4)(i) of this section may not be provided to a senior executive whose rate of basic pay is at or below the rate for level III of the Executive Schedule if such an increase would cause the senior executive's rate of basic pay to exceed the rate for level III of the Executive Schedule unless the senior executive has received an annual summary rating of outstanding for the most recently completed appraisal period and the agency head or designee who performs the functions described in 5 CFR 430.405(a)(2) and (b) (including the Inspector General, where applicable) has approved the increase in pay.
(iii) A pay increase under paragraph (b)(4)(i) of this section may not be provided to a senior executive whose rate of basic pay is above the rate for level III of the Executive Schedule unless the senior executive has received an annual summary rating of outstanding for the most recently completed appraisal period and the agency head or designee who performs the functions described in 5 CFR 430.405(a)(2) and (b) (including the Inspector General, where applicable) has approved the increase in pay. However, in the case of a senior executive whose rate of basic pay is above the rate for level III of the Executive Schedule and who has been rated below outstanding, but above fully successful, for the most recently completed appraisal period, the agency head or designee who performs the functions described in 5 CFR 430.405(a)(2) and (b) (including the Inspector General, where applicable) may approve such a pay increase in limited circumstances, such as for an exceptionally meritorious accomplishment.
(c)
(4) An authorized agency official may approve increases in a senior executive's rate of basic pay more than once during a 12-month period if the agency head or designee who performs the functions described in 5 CFR 430.405(a)(2) and (b) (including the Inspector General, where applicable) determines that—
(6) When necessary to maintain an annual executive appraisal and pay adjustment cycle that permits pay adjustments on the first day of the 27th full bi-weekly pay period following the effective date of pay adjustments for the previous cycle, an authorized agency official may provide a pay adjustment to a senior executive not more than 2 days before an applicable 12-month period expires. The pay adjustment begins a new 12-month period for the purpose of paragraph (c)(1).
(e)
(g) * * *
(3) The designation of the authorized agency official who has authority to set and adjust SES rates of pay for individual senior executives, subject to the requirement that the agency head or designee who performs the functions described in 5 CFR 430.405(a)(2) and (b) (including the Inspector General, where applicable) must approve any determination to set a senior executive's rate of basic pay higher than the rate for level III of the Executive Schedule and must approve any determination to increase a senior executive's rate of basic pay more than once in any 12-month period; and
(i)
(a) * * *
(5) The administrative and management controls that will be applied to assure compliance with applicable statutes, OPM regulations, the agency's written procedures established under this section, the applicable maximum rate of basic pay in§ 534.504(a), and, where applicable, the certification requirements set forth in part 430, subpart D of this chapter. In an agency that employs ten or more senior professionals, these controls must include centralized review of ratings proposed under § 430.208 of this chapter, pay actions proposed under § 534.507, and performance awards under § 451.104(a)(3) by a panel of individuals designated by the agency head to provide advice from an agency-wide perspective for authorized agency officials to consider before approving pay adjustments and performance awards on whether—
(i) Ratings of record and performance ratings proposed for senior professionals accurately reflect their individual performance, contributions to agency performance, or both, and take into account, as appropriate, assessment of the agency's performance against program performance measures and other relevant considerations; and
(ii) Proposed pay adjustments and performance awards for senior professionals conform to the requirements of §§ 534.507 and 451.104(a)(3) respectively and appropriately correspond to proposed ratings of record and performance ratings.
(a) * * *
(2) A determination by an authorized agency official to make a zero adjustment in pay after reviewing a senior professional's current rating of record or performance rating meets the requirement of paragraph (a)(1) of this section only if the notice required by paragraph (h) of this section is provided to the senior professional no later than 14 days after the date specified in paragraph (a)(1) of this section.
(b) An SL or ST employee whose rate of basic pay is higher than the rate for level III of the Executive Schedule may not suffer a reduction in pay because his or her agency's applicable performance appraisal system certification expires or is terminated under § 430.410 of this chapter. See § 530.203(g) and (h) of this chapter for treatment of the aggregate pay limit when certification status changes during the calendar year.
5 U.S.C. chapter 43 and 5307(d).
5 U.S.C. 5307(d).
(a) This subpart implements 5 U.S.C. 5307(d), which provides for certification of performance appraisal systems that as designed and applied make meaningful distinctions based on relative performance with respect to—
(1) Members of the Senior Executive Service (SES) paid under 5 U.S.C. 5382 and 5383; and
(2) Employees in senior-level (SL) and scientific or professional (ST) positions paid under 5 U.S.C. 5376.
(b) The regulations in this subpart strengthen the application of performance-based-pay principles to senior employees. Specifically, the statutory provisions that these regulations implement authorize an agency to apply a higher maximum rate of basic pay in setting and adjusting rates of basic pay for senior employees (consistent with 5 CFR part 534, subparts D and E) and apply a higher annual aggregate limitation on pay (consistent with 5 CFR part 530, subpart B) to its senior employees, when OPM, with OMB concurrence, has certified that the design and application of the agency's appraisal systems for these employees make meaningful distinctions based on relative performance. This subpart establishes the certification criteria and procedures that OPM will apply in considering agency requests for such certification.
In this subpart—
(1) the critical elements, performance requirements, and performance standards that constitute the senior executive performance plans, as defined in § 430.303, established for senior executives;
(2) the performance elements and standards that constitute the performance plans, as defined in § 430.203, established for senior professionals; or
(3) other appropriate means authorized under performance appraisal systems not covered by 5 U.S.C. chapter 43 for communicating what a senior employee is expected to do and the measures that demonstrate success, including contribution to agency performance where appropriate.
(a) OPM, with OMB concurrence, will certify an agency appraisal system under § 1330.408 when a review of that system's design (
(b) Each certification granted shall cover a specific period of time and is not renewable.
(c) Agencies subject to 5 U.S.C. chapter 43 and 5 CFR part 430 seeking certification of their appraisal systems must submit systems that have been approved by OPM under § 430.210 or § 430.314, as applicable.
(d) Agencies not subject to the appraisal provisions of 5 U.S.C. chapter 43 and 5 CFR part 430 seeking certification of their appraisal system(s) under this subpart must submit appropriate documentation to demonstrate that each system complies with the appropriate legal authority that governs the establishment, implementation, and application of that system.
(e) For senior professionals, an agency must establish an appraisal system(s), as defined in § 1330.402, that meets the requirements of 5 CFR part 430, subpart B, and is separate from the system(s) established to cover its SES members under 5 CFR part 430, subpart C. At its discretion, an agency may include system features in its senior professional appraisal system(s) that are the same as, or similar to, the features of its SES appraisal system(s), as appropriate. For the purpose of certification under this subpart, such senior professional appraisal system(s) with 10 or more senior professionals covered by the system(s), must include a requirement for centralized review of senior professionals' ratings of record and proposed pay and performance awards actions.
To be certified, an agency's applicable appraisal system(s) for senior executives or senior professionals must meet the following certification criteria, as verified by OPM, with OMB concurrence:
(a)
(2) Performance plans must contain performance expectations, including at least one critical element focusing on business results, that—
(i) Apply to their respective areas of responsibility and control;
(ii) Reflect expected agency and/or organizational outcomes and outputs, performance targets or metrics, policy/program objectives, and/or milestones;
(iii) Identify specific programmatic crosscutting, external, and partnership-oriented goals or objectives, as applicable; and
(iv) Are stated in terms of observable, measurable, and/or demonstrable performance (
(3) OPM may establish additional procedures to allow agencies to conduct peer reviews of the performance plans to determine whether the plans meet this criterion. When conducting peer review, agencies may not conduct concurrent reciprocal reviews.
(b)
(2) Agency application of performance appraisal systems must—
(i) Result in meaningful distinctions based on relative performance; and
(ii) Take into account the assessment of the agency's performance against relevant program performance measures, as described in § 1330.405(a), employee performance expectations, and such other relevant factors as may be appropriate.
(3) Authorized agency officials, as designated through agency delegated authority, must appraise senior employee performance accurately and realistically so that senior employees who have demonstrated the highest performance and/or exceptional contribution to the agency's performance receive the highest annual summary ratings or ratings of record, as applicable.
(4) Agencies with equivalent appraisal systems not otherwise subject to this part must provide for clearly
(5) Agencies may not equate the requirement to make distinctions based on relative performance to permitting a forced distribution of annual summary ratings or ratings of record, which is prohibited under §§ 430.208(c) and 430.305(a)(5). However, methods used to make distinctions among employees or groups of employees such as comparing, categorizing, and ranking employees or groups on the basis of their performance may be used for purposes other than assigning a summary level including, but not limited to, award determinations.
(c)
(2) Agencies must ensure differentiation is evident separately in the pay adjustments, performance awards, and rates of pay;
(3) Agencies must ensure they make pay adjustments and performance awards for senior employees in a timely manner.
(i) For senior executives, the pay adjustments authorized under 5 CFR 534.404(b)(3) and the performance awards authorized under 5 U.S.C. 5384 must have effective dates not later than 5 months after the end of the applicable appraisal period;
(ii) For senior professionals, agencies must make pay adjustments in accordance with the requirements in § 534.505(b) and pay performance awards as soon as practicable after the end of the appraisal period; and
(4) Agencies must develop processes for making pay decisions and granting awards affecting senior employees that comply with Governmentwide law, regulation, and guidance. To make these processes transparent agencies must provide access to the appraisal and pay policies that govern the decisions and communicate the results as required in § 1330.405(c).
To be certified, an agency's applicable appraisal system(s) for senior executives or senior professionals must meet the following certification criteria, as verified by the agency in accordance with instructions provided by OPM:
(a)
(1) Address agency performance overall and with respect to each of its particular missions, components, programs, policy areas, and support functions—such as reports of the agency's GPRAMA goals, annual performance plans and targets, program performance measures, and other appropriate indicators;
(2) Be communicated by the agency head, or an individual specifically designated by the agency head for such purpose, to affected senior employees, their rating and reviewing officials, and PRB and SPRP members;
(3) Be provided at the conclusion of the appraisal period but before individual senior employee performance ratings are recommended, so that they inform individual performance appraisals; and
(4) Not take the form of quantitative limitations on the number of ratings at any given rating level.
(b)
(1) The senior employee rating process makes meaningful distinctions based on relative performance;
(2) The results of the senior employee appraisal process take into account the agency's assessment of its performance against program performance measures, as well as other relevant considerations, as appropriate;
(3) Performance awards, pay adjustments, and levels of pay based on the results of the rating process accurately reflect and recognize distinctions in individual performance and/or contribution to the agency's performance; and
(4) Final decisions include PRB or SPRP recommendations regarding senior employee ratings and must—
(i) Be consistent with 5 CFR part 430, subparts B and C; and
(ii) Appropriately reflect the employee's performance expectations, relevant program performance measures, and such other relevant factors as the PRB or SPRP may find appropriate.
(c)
To be certified, an agency's appraisal system must meet the requirements of 5 CFR part 430, subparts B or C, as applicable, or other applicable legal authority. Agencies are responsible for ensuring their senior employee appraisal systems provide for—
(a)
(b)
(1) Expected results; and
(2) Those technical, leadership and/or managerial competencies or behaviors that contribute to, and are necessary to distinguish, levels of performance. In addition, for senior employees in supervisory positions, their performance expectations also must address appropriate measures or indicators of stakeholder and/or employee perspective when applicable, such that stakeholder/employee feedback is sought and used to inform decisions.
(c)
(1) The performance expectations for individual subordinate employees clearly link to organizational mission, GPRAMA strategic goals, or other program or policy objectives; and
(2) The appraisal of their subordinate employees is based on established performance expectations that differentiate among the various levels of performance. An appraisal must be a realistic assessment of the employees' actual performance, including their contribution to organizational goals as measured in GPRAMA and other organizational plans.
(d)
To receive system certification, an agency must provide documentation demonstrating that its appraisal system(s), in design, implementation, and application, meet the certification criteria in §§ 1330.404 and 1330.405 as well as the procedural requirements set forth in this section.
(a) In order for an agency's appraisal system to be certified, the agency head or designee must submit documentation in accordance with OPM instructions, including—
(1) A written request, which may include signed electronic formats, for certification of its appraisal system(s) to the Director of OPM, or an OPM official assigned to accept certification requests;
(2) Separate certification requests for systems applying to senior executives, senior professionals, and Offices of the Inspector General;
(3) A full description of the appraisal system(s) to be certified, including—
(i) Organizational and employee coverage information; and
(ii) Rating levels as described in § 1330.404(b)(1) and (4) that establish clear distinctions between levels of performance so senior employees receive ratings based on assessments of their actual performance relative to their established performance expectations in any given appraisal period;
(4) A sample of senior employee performance plans as specified by OPM, except as provided in paragraph (b) of this section;
(5) Documentation of organizational performance results and an explanation of how these results support the rating distribution in accordance with OPM instructions;
(6) Data required by the annual reporting requirement in § 1330.409;
(7) Documentation of the pay policy and procedures for setting and adjusting pay and granting performance awards that includes—
(i) For the agency's senior executives covered by 5 CFR part 534, subpart D, the plan for setting and adjusting the rate of basic pay described in § 534.404(g);
(ii) For the agency's senior professionals covered by 5 CFR part 534, subpart E, the written procedures for setting and adjusting the rate of basic pay described in § 534.505; and
(iii) Policies established for award programs authorized under § 534.405 or responsibilities identified in § 451.106, as appropriate; and
(8) Any additional information that OPM and OMB may require to make a determination regarding certification.
(b) Agencies that participate in a peer review under § 1330.404(a) must submit such documentation as OPM requires.
OPM will certify performance appraisal systems, with OMB concurrence, only for those agencies that comply with all related laws and regulations.
(a)
(1) Grant full certification, which covers a period of 24 months, of an agency's senior employee appraisal system(s) when the agency has—
(i) Demonstrated in the initial submission of its documentation, and without making any revisions directed by OPM, that it has designed and fully operationalized the certification criteria defined in §§ 1330.404 and1330.405;
(ii) Met the documentation requirements in § 1330.407; and
(iii) Demonstrated appropriate system application through the data reports required in § 1330.409 based on the 2 most recently completed performance cycles (2 years of data).
(2) Grant provisional certification, which covers a period of 12 months, of an agency's senior employee appraisal system(s) when the agency has—
(i) Designed a senior employee appraisal system(s) that meets the certification criteria in §§ 1330.404 and 1330.405; and
(ii) Revised one or more senior employee performance plans in accordance with instructions from OPM in order to meet the certification requirements in § 1330.404(a); or
(iii) Demonstrated appropriate system application through the data reports required in § 1330.409 based on only the most recently completed performance cycle (1 year of data).
(3) Grant provisional certification to an agency more than once.
(b)
(2) When requesting an extension, the agency head or designee must submit a written request, which may include signed electronic formats, to OPM outlining why the agency needs the extension and how the extension will support effective performance management. OPM will consider requests for extensions on a case-by-case basis.
Agencies must provide OPM with the annual summary ratings or ratings of record, as applicable, and rates of basic pay, pay adjustments, and performance and cash awards for their senior employees in accordance with instructions for OPM's annual data call and at any other time as needed to support a certification request.
(a) Any time OPM determines that an agency's certified appraisal system is no longer in compliance with certification criteria, OPM, with OMB concurrence, may terminate such certification.
(b) An agency's system certification is terminated automatically when OPM withdraws performance appraisal system approval or mandates corrective action because of misapplication of the system as authorized under § 430.210(c) or § 430.314(c).
(c) OPM will notify the agency head at least 30 calendar days in advance of the termination and the reason(s) for the termination, as well as any expected corrective action.
(d) Upon such termination, and until its system certification is reinstated, the agency must—
(1) Set a senior employee's rate of basic pay under 5 CFR part 534, subparts D or E as applicable, at a rate that does not exceed the rate for level III of the Executive Schedule.
(2) Limit aggregate compensation received in a calendar year by a senior employee to the rate for level I of the Executive Schedule.
(e) Performance awards, pay adjustments, and levels of pay in effect prior to such termination will remain in effect unless OPM finds that any such decision and subsequent action was in violation of law, rule, or regulation.
(f) OPM, with OMB concurrence, may reinstate certification to an agency whose certification has been terminated only after the agency demonstrates it has taken appropriate corrective action. A restored certification will terminate on the same date as the original certification. An agency with a terminated certification may choose to submit a new certification request once it has corrected the issue(s) that led to the termination.
(g) OPM may reinstate the certification of an appraisal system that has been terminated automatically under paragraph (b) of this section upon the agency's compliance with the applicable OPM-mandated corrective action(s).
Agricultural Marketing Service, USDA.
Referendum order.
This document directs that a referendum be conducted among eligible Washington potato producers to determine whether they favor continuance of the marketing order regulating the handling of Irish potatoes grown in Washington.
The referendum will be conducted from June 9 through June 23, 2017. Only current producers that were engaged in the production of fresh potatoes in Washington during the period of July 1, 2015, through June 30, 2016, are eligible to vote in this referendum.
Copies of the marketing order may be obtained from the Northwest Marketing Field Office, Marketing Order and Agreement Division, Specialty Crops Program, AMS, USDA, 1220 SW 3rd Avenue, Suite 305, Portland, OR 97204; Telephone: (503) 326-2724; from the Office of the Docket Clerk, Marketing Order and Agreement Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW., STOP 0237, Washington, DC 20250-0237; or on the Internet:
Teresa Hutchinson or Gary D. Olson, Northwest Marketing Field Office, Marketing Order and Agreement Division, Specialty Crops Program, AMS, USDA; Telephone: (503) 326-2724, Fax: (503) 326-7440, or Email:
Pursuant to Marketing Order No. 946 (7 CFR part 946), hereinafter referred to as the “order,” and the applicable provisions of the Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-674), hereinafter referred to as the “Act,” it is hereby directed that a referendum be conducted to ascertain whether continuance of the order is favored by producers. The referendum shall be conducted from June 9 through June 23, 2017, among eligible Washington potato producers. Only current producers that were also engaged in the production of fresh potatoes in Washington during the period of July 1, 2015, through June 30, 2016, may participate in the continuance referendum.
USDA has determined that continuance referenda are an effective means for determining whether producers favor the continuation of marketing order programs. USDA would consider termination of the order if less than two-thirds of the producers voting in the referendum and producers of less than two-thirds of the volume of Washington potatoes represented in the referendum favor continuance of their program. In evaluating the merits of continuance versus termination, USDA will not exclusively consider the results of the continuance referendum. USDA will also consider all other relevant information regarding operation of the order and relative benefits and disadvantages to producers, handlers, and consumers to determine whether continuing the order would tend to effectuate the declared policy of the Act.
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35), the ballot materials used in the referendum herein ordered have been submitted to and approved by the Office of Management and Budget (OMB) and have been assigned OMB No. 0581-0178, Vegetable and Specialty Crops. It has been estimated that it will take an average of 20 minutes for each of the approximately 270 Washington potato producers to cast a ballot. Participation is voluntary. Ballots postmarked after June 23, 2017, will not be included in the vote tabulation.
Teresa Hutchinson and Gary D. Olson of the Northwest Marketing Field Office, Specialty Crops Program, AMS, USDA, are hereby designated as the referendum agents of the Secretary of Agriculture to conduct this referendum. The procedure applicable to the referendum shall be the “Procedure for the Conduct of Referenda in Connection With Marketing Orders for Fruits, Vegetables, and Nuts Pursuant to the Agricultural Marketing Agreement Act of 1937, as Amended” (7 CFR part 900.400
Ballots will be mailed to all producers of record and may also be obtained from the referendum agents or from their appointees.
Marketing agreements, Potatoes, Reporting and recordkeeping requirements.
7 U.S.C. 601-674.
Federal Aviation Administration (FAA), DOT.
Notice of proposed rulemaking (NPRM).
This action proposes to modify one jet route and five VHF Omnidirectional Range (VOR) Federal airways, and establish three Area Navigation (RNAV) T-routes in the northcentral United States. The FAA is proposing this action due to the planned decommissioning of the Brainerd, MN (BRD), VHF Omnidirectional Range/Tactical Air Navigation (VORTAC) navigation aid (NAVAID), which provides navigation guidance for portions of the ATS routes proposed to be amended by this action. The T-routes proposed to be established by this action would mitigate potential issues to the National Airspace System (NAS) route structure that may be caused by the proposed ATS route amendments. Overall, this action would enhance the safety and efficient management of aircraft within the NAS.
Comments must be received on or before March 6, 2017.
Send comments on this proposal to the U.S. Department of Transportation, Docket Operations, 1200 New Jersey Avenue SE., West Building Ground Floor, Room W12-140, Washington, DC 20590; telephone:
FAA Order 7400.11A, Airspace Designations and Reporting Points, and subsequent amendments can be viewed online at
FAA Order 7400.11, Airspace Designations and Reporting Points, is published yearly and effective on September 15.
Colby Abbott, Airspace Policy Group, Office of Airspace Services, Federal Aviation Administration, 800 Independence Avenue SW., Washington, DC 20591; telephone: (202) 267-8783.
The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. Subtitle I, Section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of the airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it modifies the NAS route structure as necessary to preserve the safe and efficient flow of air traffic within the NAS.
Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal.
Communications should identify both docket numbers (FAA Docket No. FAA-2016-9319 and Airspace Docket No. 16-AGL-21) and be submitted in triplicate to the Docket Management Facility (see “ADDRESSES” section for address and phone number). You may also submit comments through the internet at
Commenters wishing the FAA to acknowledge receipt of their comments on this action must submit with those comments a self-addressed, stamped postcard on which the following statement is made: “Comments to FAA Docket No. FAA-2016-9319 and Airspace Docket No. 16-AGL-21.” The postcard will be date/time stamped and returned to the commenter.
All communications received on or before the specified comment closing date will be considered before taking action on the proposed rule. The proposal contained in this action may be changed in light of comments received. All comments submitted will be available for examination in the public docket both before and after the comment closing date. A report summarizing each substantive public contact with FAA personnel concerned with this rulemaking will be filed in the docket.
An electronic copy of this document may be downloaded through the internet at
You may review the public docket containing the proposal, any comments received and any final disposition in person in the Dockets Office (see “ADDRESSES” section for address and phone number) between 9:00 a.m. and 5:00 p.m., Monday through Friday, except Federal holidays. An informal docket may also be examined during normal business hours at the office of the Operations Support Group, Central Service Center, Federal Aviation Administration, 10101 Hillwood Blvd., Fort Worth, TX, 76177.
This document proposes to amend FAA Order 7400.11A, Airspace Designations and Reporting Points, dated August 3, 2016, and effective September 15, 2016. FAA Order 7400.11A is publicly available as listed in the
The FAA originally considered decommissioning activities for the Brainerd, MN (BRD), VOR would take place in 2019 as one of the candidate VORs identified for discontinuance by the VOR Minimum Operating Network (VOR MON) program and listed in the Final policy statement notice, “Provision of Navigation Services for the Next Generation Air Transportation System (NextGen) Transition to Performance-Based Navigation (PBN) (Plan for Establishing a VOR Minimum Operational Network),” published in the
With the planned decommissioning of the Brainerd, MN, VORTAC, the remaining ground-based NAVAID coverage in the area is insufficient to enable the continuity of the affected airways. As such, proposed modifications to Jet route J-25 and VOR Federal airways V-55, V-82, V-161, V-218, and V-413 will result in gaps in the route structures. To overcome these gaps, the FAA is proposing to establish three new RNAV T-routes: T-330, T-354, and T-383.
The FAA is proposing an amendment to Title 14, Code of Federal Regulations (14 CFR) part 71 to amend Jet route J-25 and VOR Federal airways V-55, V-82, V-161, V-218, and V-413. Additionally, the FAA is also proposing
The proposed Jet route and VOR Federal airways changes are outlined below.
The proposed RNAV T-routes to be established are outlined below.
All radials in the route descriptions below that do not reflect True (T)/Magnetic (M) degree radial information are unchanged and stated in True degrees.
Jet routes are published in paragraph 2004, VOR Federal airways are published in paragraph 6010(a), and United States Area Navigation Routes (low altitude T-routes) are published in paragraph 6011, of FAA Order 7400.11A dated August 3, 2016, and effective September 15, 2016, which is incorporated by reference in 14 CFR 71.1. The Jet routes, VOR Federal airways, and RNAV T-routes listed in this document would be subsequently published in the Order.
The FAA has determined that this proposed regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. It, therefore: (1) Is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under Department of Transportation (DOT) Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that will only affect air traffic procedures and air navigation, it is certified that this proposed rule, when promulgated, will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.
This proposal will be subject to an environmental analysis in accordance with FAA Order 1050.1F, “Environmental Impacts: Policies and Procedures” prior to any FAA final regulatory action.
Airspace, Incorporation by reference, Navigation (air).
In consideration of the foregoing, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:
49 U.S.C. 106(f), 106(g); 40103, 40113, 40120; E.O. 10854, 24 FR 9565, 3 CFR, 1959-1963 Comp., p. 389.
From INT United States/Mexico border and Brownsville, TX, 221° radial; Brownsville; INT Brownsville 358° and Corpus Christi, TX, 178° radials; Corpus Christi; INT Corpus Christi 311° and San Antonio, TX, 174° radials; San Antonio; Centex, TX; Waco, TX; Ranger, TX; Tulsa, OK; Kansas City, MO; Des Moines, IA; Mason City, IA; to Gopher, MN.
From Dayton, OH; Fort Wayne, IN; Goshen, IN; Gipper, MI; Keeler, MI; Pullman, MI; Muskegon, MI; INT Muskegon 327° and Green Bay, WI, 116° radials; Green Bay; Stevens Point, WI; INT Stevens Point 281° and Eau Claire, WI, 107° radials; Eau Claire; to Siren, WI. From Park Rapids, MN; Grand Forks, ND; INT Grand Forks 239° and Bismarck, ND, 067° radials; to Bismarck.
From Baudette, MN; to INT Baudette 194° and Park Rapids, MN, 003°T/359°M radials. From Gopher, MN; Farmington, MN; Rochester, MN; Nodine, MN; to Dells, WI.
From Three Rivers, TX; Center Point, TX; Llano, TX; INT Llano 026° and Millsap, TX, 193° radials; Millsap; Bowie, TX; Ardmore, OK; Okmulgee, OK; Tulsa, OK; Oswego, KS; Butler, MO; Napoleon, MO; Lamoni, IA; Des Moines, IA; Mason City, IA; Rochester, MN; Farmington, MN; to Gopher, MN. From International Falls, MN; to Winnipeg, MB, Canada, excluding the airspace within Canada.
From International Falls, MN; Grand Rapids, MN; Gopher, MN; Waukon, IA; to Rockford, IL. From Keeler, MI; to Lansing, MI.
From Gopher, MN; INT Gopher 109° and Eau Claire, WI, 269° radials; Eau Claire; to Ironwood, MI.
Commodity Futures Trading Commission.
Proposed rule.
The Commodity Futures Trading Commission (the “Commission”) is proposing to amend the recordkeeping obligations set forth in certain provisions of the Commission's regulations. The proposed amendments would permit recordkeepers to leverage advances in information technology as a means to reduce costs associated with the retention and production of paper and electronic records and to decrease the risks of cybersecurity threats, while maintaining necessary safeguards to ensure the integrity, availability, and accessibility of records required to be kept pursuant to the Commodity Exchange Act (the “CEA”) or Commission regulations. In addition to providing recordkeepers with greater flexibility regarding the retention and production of regulatory records, the proposed amendments would remove the requirements for electronic records to be kept in their native file format and for recordkeepers to enter into an arrangement with a third-party technical consultant with respect to electronically stored information.
Comments must be received on or before March 20, 2017.
You may submit comments, identified by RIN 3038-AE36, by any of the following methods:
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Please submit your comments using only one method.
All comments must be submitted in English, or if not, accompanied by an English translation. Comments will be posted as received to
The Commission reserves the right, but shall have no obligation, to review, pre-screen, filter, redact, refuse or remove any or all of your submission from
Eileen T. Flaherty, Director, (202) 418-5326,
Commission regulation 1.31 sets forth recordkeeping requirements for all books and records required to be kept by the CEA and Commission regulations, and implements the Commission's inspection and examination authority over such records.
Paragraph (a) of § 1.31 describes the general requirement that books and records must be kept for five years and be readily accessible during the first two years. Different retention periods apply to certain oral communications and records of any swap or related cash or forward transaction. Paragraph (a) also provides that paper records shall be kept in their original form and electronic records in the format in which they were originally created (referred to as “native file format”), and defines the inspection and production rights of representatives of the Commission and the Department of Justice. In particular, § 1.31(a)(2) requires that production shall be made in a form specified by any representative of the Commission upon the representative's request.
Paragraph (b) of § 1.31 allows books and records to be stored on electronic storage or micrographic media, such as microfiche, provided that the recordkeeper complies with various technical requirements designed to ensure the integrity, availability, and accessibility of the electronically stored information. For example, this paragraph provides that any digital storage or medium or system must preserve the records exclusively in a non-rewritable, non-erasable format, known more commonly as the “write once, read-many,” or “WORM” requirement. In addition, paragraph (b) requires a recordkeeper utilizing electronic storage media to develop and maintain an audit system to provide accountability over both the initial entry and the entry of each change to any original or duplicate record. Further, any person who uses only electronic storage media to preserve some or all of its required records shall enter into an arrangement with a third-party technical consultant (“Technical Consultant”) capable of furnishing to the Commission or its representative any information stored electronically promptly upon request.
Paragraph (c) of § 1.31 requires recordkeepers to provide notice and a representation to the Commission prior to the initial use of an electronic storage system that the electronic storage system satisfies the requirements set forth in § 1.31(b). Lastly, paragraph (d) of § 1.31 requires certain paper records, such as trading cards and documents with written trading information, to be maintained in hard-copy for the applicable retention period.
The Commission recognizes that the most recent substantive amendments to § 1.31 were made in 2012
The Commission has received petitions for rulemaking from various industry groups requesting that the Commission amend § 1.31.
Specifically, the Petitioners have requested the following changes to § 1.31:
1. Amend § 1.31(a) to no longer require electronic records to be kept in their native file format;
2. Amend § 1.31(b) to eliminate the WORM requirement for electronic records; and
3. Amend § 1.31(b) to eliminate the requirement to enter into an agreement with a Technical Consultant.
With respect to native file format, the Petitioners note that programs used to store records electronically routinely become outdated and obsolete, and/or are no longer supported by information technology manufacturers. As a result, as represented by the Petitioners, recordkeepers must bear the burden of retaining these electronic records while updating to other, advanced systems for newly created records. Accordingly, the Petitioners request that the Commission amend § 1.31 in a manner that does not specify the format of any particular electronic record, so long as there is demonstrable and auditable integrity and fidelity in the preservation of the underlying data and contents.
With respect to the WORM requirement, the Petitioners assert that it is based on a concept that was state of the art nearly twenty years ago. Records are no longer stored electronically on optical disks or CD-ROMs. Currently, state of the art information technology relies on storage subject to restricted access and includes storage logs that reflect every single change to a file, in addition to archived copies. Absent any change, the Petitioners state that recordkeepers will be required to maintain dual systems that preserve the WORM requirement but also permit them to more properly secure and manage electronic records. Accordingly, the Petitioners request that the Commission amend § 1.31 to remove the WORM requirement.
With respect to the Technical Consultant, the Petitioners state that the need to retain and train a third-party to serve as a surrogate for access and production to electronic records is no longer necessary given the in-house technical expertise regarding information technology throughout the industry. In addition to the increased costs associated with retaining a Technical Consultant, the Petitioners also note that providing additional third parties with access to sensitive, confidential, and proprietary information greatly increases the risk of cybersecurity intrusions. Accordingly, the Petitioners request that the Commission amend § 1.31 to remove the requirement to retain a Technical Consultant.
In support of their request, Petitioners note that the Securities and Exchange Commission (“SEC”) adopted a recordkeeping rule for investment companies and investment advisers consistent with the changes they propose.
The Commission noted in the 1999 Amendment the importance of conducting an ongoing review of the standards articulated in the recordkeeping regulation to ensure that the requirements reflect to the extent possible the reality of established technological innovation.
As the Petitioners highlighted, the Commission recognizes that recordkeeping has evolved significantly in the time since the last major revision to § 1.31 in 1999 from a paper-based system to electronically stored information systems that leverage computers, databases, and even cloud computing. Back then, most records were created and maintained on paper, but recordkeepers began to explore better ways to store information electronically. Now the paradigm has shifted, and most information is produced and stored electronically on complex systems tailored to the needs of a given recordkeeper. These advances in information technology may have rendered certain technical elements of § 1.31 obsolete or outdated.
Accordingly, the Commission proposes to amend § 1.31 to reorganize and update the existing recordkeeping regulation, eliminating certain outdated provisions while still maintaining the ability of the Commission to examine and inspect required records. The Proposal is intended to be technology neutral so as technology develops the regulation should withstand such changes. The updates include new definitions, deletion of outdated terms, and revision of certain provisions to reflect advances in information technology. The Commission notes that many of the existing provisions and principles in § 1.31 have been retained, albeit in a revised format. The proposed regulation is divided into five subsections: (a) Definitions; (b) regulatory records policies and procedures; (c) duration of retention; (d) form and manner of retention; and (e) inspection and production of regulatory records.
The Commission proposes to reorganize § 1.31 by revising paragraph (a) to define certain terms to be referenced elsewhere within the revised regulation. Specifically, the Commission proposes to define the terms “electronic regulatory records”, “records entity”, and “regulatory records”. The Commission believes that defining these terms will provide greater clarity regarding the recordkeeping obligations applicable to all persons subject to § 1.31, particularly for those obligations related to electronic records.
For the ease of understanding and applying the proposed amendments to § 1.31, the Commission proposes to define “records entity” to mean “any person required by the Act or Commission regulations to keep regulatory records.” The Commission notes that numerous Commission regulations set forth particular requirements for CEA Section 1a(40) “registered entities”—such as derivatives clearing organizations, designated contract markets, swap execution facilities, and swap data
The Commission also proposes to replace existing references to “books and records” within § 1.31 with the term “regulatory records” and to differentiate between electronic and paper regulatory records. The Commission proposes to define “regulatory records” to mean “all books and records required to be kept by the Act or Commission regulations.” As a subset, the Commission proposes to define within § 1.31(a) “electronic regulatory records” to mean “all regulatory records other than paper regulatory records exclusively created and maintained by a records entity on paper.” The Commission has separately proposed Regulation Automated Trading and certain requirements regarding source code and manner of production of source code.
The Commission recognizes that certain regulatory records are not created electronically and that certain records entities may elect not to convert any paper regulatory records into an electronic format. By differentiating between paper and electronic regulatory records, the Commission can better preserve existing recordkeeping obligations applicable solely to records entities that do not create anything other than paper regulatory records.
The Commission also believes that the term “books and records” in the traditional sense may no longer adequately convey that § 1.31 recordkeeping obligations extend to all associated electronic data. However, contrary to prior revisions to § 1.31 where the Commission specifically delineated the types of allowable media for electronic records storage,
The proposed language would more clearly state the existing requirement to maintain all prior versions of any regulatory record, no matter how modified. This is not a new recordkeeping obligation. Since 1993 the Commission has required electronic records to be created and maintained in a non-erasable, non-rewritable format for the retention period.
The proposed language also would clarify that electronically stored regulatory records are not limited to the data within a particular database or application, for example, but includes the electronic information that identifies the manner in which any regulatory record is altered. The Commission understands that this information is more commonly known as “metadata,” and, at its core, is data about data. Regardless of the label, the Commission understands that metadata generally refers to any hidden text, formatting codes, formulae, history, tracking, and other information associated with an electronic file or data. Metadata is integral to the Commission's ability to carry out both the inspection and investigation functions it is charged with under the CEA. To fully understand the data within a database, for example, requires knowledge of data relationships, what the information represents, and how it was generated. Once properly assembled and formatted in the form of a report, data within a database is readily understandable.
The Commission does not find it necessary at this time to define specific, technical terms related to information technology and electronically stored information, such as metadata or databases, as these technical terms may change over time. The Commission believes these are terms generally understood by practitioners notwithstanding a lack of a universal agreement on exact definitions.
The Commission notes that the requirement to provide data about data is not new. As set forth in current § 1.31(a)(2), production of any books and records shall be made “in a form specified by any representative of the Commission.” For the purpose of facilitating production requests pursuant § 1.31(a)(2), the Commission's Division of Enforcement has developed and continually updates a document entitled “CFTC Data Delivery Standards.”
Finally, the Commission further proposes not to retain within the definition section certain definitions in the existing regulation, such as “native
• Should any of the proposed definitions be revised? If yes, please provide alternative suggestions.
• Should any of the proposed definitions be deleted?
• Should any previous definitions proposed for deletion,
• Should other definitions be added, such as “metadata”, or “database”, or “paper regulatory records”?
The Commission proposes to revise and re-state in new § 1.31(b) ongoing compliance obligations regarding written regulatory records policies and procedures currently set forth in § 1.31(b)(3). Specifically, the Commission proposes in revised § 1.31(b) to require all records entities to establish, maintain, and implement written policies and procedures reasonably designed to ensure that the records entity complies with its obligations under § 1.31, including 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 this section, and regular monitoring for such compliance.
The Commission believes that the proposed obligations regarding written policies and procedures are generally consistent with the existing regulation and accepted industry practices. Currently, § 1.31(b)(3) requires anyone using electronic storage media to develop and maintain written operational procedures and controls (an “audit system”) designed to provide accountability over both the initial entry of required records to the electronic storage media and the entry of each change made to any original or duplicate record maintained on the electronic storage media. Moreover, the written operational procedures and controls must be made available for examination at all times by any representative of the Commission.
With respect to training, the Commission does not find it necessary to prescribe specific requirements regarding the frequency and format of any training. Consistent with its approach towards mandatory ethics training for registrants, the Commission views the training on written policies and procedures as an ongoing responsibility rather than an episodic one.
• Should the training requirement be scaled down, phased-in, or eliminated depending on the number of employees, or depending on the nature of the entity's business?
The Commission proposes to re-state and clarify in revised § 1.31(c) the existing retention period requirements for categories of regulatory records currently set forth in § 1.31(a). Specifically, proposed § 1.31(c)(1) would state that a records entity shall keep regulatory records of any swap or related cash or forward transaction (as defined in § 23.200(i)), other than regulatory records of oral communications, 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. The Commission proposes to incorporate by reference the definition of the term “related cash or forward transaction” in § 23.200(i).
Similarly, proposed § 1.31(c)(2) would state that a records entity that is required to retain oral communications shall keep regulatory records of such oral communications for a period of not less than one year from the date of such communication. This is consistent with the existing standard. The Commission proposes, however, to eliminate references to §§ 1.35(a) and 23.202(a)(1) and (b)(1) with respect to “oral communications” as future changes to those regulations, or the promulgation of new types of oral communications requirements, would require the Commission to contemporaneously amend § 1.31. Based on the foregoing proposed amendments, the Commission believes that the existing provision in § 23.203(b)(2) regarding the retention period of swaps-related information for swap dealers and major swap participants is redundant and therefore should be repealed. For all other regulatory records not addressed in proposed § 1.31(c)(1) and (2), proposed § 1.31(c)(3) would require a records entity to keep such records for a period of not less than five years from the date on which such record was created. However, proposed § 1.31(c)(4) would retain the existing retention period for regulatory records exclusively created and maintained on paper,
• Are the proposed recordkeeping retention periods appropriate? If not, what modifications to the retention periods should be made?
• Given the advances in information technology, such as cloud storage, should the Commission extend the standard five year retention period?
• Is there a longer or shorter period of retention that would be appropriate for some records, and if so please specify which records and such time-frames?
The Commission proposes to revise § 1.31(d) to describe recordkeeping requirements regarding the form and manner in which regulatory records are retained by records entities. These proposed revisions are designed to ensure the integrity and availability of all regulatory records. The Commission is cognizant that other provisions of the Act and Commission regulations distinguish between different classes of records entities. In particular, the Commission recognizes that records entities that are not registered or required to be registered with the Commission in any capacity, nor are one of the enumerated “registered entities” defined in Section 1a(40) of the CEA or so required to be registered or designated,
The Commission proposes to re-state and revise in new § 1.31(d) certain requirements for regulatory records currently set forth in § 1.31(b)(1) through (3). In doing so, the Commission proposes to adopt a general standard in § 1.31(d)(1) to require each records entity to retain all regulatory records in a form and manner necessary to ensure the records' and recordkeeping systems' authenticity and reliability. This general requirement would not distinguish between paper and non-paper regulatory records.
With respect to electronic regulatory records, the Commission proposes to set forth in new § 1.31(d)(2)(i) through (iii) additional controls for records entities retaining electronic regulatory records. In particular, each records entity would be required to:
(A) Have systems that maintain security, signature, chain of custody elements, and data as necessary to ensure the authenticity of the information contained in regulatory records and to monitor compliance with the Act and Commission regulations;
(B) Have systems that ensure the records entity is able to produce regulatory records in accordance with this section, and ensure the availability of regulatory records in the event of an emergency or other disruption of the records entity's record retention systems; and
(C) Create and maintain an up-to-date inventory that identifies and describes each system that maintains information necessary for accessing or producing regulatory records.
The Commission believes that these requirements are not new and are consistent with certain SEC requirements.
Finally, based on the foregoing proposed amendments, the Commission believes that the existing provision in § 1.35(a)(5)(i) regarding the form and manner in which records of commodity interest and cash forward transactions should be maintained is redundant and therefore should be repealed.
• Should the Commission routinely publish guidelines regarding the technical standards for electronic regulatory records?
With respect to potential impacts of the Proposal, the Commission specifically requests comment on the following questions:
• Would the Proposal require market participants to change their existing recordkeeping procedures under the Proposal? What, if any, transition or ongoing costs would result from such changes? Please provide details and estimates regarding any asserted costs.
• For entities who maintain digitized copies of paper records, what costs or other impacts would result under the Proposal?
The Commission proposes to re-state in revised § 1.31(e)(1) the right of inspection of the Commission and the United States Department of Justice (“DOJ”) in existing § 1.31(a)(1). Specifically, the Commission proposes § 1.31(e)(1) to state that all regulatory records shall be open to inspection by any representative of the Commission or the DOJ. The Commission previously determined that production of records is part of the Commission's inspection
The Commission proposes to revise and re-state in new § 1.31(e)(2) the existing production requirement currently set forth in § 1.31(a)(2) and (b). Currently, a records entity is required to produce regulatory records in a form specified by any representative of the Commission, including the DOJ, upon the representative's request. If the requested book or record is stored either on micrographic media or electronic storage media, production shall be immediate.
With respect to the production of regulatory records exclusively created and maintained on paper, proposed § 1.31(e)(2) would require a records entity to produce such regulatory records promptly upon request. With respect to regulatory records other than paper regulatory records, proposed § 1.31(e)(3) would set forth the process by which a records entity must respond to a request from a Commission representative. In particular, § 1.31(e)(3)(i) would require a Commission representative to specify a reasonable form and medium in which a records entity must produce such regulatory records. Proposed § 1.31(e)(3)(ii) would require a records entity, at its own expense, to produce such regulatory records in the form and medium requested promptly, upon request, unless otherwise directed by the Commission representative.
The Commission recognizes that production, depending on the records, may require the records entity to engage multiple employees, officers, or directors in order to satisfy the production request, depending upon its size and scope. Historically, Commission staff has exercised broad discretion regarding production schedules and “typically exhibits flexibility. . . .”
In adopting this revised regulation, the Commission is cognizant of the need to balance the opportunities for recordkeepers to reduce costs and improve efficiencies regarding recordkeeping systems with the Commission's need for prompt access to complete and accurate records in a format that the Commission can process,
Finally, the Commission further proposes to adopt new § 1.31(e)(4) to preserve the existing right of a records entity to provide a representative of the Commission with an original regulatory record for reproduction by the representative in lieu of a copy currently set forth in § 1.31(a)(2). As with the existing provision, the Commission proposes to require the Commission representative to issue a receipt for the original regulatory record to the records entity upon request.
• Should the Commission impose a different standard with respect to the production of paper regulatory records or other regulatory records?
• Are there records entities that retain only paper regulatory records?
Consistent with the foregoing amendments and in response to the Petitioners' request, the Commission proposes to amend § 1.31(b)(4)(i) to remove the requirement for a records entity to enter into an arrangement with a Technical Consultant and provide the Technical Consultant with access to and the ability to download information from the records entity's electronic storage media to any acceptable medium. Further, the Commission proposes to remove the requirement set forth in § 1.31(b)(4)(ii) which requires the Technical Consultant to file with the Commission an acceptable undertaking regarding its ability and willingness to provide the Commission and DOJ with access to the information contained on the record entity's electronic storage media. The Commission concurs with the position taken by Petitioners that the information technology expertise within
Consistent with the foregoing amendments and in response to the Petitioners' request, the Commission proposes to amend § 1.31 by removing existing § 1.31(c). This provision requires any person utilizing electronic storage media to provide a written representation to the Commission prior to the use of the system certifying that the system satisfies the requirements in existing paragraph (b)(1)(ii) and, where applicable, if the system will be using storage media other than optical disk or CD-ROM. Further, the written representation must include an affirmation from an individual consistent with § 1.10(d)(4),
Consistent with the foregoing amendments, the Commission proposes to amend § 1.31 by removing current § 1.31(d). This provision states that certain paper records, such as trading cards and paper copies of electronically filed certified forms, must be retained in hard-copy for the required time period. The Commission believes that revised § 1.31 provides records entities with sufficient flexibility on how to retain regulatory records while maintaining the Commission's ability to access reliable regulatory information. Having eliminated the requirement for a records entity to retain regulatory records in a specific form and manner, the Commission believes that § 1.31(d) no longer serves any regulatory purpose.
In conjunction with the Proposal, the Commission is reviewing its regulations for potential technical amendments related to § 1.31, including those part 4 regulations cited by Petitioners. This review may or may not result in a new proposed rulemaking.
The Regulatory Flexibility Act (“RFA”)
As discussed above, because the Proposal relates to most recordkeeping obligations under the CEA 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.
As discussed above, the Proposal generally updates and simplifies existing Commission regulation 1.31 with new provisions that safeguard the same statutory-based principles previously identified by the Commission. 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.
The Commission believes that the proposed rules would impose only limited additional costs on small entities related to the requirement that they establish written recordkeeping policies and procedures. However, this new requirement is replacing existing requirements applicable to such persons in many cases, including the existing similar requirements discussed above to (i) Maintain an audit system and (ii) under certain circumstances, retain a Technical Consultant. Further, as part of the Proposal, the Commission is proposing to remove existing requirements that are expected to lower costs for all records entities, including small entities, by removing requirements that certain records be kept in paper form.
In light of the limited scope of the proposed changes and the added flexibility and expected cost-savings provided to small entities thereby, the Commission does not expect small entities that are records entities to incur
Accordingly, the Chairman, on behalf of the Commission, hereby certifies pursuant to 5 U.S.C. 605(b) that the Proposal will not have a significant economic impact on a substantial number of small entities.
The Paperwork Reduction Act of 1995 (“PRA”)
The Proposal contains a collection of information for which the Commission has previously received a control number from OMB. The title for this collection of information is “Adaptation of Regulations to Incorporate Swaps-Records of Transactions, OMB control number 3038-0090”.
The responses to the Proposal's collection of information are mandatory. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid control number issued by OMB.
As discussed above, in respect of collections of information, the Proposal would replace the existing audit system requirements with a requirement that records entities establish written recordkeeping policies and procedures. Such changes would result in revisions to collection 3038-0090. Therefore, the Commission proposes to revise collection 3038-0090 as described below.
The Commission estimates that the Proposal will require approximately 15,000 persons to develop and maintain recordkeeping policies and procedures. This estimate includes approximately 8,792 registrants, 15 designated contract markets, 23 swap execution facilities, 4 swap data repositories, 15 designated clearing organizations, and 3,200 unregistered members of designated contract markets or swap execution facilities, with the balance reflecting the Commission's estimate of those persons that are required to register with the Commission, but have not so registered, and other persons neither registered nor required to register with the Commission.
Based on the above, the estimated additional hour burden for recordkeeping policies and procedures of 150,000 hours is calculated as follows:
The Commission invites the public and other Federal agencies to comment on any aspect of the proposed information collection requirements discussed above. Pursuant to 44 U.S.C. 3506(c)(2)(B), the Commission solicits comments in order to: (1) Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the Commission, including whether the information will have practical utility; (2) evaluate the accuracy of the Commission's estimate of the burden of the proposed collection of information; (3) determine whether there are ways to enhance the quality, utility, and clarity of the information to be collected; and (4) minimize the burden of the collection of information on those who are to respond, including through the use of automated collection techniques or other forms of information technology.
Comments may be submitted directly to the Office of Information and Regulatory Affairs, by fax at (202) 395-6566, or by email at
Section 15(a) of the CEA
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 statutory-based principles previously identified by the Commission. The Commission preliminarily believes that the Proposal would impose certain costs on records entities. These costs are those necessary to establish and maintain required written recordkeeping policies and procedures. The Commission believes that these costs will be quite limited. At
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 Proposal 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 Proposal will allow records entities to utilize a wider range of currently available technology than previously allowed and remove requirements that the Commission believes are now obsolete, allowing records entities to reduce their costs. In addition, the Commission believes that the flexibility provided by the Proposal will, without further Commission rulemaking, allow records entities to adopt new technologies as such technologies evolve, allowing such persons to reduce their future costs.
Moreover, the Commission expects that the added flexibility provided by the Proposal 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 DOJ, and the commodity interest industry, generally, by making the universe of regulatory records more accessible and searchable.
In addition, as a result of the Proposal codifying industry practices to require recordkeeping policies and procedures and, in doing so, providing records entities with an opportunity to examine their own recordkeeping practices, the Commission expects that records entities may improve the quality of such practices and, thus, the accuracy and integrity of their regulatory records.
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.
The Proposal 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.
As discussed above, the Proposal may increase resource allocation efficiency by improving the way in which records are maintained. Otherwise, the Commission anticipates minimal change to the efficiency, competitiveness, and financial integrity of the markets.
The Commission believes that the Proposal may increase confidence and participation in the markets for the reasons discussed above. Nevertheless, the Commission does not anticipate a significant increase in liquidity or a significant improvement in price discovery as a result of this rulemaking.
By improving recordkeeping policies and procedures, the Proposal may encourage records entities to analyze their recordkeeping practices and create or update policies and procedures related thereto.
The Commission has not identified any additional public interest considerations.
The Commission invites public comment on its cost-benefit considerations, including the Section 15(a) factors described above. Commenters are also invited to submit any data or other information that they may have quantifying or qualifying the costs and benefits of the Proposal with their comment letters.
The Commission specifically seeks comment on the following:
• For those market participants with written operational procedures and controls that comply with current Commission regulation 1.31, what transition costs, if any, will the Proposal's requirement for written policies and procedures entail?
• Are there any costs or benefits associated with the Proposal that the Commission has not considered in the Proposal? Please provide details and estimates regarding any asserted costs or benefits.
Commodity futures, Reporting and recordkeeping requirements.
Authority delegations (Government agencies), Commodity futures, Reporting and recordkeeping requirements.
For the reasons stated in the preamble, the Commodity Futures Trading Commission proposes to amend 17 CFR chapter I as follows:
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).
(a)
(i) All data produced and stored electronically that describes, directly or indirectly, the characteristics of such books and records, including, without limitation, data that describes how, when, and, if relevant, by whom such electronically stored information was collected, created, accessed, modified, or formatted; and
(ii) Any data necessary to access, search, or display any such books and records.
(b)
(c)
(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 of oral communications, 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 paragraph (c)(1) or (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.
(d)
(1)
(2)
(i) Systems that maintain the security, signature, chain of custody elements, 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.
(e)
(1)
(2)
(3)
(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)
(a) * * *
(5)
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).
The revisions to read as follows:
(b) * * * (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.
The following appendices will not appear in the Code of Federal Regulations.
On this matter, Chairman Massad and Commissioners Bowen and Giancarlo voted in the affirmative. No Commissioner voted in the negative.
I have said many times that it is important for the CFTC to ensure its rules are up-to-date in light of technological changes, as outdated rules can create unnecessary burdens. That is why I'm pleased we are unanimously issuing this proposed rulemaking, which is in keeping with that goal.
Today's proposal will modernize recordkeeping and storage obligations set forth in CFTC rules, and make them technology neutral. By doing so, it will reduce costs for businesses and improve the quality of record preservation and production. Among other things, the proposal will provide greater flexibility when it comes to how records must be retained and produced. In this age where terabytes of storage easily fit in one's pocket, our rules should not refer to microfiche or require paper records.
Today's proposal is also an example of how the Commission is focusing on issues related to technological change generally in our markets. In this regard, there is much talk today about innovations that may come from financial technology. While it is the role of the private sector to develop innovations, I believe it is our role to ensure that the Commission's rules do not stand in the way of their potential. Today's proposal is a way to do just that.
I thank the CFTC staff for their work on this proposal and my fellow Commissioners for their support.
Food and Drug Administration, HHS.
Reopening of comment period related to public hearing; availability of memorandum.
The Food and Drug Administration (FDA) is reopening the comment period for the notification of public hearing, published in the
Submit either electronic or written comments by April 19, 2017.
You may submit comments as follows:
Submit electronic comments in the following way:
•
• If you want to submit a comment with confidential information that you do not wish to be made available to the public, submit the comment as a written/paper submission and in the manner detailed (see “Written/Paper Submissions” and “Instructions”).
Submit written/paper submissions as follows:
•
• For written/paper comments submitted to the Division of Dockets Management, FDA will post your comment, as well as any attachments, except for information submitted, marked and identified, as confidential, if submitted as detailed in “Instructions.”
• Confidential Submissions—To submit a comment with confidential information that you do not wish to be made publicly available, submit your comments only as a written/paper
Kristin Davis, Office of Policy, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 32, Rm. 4252, Silver Spring, MD 20993, 301-796-0418.
In the
Interested persons were originally given until January 9, 2017, to comment on the topics discussed in the notification of public hearing.
At the public hearing on November 9 and 10, 2016, a number of speakers presented legal views regarding the application of First Amendment principles to firm communications regarding unapproved uses of approved or cleared medical products. Some expressed the view that FDA had not sufficiently discussed the First Amendment in the notification of public hearing. In response to these comments, FDA is now placing the Memorandum in the docket for the public hearing to provide additional background on the issues it is considering as part of its review of its rules and policies relating to firm communications regarding unapproved uses of approved or cleared medical products, including a discussion of First Amendment considerations. In the notification of public hearing, FDA requested comments on a number of specific issues and questions identified throughout the document. The Memorandum is intended to help advance the discussion of these topics, and FDA is seeking input on the information in the Memorandum as it relates to these issues and questions in the notification of public hearing.
Furthermore, elsewhere in this issue of the
Additionally, in this issue of the
FDA is harmonizing the comment periods for the notification of public hearing and the two draft guidances, as all three documents relate to the overarching topic of firm communications regarding medical products, and interested persons may wish to review all the documents before submitting comments to any of the relevant dockets. FDA is requesting comments on both draft guidances by April 19, 2017.
To allow interested parties an opportunity to review the Memorandum and the two draft guidances, FDA is reopening the comment period for the notification of public hearing for an additional 90 days, until April 19, 2017. The Agency believes reopening the comment period for an additional 90 days for the notification of public hearing will allow adequate time for interested persons to submit comments without significantly delaying Agency decision making and policy development on these important issues.
Internal Revenue Service (IRS), Treasury.
Notice of proposed rulemaking by cross-reference to temporary regulation.
In the Rules and Regulations section of this issue of the
Written or electronic comments and requests for a public hearing must be received by April 19, 2017.
Send submissions to: CC:PA:LPD:PR (REG-127203-15), Internal Revenue Service, Room 5203, P.O. Box 7604, Ben Franklin Station, Washington, DC 20044. Submissions may be hand-delivered Monday through Friday between the hours of 8 a.m. and 4 p.m. to CC:PA:LPD:PR (REG-127203-15), Courier's Desk, Internal Revenue Service, 1111 Constitution Avenue NW., Washington, DC 20224, or sent electronically via the Federal eRulemaking Portal at
Concerning the proposed regulations, Ryan A. Bowen, (202) 317-6937; concerning submissions of comments or requests for a public hearing, Regina Johnson, (202) 317-6901 (not toll-free numbers).
The temporary regulations in the Rules and Regulations section of this issue of the
Certain IRS regulations, including this one, are exempt from the requirements of Executive Order 12866, as supplemented and reaffirmed by Executive Order 13563. Therefore, a regulatory impact assessment is not required. It is hereby certified that the collection of information contained in this regulation will not have a significant economic impact on a substantial number of small entities. Accordingly, a regulatory flexibility analysis is not required. This conclusion is based on the fact that the proposed regulations include a $1,000,000 de minimis exception for certain transfers, and tangible property with built-in gain that does not exceed $20,000 is excluded from the application of the regulations. In addition, the regulations only apply when a U.S. transferor contributes property to a partnership with a related foreign partner, and persons related to the U.S. transferor own 80 percent or more of the interests in the partnership. Accordingly, the Treasury Department and the IRS expect that these regulations primarily will affect large domestic corporations. Pursuant to section 7805(f), this notice of proposed rulemaking has been submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on its impact on small business.
Before these proposed regulations are adopted as final regulations, consideration will be given to any comments that are submitted timely to the IRS as prescribed in this preamble under the
The principal author of these proposed regulations is Ryan A. Bowen, Office of Associate Chief Counsel (International). However, other personnel from the Treasury Department and the IRS participated in their development.
Income taxes, Reporting and recordkeeping requirements.
Accordingly, 26 CFR part 1 is proposed to be amended as follows:
26 U.S.C. 7805 * * *
Section 1.721(c)-1 also issued under 26 U.S.C. 721(c).
Section 1.721(c)-2 also issued under 26 U.S.C. 721(c).
Section 1.721(c)-3 also issued under 26 U.S.C. 721(c).
Section 1.721(c)-4 also issued under 26 U.S.C. 721(c).
Section 1.721(c)-5 also issued under 26 U.S.C. 721(c).
Section 1.721(c)-6 also issued under 26 U.S.C. 721(c).
Section 1.721(c)-7 also issued under 26 U.S.C. 721(c).
(h) * * *
(12) * * *
(vii) * * *
(C) [The text of proposed § 1.197-2(h)(12)(vii)(C) is the same as the text of § 1.197-2T(h)(12)(vii)(C) published elsewhere in this issue of the
(l) * * *
(5) [The text of proposed § 1.197-2(l)(5) is the same as the text of § 1.197-2T(l)(5) published elsewhere in this issue of the
(b) * * *
(2) * * *
(iv) * * *
(
(
(f) [The text of proposed § 1.704-1(f) is the same as the text of § 1.704-1T(f) published elsewhere in this issue of the
(a) * * *
(13) [The text of proposed § 1.704-3(a)(13) is the same as the text of § 1.704-3T(a)(13) published elsewhere in this issue of the
(d) * * *
(5) * * *
(iii) [The text of proposed § 1.704-3(d)(5)(iii) is the same as the text of § 1.704-3T(d)(5)(iii) published
(g) [The text of proposed § 1.704-3(g) is the same as the text of § 1.704-3T(g) published elsewhere in this issue of the
[The text of proposed § 1.721(c)-1 is the same as the text of § 1.721(c)-1T published elsewhere in this issue of the
[The text of proposed § 1.721(c)-2 is the same as the text of § 1.721(c)-2T published elsewhere in this issue of the
[The text of proposed § 1.721(c)-3 is the same as the text of § 1.721(c)-3T published elsewhere in this issue of the
[The text of proposed § 1.721(c)-4 is the same as the text of § 1.721(c)-4T published elsewhere in this issue of the
[The text of proposed § 1.721(c)-5 is the same as the text of § 1.721(c)-5T published elsewhere in this issue of the
[The text of proposed § 1.721(c)-6 is the same as the text of § 1.721(c)-6T published elsewhere in this issue of the
[The text of proposed § 1.721(c)-7 is the same as the text of § 1.721(c)-7T published elsewhere in this issue of the
(a) * * *
(1) * * *
(iii) [The text of proposed § 1.6038B-2(a)(1)(iii) is the same as the text of § 1.6038B-2T(a)(1)(iii) published elsewhere in this issue of the
(3) [The text of proposed § 1.6038B-2(a)(3) is the same as the text of § 1.6038B-2T(a)(3) published elsewhere in this issue of the
(c) * * *
(8) [The text of proposed § 1.6038B-2(c)(8) is the same as the text of § 1.6038B-2T(c)(8) published elsewhere in this issue of the
(9) [The text of proposed § 1.6038B-2(c)(9) is the same as the text of § 1.6038B-2T(c)(9) published elsewhere in this issue of the
(h) * * *
(3) [The text of proposed § 1.6038B-2(h)(3) is the same as the text of § 1.6038B-2T(h)(3) published elsewhere in this issue of the
(j) * * *
(4) [The text of proposed § 1.6038B-2(j)(4) is the same as the text of § 1.6038B-2T(j)(4) published elsewhere in this issue of the
(5) [The text of proposed § 1.6038B-2(j)(5) is the same as the text of § 1.6038B-2T(j)(5) published elsewhere in this issue of the
Internal Revenue Service (IRS), Treasury.
Withdrawal of notice of proposed rulemaking and notice of proposed rulemaking.
This document withdraws proposed regulations relating to the definition of an authorized placement agency for purposes of a dependency exemption for a child placed for adoption that were issued prior to the changes made to the law by the Working Families Tax Relief Act of 2004 (WFTRA). This document contains proposed regulations that reflect changes made by WFTRA and by the Fostering Connections to Success and Increasing Adoptions Act of 2008 (FCSIAA) relating to the dependency exemption. This document also contains proposed regulations that, to reflect current law, amend the regulations relating to the surviving spouse and head of household filing statuses, the tax tables for individuals, the child and dependent care credit, the earned income credit, the standard deduction, joint tax returns, and taxpayer identification numbers for children placed for adoption. These proposed regulations change the IRS's position regarding the category of taxpayers permitted to claim the childless earned income credit. In determining a taxpayer's eligibility to claim a dependency exemption, these proposed regulations change the IRS's position regarding the adjusted gross income of a taxpayer filing a joint return for purposes of the tiebreaker rules and the source of support of certain payments that originated as governmental payments. These regulations provide guidance to individuals who may claim certain child-related tax benefits.
Written or electronic comments and requests for a public hearing must be received by April 19, 2017.
Send submissions to: CC:PA:LPD:PR (REG-137604-07), Room 5203, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station, Washington, DC 20044. Submissions may be hand-delivered Monday through Friday between the hours of 8 a.m. and 4 p.m. to CC:PA:LPD:PR (REG-137604-07), Courier's Desk, Internal Revenue Service, 1111 Constitution Avenue NW., Washington, DC 20224, or sent electronically via the Federal eRulemaking Portal at
Concerning the proposed regulations, Victoria J. Driscoll, (202) 317-4718; concerning the submission of comments and requests for a public hearing, Regina Johnson, (202) 317-6901 (not toll-free calls).
This document withdraws a notice of proposed rulemaking (REG-107279-00) amending § 1.152-2(c)(2) of the Income Tax Regulations that was published in the
This document also contains proposed amendments to 26 CFR part 1 under sections 2, 3, 21, 32, 63, 151, 152, 6013, and to Part 301 under section 6109 to reflect the changes made by WFTRA and FCSIAA (Pub. L. 110-351, 122 Stat. 3949) relating to the dependency exemption, as well as changes to these sections by other acts. WFTRA amended section 152, in part, to provide a uniform definition of a qualifying child; FCSIAA added to the definition of a qualifying child the requirements that the child must be younger than the taxpayer and that the child must not file a joint return (other than as a claim for refund). FCSIAA also amended the rules that apply if two or more taxpayers are eligible to claim an individual as a qualifying child.
Under section 151, a taxpayer may deduct an exemption amount for a dependent as defined in section 152. Prior to WFTRA, section 151 contained many of the rules related to the definition of a dependent. WFTRA moved those rules to section 152. As amended, section 152(a) defines a
Section 152(b) provides that an individual who is a qualifying child or a qualifying relative of a taxpayer is not a taxpayer's dependent in certain circumstances. Section 152(b)(2) provides that, to be a dependent of a taxpayer, an individual must not have filed a joint return with his or her spouse. However, the WFTRA conference report provides that the “restriction does not apply if the return was filed solely to obtain a refund and no tax liability would exist for either spouse if they filed separate returns.” See H.R. Rep. No. 108-696, at 55 n.38 (2004) (Conf. Rep.).
WFTRA established under section 152(c) a uniform definition of a qualifying child. The legislative history identifies five child-related benefits to which the uniform definition applies: The filing status of head of household under section 2(b), the child and dependent care credit under section 21, the child tax credit under section 24, the earned income credit under section 32, and the dependency exemption under section 151. See H.R. Rep. No. 108-696, at 55-65.
Section 152(c) defines a qualifying child as an individual who bears a certain relationship to the taxpayer (qualifying child relationship test), has the same principal place of abode as the taxpayer for more than one-half of the taxable year (residency test), is younger than the taxpayer and is under the age of 19 (or age 24 if a full-time student or any age if permanently and totally disabled) (age test), does not provide more than one-half of his or her own support (qualifying child support test), and does not file a joint return with a spouse except to claim a refund of estimated or withheld taxes (joint return test).
A child is considered to reside in the same principal place of abode as a taxpayer during a temporary absence. Under the existing section 152 regulations, a nonpermanent failure to occupy a common abode by reason of illness, education, business, vacation, military service, or a custody agreement may be a temporary absence due to special circumstances. The existing regulations under section 2 defining surviving spouse and head of household include a similar rule relating to the effect of a temporary absence on the requirement to maintain a household, but add the requirement that it is reasonable to assume that the absent person will return to the household. Under case law, a factor to consider in determining whether an absence is temporary is whether the individual intends to establish a new principal place of abode. In
Section 152(c)(4) provides tiebreaker rules that apply if an individual meets the definition of a qualifying child for two or more taxpayers (eligible taxpayers). In general, the eligible taxpayer who is a parent (eligible parent) of the individual may claim the individual as a qualifying child or, if there is no eligible parent, then the individual may be claimed by the eligible taxpayer with the highest adjusted gross income.
If more than one of the eligible taxpayers is a parent of the individual, more than one eligible parent claims the individual as a qualifying child, and the eligible parents claiming the individual do not file a joint return with each other, the individual is treated as the qualifying child of the eligible parent claiming the individual with whom the individual resided for the longest period of time during the taxable year. If the individual resided with each eligible parent claiming the individual for the same amount of time during the taxable year, the individual is treated as the qualifying child of the eligible parent claiming the individual with the highest adjusted gross income.
If at least one, but not all, of two or more eligible taxpayers is a parent of the individual, but no eligible parent claims the individual as a qualifying child, another eligible taxpayer may claim the individual, but only if the eligible taxpayer's adjusted gross income is higher than the adjusted gross income of each eligible parent. Since 2009, IRS Publication 501,
Notice 2006-86 (2006-2 CB 680) provides interim guidance on these rules prior to the amendments by FCSIAA. The notice provides that, except to the extent that a noncustodial
Notice 2006-86 contains an exception to the rule that only one taxpayer may claim a child as a qualifying child for all purposes. Section 152(e) has a special rule for divorced or separated parents that determines who, as between the custodial and noncustodial parent, may claim a child as a qualifying child or qualifying relative if certain tests (different from the general tests under sections 152(c) and (d)) regarding residency and support are met and the custodial parent releases a claim to exemption for the child. The notice provides that, if this special rule applies, a noncustodial parent may claim a child as a qualifying child for purposes of the dependency exemption and the child tax credit (the only two of the provisions addressed in the notice to which section 152(e) applies in determining who is a qualifying child), and another taxpayer may claim the child for one or more of the other benefits to which section 152(e) does not apply.
Although FCSIAA affects other aspects of section 152(c)(4) and Notice 2006-86, there is nothing in FCSIAA that would compel a change in the rule described in Notice 2006-86 that an individual is treated as the qualifying child of only one taxpayer for the listed child-related tax benefits, except if the special rule in section 152(e) applies.
Under section 152(d), a qualifying relative is an individual who bears a certain relationship to the taxpayer, including an individual who has the same principal place of abode as the taxpayer and is a member of the taxpayer's household for the taxable year (qualifying relative relationship test), has gross income less than the exemption amount for the taxable year (gross income test), receives more than one-half of his or her support from the taxpayer (qualifying relative support test), and is not a qualifying child of any taxpayer (not a qualifying child test).
Notice 2008-5 (2008-1 CB 256) addresses whether a taxpayer meets the test under section 152(d)(1)(D) to claim an individual as a qualifying relative. That provision requires that the individual not be a qualifying child of either the taxpayer or any other taxpayer during a taxable year beginning in the calendar year in which the taxpayer's taxable year begins. The notice provides that, for purposes of section 152(d)(1)(D), an individual is not a qualifying child of “any other taxpayer” if the individual's parent (or other person for whom the individual is defined as a qualifying child) is not required by section 6012 to file an income tax return and (1) does not file an income tax return, or (2) files an income tax return solely to obtain a refund of withheld income taxes.
Under section 152(c)(1)(D), to be a taxpayer's qualifying child, an individual must not have provided over one-half of the individual's own support for the calendar year. Under section 152(d)(1)(C), to be a taxpayer's qualifying relative, a taxpayer must have provided over one-half of an individual's support for the calendar year.
Regarding governmental payments to a person with a qualifying need, the WFTRA conference report, H.R. Rep. No. 108-696, at 57, states that “[g]overnmental payments and subsidies (
Prior to amendment by section 803(b) of the Tax Reform Act of 1969 (Pub. L. 91-172, 83 Stat. 487), section 2(a) provided that the return of a surviving spouse is treated as a joint return for purposes of the tax rates, the tax tables for individuals, and the standard deduction. Following the 1969 amendments, section 2(a) defines the term
Generally, under section 2(b), to qualify as a head of household, a taxpayer must maintain a household that is the principal place of abode of a qualifying child or other dependent for more than one-half of the taxable year. If the dependent is a parent of the taxpayer and the parent does not share a principal place of abode with the taxpayer, the household maintained by the taxpayer must be the parent's principal place of abode for the entire taxable year.
Prior to WFTRA, section 21 required that a taxpayer maintain a household to claim the credit for dependent care expenses, and regulations on maintaining a household were published under that section. WFTRA removed that requirement from the dependent care credit.
Section 32 provides a tax credit to eligible taxpayers who work and have earned income below a certain dollar amount. Before the amendment of section 32 by the Omnibus Reconciliation Act of 1993 (Pub. L. 103-66, 107 Stat. 312), the earned income credit (EIC) was allowable only to a taxpayer with one or more qualifying children. If an individual met the definition of a qualifying child for more than one taxpayer, a tiebreaker rule in section 32 determined which taxpayer was allowed to claim the individual as a qualifying child for the EIC. For taxable years beginning after 1993, section 32(c)(1)(A)(ii) allows a taxpayer without a qualifying child to claim the EIC (childless EIC) if certain
Before repeal in 2010, section 3507 allowed advance payment of the EIC. Section 3507 was repealed by the FAA Air Transportation Modernization and Safety Improvement Act (Pub. L. 111-226, 124 Stat. 2389).
Before the amendments to sections 63 and 151 made by the Tax Reform Act of 1986 (Pub. L. 99-514, 100 Stat. 2085), a taxpayer was entitled to an additional personal exemption under section 151 for the taxpayer or the taxpayer's spouse (or both), if either was age 65 or older or was blind at the close of the taxable year. As amended, section 63 provides an additional standard deduction for age or blindness instead of an additional personal exemption under section 151.
The proposed regulations reflect statutory amendments to sections 2, 3, 21, 32, 63, 151, 152, 6013, and 6109. In addition, the regulations address certain significant issues arising under these sections and modify certain IRS positions, as explained below.
Consistent with the amendments made to sections 151 and 152 by WFTRA, the proposed regulations move rules related to the definition of a dependent from the regulations under section 151 to the regulations under section 152.
Section 152(c)(2) provides that a qualifying child must be a child or a descendant of a child of the taxpayer, or a brother, sister, stepbrother, or stepsister of the taxpayer, or a descendant of any of these relatives. Section 152(d)(2) provides that a qualifying relative must bear a certain relationship to the taxpayer, which includes a child or a descendant of a child, a brother, sister, stepbrother, stepsister, parent or ancestor of a parent, or an aunt or uncle of the taxpayer. An individual (other than the taxpayer's spouse) who is not related to the taxpayer in one of the named relationships nevertheless may satisfy the relationship test for a qualifying relative if the individual has the same principal place of abode as the taxpayer and is a member of the taxpayer's household for the taxpayer's taxable year.
The proposed regulations adopt the rule in Notice 2008-5 regarding whether an individual is a qualifying child of a taxpayer for purposes of determining whether that individual may be a qualifying relative. That is, the proposed regulations provide that an individual is not a qualifying child of a person if that person is not required to file an income tax return under section 6012, and either does not file an income tax return or files an income tax return solely to claim a refund of estimated or withheld taxes.
Prior to 2005, for purposes of the relationship test, a person's legally adopted child was treated as that person's child by blood. Specifically, section 152(b)(2) provided that “a legally adopted child of an individual (and a child who is a member of an individual's household, if placed with such individual by an authorized placement agency for legal adoption by such individual), . . . shall be treated as a child of such individual by blood.” Therefore, a taxpayer other than the adopting “individual” could be eligible to claim an exemption for an adopted child. For example, the parent of the adopting parent could claim a dependency exemption for the legally adopted child of the taxpayer's son or daughter (just as biological grandparents may claim an exemption for a grandchild) if all other requirements were met.
WFTRA amended section 152 to change the reference from a child placed by an authorized placement agency for adoption to a child who is “lawfully placed” for legal adoption. In making that change, however, WFTRA also changed the reference to the adopting person from “an individual” to “the taxpayer,” so that section 152(f)(1)(B) currently provides that a legally adopted individual of the taxpayer is treated as a child by blood of the taxpayer. The use of the word “taxpayer” rather than “individual” arguably limits the recognition of a relationship through adoption only to those situations in which the taxpayer claiming a dependency exemption for the child is the person who adopts the child. This interpretation of the amended statutory language would diverge from the results of a legal adoption under property, inheritance, and other nontax law, and from the prior tax treatment of adoptions—a significant change in the applicable law. However, there is nothing in the legislative history indicating that Congress intended to limit the treatment of an adopted child as a child by blood in this manner or that otherwise suggests this change in language was intended to effect a change in existing law.
To fill this apparent gap in the statute, the proposed regulations provide that any child legally adopted by a “person,” or any child who is placed with a “person” for legal adoption by that “person,” is treated as a child by blood of that person for purposes of the relationship tests under sections 152(c)(2) and 152(d)(2). Similarly, the proposed regulations provide that an eligible foster child is a child who is placed with a “person” rather than with a taxpayer.
Although WFTRA removed the reference to an authorized placement agency from the provisions relating to an adopted child in section 152(f)(1)(B), the reference to an authorized placement agency continues to appear in section 152(f)(1)(C), relating to an eligible foster child. Prior to amendment by WFTRA, section 152 treated a child who was a member of an individual's household pending adoption as a child by blood of the individual for purposes of the relationship test only if the child was a foster child living with the individual or if the child was placed with the individual by an authorized placement agency for adoption by the individual. Similarly, § 301.6109-3(a) currently provides that a taxpayer may obtain an adoption taxpayer identification number (ATIN) only for a child who was placed for adoption by an authorized placement agency.
As amended by WFTRA, section 152 treats a child placed for adoption as a child by blood of the taxpayer if the child “is lawfully placed with the taxpayer for legal adoption by the taxpayer.” A child may be lawfully placed for legal adoption by an authorized placement agency, the child's parents, or other persons authorized by State law to place children for legal adoption. These proposed regulations reflect the changes made by WFTRA and amend the regulations under section 6109 to provide that the IRS will assign an ATIN to a child who has been lawfully placed with a person for legal adoption.
Under section 152(f)(1)(A)(ii) and § 1.152-1(b)(1)(iii) of these proposed regulations, the term
The 2000 proposed regulations under § 1.152-2(c)(2) defined an authorized placement agency for purposes of the prior law regarding a child placed for legal adoption. These proposed regulations define an authorized placement agency for purposes of the definition of an eligible foster child and withdraw the 2000 proposed regulations, which defined that term without reference to an Indian Tribal Government (ITG).
These proposed regulations provide that an
For purposes of determining whether an individual has the same principal place of abode as the taxpayer in applying the residency test for a qualifying child and the relationship test for a qualifying relative who does not have one of the listed relationships to the taxpayer, the proposed regulations provide that the term
The proposed regulations further provide that a taxpayer and an individual have the same principal place of abode despite a temporary absence by either person. A person is temporarily absent if, based on the facts and circumstances, the person would have resided with the taxpayer but for the temporary absence and it is reasonable to assume the person will return to reside at the place of abode. Thus, the proposed regulations adopt the “reasonable to assume” language from the existing regulations under section 2. The proposed regulations indicate that a nonpermanent failure to occupy the abode by reason of illness, education, business, vacation, military service, institutionalized care for a child who is permanently and totally disabled (as defined in section 22(e)(3)), or incarceration may be treated as a temporary absence due to special circumstances. This definition of temporary absence applies to the residency test for a qualifying child, to the relationship test for a qualifying relative who does not have a listed relationship to the taxpayer, and to the requirements to maintain a household for surviving spouse and head of household.
For purposes of the residency test for a qualifying child, the proposed regulations provide that an individual is treated as having the same principal place of abode as the taxpayer for more than one-half of the taxable year if the individual resides with the taxpayer for at least 183 nights during the taxpayer's taxable year or for at least 184 nights during the taxpayer's taxable year that includes a leap day (residing for more than one-half of the taxable year). The proposed regulations further provide that an individual resides with the taxpayer for a night if the individual sleeps (1) at the taxpayer's residence, or (2) in the company of the taxpayer when the individual does not sleep at the taxpayer's residence (for example, when the parent and the child are on vacation). The regulations provide additional rules for counting nights if a night extends over two taxable years and for taxpayers who work at night.
The proposed regulations provide special rules for determining whether an individual satisfies a residency test if the individual is born or dies during the taxable year, is adopted or placed for adoption, is an eligible foster child, or is a missing child.
The age test for a qualifying child requires that an individual be younger than the taxpayer claiming the individual as a qualifying child, and the individual must not have attained the age of 19 (or age 24 if the individual is a student). The age requirement is treated as satisfied if the individual is permanently and totally disabled.
For purposes of this age test, the proposed regulations substantially adopt the existing definition of a student. Accordingly, the proposed regulations provide that the term
In determining whether an individual provided more than one-half of the individual's own support (qualifying child support test), or whether a taxpayer provided more than one-half of an individual's support (qualifying relative support test), the proposed regulations compare the amount of support provided by the individual or the taxpayer to the total amount of the individual's support from all sources. In general, the amount of an individual's support from all sources includes support the individual provides and income that is excludable from gross income. The proposed regulations further provide that the amount of an item of support is the amount of expenses paid or incurred to furnish the item of support. If support is furnished in the form of property or a benefit (such as lodging), the amount of that support is the fair market value of the item furnished (Rev. Rul. 58-302 (1958-1 CB 62)).
The proposed regulations provide that the term
The proposed regulations provide that medical insurance premiums are treated as support. These premiums include Part A Basic Medicare premiums, if any, under Title XVIII of the Social Security Act (42 U.S.C. 1395c to 1395i-5), Part B Supplemental Medicare premiums under Title XVIII of the Social Security Act (42 U.S.C. 1395j to 1395w-6), Part C Medicare + Choice Program premiums under Title XVIII of the Social Security Act (42 U.S.C. 1395w-21 to 1395w-29), and Part D Voluntary Prescription Drug Benefit Medicare premiums under Title XVIII of the Social Security Act (42 U.S.C. 1395w-101 to 1395w-154). However, medical insurance proceeds, including benefits received under Medicare Part A, Part B, Part C, and Part D, are not treated as support and are disregarded in determining the amount of the individual's support. Thus, only the premiums paid and the unreimbursed portion of the expenses for the individual's medical care are support. See Rev. Rul. 64-223 (1964-2 CB 50); and Rev. Rul. 70-341 (1970-2 CB 31), revoked in part by Rev. Rul. 79-173 (1979-1 CB 86) to the extent that it held that Part A Medicare benefits are included as a recipient's contribution to support. In addition, services provided to individuals under the medical and dental care provisions of the Armed Forces Act (10 U.S.C. chapter 55) are not treated as support and are disregarded in determining the amount of the individual's support. Finally, payments from a third party (including a third party's insurance company) for the medical care of an injured individual in satisfaction of a legal claim for the personal injury of the individual are not items of support and are disregarded in determining the amount of the individual's support. See Rev. Rul. 64-223.
The proposed regulations provide that, in general, governmental payments and subsidies are treated as support provided by a third party. Consistent with previously issued rulings and case law, these payments and subsidies include, for example, Temporary Assistance for Needy Families (TANF) (42 U.S.C. 601-619), low-income housing assistance (42 U.S.C. 1437f), benefits under the Supplemental Nutrition Assistance Program (7 U.S.C. chapter 51), Supplemental Security Income payments (42 U.S.C. 1381-1383f), foster care maintenance payments, and adoption assistance payments. See H.R. Rep. No. 108-696, at 57 (2004) (Conf. Rep.);
However, unlike the subsidies described in the previous paragraph that generally are based solely on need, old age benefits under section 202(b) of Title II of the Social Security Act (SSA) (42 U.S.C. 402) are based on an individual's earnings and contributions into the Social Security system and thus are treated as support provided by the recipient to the extent the recipient uses the payments for support. See Rev. Rul. 58-419 (1958-2 CB 57), as modified by Rev. Rul. 64-222 (1964-2 CB 47). Similarly, Social Security survivor and disability insurance benefit payments made under section 202(d) of the SSA to the child of a deceased or disabled parent are treated as support provided by the child to the extent those payments are used for the child's support. See Rev. Rul. 57-344 (1957-2 CB 112) and Rev. Rul. 74-543 (1974-2 CB 39).
The proposed regulations provide a special rule for governmental payments used by the recipient or other intended beneficiary to support another individual. The proposed regulations draw a distinction between: (1) Governmental payments (such as Social Security old age benefits, or survivor and disability insurance benefits for a child) made to a recipient that are intended to benefit a particular named individual (whether the recipient, or another intended beneficiary for whom the recipient merely acts as the payee on behalf of that other intended beneficiary); and (2) governmental payments made to a recipient that are intended to support the recipient and other individuals (such as TANF). Although the governmental payments of the former variety are intended to benefit a particular named individual, because money is fungible, the intended beneficiary might use the governmental payments to support another individual. In this situation, the proposed regulations provide that, if the intended beneficiary (whether the recipient or another individual) uses the governmental payments to support another individual, that amount would constitute support of that other individual provided by the intended beneficiary. Similarly, the proposed regulations provide that the use of governmental payments of the latter variety by the recipient to support another individual would constitute support of that other individual provided by the recipient, whereas any part of such a payment used for the support of the recipient would constitute support of the recipient by a third party. For example, if a mother receives TANF and uses the TANF payments to support her children, the proposed regulations treat the mother as having provided that support. Thus, the IRS will no longer assert the position that it took in
The Treasury Department and IRS request comments on whether various payments made pursuant to the Patient Protection And Affordable Care Act (Public Law 111-148, 124 Stat. 119) in the form of a cost-sharing reduction, an advanced payment of the premium tax credit, or as a reimbursement of health insurance premiums in the form of a premium tax credit, when used for the benefit of another individual, are support provided by the recipient of those benefits or support provided by a third party.
Under section 152(b)(3)(A), an individual who is not a citizen or national of the United States is not a dependent unless the individual is a resident of the United States, Canada, or Mexico. Nevertheless, consistent with the exception for certain adopted children in section 152(b)(3)(B), the proposed regulations provide that an adopted child of a taxpayer who is a U.S. citizen or national may qualify as a dependent if, for the taxpayer's taxable year, the child has the same principal place of abode as the taxpayer and is a member of the taxpayer's household, and otherwise qualifies as the taxpayer's dependent.
The proposed regulations change the interpretation in Publication 501 regarding a taxpayer's adjusted gross income on a joint return and provide that, in applying the tiebreaker rules that treat an individual as the qualifying child of the eligible taxpayer with the higher or highest adjusted gross income, the adjusted gross income of a taxpayer who files a joint tax return is the total adjusted gross income shown on the return. The prior interpretation is changed to be consistent with other Code sections that require the filing of a joint return to claim a benefit and therefore calculate income based on the entire amount shown on the joint return. For example, the earned income credit under section 32 calculates the
The proposed regulations also expand the tiebreaker rule in section 152(c)(4)(C) to address the situation in which an eligible parent does not claim an individual as a qualifying child and two or more taxpayers, none of whom is a parent, are eligible to claim the individual as a qualifying child and each has adjusted gross income higher than any eligible parent. In this situation, the proposed regulations provide that the individual is treated as the qualifying child of the eligible taxpayer with the highest adjusted gross income.
Section 152(e) provides, in general, that a child is treated as the qualifying child or qualifying relative of a noncustodial parent for a calendar year if, among other things, the custodial parent provides to the noncustodial parent a written declaration that the custodial parent will not claim the child as a dependent for any taxable year beginning in that calendar year. Under section 152(e)(2)(B), the noncustodial parent must attach the written declaration to his or her return.
The proposed regulations provide that the noncustodial parent must attach a copy of the written declaration to an original or amended return. A taxpayer may submit a copy of the written declaration to the IRS during an examination of that parent's return. However, to provide certainty for both taxpayers and the IRS, the proposed regulations provide that a copy of a written declaration attached to an amended return or provided during an examination will not meet the requirements of section 152(e) and § 1.152-5(e) if the custodial parent signed the written declaration after the custodial parent filed a return claiming a dependency exemption for the child for the year at issue, and the custodial parent has not filed an amended return to remove that claim to a dependency exemption. The proposed regulations provide similar rules for a parent revoking a written declaration.
Individuals who file an income tax return solely to obtain a refund of estimated or withheld taxes are subject to special rules under various provisions of section 152. Section 152(c)(1)(E) provides that, for an individual to be a qualifying child of a taxpayer, the individual cannot have filed a joint return “other than only for a claim of refund.” Section 152(b)(2) provides that, for an individual to be a dependent of a taxpayer, the individual cannot have filed a joint return with the individual's spouse. However, the WFTRA conference report states that “[t]his restriction does not apply if the return was filed solely to obtain a refund and no tax liability would exist for either spouse if they filed separate returns.” Section 152(d)(1)(D) provides that, to be a qualifying relative, an individual may not be the qualifying child of the taxpayer or of any other taxpayer. Notice 2008-5 concludes that an individual is not the qualifying child of “any other taxpayer,” within the meaning of section 152(d)(1)(D), if the person who could have claimed the individual as a qualifying child does not have a filing obligation and either does not file a return or files a return solely to obtain a refund of withheld taxes.
The proposed regulations provide a similar exception to the rule in section 152(b)(1) that a taxpayer cannot have a dependent if the taxpayer himself or herself is a dependent of another taxpayer. Specifically, the proposed regulations provide that an individual is not a dependent of a person if that person is not required to file an income tax return under section 6012 and either does not file an income tax return or files an income tax return solely to claim a refund of estimated or withheld taxes.
The proposed regulations amend the regulations under section 2 regarding the definition of surviving spouse and the definition of head of household to conform to the amendments made by WFTRA. To reflect the amendments made by the Tax Reform Act of 1969, the proposed regulations remove from the regulations under sections 2, 3, and 6013 references to the return of a surviving spouse being treated as a joint return. The proposed regulations also revise and move from the regulations under section 21 to the regulations under section 2 the definition of maintaining a household, in part, to conform to the amendments to section 21 made by WFTRA, which removed the requirement that a taxpayer maintain a household to claim the credit under section 21.
From the time of the 1969 amendment until the enactment of WFTRA, section 2(a)(1)(B) provided that a taxpayer who is a surviving spouse described in section 2(a)(1)(A) may file as a surviving spouse (and thus may use the tax rates of joint filers) only if the taxpayer “maintains as his home a household which constitutes for the taxable year the principal place of abode (as a member of such household) of a dependent (i) who (within the meaning of section 152) is a son, stepson, daughter, or stepdaughter of the taxpayer, and (ii) with respect to whom the taxpayer is entitled to a deduction for the taxable year under section 151.” Thus, the member of the taxpayer's household had to be a son or daughter or stepson or stepdaughter for whom the taxpayer was entitled to a dependency deduction.
WFTRA amended section 2(a), as well as certain other sections such as section 42 relating to the low-income housing credit and section 125 relating to cafeteria plans, to provide that the reference to section 152 applies “without regard to subsections (b)(1), (b)(2), and (d)(1)(B).” These three subsections, respectively: (1) Deny a dependency exemption to a dependent, (2) deny a dependency exemption for a person filing a joint return with his or her spouse, and (3) require the gross income of a qualifying relative to be less than the amount of the dependency exemption. Thus, the language inserted by the WFTRA technical amendment to section 2(a) was intended to broaden the class of individuals whose members could qualify a taxpayer as a surviving spouse for purposes of section 2. See also Staff of Joint Comm. on Taxation, 108th Cong.,
However, in amending section 2(a) for this purpose, WFTRA inserted the direction to exclude the three referenced provisions after the reference to section 152 in section 2(a)(1)(B)(i). Thus, this section currently provides, “(i) who (within the meaning of section 152, determined without regard to subsections (b)(1), (b)(2), and (d)(1)(B)
The proposed regulations under section 2(b) update and simplify the existing regulations defining head of household. Consistent with the statutory amendments to the definition of a dependent, the proposed regulations provide rules on qualifying as a head of household by maintaining a household that is the principal place of abode of a qualifying child or a dependent. The proposed regulations on head of household apply the rules in the proposed regulations under section 152 for determining principal place of abode, including whether an absence is temporary.
The proposed regulations provide that a taxpayer maintains a household only if the taxpayer pays more than one-half of the cost related to operating the household for the relevant period. Expenses related to operating the household include property taxes, mortgage interest, rent, utility charges, upkeep and repairs, property insurance, and food consumed on the premises. A taxpayer may treat a home's fair market rental value as a cost of maintaining a household (instead of the sum of payments for mortgage interest, property taxes, and insurance). The proposed regulations provide rules that, in certain circumstances, prorate on a monthly basis the annual cost of maintaining a household when a qualifying child or dependent resides in the household for less than the entire taxable year. The proposed regulations also, in certain circumstances, recognize the creation of a new household during a year and treat shared living quarters as separate households.
The proposed regulations remove from the regulations under section 3 references to the return of a surviving spouse being treated as a joint return to conform to the amendments made by the Tax Reform Act of 1969. The proposed regulations also update the regulations under section 3 to reflect current law.
The proposed regulations conform the regulations under section 32 to amendments made to section 32 by WFTRA. Consistent with the 2010 repeal of section 3507 by the FAA Air Transportation Modernization and Safety Improvement Act, the proposed regulations delete the paragraphs of the regulations under section 32 discussing advance payment of the earned income credit.
In addition, the proposed regulations reflect a change in the IRS's position on the interaction of sections 152(c)(4) and 32. Specifically, the proposed regulations provide that, if an individual meets the definition of a qualifying child under section 152(c)(1) for more than one taxpayer and the individual is not treated as the qualifying child of one such taxpayer under the tiebreaker rules of section 152(c)(4), then the individual also is not treated as a qualifying child of that taxpayer for purposes of section 32(c)(1)(A). Thus, that taxpayer may be an eligible individual under section 32(c)(1)(A)(ii) and may claim the childless EIC if he or she meets the other requirements of that section. The Treasury Department and the IRS have concluded that this change in position is consistent with the language and purpose of section 32 and will be less confusing to taxpayers and easier for the IRS to administer.
The problems with the current rule may be illustrated by the following example. Two sisters (B and C) live together and each of them is a low-income taxpayer. Neither has a child and each may claim the childless EIC under section 32(c)(1)(A)(ii). Later, B has a child, and B's child meets the definition of a qualifying child under section 152(c)(1) for both B and C. The child is treated as the qualifying child of B under the tiebreaker rules of section 152(c)(4), and B may claim the EIC as an eligible individual with a qualifying child under section 32(c)(1)(A)(i). Under the current rule, C would not be allowed to claim the childless EIC under section 32(c)(1)(A)(ii). The Treasury Department and the IRS have determined that allowing C to continue to claim the childless EIC after the child is born is equitable and consistent with the purpose of section 32 to assist working, low-income taxpayers. Accordingly, the proposed regulations provide that, if an individual is not treated as a qualifying child of a taxpayer after applying the tiebreaker rules of section 152(c)(4), then the individual will not prevent that taxpayer from qualifying for the childless EIC.
The proposed regulations remove the provisions on additional exemptions for age and blindness from the regulations under section 151 and add regulations under section 63 on the additional standard deduction for the aged and the blind to reflect the changes made by the Tax Reform Act of 1986. The proposed regulations amend the regulations under section 63 to remove a cross reference to now-repealed statutory provisions relating to a charitable deduction for taxpayers who do not itemize. To limit impediments to electronic filing, the proposed regulations also delete the requirement that a taxpayer claiming a tax benefit for blindness must attach a certificate or statement to the taxpayer's tax return. Instead, a taxpayer must maintain the certificate or statement in the taxpayer's records.
These regulations are proposed to apply to taxable years beginning after the date the regulations are published as final regulations in the
When finalized, the proposed regulations will obsolete Rev. Rul. 57-344, Rev. Rul. 58-67, Rev. Rul. 58-302, Rev. Rul. 64-223, Rev. Rul. 65-307, Rev. Rul. 70-341, Rev. Rul. 74-153, Rev. Rul. 74-543, Rev. Rul. 79-173, Rev. Rul. 84-89, Notice 2006-86, and Notice 2008-5.
Certain IRS regulations, including these, are exempt from the requirements of Executive Order 12866, as supplemented and reaffirmed by Executive Order 13563. Therefore, a regulatory impact assessment is not required. The regulations affect individuals and do not impose a
IRS revenue procedures, revenue rulings, notices and other guidance cited in this preamble are published in the Internal Revenue Bulletin (or Cumulative Bulletin) and are available from the Superintendent of Documents, U.S. Government Publishing Office, Washington, DC 20402, or by visiting the IRS Web site at
Before these proposed regulations are adopted as final regulations, consideration will be given to any comments that are submitted timely to the IRS, as prescribed in this preamble under the “Addresses” heading. The IRS and Treasury Department request comments on all aspects of the proposed rules. All comments will be available at
The principal authors of these proposed regulations are Christina M. Glendening and Victoria J. Driscoll of the Office of Associate Chief Counsel (Income Tax and Accounting). However, other personnel from the Treasury Department and the IRS participated in the development of the regulations.
Income taxes, Reporting and recordkeeping requirements.
Employment taxes, Estate taxes, Excise taxes, Gift taxes, Income taxes, Penalties, Reporting and recordkeeping requirements.
Accordingly, under authority of 26 U.S.C. 7805, the notice of proposed rulemaking (REG-107279-00) that was published in the
Accordingly, 26 CFR parts 1 and 301 are proposed to be amended as follows:
26 U.S.C. 7805 * * *
(a)
(b)
(c)
(d)
(e)
(a)
(i) Has not remarried before the close of the taxable year; and
(ii) Maintains as the taxpayer's home a household that is for the taxable year the principal place of abode of a son or daughter (including by adoption), stepson, or stepdaughter who is a member of the taxpayer's household and who is a dependent of the taxpayer within the meaning of paragraph (a)(2) of this section.
(2)
(b)
(i) Maintains as the taxpayer's home a household that is for more than one-half of the taxable year the principal place of abode of a qualifying child or dependent of the taxpayer, within the meaning of paragraph (b)(2) of this section, who is a member of the taxpayer's household during that period; or
(ii) Maintains a household, whether or not the taxpayer's home, that is for the taxable year the principal place of abode of a parent of the taxpayer, within the meaning of paragraph (b)(3) of this section.
(2)
(ii)
(3)
(4)
(5)
(6)
(c)
(d)
(i) The cost of clothing, education, medical treatment, vacations, life insurance, and transportation;
(ii) The value of services performed in the household by the taxpayer or any other person qualifying the taxpayer as a head of household or as a surviving spouse; or
(iii) An expense paid or reimbursed by any other person.
(2)
(3)
(4)
(5)
(ii)
Two sisters and their respective children reside in the same living quarters. Neither sister may claim the other sister as a dependent. Each sister pays more than one-half of the expenses for herself and her children, and each sister claims each of her own children as a dependent. Because neither sister may claim the other sister as a dependent, and because neither sister would have priority to claim any of the other sister's children as a qualifying child under the tiebreaker rules of section 152(c)(4), each sister is treated as maintaining a separate household.
A and B, an unmarried couple, have two children together (C1 and C2) and all four individuals live in the same living quarters for the entire tax year. Both A and B contribute to paying the expenses of the couple and the two children. A has higher adjusted gross income than B. Each parent files a tax return. Under the tiebreaker rules in section 152(c)(4), the parent with the higher adjusted gross income (in this case, A) would have priority to claim each child as a qualifying child if both claimed the child. As a result, B may not be treated as maintaining a separate household with either child or both children. Therefore, if B may be claimed as A's dependent, then all four individuals are members of the same household. However, if B may not be claimed as A's dependent, B may be treated as maintaining a separate household consisting solely of B, even if B claims one of the children as a dependent on B's return.
The facts are the same as in
Grandparent, Parent, and Child live together and Child meets the definition of a qualifying child for both Parent and Grandparent. Both Parent and Grandparent pay their respective expenses, and both contribute to paying Child's expenses. Neither Parent nor Grandparent may claim the other as a dependent. Under the tiebreaker rules of section 152(c)(4), Parent would have priority over Grandparent to claim Child as a qualifying child. Therefore, Grandparent may not be treated as maintaining a household for Grandparent and Child separate from the household of Parent. However, Parent may be treated as maintaining a household for Parent and
(e)
(2)
(3)
(f)
(g)
(a)
(b)
(c)
(d)
(e)
(a)
(k)
(2)
(c) * * *
(3)
(ii)
(iii)
Child, Parent, and Grandparent share the same principal place of abode for the taxable year. Child meets the definition of a qualifying child under paragraph (c)(3)(i) of this section for both Parent and Grandparent (and for no other person) for the taxable year. Parent claims the earned income credit with Child as Parent's qualifying child. Under the tiebreaker rules of section 152(c)(4)(A) and the related regulations, Child is treated as the qualifying child of Parent and is not treated as the qualifying child of Grandparent. Under section 32(c)(1) and paragraph (c)(3)(ii) of this section, Parent is an eligible individual under section 32(c)(1)(A)(i) who may claim the earned income credit for a taxpayer with a qualifying child, and Grandparent is an eligible individual under section 32(c)(1)(A)(ii) who may claim the earned income credit for a taxpayer without a qualifying child.
The facts are the same as in
(e)
(2)
The standard deduction means the sum of the basic standard deduction and the additional standard deduction.
(a)
(b)
(2)
(c)
(2)
(d)
(a) * * * (1) In computing taxable income, an individual is allowed a deduction for the exemptions for an individual taxpayer and spouse (the personal exemptions) and the exemption for a dependent of the taxpayer.
(c)
(d)
This section lists the captions contained in § 1.152-1 through § 1.152-5.
(a) In general.
(1) Dependent defined.
(2) Exceptions.
(i) Dependents ineligible.
(ii) Married dependents.
(iii) Citizens or nationals of other countries.
(b) Definitions.
(1) Child.
(i) In general.
(ii) Adopted child.
(iii) Eligible foster child.
(iv) Authorized placement agency.
(2) Student.
(3) Brother and sister.
(4) Parent.
(c) Applicability date.
(a) In general.
(b) Qualifying child relationship test.
(c) Residency test.
(d) Age test.
(1) In general.
(2) Disabled individual.
(e) Qualifying child support test.
(f) Joint return test.
(g) Child who is eligible to be claimed as a qualifying child by more than one taxpayer.
(1) In general.
(i) More than one eligible parent.
(ii) Eligible parent not claiming.
(iii) One eligible parent and other eligible taxpayer(s).
(iv) No eligible parent.
(2) Determination of adjusted gross income of a person who files a joint return.
(3) Coordination with other provisions.
(4) Examples.
(a) In general.
(b) Qualifying relative relationship test.
(c) Gross income test.
(1) In general.
(2) Income of disabled or handicapped individuals.
(d) Qualifying relative support test.
(1) In general.
(2) Certain income of taxpayer's spouse.
(3) Support from stepparent.
(4) Multiple support agreements.
(e) Not a qualifying child test.
(1) In general.
(2) Examples.
(a) Support.
(1) In general.
(2) Payments made during the year for unpaid or future support.
(3) Governmental payments.
(i) Governmental payments as support.
(A) In general.
(B) Examples.
(ii) Governmental payments based on a taxpayer's contributions.
(A) In general.
(B) Examples.
(iii) Payments used for support of another individual.
(4) Medical insurance.
(5) Medical care payments from personal injury claim.
(6) Scholarships.
(b) Relationship test.
(1) Joint return.
(2) Divorce or death of spouse.
(c) Principal place of abode.
(1) In general.
(2) Temporary absence.
(3) Residing with taxpayer for more than one-half of the taxable year.
(i) In general.
(ii) Nights of residence.
(A) Nights counted.
(B) Night straddling two taxable years.
(C) Exception for a parent who works at night.
(D) Absences.
(4) Examples.
(d) Residence for a portion of a taxable year because of special circumstances.
(1) Individual who is born or dies during the year.
(2) Adopted child or foster child.
(e) Missing child.
(1) Qualifying child.
(2) Qualifying relative.
(3) Age limitation.
(4) Application.
(a) In general.
(b) Release of claim by custodial parent.
(1) In general.
(2) Support, custody, and parental status.
(i) In general.
(ii) Multiple support agreement.
(3) Release of claim to child.
(c) Custody.
(d) Custodial parent.
(1) In general.
(2) Night straddling taxable years.
(3) Absences.
(4) Special rule for equal number of nights.
(5) Exception for a parent who works at night.
(e) Written declaration.
(1) Form of declaration.
(i) In general.
(ii) Form designated by IRS.
(2) Attachment to return.
(i) In general.
(ii) Examples.
(3) Revocation of written declaration.
(i) In general.
(ii) Form of revocation.
(iii) Attachment to return.
(4) Ineffective declaration or revocation.
(5) Written declaration executed in a taxable year beginning on or before July 2, 2008.
(f) Coordination with other sections.
(g) Examples.
(h) Applicability date.
(1) In general.
(2) Exception.
(a)
(2)
(ii)
(iii)
(b)
(1)
(ii)
(iii)
(iv)
(2)
(3)
(4)
(c)
(a)
(b)
(1) A child of the taxpayer or descendant of such a child; or
(2) A brother, sister, stepbrother, or stepsister of the taxpayer, or a descendant of any of these relatives.
(c)
(d)
(2)
(e)
(f)
(g)
(i)
(ii)
(iii)
(iv)
(2)
(3)
(4)
(i) A and B, parents of Child, are married to each other. A, B, and Child share the same principal place of abode for the first 8 months of the year. Thus, both parents satisfy the qualifying child residency
(ii) Under paragraph (g)(1)(i) of this section, Child is treated as a qualifying child of B for all purposes, because Child resided with B for the longer period of time during the taxable year. Because section 152(e) does not apply, Child may not be treated as a qualifying child of A for any purpose.
(i) The facts are the same as in
(ii) Because A and B are not both claiming the same child as a qualifying child, under paragraph (g)(1)(i) of this section, Child is treated as a qualifying child of A.
(i) Child, Child's parent (D), and Grandparent share the same principal place of abode. D is not married and is not a qualifying child or dependent of Grandparent, and Grandparent is not D's dependent. Section 152(e), relating to divorced or separated parents, does not apply. Under paragraph (a) of this section, Child meets the definition of a qualifying child of both D and Grandparent. D claims Child as a qualifying child for purposes of the child and dependent care credit under section 21, the earned income credit under section 32, and the dependency exemption under section 151. Grandparent claims Child as a qualifying child for purposes of head of household filing status under section 2(b).
(ii) Under paragraph (g)(1)(iii) of this section, Child is treated as the qualifying child of D for all purposes, because D is eligible to claim and claims Child as D's qualifying child. Because D is eligible to claim and claims Child as D's qualifying child, under paragraph (g)(3) of this section, Child may not be treated as a qualifying child of Grandparent for any purpose. Grandparent erroneously claimed Child as Grandparent's qualifying child for purposes of head of household filing status under section 2(b). If D had not claimed Child as D's qualifying child for any purpose, under paragraph (g)(1)(ii) of this section, Grandparent could have claimed Child as Grandparent's qualifying child if Grandparent's adjusted gross income (AGI) exceeded D's AGI. In that situation, under paragraph (g)(3) of this section, Grandparent could have claimed Child as Grandparent's qualifying child for purposes of any of the child-related tax benefits, provided that Grandparent had met the requirements of those sections.
(i) The facts are the same as in
(ii) Because D or E may claim Child as a qualifying child but neither claims Child as a qualifying child for any purpose, under paragraph (g)(1)(ii) of this section, Grandparent may claim Child as a qualifying child if Grandparent's AGI exceeds the total AGI reported on the joint return of D and E.
(i) The facts are the same as in
(ii) Under paragraph (g)(3) of this section, Child is treated as a qualifying child of E for purposes of the dependency exemption and the child tax credit. Child may be treated as a qualifying child of D for purposes of the earned income credit. If D claims Child as a qualifying child for purposes of the earned income credit, under paragraph (g)(1)(iii) of this section, Child may not be treated as a qualifying child of Grandparent for any purpose.
(i) F and G, parents of two children, are married to each other. F, G, and both children share the same principal place of abode for the entire taxable year. F and G file as married filing separately for the taxable year. F claims the older child as a qualifying child for purposes of the child tax credit, dependency exemption, and the child and dependent care credit. G claims the younger child as a qualifying child for purposes of the same three tax benefits.
(ii) The older child is treated as a qualifying child of F and the younger child is treated as a qualifying child of G. The tiebreaker rule of paragraph (g)(1)(i) of this section does not apply because F and G are not claiming the same child as a qualifying child.
(a)
(b)
(1) A child or descendant of a child;
(2) A brother, sister, stepbrother, or stepsister;
(3) A father or mother, or an ancestor of either;
(4) A stepfather or stepmother;
(5) A niece or nephew;
(6) An aunt or uncle;
(7) A son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-law; or
(8) An individual (other than one who at any time during the taxable year was the taxpayer's spouse, determined without regard to section 7703) who for the taxable year of the taxpayer has the same principal place of abode as the taxpayer and is a member of the taxpayer's household. See § 1.2-2(c) for the definition of a member of the household, and § 1.152-4(c) for rules relating to the meaning of principal place of abode and the meaning of temporary absence.
(c)
(2)
(i) The principal reason for the individual's presence at the workshop is the availability of medical care there; and
(ii) The individual's income arises solely from activities at the workshop that are incident to the medical care.
(d)
(2)
(3)
(4)
(i) No one person contributes more than one-half of the individual's support;
(ii) Each member of the group that collectively contributes more than one-half of the support of the individual would have been entitled to claim the individual as a dependent for a taxable year beginning in that calendar year but for the fact that the group member alone did not contribute more than one-half of the individual's support;
(iii) The taxpayer claiming the individual as a qualifying relative contributes more than 10 percent of the individual's support; and
(iv) Each other group member who contributes more than 10 percent of the support of the individual furnishes to the taxpayer claiming the individual as a dependent a written declaration that the other person will not claim the individual as a dependent for any taxable year beginning in that calendar year.
(e)
(2)
For the taxable year, B provides more than one-half of the support of an unrelated friend, C, and C's 3-year-old child, D, who are members of B's household. No taxpayer other than C is eligible to claim D as a qualifying child. C has no gross income, is not required by section 6012 to file a Federal income tax return, and does not file a Federal income tax return for the taxable year. Under paragraph (e)(1) of this section, because C does not have a filing requirement and does not file an income tax return, D is not treated as a qualifying child of C, and B may claim both C and D as B's qualifying relatives.
The facts are the same as in
The facts are the same as in
(a)
(2)
(3)
(B)
(ii)
(B)
(iii)
(4)
(5)
(6)
(b)
(2)
(c)
(2)
(3)
(ii)
(
(
(B)
(C)
(D)
(4)
B and C are the divorced parents of Child. In 2015, Child sleeps at B's principal place of abode for 210 nights and at C's principal place of abode for 155 nights. Under paragraph (c)(3) of this section, Child resides with B for at least 183 nights during 2015 and has the same principal place of abode as B for more than one-half of 2015.
D and E are the divorced parents of Child, and Grandparent is E's parent. In 2015, Child resides with D for 140 nights, with E for 135 nights, and with Grandparent for the last 90 nights of the year. None of these periods is a temporary absence. Under paragraph (c)(3) of this section, Child does not have the same principal place of abode as D, E, or Grandparent for more than one-half of 2015.
The facts are the same as in
The facts are the same as in
F and G are the divorced parents of Child. In 2015, Child sleeps at F's principal place of abode for 170 nights and at G's principal place of abode for 170 nights. Child spends 25 nights of the year away from F and G at a summer camp. Child would have spent those nights with F if Child had not gone to summer camp. Under paragraphs (c)(2) and (c)(3)(ii)(D) of this section, Child is treated as residing with F for 195 nights and,
H and J are the divorced parents of Child. In 2015, Child sleeps at H's principal place of abode for 180 nights and at J's principal place of abode for 180 nights. For 5 nights during that year, Child sleeps at Grandparent's abode or at the house of a friend. Child would have spent all 5 nights at H's house if Child had not slept at Grandparent's or a friend's house. Under paragraphs (c)(2) and (c)(3)(ii)(D) of this section, Child is treated as residing with H for 185 nights and, therefore, Child has the same principal place of abode as H for more than one-half of 2015.
(d)
(2)
(e)
(2)
(3)
(4)
(e) * * *
(2)
(ii)
Custodial parent (CP) files her 2015 return on March 1, 2016, and claims a dependency exemption for Child. At noncustodial parent's (NCP) request, CP signs a Form 8332 for the 2015 tax year on April 15, 2016. On April 15, NCP files his return claiming a dependency exemption for Child and attaches the signed Form 8332 to his return. Under section 152(e) and paragraph (b) of this section, NCP is allowed a dependency exemption for Child for 2015, and CP is not allowed a dependency exemption for Child for that year.
The facts are the same as in
CP files his 2015 return on March 1, 2016, and claims a dependency exemption for Child. NCP files her return on April 15, 2016, and does not claim a dependency exemption for Child, even though her divorce decree allocates the dependency exemption for Child to her. CP signs a Form 8332 for the 2015 tax year in August of 2016, and NCP files an amended return a week later and attaches the signed Form 8332 to her amended return claiming a dependency exemption for Child. Under paragraph (e)(2) of this section, NCP is not allowed a dependency exemption for Child for 2015 if CP has not amended his return to remove a claim to the dependency exemption for Child for that year.
(3) * * *
(iii)
(h)
(2)
26 U.S.C. 7805 * * *
The revisions and addition read as follows:
(a)
(b)
(2)
(3)
(c) * * *
(1) * * *
(ii) The child has been placed lawfully with the prospective adoptive parent for legal adoption by that person;
(2) * * * In addition, the application must include documentary evidence the IRS prescribes to establish that a child has been placed lawfully with the prospective adoptive parent for legal adoption by that person. Examples of acceptable documentary evidence establishing lawful placement for a legal adoption may include—
(d)
(2)
Department of Justice.
Notice of proposed rulemaking.
The Department of Justice is issuing this notice of proposed rulemaking to revise its regulation implementing section 504 of the Rehabilitation Act of 1973, as applicable to programs and activities receiving financial assistance from the Department, in order to incorporate amendments to the statute, including the changes in the meaning and interpretation of the applicable definition of disability required by the ADA Amendments Act of 2008; incorporate requirements stemming from judicial decisions; update accessibility standards applicable to new construction and alteration of buildings and facilities; update certain provisions to promote consistency with comparable provisions implementing title II of the Americans with Disabilities Act; and make other non-substantive clarifying edits, including updating outdated terminology and references that currently exist in 28 CFR part 42, such as changing the word “handicapped” and similar variations of that word to language referencing “individuals with disabilities,” modifying the order of the regulatory provisions to group like provisions together, and adding some headings to make the regulation more user-friendly.
All comments must be submitted on or before March 20, 2017.
You may submit comments, identified by RIN 1105-AB50, by any one of the following methods:
•
•
•
Rebecca Bond, Chief, Disability Rights Section, Civil Rights Division, U.S. Department of Justice, at (202) 307-0663 (voice or TTY) (not a toll-free number); or Michael Alston, Director, Office for Civil Rights, Office of Justice Programs, U.S. Department of Justice, at (202) 307-0690 (not a toll-free number). Information may also be obtained from the Department's toll-free ADA Information Line at (800) 514-0301 (voice), or (800) 514-0383 (TTY).
You may obtain copies of this notice of proposed rulemaking (NPRM) in an alternative format by calling the ADA Information Line at (800) 514-0301 (voice), or (800) 514-0383 (TTY). This NPRM is also available on the ADA Home Page at
You may submit electronic comments to
Please note that all comments received are considered part of the
The Department of Justice (Department) is issuing this rule in order to revise and update its regulation implementing section 504 of the Rehabilitation Act of 1973 (section 504) as applicable to programs and activities receiving financial assistance from the Department. Section 504 prohibits discrimination on the basis of disability in federally conducted and assisted programs or activities. The Department implements the requirements of section 504 for federally assisted programs through its regulation at 28 CFR part 42, subpart G (federally assisted regulation).
The major provisions of this proposed rule can be summarized as follows.
First, the NPRM proposes to revise the regulatory text to incorporate a range of statutory amendments to the Rehabilitation Act, including the following: (1) Changes in the meaning and interpretation of the definition of “disability” required by the ADA Amendments Act of 2008, which also amended section 504's definition of “disability;” (2) the addition of definitions of “drugs” and “illegal use of drugs” and the exclusion from coverage of an individual who is currently engaging in the illegal use of drugs, all of which are definitions used in the ADA; (3) the adoption of “person first” language, such as changing the term “handicapped person” to “individual with a disability”; and (4) the application of the ADA title I standards to determinations of employment discrimination under section 504.
Second, the proposed regulation incorporates into the regulatory text existing requirements, which stem from longstanding Supreme Court decisions interpreting section 504, by adding provisions setting forth the “direct threat” defense and the obligation to provide reasonable accommodations.
Third, the proposed rule updates the section 504 accessibility standards applicable to new construction and alteration of buildings and facilities from the Uniform Federal Accessibility Standards to the 2010 ADA Standards for Accessible Design.
Fourth, the proposed rule revises the language of certain provisions, including the general nondiscrimination prohibitions and the requirement to provide auxiliary aids and services, in order to promote consistency with comparable provisions implementing title II of the ADA. The rule also eliminates the exception for provision of auxiliary aids and services for recipients that have fewer than fifteen employees.
Fifth, the proposed rule revises the regulation's compliance procedures: (1) To provide alternative remedies for the Department in cases where a recipient of Federal assistance fails to provide compliance information, such as compliance reports or information sought by beneficiaries; (2) to provide for the protection of confidential information without barring the responsible Department official or designee from accessing information necessary for evaluating or seeking to enforce compliance with the federally assisted regulation; and (3) to direct the filing of complaints alleging violations of section 504 by recipients of financial assistance from the Department with the Office of Justice Programs.
This rulemaking is not considered economically significant under Executive Order 12866. Additionally, the Department is certifying that the rule will not have a significant economic impact on a substantial number of small entities in accordance with the Regulatory Flexibility Act, as amended.
The Department of Justice (Department) implements the requirements of section 504 of the Rehabilitation Act of 1973, as amended, 29 U.S.C. 794 (section 504), which prohibits discrimination on the basis of disability in federally conducted and assisted programs or activities, through its regulations at 28 CFR part 39, applicable to programs and activities conducted by the Department (federally conducted regulation), and 28 CFR part 42, subpart G, applicable to recipients to whom the Department extends Federal financial assistance (federally assisted regulation).
On June 3, 1980, the Department published its section 504 federally assisted regulation.
Title II of the ADA prohibits discrimination on the basis of disability by public entities (
This section provides a detailed description of the Department's proposed changes to the section 504 federally assisted regulation and the reasoning behind the proposals. If the Department is not proposing a change to a regulation section, the unchanged section is not discussed. The Department is proposing to modify the order and names of some of the regulatory provisions to group like provisions together and make the regulation more user-friendly. This section-by-section analysis follows the revised order of the regulatory text.
The Department proposes to revise existing § 42.502 to add clarifying language to the discussion of the application of this subpart, to add a new paragraph (b), which addresses the broad scope of coverage required by the ADA Amendments Act and the section 504 federally assisted regulation, and to move and revise the discussion of the relationship to other laws from existing § 42.505(h) to a new paragraph (c) in this section.
The Department proposes to add a sentence clarifying that this subpart does not apply to programs or activities conducted by the Department. The Department's section 504 federally conducted regulation is found at 28 CFR part 39.
The ADA Amendments Act was signed into law on September 25, 2008, and became effective on January 1, 2009. Congress enacted the ADA Amendments Act in order to ensure that the definition of disability is broadly construed and applied without extensive analysis, and to supersede Supreme Court decisions that had too narrowly interpreted the ADA's definition of disability.
The ADA Amendments Act does not alter the basic elements of the definition of disability in the ADA and section 504, but it significantly clarifies how the term “disability” is to be interpreted and adds important rules of construction to inform that interpretation. Specifically, Congress directed that the definition of disability shall be construed broadly and that the determination of whether an individual has a disability should not demand extensive analysis. ADA Amendments Act, sec. 2(b)(5), 4(a).
Congress also authorized the Equal Employment Opportunity Commission (EEOC) and the Department to issue regulations implementing the ADA Amendments Act changes, including rules of construction.
The Department is proposing to move its provision addressing the relationship of section 504 to State and local laws that provide lesser protections for persons with disabilities from its location in the current regulation at § 42.505(h) to § 42.502(c)(1) in the revised regulation. The Department is proposing a minor edit to this provision by adding “obviated by or otherwise” before “affected” so that the provision would read: “The obligation to comply with this subpart is not obviated by or otherwise affected by the existence of any State or local law or other requirement that, on the basis of disability, imposes prohibitions or limits upon the eligibility of qualified individuals with disabilities to receive services or to practice any occupation or profession.”
In addition, the Department is proposing to add a new provision at § 42.502(c)(2) that addresses the relationship between section 504 and other Federal, State, and local laws that provide greater protections to persons with disabilities. In the ADA, Congress expressly provided that nothing in the ADA invalidated or limited the remedies, rights, and procedures of any Federal law, or State or local law that provides greater or equal protection for the rights of individuals with disabilities.
The Department proposes revising certain definitions to make them consistent with the language used to define corresponding terms in the Department's ADA regulations; deleting terminology that is no longer necessary or has become obsolete; revising or adding certain terms to incorporate statutory changes to the Rehabilitation Act; adding other definitions for clarity; and making minor technical edits to existing definitions. Also, for ease of reference, the Department proposes moving the “definitions” section, currently codified at § 42.540, to the beginning of the subpart at § 42.503.
First, in order to ensure consistency of terminology between section 504 and the ADA, the Department is proposing to add definitions of the following terms from the Department's ADA title II regulation at 28 CFR 35.104: “2004 ADAAG,” “2010 Standards,” “Auxiliary aids and services,” “Current illegal use of drugs,” “Historic preservation programs,” “Qualified interpreter,” “Qualified reader,” and “Video remote interpreting (VRI) service.”
The Department also proposes to delete several terms from the regulation, including “Alcohol abuse,” “Benefit,” and “Handicap,” as well as obsolete references to Departmental components that no longer exist within the Department. First, with respect to “alcohol abuse,” the Department believes the term is no longer necessary given that the definition was only applicable to the regulation's employment provisions, and those provisions are being revised to reference the requirements in title I of the ADA, in accordance with section 503(b) of the 1992 Amendments (codified at 29 U.S.C. 791(f)). Second, the Department also proposes to delete the definition of “benefit” as unnecessary given that the meaning of “benefit” is commonly understood. Third, the Department proposes to delete the definition of “handicap,” as it is neither necessary nor appropriate following the “people first” language changes from the 1992 Amendments, which use the term “disability.” And fourth, the Department proposes to delete the definitions of “LEAA,” “NIJ,” “BJS,” “OJARS,” and “OJJDP.” Some of these offices no longer exist, and to account for future changes in organization, the regulation, where appropriate, will refer generally to “grant-making components of the Department.”
Finally, the Department proposes the following revisions and additions to the “definitions” section to incorporate statutory changes to the Rehabilitation Act and to provide greater clarity and consistency of terminology.
The Department proposes to add the definition of “applicant” to the proposed regulation using language consistent with the definition in the Department's regulation implementing title VI of the Civil Rights Act, at 28 CFR 42.102(h).
The Department proposes to add a definition of “component” to the proposed regulation. Given the various names for the Department's subagencies (
The Department proposes to revise the definition of “department” to clarify that the term includes all of the Department's components.
The Department proposes to add, with respect to non-employment services, programs, and activities, a definition of “direct threat” that is based upon the definition provided in the Department's title II regulation at 28 CFR 35.104. The Department also proposes to include, for the employment context, an additional paragraph that adopts the definition of “direct threat” in the EEOC's regulation at 29 CFR 1630.2(r).
As previously discussed, the ADA Amendments Act not only amended the meaning and interpretation of the definition of “disability” applicable to the ADA, it also amended the Rehabilitation Act of 1973 to require similar changes to the meaning and interpretation of the definition of “disability” at 29 U.S.C. 705(20)(B), applicable to section 504. The Department has decided that rather than spelling out the meaning and interpretation of the definition of
The Rehabilitation Act and the ADA define “disability” as including: (1) A physical or mental impairment that substantially limits a major life activity; (2) a record of such an impairment; or (3) being regarded as having such an impairment. 29 U.S.C. 705(9)(B); 42 U.S.C. 12102(1). The ADA Amendments Act does not alter these three basic elements of the definition of disability, but it does significantly clarify how the term “disability” is to be interpreted and adds important rules of construction to inform that interpretation. Congress directed that the definition of disability shall be construed broadly and that the determination of whether an individual has a disability should not demand extensive analysis. 42 U.S.C. 12102. The Department proposes to update its section 504 federally assisted regulation to reflect these changes.
The ADA amended the Rehabilitation Act to include a definition of “drug.”
The Department proposes to revise the existing definition of “facility” to conform more closely to the definition of “facility” in the Department's title II regulation by including within the definition's scope sites, complexes, rolling stock or other conveyances.
The Department proposes to include a definition of “historic properties” that is substantially similar to that provided in the Department's title II regulation, 28 CFR 35.104.
The Department proposes to replace the existing definition of “drug abuse” with a definition that is substantially similar to the definition of “illegal use of drugs” that was added to the Rehabilitation Act by the ADA in 1990.
The Department proposes to replace the definition of “handicapped person” with “individual with a disability,” consistent with the 1992 Amendments, which provide “people first” language (
The Department proposes to add a definition of “primary recipient” to the regulation. The Department proposes to adopt a definition that is substantially similar to the definition of “primary recipient” provided in the Department's regulation implementing title VI of the Civil Rights Act, at 28 CFR 42.102(g). The revised regulation defines “primary recipient” as “any recipient that is authorized or required to extend Federal financial assistance to another recipient.”
The Department proposes to replace the definition of “qualified handicapped person” with “qualified individual with a disability.” With respect to employment, the proposed definition incorporates the definition of “qualified” as provided in the EEOC regulation at 29 CFR 1630.2(m), which implements the employment standards of title I of the ADA, in accordance with section 503(b) of the 1992 Amendments (codified at 29 U.S.C. 791(f)). With respect to programs or activities, the proposed definition is substantially similar to the definition of “qualified individual with a disability” from the Department's ADA title II regulation, 28 CFR 35.104.
The Department proposes to add a definition of “subrecipient” to the proposed regulation. Entities receiving Federal financial assistance through a primary recipient also must comply with the Department's section 504 federally assisted regulation.
The Department proposes to update and clarify the discriminatory actions prohibited under § 42.503 of the Department's current regulation. With the exception of the revisions addressed below, the Department proposes retaining the same prohibited discriminatory actions as in the current regulation but, where applicable, adopting the language that is provided in the Department's ADA title II regulation for consistency, and reorganizing and re-titling some of the provisions, as appropriate. For instance, the provision relating to the prohibition on retaliation and intimidation at § 42.503(b)(1)(vii) in the current regulation has been moved to a new section at proposed § 42.510(k). The Department also proposes to add several regulatory provisions that are consistent with provisions in the Department's ADA title II regulation and that further illustrate the types of actions that are prohibited discrimination under section 504. The Department notes that current § 42.503(g) (renumbered as § 42.510(l)) states that “[t]he enumeration of specific forms of prohibited discrimination in this subpart is not exhaustive but only illustrative.”
The Department's current regulation at § 42.503(b)(iv) prohibits a recipient from denying “a qualified [person with a disability] an equal opportunity to participate in the program or activity by providing services to the program.” This prohibition does not clearly explain how a qualified individual with a disability would be denied an equal opportunity to participate in a program or activity “by providing services” to the program. The Department is proposing to revise this paragraph for clarity but is not changing the meaning. The revised paragraph (renumbered as § 42.510(b)(1)(v)) states that a recipient may not “[d]eny a qualified individual with a disability an equal opportunity to provide services to the program or activity.” Under this provision, for example, a recipient that uses
The Department proposes to delete the provision in the Department's current regulation at § 42.503(b)(5), which provides that “[a] recipient is prohibited from discriminating on the basis of handicap in aid, benefits, or services operating without Federal financial assistance where such action would discriminate against the handicapped beneficiaries or participants in any program or activity of the recipient receiving Federal financial assistance.” This provision no longer appears to be necessary given the expanded definition of “program or activity” provided under the Civil Rights Restoration Act, 42 U.S.C. 2000d-4a, which, in the case of assistance to a State or local government, includes all the operations of the department or agency to which funding is extended.
The Department proposes to move the requirements in existing § 42.503(e) and (f), which currently address the recipient's obligation to ensure effective communication to applicants, employees and beneficiaries, to new § 42.511, which specifically addresses the recipient's communication requirements in greater detail, consistent with the Department's title II regulation at 28 CFR 35.160, 35.161, and 35.164. The Department has also conformed the language of these provisions to the language of the title II regulation. It notes that the definition of “auxiliary aids” that is in § 42.503(f) of the existing regulation is replaced by the revised definition of “auxiliary aids and services” provided in the renumbered definitional section at proposed § 42.503.
The Department proposes to add a new provision at § 42.510(g)(1) that affirmatively states the longstanding section 504 obligation to provide reasonable accommodations by making changes to policies, practices, and procedures unless those changes can be shown to pose a fundamental alteration to the program or activity or an undue financial and administrative burden.
Subsequently, in
Over the past decades, in keeping with these Supreme Court decisions, Federal courts and Federal agencies have regularly acknowledged Federal agencies' affirmative obligation to ensure that recipients provide qualified individuals with disabilities reasonable accommodations in programs and activities unless the recipient can demonstrate that making these accommodations would fundamentally alter the program or activity or result in an undue financial and administrative burden. However, traditionally, agencies' section 504 regulations have lacked a specific provision implementing this requirement outside of the employment arena.
The Department notes that title I of the ADA also uses the term “reasonable accommodation” to apply to the job application process, work environment, or manner or circumstances under which the position held or desired is customarily performed, and the ability to enjoy equal benefits and privileges of employment. However, the specific ADA title I regulatory requirements related to this term should not be applied to non-employment related requests for reasonable accommodations under section 504, and the Department proposes to clarify at proposed § 42.510(g)(3) that with respect to employment, the definitions and standards that apply to “reasonable accommodation” and “undue hardship” in the EEOC's regulation implementing title I of the ADA apply to this subpart.
In addition, when Congress enacted the ADA Amendments Act, it expressly provided that a covered entity need not provide a reasonable modification [or accommodation] to policies, practices, or procedures to an individual who meets the definition of disability under the “regarded as” prong. ADA Amendments Act, sec. 6(a)(1). While Congress did not specifically apply this provision of the ADA Amendments Act to section 504, the Department believes that it is equally appropriate to apply this limitation to reasonable accommodations under section 504 and proposes to adopt this limitation at § 42.510(g)(2) of this regulation.
Lastly, the Department notes that the necessary reasonable accommodations will vary based on the need of the individual and the impact of the accommodation on the recipient. Where the recipient receives funding from multiple Federal agencies, each Federal agency's particular requirements will also impact the types of reasonable accommodations that a recipient must provide.
It has been a longstanding principle under both section 504 and the ADA that recipients or covered entities may not charge affected individuals or groups for the cost of measures required to provide an individual or group with nondiscriminatory treatment. This principle is already set forth in the Department's title II regulation at 28 CFR 35.130(f), and the Department is proposing to add it to § 42.510(h) of the Department's section 504 federally assisted regulation as well.
The Department's ADA regulations provide protection for individuals associated with individuals with disabilities.
The Department proposes to add a new provision at § 42.510(j) that prohibits a recipient from imposing or applying eligibility criteria that screen out or tend to screen out an individual with a disability or any class of individuals with disabilities from fully and equally enjoying any aid, benefit, or service, unless such criteria can be shown to be necessary for the provision of the aid, benefit, or service being offered. This principle is already set forth in the Department's title II regulation at 28 CFR 35.130(b)(8). The prohibition of the imposition of “criteria that `tend to' screen out an individual with a disability” actually had its origins in the Department of Health and Human Services' section 504 regulation at 45 CFR 84.13 (1991), which was cited by the Department in its 1991 title II rulemaking.
The Department is proposing to reorganize and revise its articulation of recipients' longstanding obligation to ensure that communications are effectively conveyed to individuals with disabilities and to provide appropriate auxiliary aids and services, using language that generally conforms with the effective communication provisions in the Department's title II regulation at 28 CFR 35.160, 35.161, and 35.164. Specifically, the Department is proposing to move the provisions addressing communication in the section 504 regulation from the general nondiscrimination obligations in current § 42.503(e) and (f), place these revised provisions in a new § 42.511, and generally conform the language to the title II provisions. As mentioned earlier, the Department has revised the definitions section of the regulation at proposed § 42.503 to include definitions of the terms “auxiliary aids and services,” “qualified interpreter,” “qualified reader,” and “video remote interpreting (VRI) service.” Finally, the Department is proposing to remove the limitation on the obligation to provide auxiliary aids for recipients with fewer than 15 employees, currently found in § 42.503(f).
Proposed § 42.511(a) sets forth the general obligation (formerly set forth in § 42.503(e)) that a recipient take “appropriate steps to ensure that communications with applicants, participants, beneficiaries, members of the public, and companions with disabilities are as effective as communications with others.” This general obligation parallels the general communications requirement in the ADA title II regulation, at 28 CFR 35.160(a)(1). The Department recognizes that since the Department's section 504 federally assisted regulation was first issued in 1980, electronic and information technology has changed the way that recipients communicate with interested persons. Individuals with disabilities—like other members of the public—should be able to equally engage with a recipient's services, programs, and activities using electronic and information technology. Opportunities for such engagement require that electronic and information technology be accessible to ensure that communication with individuals with disabilities is as effective as communication with others.
Proposed § 42.511(b)(1), which tracks language in existing § 42.503(f), provides that “[a] recipient shall furnish appropriate auxiliary aids and services where necessary to afford qualified individuals with disabilities, including applicants, participants, beneficiaries, companions, and members of the public, an equal opportunity to participate in, and enjoy the benefits of, a service, program, or activity of a recipient.” Proposed § 42.511(b)(2) provides that “[t]he type of auxiliary aid or service necessary to ensure effective communication will vary in accordance with the method of communication used by the individual; the nature, length, and complexity of the communication involved; and the
An example of an auxiliary aid, which would apply in the corrections setting, would be the provision of videophones or other video-based telecommunication services to ensure that incarcerated individuals with disabilities can communicate as effectively as others who use public telephones made available by the facility.
Proposed § 42.511(c) includes the express limitations on the use of accompanying adults or children as interpreters that are specified in the ADA title II rule at 28 CFR 35.160. Under section 504, responsibility for providing effective communication, including the use of interpreters, falls directly on recipients, and they may not require an individual to bring someone to serve as an interpreter. Consistent with the ADA provisions, proposed § 42.511(c) provides that a recipient may rely on an adult or minor child companion to interpret only in very limited emergency circumstances when no qualified interpreters are available. Specifically, proposed § 42.511(c)(2)-(3) only apply to emergencies involving an “imminent threat to the safety or welfare of an individual or the public.” The imminent threat exception is not intended to apply to the typical and foreseeable emergency situations that are part of the normal operations of institutions, such as visits to the emergency room or responses by law enforcement to situations involving a threat to the safety or welfare of an individual or the public. As such, a recipient may rely on an accompanying individual to interpret or facilitate communication under the proposed § 42.511(c)(2)-(3) imminent threat exception only in truly exigent circumstances,
In nonemergency circumstances, a recipient may rely on an adult companion (but not a minor child) to interpret only when, (1) the individual requests this, (2) the accompanying adult agrees, and (3) reliance on the accompanying adult is appropriate under the circumstances. Under no circumstances may a recipient rely on an accompanying adult to interpret when there is reason to doubt the individual's impartiality or effectiveness.
When the Department updated its title II effective communication provisions to include performance requirements for VRI, at 28 CFR 35.160(d), the intent was to ensure that if VRI is used, it would be used in a manner that makes it as effective as when sign language interpreters are provided on site. The Department certainly has recognized that VRI can be an effective method of providing interpreting services in certain circumstances, but not in others.
Since the Department added this language to its title II regulation, it has become aware that some entities subject to title II, particularly in the medical environment, have not properly evaluated whether VRI is effective in particular situations, nor have they understood that these standards require that the VRI image is actually positioned so that it can be seen by the individual with a hearing disability. For example, in some circumstances, a patient who is lying prone while receiving medical treatment may have difficulty seeing the image on the screen and thus may be unable to communicate effectively using the remote sign language interpreter. Similarly, a pregnant woman who is deaf and who needs to regularly change positions while receiving medical assistance during labor and delivery may not always be able to see the image on the screen. Accordingly, the Department is adding language in its proposed VRI provision to expressly clarify that the VRI image must be positioned so that the individual with a hearing disability can easily see the interpreter on the screen.
Proposed § 42.511(d) states that a recipient that provides qualified interpreters via VRI services shall ensure that it provides “[a] sharply delineated image that is large enough to display the interpreter's face, arms, hands, and fingers, and the participating individual's face, arms, hands, and fingers, and can be seen by the participating individual regardless of the individual's body position.”
Proposed § 42.511(e) incorporates the ADA title II regulatory requirement, at 28 CFR 35.161, that where a public entity communicates by telephone with applicants and beneficiaries, text telephones (TTY) or equally effective telecommunications systems must be used to communicate with individuals with disabilities. Unlike the corresponding ADA requirement at 28 CFR 35.161(a), however, § 42.511(e)(1) eliminates a specific reference to TTYs. The Department has become aware that individuals with hearing and speech disabilities are increasingly using other forms of telecommunication systems, including cellular phones, videophones, video relays, and internet-based communication systems, in lieu of TTYs. Thus, § 42.511(e)(1) provides that “[w]here a recipient communicates by telephone with applicants, participants, beneficiaries, members of the public, and companions with disabilities, the recipient shall communicate with individuals who are deaf or hard of hearing or have speech disabilities using telecommunication systems that provide equally effective communication.”
Additionally, the Department is aware that individuals with disabilities are concerned that, in some cases, emergency response services lack the ability to communicate with individuals who use methods of communication other than TTYs, such as text messaging or videophones, to communicate effectively. In July 2010, the Department issued an Advance Notice of Proposed Rulemaking on the Accessibility of Next Generation 9-1-1 Services, in which the Department made clear its intention to modify title II's telephone emergency services provision, at 28 CFR 35.162, to address these and other changes, and included a specific reference to video relay service as an example of a type of relay service. 75 FR 43446 (July 26, 2010). Although that regulation has not yet been released, the Department maintains that, under title II's general requirement at 28 CFR 35.161(a),
Proposed § 42.511(e)(2) addresses the use of automated-attendant systems and specifies that “[w]hen a recipient uses an automated-attendant system, including, but not limited to, voice mail and messaging, or an interactive voice response system, for receiving and directing incoming telephone calls, that system must provide effective real-time communication with individuals using auxiliary aids and services, including, but not limited to TTYs and all forms of FCC-approved telecommunications relay systems, including Internet-based relay systems.” In proposed § 42.511(e)(3), the Department proposes a requirement that recipients must respond to all types of relay services, including video relay services, in the same manner that they respond to other telephone calls. This provision tracks title II, at 28 CFR 35.161(c), but includes an updated reference to the U.S. Code citation establishing the types of FCC-approved relay services, which include telephone relay, video relay, and IP relay.
Finally, the Department is proposing to remove a limitation that currently appears in § 42.503(f). This provision directs that the obligation to provide auxiliary aids is mandatory for recipients with 15 or more employees, but indicates that Departmental officials may require recipients employing fewer than 15 persons to comply with this requirement “when [compliance] would not significantly impair the ability of the recipient to provide its benefits or services.” The Department is proposing to remove this limitation for several reasons. First, this limitation is of minimal consequence because the vast majority of recipients of Federal financial assistance from the Department are already required by either title II or title III of the ADA to provide auxiliary aids or services in order to ensure effective communication. Second, all recipients, regardless of size, are not required, in providing effective communication, to take any action that the recipient can demonstrate would result in a fundamental alteration to the program or activity or pose undue financial and administrative burdens. Third, the Department already has the discretion whether to impose these obligations on recipients with fewer than 15 employees. Finally, given that Congress specifically intended that the principles of the ADA guide the policies, practices, and procedures developed under the Rehabilitation Act,
The Department maintains the prohibition of discrimination in employment against any qualified individual with a disability and proposes to revise § 42.512 to conform to the 1992 Amendments, which amended title V of the Rehabilitation Act to apply the same employment standards set forth in title I of the ADA to employment discrimination claims under section 504. Accordingly, the proposed rule deletes the existing requirements related to discriminatory employment practices and references the standards applied under title I of the ADA, 42 U.S.C. 12111
The Department proposes to add a new provision at § 42.513 addressing direct threat to others as a limitation on the requirement to comply with this subpart, in accordance with the ADA. The applicability of the “direct threat” concept to section 504 of the Rehabilitation Act was first set forth in the Supreme Court decision
Congress turned to
Additionally, the Department proposes to include a new paragraph at proposed § 42.513(c) that addresses “direct threat” in the employment discrimination context. As provided in the definitions section, the applicable definition of “direct threat” in the employment discrimination context includes significant risk of substantial harm to self. The Department is therefore proposing to include a paragraph that provides that an employer does not have to employ an individual who would pose a “direct threat” as that term is defined in the EEOC's regulation implementing title I of the ADA at 29 CFR 1630.2(r) and 1630.15(b).
The ADA amended the Rehabilitation Act to exclude individuals engaging in illegal drug use from coverage of section 504.
In § 42.515, the Department proposes to add a new provision stating that “[n]othing in this subpart shall provide the basis for a claim that an individual without a disability was subject to discrimination because of a lack of disability, including a claim that an individual with a disability was granted a reasonable accommodation that was denied to an individual without a disability.” This provision is consistent with a recent amendment to title V of the ADA by section 6 of the ADA Amendments Act.
Section 42.521 addresses the obligations of recipients to operate each program or activity subject to this subpart so that when viewed in its entirety, the program or activity is readily accessible to and usable by individuals with disabilities. This obligation, which applies to existing facilities, is generally known as “program accessibility.” The comparable obligation is found in the ADA title II regulation at 28 CFR 35.150. The Department is proposing to make non-substantive changes to certain provisions in § 42.521 in order to conform them to the corresponding language in the title II regulation, including adding a specific provision at § 42.521(b)(3) to address how a historic preservation program shall achieve program accessibility where structural changes would threaten or destroy the historically significant features of a historic property. Aligning the section 504 provision addressing historic preservation programs with the title II provision will ensure that recipients subject to both the ADA and section 504 may follow the same rules with respect to historic preservation.
In conforming the language of § 42.521 to the corresponding title II provision, the Department is also proposing to add an affirmative statement to the regulation at § 42.521(a)(2) making it clear that the longstanding limitations of undue financial and administrative burden and fundamental alteration apply to the obligation to provide program accessibility.
The Department is also proposing several other revisions to § 42.521. In § 42.521(b)(1), the Department is proposing to update the references to the accessibility standards that apply to structural changes to buildings and facilities made for the purposes of providing program accessibility so that the section references the 2010 ADA Standards for Accessible Design (2010 Standards), which the Department is proposing to adopt in § 42.522 below.
The Department's proposed adoption of the 2010 Standards as the standard under section 504 for new construction and alterations raises the question of whether recipients will have to update elements in buildings or facilities currently compliant with the Uniform Federal Accessibility Standards (UFAS) that are not otherwise being altered, in order to comply with the 2010 Standards. In order to provide certainty to recipients and individuals with disabilities alike, the Department is proposing to add a safe harbor provision at § 42.521(b)(2), which specifies that “elements that have not been altered in existing facilities on or after [INSERT EFFECTIVE DATE OF THE RULE], and that comply with the corresponding technical and scoping specifications for those elements in the Uniform Federal Accessibility Standards (UFAS), * * * are not required to be modified to be brought into compliance with the requirements set forth in the 2010 Standards.” This provision is similar to the safe harbor provision in the Department's ADA title II regulation at 28 CFR 35.150(b)(2)(i).
The Department's current regulation at § 42.521(c) provides that “[i]f a recipient with fewer than fifteen employees finds, after consultation with [an individual with a disability] seeking its services, that there is no method of complying with § 42.521(a) other than making a significant alteration in its existing facilities, the recipient may, as an alternative, refer the [individual with a disability] to other available providers of those services that are accessible.” When the Civil Rights Restoration Act (CRRA) took effect in 1988, it amended section 504 to provide that small providers are not required “to make significant structural alterations to their existing facilities for the purpose of assuring program accessibility, if alternative means of providing the services are available. The terms used in this subsection shall be construed with reference to the regulations existing on the date of the enactment of this subsection.”
The Department is proposing to revise its small provider provision to reflect Congress's intent when it revised section 504. Accordingly, the Department proposes to revise § 42.521(c) to provide that a recipient with fewer than 15 employees who finds, after consultation with an individual with a disability seeking its services, that there is no method of complying with § 42.521(a) other than making a significant alteration to its existing facilities, may, as an alternative, refer the individual with a disability to alternative providers of available accessible services. The proposed revision further provides that for these purposes, in order to ensure that the services are available, the small provider “must first determine that the alternative provider's services are accessible, the alternative provider is willing to provide the services, the services are available at no additional cost to the individual with a disability, and transportation costs to and from the alternative provider do not exceed costs to and from the small provider.” As with all providers subject to section 504, if the cost of making structural changes as a means of providing program accessibility in existing facilities is an undue financial and administrative burden, then the small provider is not obligated to make those changes. The Department notes that in the vast majority of cases, small providers are also subject either to the program accessibility requirements of title II of the ADA or the barrier removal obligation of title III of the ADA.
The Department is proposing to revise § 42.521(d) to clarify that this provision only refers to those circumstances where a written plan was originally required for recipients subject to the rule when it first took effect. The Department is proposing to replace all references in this section that set compliance dates for specific requirements in relation to the “effective date of this subpart” with references to the actual dates when compliance was required. These changes will maintain continuity of regulatory requirements by clarifying that the original effective date of the subpart (and other deadlines based on this original effective date), and not the date these proposed amendments take effect, is the operative date for compliance with this section of the regulation.
Under § 42.521(e) of the Department's current regulation, the recipient is required to adopt and implement procedures to ensure that interested persons, including persons with various types of disabilities, can obtain information as to the existence and location of accessible services, activities, and facilities. The Department proposes to make a non-substantive revision to the provision on notice of location of accessible facilities (renumbered as § 42.521(e)(1)) to reflect updated terminology describing certain disabilities.
Proposed § 42.521(e)(2) clarifies the obligation to provide notice by adding language consistent with the existing title II obligation at 28 CFR 35.163(b) requiring signs at a primary entrance to each of the recipient's inaccessible facilities, if any, directing users to an accessible facility or a location where they can obtain information about accessible facilities.
The Department is proposing to add a new section entitled “Program accessibility in jails, detention and correctional facilities, and community correctional facilities.” This section, which is modeled after the Department's title II regulation at 28 CFR 35.152, provides additional guidance about the specific application of section 504's general requirements to these facilities operated by or on behalf of recipients of Federal financial assistance from the Department. While all of the jails, detention and correctional facilities, and community correctional facilities funded by the Department are also public entities subject to the title II requirements, because the Department provides assistance to so many of the agencies that operate these facilities, it believes it will be helpful to recipients to understand that the same requirements apply under both statutes. The Department has added some language that clarifies that the requirements in this section are in addition to the general requirements of this subpart and intends that this section be interpreted consistent with 28 CFR 35.152.
Section 42.522(a) of the Department's current regulation requires that, if construction of a recipient's facility commenced after the effective date of the regulation, the facility must be designed and constructed so that it is readily accessible to and usable by individuals with disabilities. In proposed § 42.523(a), the Department proposes to replace the reference to the “effective date of this subpart” with “July 3, 1980,” which was the date the Department's original section 504 regulation took effect. This will maintain continuity of regulatory
Section 42.522(a) of the Department's existing regulation also requires that facility alterations commenced after the effective date of the regulation that affect or may affect the facility's usability must be carried out so that, to the maximum extent feasible, the altered portion of the facility is readily accessible to and usable by individuals with disabilities. The Department proposes to separate this requirement into its own paragraph at proposed § 42.523(b) and to update its phrasing for clarity. For the same purposes as the new construction paragraph above, the Department proposes to replace the reference to the “effective date of this subpart” with “July 3, 1980.”
The Department proposes to revise § 42.523 to adopt the 2010 Standards for new construction and alterations in lieu of the Uniform Federal Accessibility Standards (UFAS).
The Department's proposed § 42.523(c)(1) would require that recipients comply with the 2010 Standards beginning one year from the publication date of the final rule. In addition, the Department recognizes that many but not all of its recipients are also subject to the ADA and are already required to comply with the 2010 Standards. In order to minimize the timeframe during which recipients subject to section 504 and the ADA must comply with two separate accessibility standards, the Department proposes that beginning with the publication of the final rule in the
While in some circumstances the ADA imposes different obligations on public entities as compared to private entities, section 504 does not differentiate between public and private recipients of Federal financial assistance. Accordingly, neither the Department's section 504 regulation nor UFAS imposes different scoping and technical accessibility requirements on recipients based upon their status as public or private entities.
Although in nearly all circumstances the requirements in the 2010 Standards for buildings and facilities subject to either title II or title III of the ADA are the same, there are several instances where the requirements differ. Most significantly, Exception 1 of section 206.2.3 of the 2010 Standards exempts certain multistory buildings owned by private entities from the requirement to provide an elevator to facilitate an accessible route throughout the building. This exemption does not apply to buildings owned by public entities.
UFAS and the 2010 Standards also have differing requirements for employee work areas.
In addition, the Department's current section 504 federally assisted regulation at § 42.522(b) allows departures from the requirements of UFAS if the other methods used provide “substantially equivalent or greater access to and usability of the building.” This concept of departure from the accessibility standards is retained in this regulation (renumbered as § 42.523(c)(1)(v)), but the phrasing is adjusted for consistency with the title II regulation.
Lastly, the Department notes that a recipient that receives funding from multiple Federal agencies must ensure that it is compliant with the accessibility standards of each agency from which it receives Federal funding.
As discussed above, the Department is proposing that all recipients must comply with the 2010 Standards in lieu of UFAS one year from the publication date of the final rule in the
Thus, the Department is proposing that recipients that are private entities may choose either UFAS or the 2010 Standards when one of the following events has occurred on or after the date of publication of the final rule in the
Similarly, the Department is proposing that recipients that are private entities must comply with the 2010 Standards as of one year from publication of this rule in the
For public entities receiving Federal financial assistance from the Department, the Department is proposing to use the commencement of physical construction or alterations on or after the publication date of the final rule but before the required compliance date of the 2010 Standards as the “triggering event” for the choice of standards permitted by § 42.523(c)(1). Similarly, the Department is proposing to use the commencement of physical construction or alterations on or after one year from publication of the final rule in the
The Department is proposing at § 42.523(c)(3) to add a provision similar to the language in the ADA regulations at 28 CFR 35.151(c)(4) in title II and 28 CFR 36.406(a)(4) in title III that states that “ceremonial groundbreaking or razing of structures prior to site preparation will not be considered to commence or start physical construction or alterations.”
Facilities designed, built, altered, or leased with Federal funds are subject to the requirements of the Architectural Barriers Act of 1968, as amended, 42 U.S.C. 4151-57 (ABA). Facilities that receive Federal financial assistance from the Department are required to comply with the ABA accessibility standards adopted by the General Services Administration (GSA), which is the Federal agency responsible for adopting ABA standards for all buildings subject to the ABA except for residential structures; buildings, structures, and facilities of the Department of Defense (DOD); and buildings, structures and facilities of the U.S. Postal Service (USPS).
Many, but not all, buildings and facilities used by recipients for their programs or activities are also covered by the ABA. Until recently, UFAS served as the applicable accessibility standard under both section 504 federally assisted regulations and the ABA, and, therefore, facilities that complied with UFAS were also in compliance with the ABA. While there is significant overlap between the current ABA standards and the 2010 Standards, there are a number of differences. Recipients subject to both statutes need to be aware of the requirements of both accessibility standards and need to comply with both. Thus, the Department is proposing at § 42.523(c)(4) to add a provision reminding recipients that “[n]othing in this section relieves recipients whose facilities are covered by the Architectural Barriers Act of 1968, as amended (42 U.S.C. 4151-4157), from their responsibility of complying with the requirements of that Act and any implementing regulations.”
Certain provisions of § 42.505 of the existing regulation (renumbered as § 42.530) impose administrative requirements related to the designation of a responsible employee for compliance with this subpart (§ 42.505(d) of the current regulation), adoption of grievance procedures (§ 42.505(e) of the current regulation), and provision of notice of nondiscrimination (§ 42.505(f) of the
The Department is seeking public comment on whether it should revise paragraphs 42.505(d), (e) and (f) of the existing regulation (renumbered as 42.530(c), (d) and (e)), to delete any references to size of grant award, so that the number of employees (50 or more) is the only criteria triggering the application of the administrative requirements in these three paragraphs. State and local governments already are subject to comparable requirements under title II of the ADA.
The Department is maintaining the provision requiring recipients to conduct a self-evaluation as a historical requirement but is revising it to refer to the requirements in the past tense. The Department's current regulation at § 42.505(c) requires in part that a recipient, “within one year of the effective date of this subpart, evaluate and modify its policies and practices that do not meet the requirements of this subpart.” The Department is proposing to make a non-substantive revision to § 42.530(b) of this paragraph by replacing the phrase “within one year of the effective date of this subpart,” with the actual date that was a year from when the subpart originally took effect, which is “July 3, 1981.” While this provision does not require recipients to conduct a self-evaluation beyond the original deadline of July 3, 1981, the Department is retaining this provision because the self-evaluation requirement under section 504 is cross-referenced in the Department's ADA title II regulation at 28 CFR 35.105(d).
Section 42.505(e) of the current regulation requires recipients to adopt grievance procedures. The Department proposes to make a non-substantive change to this provision (renumbered as § 42.530(d)) to clarify that the procedures adopted by the recipient must incorporate appropriate due process standards. The Department also proposes to revise this paragraph to clarify that any individual may file a complaint with the Department without having first used the recipient's grievance procedures.
Section 42.505(f) of the current regulation requires a recipient that employs 50 or more persons and that receives Federal financial assistance from the Department of more than $25,000 to take appropriate initial and continuing steps to notify participants, beneficiaries, applicants, employees, and unions or professional organizations holding collective bargaining or professional agreements with the recipient that it does not discriminate on the basis of disability in violation of section 504 and this subpart. This provision also delineates the methods of initial and continuing notification to include “the posting of notices, publication in newspapers and magazines, placement of notices in recipients' publication, and distribution of memoranda or other written communications.”
The proposed regulation maintains the requirement that the notice shall state that the recipient does not discriminate in its programs or activities with respect to access, treatment, or employment and shall include the identification of the person responsible for coordinating compliance with this subpart and where to file section 504 complaints with the Department and, where applicable, with the recipient. The Department encourages recipients to consider including in their notice information relating to the availability of auxiliary aids and services, procedures for obtaining such aids and services, contact information for the responsible employee, and the availability of grievance procedures.
The Department recognizes that the methods by which a recipient communicates with interested persons have changed significantly since this regulation was promulgated and that this regulation, as currently written, does not reflect the current and future state of information dissemination. With the growth of the Internet and the World Wide Web, the Department has determined that the regulation should also reference postings on a recipient's Web site as a permissible method of communication and is proposing to include “publications on the recipient's internet Web site” as a method of initial and continuing notification in the regulation (renumbered as § 42.530(e)(1)). Many of the publications that previously were available in print such as pamphlets, brochures, maps, course catalogs, policies, and procedures are now posted on recipients' Web sites and can be printed or downloaded by an interested person viewing the Web site.
The Department has deleted the reference in this section to the initial notification deadline because the requirement to provide notice is a continuing obligation and the initial notification deadline has long passed.
The Department is proposing to remove the reference to paragraph (c)(2) in the current § 42.505(g) (renumbered as § 42.530(f)), which addresses self-evaluation as a potential requirement for recipients with fewer than 50 employees. The self-evaluation provision at paragraph (c)(2) (renumbered as paragraph (b)(2) in this section) is a historical requirement and does not apply to current or future recipients.
The Department is proposing to revise its provisions on assurances from government agencies at current § 42.504(b) and assurances from institutions at current § 42.504(c) to align these provisions with the definition of “program or activity” that was adopted by the Department in 2003 as a result of the Civil Rights Restoration Act and
Additionally, the definition of “program or activity” adopted in 2003 also includes educational institutions, corporations and other private organization, and plants. The Department is proposing to revise current § 42.504(c) to ensure that the applicability of the nondiscrimination requirements is also addressed with respect to these entities consistent with the definition of “program or activity.”
The Department's current section 504 federally assisted regulation at § 42.504(d) provides that “[w]here the Federal financial assistance is to provide or is in the form of real or personal property, the assurance will obligate the recipient and any transferee for the period during which the property is being used for the purpose for which the Federal financial assistance is extended or for another purpose involving the provisions of similar benefits, or for as long as the recipient retains ownership or possession of the property, whichever is longer. In all other cases the assurance will obligate the recipient for the period during which Federal financial assistance is extended.” The Department proposes several clarifications to the duration of obligation requirement. First, the Department proposes to have the assurance apply to improvements provided by Federal financial aid and assistance, in addition to real or personal property. Second, the Department proposes to reference the provision of federally assisted services, in addition to benefits, as a determinant of the duration of assurance obligations. Finally, the Department proposes to replace the reference “[i]n all other cases” with “[w]hen the Federal financial assistance is not in the form of real or personal property or improvements” to clarify the particular circumstances under which the assurance continues to apply to the recipient during the period for which Federal financial assistance is extended.
The Department is maintaining the compliance and enforcement procedures provision from § 42.530 of its current regulation and has renumbered it as § 42.532. In an effort to account for future changes in organization and to eliminate obsolete references to some components that no longer exist within the Department, the Department proposes to replace the references to “LEAA, NIJ, BJS, OJARS, and OJDDP” with the phrase “a grant-making component of the Department.” In addition, the Department is proposing to revise § 42.530(c) which currently provides that “[i]n the case of programs or activities funded by LEAA, NIJ, BJS, OJARS, and OJJDP, the refusal to provide requested information under paragraph (a) of this section and [28 CFR] 42.106
The Department also proposes to move its existing provision addressing remedial action from existing § 42.505(a) to proposed § 42.532(c) because the requirement for remedial action arises after a finding of discrimination has been made in accordance with the procedures set forth in this section. The Department believes that the placement of the remedial action provision in the compliance procedures section is a more logical placement than its current location in the administrative requirements section. The Department also proposes making non-substantive edits to the existing language.
Lastly, the Department proposes to add a new paragraph at proposed § 42.532(d) that directs complaints alleging violations of section 504 by recipients of financial assistance from the Department to be filed with the Office of Justice Programs. The Office of Justice Programs is the entity within the Department that enforces section 504.
This NPRM has been drafted in accordance with Executive Order 13563 of January 18, 2011, 76 FR 3821, Improving Regulation and Regulatory Review, and Executive Order 12866 of September 30, 1993, 58 FR 51735, Regulatory Planning and Review. Executive Order 13563 directs agencies, to the extent permitted by law, to propose or adopt a regulation only upon a reasoned determination that its benefits justify its costs; tailor the regulation to impose the least burden on society, consistent with obtaining the regulatory objectives; and, in choosing among alternative regulatory approaches, select those approaches that maximize net benefits. Executive Order 13563 recognizes that some benefits and costs are difficult to quantify and provides that, where appropriate and permitted by law, agencies may consider and discuss qualitatively values that are difficult or impossible to quantify, including equity, human dignity, fairness, and distributive impacts.
The Department has determined that this proposed rule is a “significant regulatory action” as defined by Executive Order 12866, sec. 3(f). The Department has determined, however, that this proposed rule is not an economically significant regulatory action, as it will not have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities. This NPRM has been reviewed by the Office of Management and Budget (OMB) pursuant to Executive Orders 12866 and 13563.
This rule provides necessary revisions to the Department's current section 504 federally assisted regulation to: (1) Incorporate amendments to the statute including the changes in the meaning and interpretation of the applicable definition of disability required by the ADA Amendments Act; (2) incorporate requirements stemming from judicial decisions; (3) update accessibility standards applicable to new construction and alteration of buildings and facilities; (4) update certain provisions to promote consistency with comparable provisions implementing title II of the ADA; and (5) make other non-substantive clarifying edits. The proposed regulation is intended to promote consistency of judicial interpretations and predictability of executive enforcement of section 504 of the Rehabilitation Act, as it pertains to federally assisted programs.
This rule does not significantly change any existing substantive obligations of recipients subject to the Department's federally assisted regulation because, with the exception of the updated accessibility standard, the Department is incorporating into its section 504 regulation definitions and requirements arising out of statutory amendments to the Rehabilitation Act and longstanding Supreme Court decisions. Moreover, the Department's adoption of the 2010 Standards as the updated accessibility standard under section 504 will have the effect of simplifying the obligations of its recipients. It should not result in any substantial costs since the vast majority of its recipients are already required to comply with the 2010 Standards because they are either State or local governments covered by title II of the ADA or public accommodations subject to title III of the ADA. The harmonization of the section 504 accessibility requirements with the ADA's requirements will result in recipients being subject to only one accessibility standard (the 2010 Standards) instead of two and could have the effect of reducing costs since recipients will no longer have to be familiar with and apply up to two sets of requirements. Lastly, the conformance of section 504's regulatory provisions with the existing comparable regulatory provisions implementing title II of the ADA will not result in any substantial costs because the requirements under section 504 will remain substantially the same. Title II of the ADA is modeled on section 504 of the Rehabilitation Act of 1973, and Congress intended, through its 1992 Amendments to the Rehabilitation Act, that the principles underlying the ADA also apply to all sections of the Rehabilitation Act, including section 504. As a result, courts have generally treated claims under title II and section 504 the same.
Title III of the ADA applies to the activities of all public accommodations (including nonprofit organizations) funded by the Department with the exception of those recipients that fall within the ADA's exemption for “religious organizations or entities controlled by religious organizations.”
• Of the approximately 6395 recipients
• Of the approximately 1478 recipients
• Of the approximately 1739 discretionary grantees and 2934 discretionary subgrantees
This data suggests a total of approximately 118 grantees and subgrantees collectively that are self-identified as faith-based organizations. However, because the Department has no data on the number of subrecipients funded by OJP or whether any of them are in fact religious entities, this number may be higher. OJP has previously estimated that there are approximately 100 total faith-based grantees and subgrantees funded by OVW and 50 total faith-based grantees and subgrantees funded by OJP, for a total estimate of 150 grantees and subgrantees from OJP and OVW collectively that are faith-based organizations.
The recipients falling under the ADA's religious exemption could be affected by any incremental changes in the accessibility requirements that result from the change in the applicable standard from UFAS to the 2010 Standards if they engage in new construction or alterations of the facilities serving the program or activity funded by the Department. As discussed in the preamble, however, because of the safe harbor set forth in proposed § 42.521(b)(2), these recipients will not have any obligation to modify any elements in their existing facilities that are compliant with UFAS unless they alter those elements after the compliance date for the Standards takes effect.
A subset of these recipients falling under the ADA religious exemption—those with fewer than 15 employees that were previously exempt from the automatic obligation to provide auxiliary aids and services—may be affected by the proposed elimination of the 15 employee threshold for that obligation. Some of these entities may have fewer than 15 employees.
Given the small subset of recipients who could potentially be affected and the infinite variations of the type of new construction or alteration that could occur along with the type of auxiliary aid or service that could be provided, it would not be feasible to quantify the impact of these changes on an individual basis. However, the Department believes that generally costs for individual recipients would not likely be significant.
The Department is interested in public comment on whether its assumptions are correct as to the following: (1) The number of recipients that fall within the ADA exemption for religious organizations or organizations controlled by religious organizations; (2) how many subrecipients funded by OJP may fall within the ADA religious exemption; 3) how many of these recipients also have fewer than 15 employees and whether this particular provision should have a compliance date later than the general effective date of the rule; and 4) the costs to individual recipients not being significant. The Department believes that the costs of this rule will be significantly less than $100 million in any given year. The Department is interested in public comment on its assumptions that the costs of this rule will be significantly less than $100 million in any given year.
The Attorney General, in accordance with the Regulatory Flexibility Act, 5 U.S.C. 605(b), has reviewed this regulation, and by approving it certifies that it will not have a significant economic impact on a substantial number of small entities. With the exception of the updated accessibility standard, the substantive changes to the section 504 regulation reflect the Department's incorporation of definitions and requirements arising out of statutory amendments to the Rehabilitation Act and longstanding Supreme Court decisions. Moreover, the Department's adoption of the 2010 Standards as the updated accessibility standard under section 504 will have the effect of simplifying the obligations of its recipients and should not result in any additional costs since the vast majority of its recipients are already required to comply with the 2010 Standards because they are either State or local governments covered by title II of the ADA or public accommodations subject to title III of the ADA. The harmonization of the section 504 accessibility requirements with the ADA requirements will result in recipients being subject to only one accessibility standard (the 2010 Standards) instead of two. Additionally, the conformance of section 504's regulatory provisions with existing comparable provisions implementing title II of the ADA will not result in any additional costs for the vast majority of recipients funded by the Department. Lastly, the rule does not include reporting requirements and imposes no new recordkeeping requirements. Even if the Department assumed that all of the recipients that may be subject to the ADA's religious exemption qualify as “small organizations” and would be affected by the incremental changes in the accessibility standards and the elimination of the 15-employee threshold for the requirement to provide auxiliary aids and services, the Department believes that the number of small entities affected by this rule, compared to the thousands of recipients funded by the Department's grant-making components does not constitute a “significant number of small entities” affected by this rule. The Department is interested in public comment on its assumptions about the impact of the revisions to its section 504 regulation on small entities that receive Federal financial assistance from the Department.
Executive Order 13132 directs that, to the extent practicable and permitted by law, an agency shall not promulgate any regulation that has federalism implications, that imposes substantial direct compliance costs on State and local governments, that is not required by statute, or that preempts State law, unless the agency meets the consultation and funding requirements of section 6 of the Executive Order. Because each change proposed by this rule does not have federalism implications as defined in the Executive Order, does not impose direct compliance costs on State and local governments, is required by statute, or does not preempt State law within the meaning of the Executive Order, the Department has concluded that compliance with the requirements of section 6 is not necessary.
The Department makes every effort to promote clarity and transparency in its rulemaking. In any regulation, there is a tension between drafting language that is simple and straightforward and drafting language that gives full effect to issues of legal interpretation. The Department is proposing a number of changes to this regulation to enhance its clarity and satisfy the plain language requirements, including revising the organizational scheme and adding headings to make it more user-friendly. The Department operates a toll-free ADA Information Line (800) 514-0301 (voice) and (800) 514-0383 (TTY) that the public is welcome to call to obtain assistance in understanding anything in this proposed rule. If any commenter has suggestions for how the regulation could be written more clearly, please provide comments using the contact information provided in the introductory section of this proposed rule entitled,
This proposed rule does not contain any new or revised “collection[s] of information” as defined by the Paperwork Reduction Act of 1995. 44 U.S.C. 3501
Section 4(2) of the Unfunded Mandates Reform Act of 1995, 2 U.S.C. 1503(2), excludes from coverage under that Act any proposed or final Federal regulation that “establishes or enforces any statutory rights that prohibit discrimination on the basis of race, color, religion, sex, national origin, age, handicap, or disability.” Accordingly, this rulemaking is not subject to the provisions of the Unfunded Mandates Reform Act.
Administrative practice and procedure, Buildings and facilities, Civil rights, Communications, Grant programs, Individuals with disabilities, Reporting and recordkeeping requirements.
By the authority vested in me as Attorney General by law, including 5 U.S.C. 301, 28 U.S.C. 509, 510, 29 U.S.C. 794, Executive Order 12250, part 42 of title 28 of the Code of Federal Regulations is proposed to be amended as follows:
5 U.S.C. 301; 28 U.S.C. 509, 510; 29 U.S.C. 794; E.O. 12250.
The purpose of this subpart is to implement section 504 of the Rehabilitation Act of 1973, as amended, which prohibits discrimination on the basis of disability in any program or activity receiving Federal financial assistance.
(a)
(b)
(c)
(1) The obligation to comply with this subpart is not obviated by or otherwise affected by the existence of any State or local law or other requirement that, on the basis of disability, imposes prohibitions or limits upon the eligibility of qualified individuals with disabilities to receive aid, benefits, or services or to practice any occupation or profession.
(2) This subpart does not invalidate or limit the remedies, rights, and procedures of any other Federal law, or State or local law (including State common law), that provide greater or equal protection for the rights of individuals with disabilities or individuals associated with them.
As used in this subpart the term—
(1) Qualified interpreters on-site or through video remote interpreting (VRI) services; note takers; real-time computer-aided transcription services; written materials; exchange of written notes; telephone handset amplifiers; assistive listening devices; assistive listening systems; telephones compatible with hearing aids; closed caption decoders; open and closed captioning, including real-time captioning; voice, text, and video-based telecommunications products and systems, including text telephones (TTYs), videophones, and captioned telephones, or equally effective telecommunications devices; videotext displays; accessible electronic and information technology; or other effective methods of making aurally delivered information available to individuals who are deaf or hard of hearing.
(2) Qualified readers; taped texts; audio recordings; Brailled materials and displays; screen reader software; magnification software; optical readers; secondary auditory programs (SAP); large print materials; accessible electronic and information technology; or other effective methods of making visually delivered materials available to individuals who are blind or have low vision;
(3) Acquisition or modification of equipment or devices; and
(4) Other similar services and actions.
(1) With respect to any aid, benefit, or service provided under a program or activity subject to this subpart, a significant risk to the health or safety of others that cannot be eliminated by a modification of policies, practices, or procedures, or by the provision of auxiliary aids or services.
(2) With respect to employment, the term as defined by the Equal Employment Opportunity Commission's regulation implementing title I of the Americans with Disabilities Act of 1990, at 29 CFR 1630.2(r).
(1) Funds;
(2) Services of Federal personnel;
(3) Real and personal property or any interest in or use of such property, including—
(i) Transfers or leases of such property for less than fair market value or for reduced consideration; and
(ii) Proceeds from a subsequent transfer or lease of such property if the Federal share of its fair market value is not returned to the Federal Government; and
(4) Any other thing of value by way of grant, loan, contract or cooperative agreement.
(1)(i) A department, agency, special purpose district, or other instrumentality of a State or of a local government; or
(ii) The entity of such State or local government that distributes such assistance and each such department or agency (and each other State or local government entity) to which the assistance is extended, in the case of assistance to a State or local government;
(2)(i) A college, university, or other postsecondary institution, or a public system of higher education; or
(ii) A local educational agency, as defined in 20 U.S.C. 7801, system of vocational education, or other school system;
(3)(i) An entire corporation, partnership, or other private organization, or an entire sole proprietorship if—
(A) Assistance is extended to such corporation, partnership, private organization, or sole proprietorship as a whole; or
(B) The corporation, partnership, private organization, or sole proprietorship is principally engaged in the business of providing education, health care, housing, social services, or parks and recreation; or
(ii) The entire plant or other comparable, geographically separate facility to which Federal financial assistance is extended, in the case of any other corporation, partnership, private organization, or sole proprietorship; or
(4) Any other entity which is established by two or more of the entities described in paragraph (s)(1), (2), or (3) of this section.
(1) With respect to any aid, benefit, or service provided under a program or activity subject to this subpart, an individual with a disability who, with or without reasonable accommodations in rules, policies, or procedures, the removal of architectural, communication, or transportation barriers, or the provision of auxiliary aids or services, meets the essential eligibility requirements for receipt of services or the participation in programs or activities provided by a recipient; and
(2) With respect to employment, the definition of “qualified” in the Equal Employment Opportunity Commission's regulation implementing title I of the Americans with Disabilities Act of 1990, at 29 CFR 1630.2(m), applies to this subpart.
(a)
(b)
(i) Deny a qualified individual with a disability the opportunity accorded others to participate in, or benefit from, the aid, benefit, or service;
(ii) Afford a qualified individual with a disability an opportunity to participate in or benefit from the aid, benefit, or service that is not equal to that afforded others;
(iii) Provide a qualified individual with a disability with an aid, benefit, or service that is not as effective in affording equal opportunity to obtain the same result, to gain the same benefit,
(iv) Provide different or separate aid, benefits, or services to individuals with disabilities or to any class of individuals with disabilities than are provided to others unless such action is necessary to provide qualified individuals with disabilities or any class of individuals with disabilities with aid, benefits, or services that are as effective as that provided to others;
(v) Deny a qualified individual with a disability an equal opportunity to provide services to the program or activity;
(vi) Deny a qualified individual with a disability an opportunity to participate as a member of a planning or advisory board;
(vii) Aid or perpetuate discrimination against a qualified individual with a disability by providing assistance to an agency, organization, or person that discriminates on the basis of disability in providing any aid, benefit, or service to beneficiaries of the recipient's program or activity;
(viii) Permit the participation in the program or activity of agencies, organizations, or persons which discriminate against individuals with disabilities who participate in or benefit from the recipient's program; or
(ix) Otherwise limit a qualified individual with a disability in the enjoyment of any right, privilege, advantage, or opportunity enjoyed by others receiving the aid, benefit, or service.
(2) A recipient may not deny a qualified individual with a disability the opportunity to participate in any aid, benefits, or services that are not separate or different, despite the existence of permissibly separate or different aid, benefits, or services.
(3) A recipient may not, directly or through contractual, licensing, or other arrangements, utilize criteria or methods of administration—
(i) That have the effect of subjecting qualified individuals with disabilities to discrimination on the basis of disability;
(ii) That have the purpose or effect of defeating or substantially impairing accomplishment of the objectives of the recipient's program or activity with respect to individuals with disabilities; or
(iii) That perpetuate the discrimination of another recipient if both recipients are subject to common administrative control or are departments or agencies, special purpose districts, or other instrumentalities of the same State or local government unit.
(4) A recipient may not, in determining the site, or a location of a facility, make selections—
(i) That have the effect of excluding individuals with disabilities from, denying them the benefits of, or otherwise subjecting them to discrimination on the basis of disability; or
(ii) That have the purpose or effect of defeating or substantially impairing the accomplishment of the objectives of the program or activity with respect to individuals with disabilities.
(5) An entity not otherwise receiving Federal financial assistance but using a facility provided with the aid of Federal financial assistance after the effective date of this subpart is prohibited from discriminating on the basis of disability.
(6) A recipient, in the selection of procurement contractors, may not use criteria that subject qualified individuals with disabilities to discrimination on the basis of disability.
(7) A recipient may not administer a licensing or certification program in a manner that subjects qualified individuals with disabilities to discrimination on the basis of disability, nor may a recipient establish requirements for any of the programs or activities of entities that are licensed or certified that subject qualified individuals with disabilities to discrimination on the basis of disability. The programs or activities of entities that are licensed or certified by a recipient are not, themselves, covered by this subpart unless those entities are also recipients of Federal financial assistance from the Department.
(c) This subpart does not prohibit the exclusion of individuals without disabilities or specified classes of individuals with disabilities from aid, benefits, or services limited by Federal statute or executive order to individuals with disabilities or a different class of individuals with disabilities.
(d) Nothing in this subpart prohibits a recipient from providing aid, benefits, or services to individuals with disabilities or to a particular class of individuals with disabilities beyond those required by this part.
(e)
(f) Nothing in this subpart shall be construed to require an individual with a disability to accept an accommodation, aid, service, opportunity, or benefit provided under section 504 or this subpart which such individual chooses not to accept.
(g)
(2) A recipient is not required to provide a reasonable accommodation to an individual who meets the definition of disability solely under the “regarded as” prong of the definition of disability as defined in 28 CFR 35.104.
(3) With respect to employment, the definitions and standards applied to “reasonable accommodation” and “undue hardship” in the Equal Employment Opportunity Commission's regulation implementing title I of the Americans with Disabilities Act, at 29 CFR 1630.2(o) and (p), and 1630.9, apply to this subpart.
(h)
(i)
(j)
(k)
(l) The enumeration of specific forms of prohibited discrimination in this subpart is not exhaustive but only illustrative.
(a)
(2) For purposes of this section, “companion” means a family member, friend, or associate of an individual seeking access to a program, or activity of a recipient, who, along with such individual, is an appropriate person with whom the recipient should communicate.
(b)
(2) The type of auxiliary aid or service necessary to ensure effective communication will vary in accordance with the method of communication used by the individual; the nature, length, and complexity of the communication involved; and the context in which the communication is taking place. In determining what types of auxiliary aids and services are necessary, a recipient entity shall give primary consideration to the requests of individuals with disabilities. In order to be effective, auxiliary aids and services must be provided in accessible formats, in a timely manner, and in such a way as to protect the privacy and independence of the individual with a disability.
(c)
(1) A recipient shall not require an individual with a disability to bring another individual to interpret for him or her.
(2) A recipient shall not rely on an adult accompanying an individual with a disability to interpret or facilitate communication except—
(i) In an emergency involving an imminent threat to the safety or welfare of an individual or the public where there is no interpreter available; or
(ii) When the individual with a disability specifically requests that the accompanying adult interpret or facilitate communication, the accompanying adult agrees to provide such assistance, and reliance on that adult for such assistance is appropriate under the circumstances.
(3) A recipient shall not rely on a minor child to interpret or facilitate communication, except in an emergency involving an imminent threat to the safety or welfare of an individual or the public when there is no interpreter available.
(d)
(1) Real-time, full-motion video and audio over a dedicated high-speed, wide-bandwidth video connection or wireless connection that delivers high-quality video images that do not produce lags, choppy, blurry, or grainy images, or irregular pauses in communication;
(2) A sharply delineated image that is large enough to display the interpreter's face, arms, hands, and fingers, and the participating individual's face, arms, hands, and fingers, and can be seen by the participating individual regardless of the individual's body position;
(3) A clear, audible transmission of voices; and
(4) Adequate training to users of the technology and other involved individuals so that they may quickly and efficiently set up and operate the VRI.
(e)
(2) When a recipient uses an automated-attendant system, including, but not limited to, voice mail and messaging, or an interactive voice response system, for receiving and directing incoming telephone calls, that system must provide effective real-time communication with individuals using auxiliary aids and services, including, but not limited to TTYs and all forms of FCC-approved telecommunications relay systems, including Internet-based relay systems.
(3) A recipient shall respond to telephone calls from a relay service, established under 47 U.S.C. 225, including telephone relay, video relay, and Internet protocol (IP) relay in the same manner that it responds to other telephone calls.
(f)
(a)
(2)
(a) This subpart does not require a recipient to permit an individual to participate in or benefit from the program or activity of that recipient when that individual poses a direct threat to the health or safety of others.
(b) In determining whether an individual poses a direct threat to the health or safety of others, a recipient must make an individualized assessment, based on reasonable judgment that relies on current medical
(c) An employer does not have to employ an individual who would pose a direct threat as that term is defined in the Equal Employment Opportunity Commission's regulation implementing title I of the Americans with Disabilities Act of 1990, at 29 CFR 1630.2(r) and 1630.15(b).
(a)
(b)
(1) Has successfully completed a supervised drug rehabilitation program or has otherwise been rehabilitated successfully;
(2) Is participating in a supervised rehabilitation program; or
(3) Is erroneously regarded as engaging in such use.
(c)
(2) A drug rehabilitation or treatment program may deny participation to individuals who engage in illegal use of drugs while they are in the program.
(d)
(2) Nothing in paragraph (d)(1) of this section shall be construed to encourage, prohibit, restrict, or authorize the conducting of testing for the illegal use of drugs.
Nothing in this subpart shall provide the basis for a claim that an individual without a disability was subject to discrimination because of a lack of disability, including a claim that an individual with a disability was granted a reasonable accommodation that was denied to an individual without a disability.
A recipient shall ensure that no qualified individual with a disability is denied the benefits of, excluded from participation in, or otherwise subjected to discrimination under any program or activity receiving Federal financial assistance because the recipient's facilities are inaccessible to or unusable by individuals with a disability.
(a)
(1) Necessarily require a recipient to make each of its existing facilities or every part of an existing facility accessible to and usable by individuals with disabilities;
(2) Require a recipient to take any action that it can demonstrate would result in a fundamental alteration in the nature of a program or activity or in undue financial and administrative burdens. In those circumstances where the recipient believes that the proposed action would fundamentally alter the program or activity or would result in undue financial and administrative burdens, the recipient has the burden of proving that compliance with § 42.521(a) of this subpart would result in such alteration or burdens. The decision that compliance would result in such alteration or burdens must be made by the head of the recipient or the head's designee after considering all resources available for use in the funding and operation of the program or activity, and must be accompanied by a written statement of the reasons for reaching that conclusion. If an action required to comply with this section would result in such an alteration or such burdens, a recipient shall take any other action that would not result in such an alteration or such burdens but would nevertheless ensure to the maximum extent possible, that individuals with disabilities receive the benefits or services of the program or activity; or
(3) Require a recipient to take any action that would threaten or destroy the historically significant features of a historic property.
(b)
(2)
(3)
(i) Using audio-visual materials and devices to depict those portions of an historic property that cannot otherwise be made accessible;
(ii) Assigning persons to guide individuals with disabilities into or through portions of historic properties that cannot otherwise be made accessible; or
(iii) Adopting other innovative methods.
(c)
(d)
(1) Identified physical obstacles in the recipient's facilities that limit the accessibility of its program or activity to individuals with disabilities;
(2) Described in detail the methods that would be used to make the facilities accessible;
(3) Specified the schedule for taking the steps necessary to achieve full accessibility under § 42.521(a) and, if the time period of the transition plan was longer than one year, identified the steps that would be taken during each year of the transition period; and
(4) Indicated the person responsible for implementation of the plan.
(e)
(2)
(a)
(b)(1) In addition to the other requirements of this subpart, a recipient shall ensure that qualified inmates or detainees with disabilities shall not, because a facility is inaccessible to or unusable by individuals with disabilities, be excluded from participation in, or be denied the benefits of, the services, programs, or activities of a recipient, or be subjected to discrimination by any recipient.
(2) A recipient shall ensure that inmates or detainees with disabilities are housed in the most integrated setting appropriate to the needs of the individuals. Unless it is appropriate to make an exception, a recipient—
(i) Shall not place inmates or detainees with disabilities in inappropriate security classifications because of their disabilities;
(ii) Shall not place inmates or detainees with disabilities in designated medical areas unless they are actually receiving medical care or treatment;
(iii) Shall not place inmates or detainees with disabilities in facilities that do not offer the same aid, benefits, and services as the facilities where they would otherwise be housed; and
(iv) Shall not deprive inmates or detainees with disabilities of visitation with family members by placing them in distant facilities where they would not otherwise be housed.
(3) A recipient shall implement reasonable policies, including physical modifications to additional cells in accordance with the 2010 Standards, so as to ensure that each inmate with a disability is housed in a cell with the accessible elements necessary to afford the inmate access to safe, appropriate housing.
(a)
(b)
(c)
(1) Applicable accessibility standards—
(i) New construction and alterations of buildings or facilities undertaken on or after March 7, 1988, but before [INSERT DATE OF PUBLICATION OF THE FINAL RULE IN THE
(ii) New construction and alterations of buildings or facilities undertaken after [INSERT DATE OF PUBLICATION OF THE FINAL RULE IN THE
(iii) New construction and alterations of buildings or facilities undertaken on or after [INSERT DATE ONE YEAR FROM PUBLICATION DATE OF THE FINAL RULE IN THE
(iv) New construction and alterations of buildings or facilities undertaken in compliance with the 2010 Standards shall comply with the scoping and technical requirements for a “public building or facility” regardless of whether the recipient is a public entity as defined in 28 CFR 35.104 or a private entity.
(v) Departures from particular requirements of either standard by the use of other methods shall be permitted when it is clearly evident that equivalent access to the facility or part of the facility is thereby provided.
(vi) For purposes of compliance with UFAS, section 4.1.6(1)(g) of UFAS shall be interpreted to exempt from the requirements of UFAS only mechanical rooms and other spaces that, because of their intended use, will not require accessibility to the public or beneficiaries or result in the employment or residence therein of persons with physical disabilities.
(2)
(B) Private entities must comply with paragraph (c)(1)(iii) of this section if: the last application for a building permit or permit extension for such construction or alterations is certified to be complete by a State, county, or local government; or, in those jurisdictions where the government does not certify completion of applications, the last application for a building permit or permit extension is received by the State, county, or local government; or, in jurisdictions where no permit is required, physical construction or alteration has commenced, on or after [INSERT DATE ONE YEAR FROM PUBLICATION DATE OF THE FINAL RULE IN THE
(ii)
(B) Public entities must comply with paragraph (c)(1)(iii) of this section if new physical construction or alterations commence on or after [INSERT DATE ONE YEAR FROM PUBLICATION DATE OF THE FINAL RULE IN THE
(3) For the purposes of this section, ceremonial groundbreaking or razing of structures prior to site preparation will not be considered to commence or start physical construction or alterations.
(4)
(a)
(b)
(2) A recipient employing 50 or more persons and receiving Federal financial assistance from the Department of $25,000 or more was required, for at least three years following completion of the evaluation required under paragraph (c)(1) of this section, to maintain on file, make available for public inspection, and provide to the Department on request—
(i) A list of the interested persons consulted;
(ii) A description of areas examined and problems identified; and
(iii) A description of modifications made and remedial steps taken.
(c)
(d)
(e)
(2) Recruitment materials or publications containing general information that a recipient makes available to participants, beneficiaries, applicants, or employees shall include a policy statement of nondiscrimination on the basis of disability.
(f) The Department may require any recipient with fewer than 50 employees and receiving Federal financial assistance from the Department of $25,000 or more to comply with paragraphs (c) through (e) of this section.
(a)
(2)
(3)
(b)
(c)
(d)
(a)(1) The procedural provisions applicable to title VI of the Civil Rights Act of 1964, 28 CFR 42.106-42.110, apply to this subpart, except that the provision contained in § 42.108(c)(3) and § 42.110(e) that requires the Attorney General's approval before the imposition of any sanction against a recipient, does not apply to programs or activities funded by a grant-making component of the Department. The applicable provisions contain requirements for compliance information (§ 42.106), conduct of investigations (§ 42.107), procedure for effecting compliance (§ 42.108), hearings (§ 42.109), and decisions and notices (§ 42.110).
(2) In the case of programs or activities funded by a grant-making component of the Department, the requirement to provide access to sources of information pursuant to 28 CFR 42.106(c) may be enforced using the procedures cited in paragraph (a)(1) of this section or using the provisions of section 803(a) of title I of the Omnibus Crime Control and Safe Streets Act, as amended by the Justice System Improvement Act of 1979, Public Law 96-157, 93 Stat. 1167.
(b) In the case of programs or activities funded by a grant-making component of the Department, the timetables and standards for investigation of complaints and for the conduct of compliance reviews contained in § 42.205(c)(1) through (c)(3) and § 42.206(c) and (d) are applicable to this subpart except that any finding of noncompliance shall be enforced as provided in paragraph (a) of this section.
(c)
(2) The Department may, where necessary to overcome the effects of discrimination in violation of section 504, or this subpart, require a recipient to take remedial action—
(i) With respect to individuals with disabilities who are no longer participants in the recipient's program or activity but who were participants in the program when such discrimination occurred; and
(ii) With respect to individuals with disabilities who would have been participants in the program had the discrimination not occurred.
(d) Complaints of violations of section 504 by recipients of Federal financial assistance from the Department should be filed with the Office for Civil Rights at the Office of Justice Programs.
Failure to list a type of Federal assistance in appendix A shall not mean, if section 504 is otherwise applicable, that a program or activity is not covered.
For the text of appendix A to subpart G, see appendix A to subpart C of this part.
For the text of appendix C, see §§ 42.106 through 42.110 of this part.
For the text of appendix D, see §§ 42.205 and 42.206 of this part.
Environmental Protection Agency (EPA).
Proposed rule.
The Environmental Protection Agency (EPA) is proposing to approve revisions to the Washington State Implementation Plan (SIP) that were submitted by the Washington Department of Ecology (Ecology) in coordination with Southwest Clean Air Agency (SWCAA) on December 20, 2016. In the fall of 2014 and spring of 2015, the EPA approved numerous revisions to Ecology's general air quality regulations. However, our approval of the updated Ecology regulations applied only to geographic areas where Ecology, and not a local air agency, has jurisdiction, and statewide to source categories over which Ecology has sole jurisdiction. Under the Washington Clean Air Act, local clean air agencies may adopt equally stringent or more stringent requirements in lieu of Ecology's general air quality regulations, if they so choose. Therefore, the EPA stated that we would evaluate the general air quality regulations as they apply to local jurisdictions in separate, future actions. If finalized, this proposed action would approve the submitted SWCAA general air quality regulations to replace or supplement the corresponding Ecology regulations for sources in SWCAA's jurisdiction, including implementation of the minor new source review and nonattainment new source review permitting programs. This action would also approve a limited subset of Ecology regulations, for which there are no corresponding SWCAA corollaries, to apply in SWCAA's jurisdiction.
Written comments must be received on or before February 21, 2017.
Submit your comments, identified by Docket ID No. EPA-R10-OAR-2016-0784 at
Jeff Hunt at (206) 553-0256, or
Throughout this document whenever “we,” “us,” or “our” is used, it is intended to refer to the EPA.
On January 27, 2014, Ecology submitted revisions to update the general air quality regulations contained in Chapter 173-400 of the Washington Administrative Code (WAC), which the EPA approved in three phases on October 3, 2014 (79 FR 59653), November 7, 2014 (79 FR 66291), and April 29, 2015 (80 FR 23721). Because the Washington Clean Air Act allows local clean air agencies to adopt equally stringent or more stringent standards than the State regulations contained in Chapter 173-400 WAC, the EPA's approval of Ecology's January 2014 submittal applied only to geographic areas and source categories under Ecology's direct jurisdiction. We stated that we would address the applicability of Chapter 173-400 WAC in local clean air agency jurisdictions on a case-by-case basis in separate, future actions.
On December 20, 2016, the Director of Ecology, as the Governor's designee for SIP revisions, submitted a request to update the general air quality regulations as they apply to the jurisdiction of SWCAA. SWCAA's jurisdiction consists of Clark, Cowlitz, Lewis, Skamania and Wahkiakum counties, excluding facilities subject to Energy Facility Site Evaluation Council (EFSEC) jurisdiction, Indian reservations and any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction, and facilities subject to the applicability sections of 173-405-012, 173-410-012, and 173-415-012, as discussed in Section III.C.
Aside from the name change “Southwest Air Pollution Control Authority” to “Southwest Clean Air Agency” this section remains unmodified since the EPA's last approval (62 FR 8624, February 26, 1997). The EPA reviewed SWCAA 400-010 and is proposing to approve this provision to apply in lieu of WAC 173-400-010 within SWCAA's jurisdiction.
The EPA's October 3, 2014 approval of the Ecology regulations included a revised version of WAC 173-400-020 which clarified that local clean air agencies have the option to implement equally stringent or more stringent corollaries to apply in lieu of Chapter 173-400 WAC, or parts of Chapter 173-400 WAC, for sources within its jurisdiction. SWCAA added 400-020(2) to reflect this revision of WAC 173-400-020. Specifically, SWCAA 400-020(2) states, “The Agency implements and enforces the Washington Administrative Code as adopted by Ecology in Title 173 under Chapter 70.94 RCW, except where the Agency has adopted corresponding provisions. Agency adopted provisions apply in lieu of the corresponding WAC provisions.” SWCAA 400-020(2) also clarifies that SWCAA has chosen not to adopt WAC 173-400-930, which provides an optional, alternative means of satisfying new source review permitting requirements for emergency engines in jurisdictions that choose to adopt this provision. As discussed later in this preamble, SWCAA 400-072
The majority of definitions contained in SWCAA 400-030 are adapted or copied verbatim from the definitions contained in WAC 173-400-030, as approved by the EPA in October 3, 2014. A notable exception is SWCAA 400-030(4) “Air contaminant” or “air pollutant.” In SWCAA 400-030(4), the agency clarifies that for the purposes of regulation under the Washington SIP, air contaminant means only, “(a) Those air contaminants for which the EPA has established National Ambient Air Quality Standards (NAAQS) and precursors to such NAAQS pollutants as determined by EPA for the applicable geographic area; and (b) Any additional air contaminants that are required to be regulated under Part C of Title I of the Federal Clean Air Act (CAA), but only for the purpose of meeting the requirements of Part C or to the extent those additional air contaminants are regulated in order to avoid such requirements.” This clarification is consistent with the EPA's interpretation of section 110 of the CAA, and the EPA's response to comments in our approval of the Chapter 173-400 WAC general provisions (79 FR 59653, October 3, 2014, at page 59654). Similarly, SWCAA is not submitting and the EPA is not proposing to approve SWCAA 400-030(21) “Climate Change” and SWCAA 400-030(129) “Toxic Air Pollutant” because they are not related to the criteria pollutants regulated under title I of the CAA, not essential for meeting and maintaining the NAAQS, or not related to the requirements for SIPs under section 110 of the CAA. The remainder of the SWCAA definitions, not otherwise adapted from the WAC, generally copy or cite to Federal definitions or internal SWCAA definitions previously approved in other sections. With the exception of SWCAA 400-030(21) and (129), we are proposing to approve SWCAA 400-030 to apply in lieu of WAC 173-400-030 within SWCAA's jurisdiction.
The EPA's October 3, 2014 approval included Ecology's regulations in WAC 173-400-036. WAC 173-400-036 allows portable sources to relocate and operate in any other clean air agency jurisdiction within the State, without obtaining a site-specific or permitting
SWCAA 400-040 generally follows the language of WAC 173-400-040, with minor changes to reflect SWCAA's regulatory structure or to improve clarity. SWCAA submitted revisions to the introductory paragraph of 400-040 and sections (1)(b), (1)(e), (3), (5), (6), (7), and (8) for approval into the SIP. Other regulatory provisions contained in SWCAA 400-040 were not submitted and SWCAA is not requesting revision of these provisions in the SIP at this time.
The revised regulations in sections (1)(b), (1)(e), (3), (5), (6), (7), and (8) set out general requirements for reasonably available control technology (RACT), visible emissions, fugitive emissions, sulfur dioxide concentrations, and dust control. These general requirements apply to all sources and emission units, unless applicable emission unit-specific standards are contained in another section of the regulations. Because the submitted SWCAA 400-040 regulatory text is consistent with our October 2014 approval of the corresponding WAC 173-400-040 provisions, we are proposing to approve the introductory paragraph of SWCAA 400-040 and sections (1)(b), (1)(e), (3), (5), (6), (7), and (8) to apply in lieu of WAC 173-400-040 within SWCAA's jurisdiction.
SWCAA 400-050 is similar in format and content to WAC 173-400-050
Consistent with the EPA's October 2014 final action on WAC 173-400-050, SWCAA is not submitting and the EPA is not proposing to approve, certain provisions in SWCAA 400-050 which do not regulate criteria pollutants covered under title I of the CAA, are not essential for meeting and maintaining the NAAQS, and are not required for SIPs under section 110 of the CAA. Specifically, SWCAA requested that the EPA remove SWCAA 400-050(3) from the SIP. This subsection, which regulates total carbonyls from incineration units, corresponds to WAC 173-400-050(2). In the EPA's October 2014 final action we removed WAC 173-400-050(2) from the SIP, stating that total carbonyls are not a criteria air pollutant or an EPA designated precursor to criteria pollutants, and are not appropriate for inclusion in a SIP. Similarly, SWCAA is not submitting, and the EPA is not proposing to approve, SWCAA 400-050(5) and (6), which are emission guidelines for commercial, industrial, and small municipal waste combustion units regulated under section 111 of the CAA which are not related to section 110 of the CAA and not appropriate for approval into the SIP.
Ecology first submitted SWCAA 400-052 for incorporation into the SIP in 1994. The intent was to establish a regime of emission testing for large combustion sources that predated the establishment of SWCAA and had not undergone new source review. In the December 20, 2016 submittal, SWCAA explains that all major sources that would otherwise be subject to this provision already have periodic testing requirements established via new source review and/or compliance assurance monitoring imposed under the Air Operating Permit (AOP) program. For this reason, SWCAA requested that the EPA remove SWCAA 400-052 from the SIP. The EPA reviewed SWCAA's demonstration that removal of this provision would not interfere with any applicable requirement concerning attainment and reasonable further progress, or any other applicable requirement of section 110 of the CAA and is proposing to remove SWCAA 400-052 from the SIP. The demonstration can be found in the docket for this action.
SWCAA 400-060 follows the SIP-approved requirements of WAC 173-400-060, which stipulate that no person shall cause or allow the emission of particulate material from any general process operation in excess of 0.23 grams per dry cubic meter at standard conditions of exhaust gas. SWCAA 400-060 and WAC 173-400-060 use slightly different methods to determine compliance. WAC 173-400-060 cites test methods found in 40 CFR parts 51, 60, 61 and 63 or contained in Ecology's “Source Test Manual—Procedures for Compliance Testing.” SWCAA 400-060 cites test methods from 40 CFR parts 51, 60, 61 and 63 and any other appropriate test procedures approved in advance by both SWCAA and the EPA. The EPA has
SWCAA submitted revisions to SWCAA 400-070 sections (1), (2)(b), (3)(a), (4), (8)(a), (8)(b), (13), (15)(a), (15)(b), and (15)(d) for approval into the SIP. Other regulatory provisions contained in SWCAA 400-070 were not submitted and SWCAA is not requesting revision of these provisions in the SIP at this time.
SWCAA 400-070, which sets separate standards applicable to certain source categories, generally follows the language of the SIP-approved provisions of WAC 173-400-070, with some differences. For example, WAC 173-400-070(1) sets requirements for the use of wigwam burners designed to dispose of wood waste; whereas SWCAA 400-070(1) banned the use of wigwam or equivalent type burners effective January 1, 1994. SWCAA 400-070(2)(b) and (3)(a) regulate hog fuel boilers and orchard heaters, respectively, with regulatory text identical to WAC 173-400-070(2)(b) and (3)(a). SWCAA 400-070 contains no provisions that correspond to WAC 173-400-070(4) and (6), which regulate grain elevators and certain wood waste burners, respectively. This has the effect of making SWCAA 400-070 more stringent, subjecting these source categories to all general standards rather than providing source category exemptions from the general standards. SWCAA 400-070(4), which regulates catalytic cracking units, corresponds to WAC 173-400-070(5). In the December 20, 2016 submittal, SWCAA notes that its jurisdiction has no existing catalytic cracking units. Therefore SWCAA 400-070(4) focuses exclusively on the new source review and BACT requirements similar to WAC 173-400-070(5)(b). SWCAA 400-070(8), (13), and (15), which regulate abrasive blasting, natural gas fired water heaters, and outdoor wood-fired boilers, have no corresponding provisions in WAC 173-400-070. Unlike WAC 173-400-070, which provides exemptions from the general requirements of WAC 173-400-040, 173-400-050, and 173-400-060, the source category-specific requirements of SWCAA 400-070 are in addition to any general requirements that apply. This has the effect of making SWCAA 400-070 more stringent than WAC 173-400-070 for these source categories. Lastly, the version of SWCAA 400-070(6) currently incorporated into the SIP requires “that all gasoline dispensing facilities shall meet all the provisions of SWAPCA 400-110(8) and SWAPCA 491
The EPA is proposing to approve SWCAA 400-070 sections (1), (2)(b), (3)(a), (4), (8)(a), (8)(b), (13), (15)(a), (15)(b), and (15)(d) to apply in lieu of WAC 173-400-070 within SWCAA's jurisdiction. The EPA is also proposing to grant SWCAA's request to remove SWCAA 400-070(6) from the SIP because removal of this provision would not interfere with any applicable requirement concerning attainment and reasonable further progress, or any other applicable requirement of section 110 of the CAA. We are also proposing to remove SWCAA 400-070(8)(c) [formerly 400-070(7)(d)] from the SIP because this provision related to toxic air pollutants, regulated outside the scope of the SIP, was inadvertently included in our February 26, 1997 approval of SWCAA 400-070 (62 FR 8624).
SWCAA 400-072 has no corresponding provision in the WAC; however in many ways it is similar to the EPA-approved WAC 173-400-560
SWCAA 400-074, which regulates gasoline transport tankers, has no corresponding provision in Chapter 173-400 WAC. Aside from minor revisions to address the agency name change and readability, SWCAA 400-074 remains unchanged since the EPA's last approval on February 26, 1997. As part of the December 20, 2016 submittal, SWCAA requested that the EPA remove SWCAA 400-074(2) from the SIP because this agency registration fee provision is not a required element for SIPs under section 110 of the CAA. The EPA is proposing to approve the updated text of SWCAA 400-074, except for SWCAA 400-074(2), which the EPA proposes to remove from the SIP.
SWCAA 400-081 generally follows the language of the EPA-approved WAC 173-400-081
SWCAA 400-091 generally follows the language of WAC 173-400-091, which the EPA approved in our October 3, 2014 final action. These provisions authorize the respective agencies to issue regulatory orders setting voluntary limits on the potential to emit of a source, allowing the source to avoid applicability of certain major source programs such as PSD. SWCAA 400-091 contains the same substantive requirements of WAC 173-400-091 with minor revisions to reflect the SWCAA regulatory structure and to improve clarity. We reviewed SWCAA 400-091 and are proposing to approve this provision to apply in lieu of WAC 173-400-091 in SWCAA's jurisdiction. We also note that the current SIP includes a reference to SWCAA 400-090 which was renumbered to SWCAA 400-091 on September 21, 1995. We are proposing to correct this typographical error which was inadvertently not addressed as part of our prior February 26, 1997 action.
In the January 27, 2014 submittal of the general air quality regulations, Ecology explained that WAC 173-400-100
SWCAA 400-105 generally follows WAC 173-400-105, which the EPA approved in October 3, 2014 final action. It contains the emissions inventory, monitoring, reporting, and recordkeeping requirements for sources under SWCAA's jurisdiction. SWCAA 400-105 differs slightly from the WAC in applicability, deadlines for reporting, list of reportable pollutants, and monitoring requirements, but not in a substantive way. For example, SWCAA 400-105 applies to all registered sources and sources subject to operating permits under title V of the CAA; whereas WAC 173-400-105 applies to all sources receiving notification from the Director of Ecology. In practical terms, the scope is the same. Similarly, SWCAA's submittal deadline for emissions inventory information is March 15th, as opposed to the 105th day of the calendar year under the WAC. SWCAA 400-105(1) contains additional reportable pollutants than the WAC, including toxic air pollutants. As previously discussed, SWCAA is not submitting and the EPA is not approving provisions related to toxic air pollutants that are inappropriate for SIP approval under section 110 of the CAA.
With respect to the difference in monitoring requirements, SWCAA 400-105(4)(e) requires compliance with the specifications and reporting requirements of 40 CFR part 60, Appendices B and F, in addition to the specifications and reporting requirements of 40 CFR 51, Appendix P, Sections 3-5 required under WAC 173-400-105(5)(e). SWCAA 400-105(4)(f) explicitly contemplates the use of continuous process parameter monitoring and/or frequent stack testing as potential surrogates to continuous emission monitoring; whereas WAC 173-400-105(5)(f) states that alternative monitoring and reporting procedures “will generally take the form of stack tests” but allows agency discretion in determining other alternatives. In practical terms, the requirements are the same. We reviewed SWCAA 400-105 and are proposing to approve this provision to apply in lieu of WAC 173-400-105 within SWCAA's jurisdiction, except for the reporting requirements related to toxic air pollutants which are inappropriate for SIP approval under section 110 of the CAA.
SWCAA 400-106(1)(a), (b), and (c) take the EPA-approved emission testing requirements of WAC 173-400-105(4) and incorporate them in another section with additional requirements not cited in the WAC and not submitted for the EPA's approval. SWCAA 400-106(1)(a), (b), and (c), although different in structure, are nearly identical to WAC 173-400-105(4). The key difference is that SWCAA 400-106(1)(b) allows the use of selected Oregon Department of Environmental Quality test methods, due to the geographic proximity to Oregon; whereas the WAC does not. We reviewed SWCAA 400-106(1)(a), (b), and (c) and are proposing to approve these provisions to apply in lieu of WAC 173-400-105(4) within SWCAA's jurisdiction.
SWCAA 400-109 contains the applicability and permit application procedures for new source review (NSR) that corresponds to the EPA-approved provisions of WAC 173-400-110. The most significant difference is that SWCAA 400-109 contains generally lower, more stringent NSR-applicability exemption thresholds than the corresponding WAC provisions for many of the criteria pollutants. For example, SWCAA 400-109(3)(d) sets exemption emission thresholds for nitrogen oxides, sulfur dioxide, and volatile organic compounds at one ton per year (tpy) compared to two tpy under the SIP-approved provisions of WAC 173-400-110(5). Any stationary source that is not otherwise exempt under SWCAA 400-109(3)(e), discussed below, must undergo preconstruction permitting review if uncontrolled potential emissions are above these threshold levels. Like the WAC, if the stationary source emissions are significant enough to be considered “major” for a given pollutant, SWCAA 400-109 directs the reader to the relevant portions of WAC 173-400-700 through 750 for the PSD program administered by Ecology, and SWCAA 400-800 through 860 for major source nonattainment NSR administered by SWCAA. All other stationary sources, or
SWCAA 400-109(3)(e) also contains equipment and activity exemptions comparable to the EPA-approved provisions of WAC 173-400-110(4), with some differences in source categories to reflect local pollution concerns. The majority of equipment and activity exemptions contained in SWCAA 400-109(3)(e) remain the same since the EPA's last approval in 1997. As part of the December 20, 2016 submittal, SWCAA provided a demonstration to show that the new exemptions added since the EPA's last approval are unlikely to cause or contribute to an exceedance of the NAAQS. These new exemptions cover certain wastewater treatment plants, water heaters, and emergency internal combustion engines. SWCAA's demonstration describes how these source categories are covered by other local or Federal standards, such as the Federal engine standards contained in 40 CFR 63, subpart ZZZZ, or have been found by SWCAA to have emissions below the thresholds contained in SWCAA 400-109(3)(d).
The EPA reviewed SWCAA 400-109 and is proposing to determine that it meets the criteria for approvability under CAA section 110. The EPA also notes that SWCAA did not submit, and the EPA does not propose to approve, the toxic air pollutant provisions contained in SWCAA 400-109(3)(d) and (3)(e)(ii) because they are outside the scope of this proposed action under section 110 of the CAA. Lastly, under section 110(a)(2)(L) of the CAA, the State, or local agencies acting in lieu of the State, must demonstrate the ability to collect adequate fees for permitting major sources. SWCAA is therefore submitting SWCAA 400-109(4) to demonstrate adequate fee authority to implement the major source nonattainment NSR program under SWCAA 400-800 through 860. While the EPA reviews these submissions to confirm adequate authority, the EPA generally does not include local or State agency fees as part of the Washington SIP incorporated by reference in 40 CFR 52.2470(c). The EPA is also proposing to correct an error from our previous approval in 1997 when the fee provisions of SWCAA 400-109(4) were inadvertently incorporated by reference. With the exceptions noted above, we are proposing to approve SWCAA 400-109 to apply in lieu of WAC 173-400-110 within SWCAA's jurisdiction.
As part of the December 20, 2016 submittal, SWCAA explains that an effort was made to align the SWCAA NSR program to be as consistent as possible with the EPA-approved Ecology regulations contained in the WAC. Differences are generally insubstantial, with slightly different numbering systems, procedures, and edits for readability. One key difference is that the SWCAA NSR program contains more stringent NSR provisions for “designated maintenance plan areas” to ensure continued compliance with the NAAQS under SWCAA 400-111. In these areas, if a violation of an ozone ambient air quality standard or a second violation of the carbon monoxide ambient air quality standard has occurred, SWCAA may require the application of lowest achievable emission rate (LAER) for the maintenance pollutant(s) and any pollutant for which the proposed new source or modification is major.
Other less substantive differences between the SWCAA NSR program and the Ecology program under the WAC are discussed below. SWCAA 400-110
SWCAA 400-114 is derived from the statutory provisions of the Washington Clean Air Act, in particular Revised Code of Washington (RCW) 70.94.153. Under SWCAA 400-114, any replacement or substantial alteration of emission control technology installed on an existing stationary source or emission unit, excluding routine maintenance, repair or parts replacement, shall require submission of an air discharge permit application for determining NSR applicability under SWCAA 400-110. If the stationary source or emission unit is subject to NSR, all requirements under SWCAA 400-111, 400-112, and/or 400-113 shall apply. If the replacement or substantial alteration is not subject to NSR, then reasonably available control technology (RACT) or other requirements shall apply as dictated by RCW 70.94. Aside from minor wording changes for clarity, SWCAA 400-114 remains substantially unchanged since the EPA's last approval of this provision in 1997. We reviewed SWCAA 400-114 and are proposing to determine that it meets the criteria for approvability under CAA section 110. The corresponding Ecology provision of WAC 173-400-114 is currently not in the SIP. However, the EPA is also proposing to approve SWCAA 400-114 to apply in lieu of WAC 173-400-114 should this WAC provision be approved into the SIP at some future time.
SWCAA 400-116 has no corresponding provision under the WAC. This regulation requires that all process and pollution control equipment be maintained and operated in good working order. SWCAA 400-116(3) gives the agency authority to require that an Operations and Maintenance (O&M) plan be developed and implemented for each emission unit or piece of control or capture equipment in order to assure continuous compliance with approval conditions. SWCAA 400-116 remains substantially unchanged since the EPA's last approval in 1997, aside from minor wording changes for readability. We reviewed the updated version of SWCAA 400-116 and we propose to approve the changes.
SWCAA 400-130, 400-131, and 400-136 correspond to the Ecology provisions of WAC 173-400-131 and WAC 173-400-136, which the EPA approved on November 7, 2014 (79 FR 59653). These provisions implement a program to issue emission reduction credits (ERCs) useable for offsets required by the major nonattainment NSR permitting program and the attainment area offset provisions for sources under SWCAA 400-113(3) and its corollary, WAC 173-400-113(4). ERCs under this program may also be used as creditable emission reductions for netting purposes in the major nonattainment NSR and PSD permitting programs provided they meet the requirements set forth in the definitions of “major modification” in those programs. SWCAA's ERC program contains all of the functional requirements of the WAC, but does not contain provisions for discounting issued ERCs as provided in WAC 173-400-136(6). An approvable ERC program need not include provisions which spell out how banked ERC's would be discounted, but it cannot include provisions which would prevent the air authority from reducing or cancelling ERC's when necessary to attain and maintain the NAAQS. SWCAA's rules do not include any provisions which would prevent it from doing such as part of the development of an attainment or maintenance plan. SWCAA's ERC program also contains provisions for the establishment and maintenance of an ERC bank to document and track outstanding ERCs, which does not exist in the WAC.
We reviewed SWCAA's ERC program and are proposing to determine that it meets the criteria for approvability under section 110 of the CAA. We are also proposing to approve SWCAA 400-130, 400-131, and 400-136 to apply in lieu of WAC 173-400-131 and 173-400-136 within SWCAA's jurisdiction.
Aside from minor wording changes for clarity, SWCAA 400-151 and 400-161 remain substantially unchanged since the EPA's last approval of these provisions on February 26, 1997. Both provisions include the substantive requirements of the corresponding Ecology regulations contained in WAC 173-400-151 and 173-400-161. The most significant change is the modification of SWCAA 400-151 and 400-030 to more clearly define the term “existing stationary facility” to be consistent with the definition contained in 40 CFR 51.301, under the EPA's visibility protection program requirements. We reviewed SWCAA 400-151 and 400-161 and are proposing to approve these provision to apply in lieu of WAC 173-400-151 and 173-400-161 within SWCAA's jurisdiction.
SWCAA 400-171 closely follows WAC 173-400-171
Aside from minor updates to the citations, these long-standing provisions remain substantially unchanged since the EPA's last approval in 1997. They also closely match the corresponding EPA-approved Ecology provisions of WAC 173-400-190, 173-400-200, 173-400-205, and 173-400-210. Minor revisions include the updating of SWCAA 400-190 to reflect the major source specific nonattainment NSR requirements contained in SWCAA 800 through 860. SWCAA also revised SWCAA 400-200 to include vertical dispersion requirements that are not present in the corresponding WAC requirements. SWCAA is not submitting, and the EPA is not proposing to approve, these additional requirements contained in SWCAA 400-200(1). The remaining changes reflect the name change from “Southwest Air Pollution Control Authority” to “Southwest Clean Air Agency” that occurred after the EPA's 1997 approval. With the exception of SWCAA 400-200(1) noted above, we are proposing to approve SWCAA 400-190, 400-200, 400-205, and 400-210 to apply in lieu of the corresponding Ecology provisions in WAC 173-400-190, 173-400-200, 173-400-205, and 173-400-210.
The EPA reviews and approves state and local clean air agency submissions to ensure they provide adequate enforcement authority and other general authority to implement and enforce the SIP. However, regulations describing such agency enforcement and other general authority are generally not incorporated by reference so as to avoid potential conflict with the EPA's independent authorities. The EPA reviewed and is proposing to approve SWCAA 400-220, 400-230, 400-240, 400-250, 400-260, 400-270, and 400-280 as providing SWCAA adequate enforcement and other general authority for purposes of implementing and enforcing its SIP. However, we are not proposing to incorporating these provisions by reference into the SIP codified in 40 CFR 52.2470(c). Instead, the EPA is proposing to include these provisions in 40 CFR 52.2470(e),
Aside from minor edits to the citations to reflect the SWCAA regulatory structure, the SWCAA major nonattainment NSR program contained in SWCAA 400-800 through 860 is nearly identical to the Ecology major nonattainment NSR program in WAC 173-400-800 through 860, which the EPA approved on November 7, 2014 (79 FR 59653). We note that Ecology's major nonattainment NSR program for PM
As discussed above, WAC 173-400-020(1) states that, “The provisions of this chapter shall apply statewide, except for specific subsections where a local authority has adopted and implemented corresponding local rules that apply only to sources subject to local jurisdiction as provided under RCW 70.94.141 and 70.94.331.” SWCAA 400 does not contain any rules that correspond to the EPA-approved provisions of WAC 173-400-117, 173-400-118, or 173-400-560. In this action, the EPA therefore proposes to approve these WAC provisions within SWCAA's jurisdiction, which the EPA has previously approved into the Washington SIP for areas under Ecology's jurisdiction.
SWCAA Appendix A corresponds to the EPA Test Method 9—
SWCAA Appendix B—
The EPA proposes to approve and incorporate by reference into the Washington SIP at 40 CFR 52.2470(c)—
In addition to the regulations proposed for approval and incorporation by reference above, the EPA reviews and approves state and local clean air agency submissions to ensure they provide adequate enforcement authority and other general authority to implement and enforce the SIP. However, regulations describing such agency enforcement and other general authority are generally not incorporated by reference so as to avoid potential conflict with the EPA's independent authorities. As discussed above, the EPA has reviewed and is proposing to approve SWCAA 400-220
The Ecology regulations contained in Washington's SIP at 40 CFR 52.2470(c)—
This proposed revision to the SIP applies specifically to the SWCAA jurisdiction incorporated into the SIP at 40 CFR 52.2470(c)—Table 8. As discussed in our October 3, 2014 action (79 FR 59653, at page 59654), local air agency jurisdiction in Washington is generally defined on a geographic basis; however there are exceptions. By statute, SWCAA does not have authority for sources under the jurisdiction of the Energy Facility Site Evaluation Council (EFSEC). See Revised Code of Washington Chapter 80.50. Under the applicability provisions of WAC 173-405-012, 173-410-012, and 173-415-012, SWCAA also does not have jurisdiction for kraft pulp mills, sulfite pulping mills, and primary aluminum plants. For these sources, Ecology retains statewide, direct jurisdiction. Ecology also retains statewide, direct jurisdiction for the PSD permitting program. Therefore, the EPA is not approving into 40 CFR 52.2470(c)—Table 8 those provisions of Chapter 173-400 WAC related to the PSD program. Specifically, these provisions are WAC 173-400-116 and WAC 173-400-700 through 750, which the EPA has already approved as applying state-wide.
As described in our April 29, 2015 action, jurisdiction to implement the visibility permitting program contained in WAC 173-400-117 varies depending on the situation. Ecology retains authority to implement WAC 173-400-117 as it relates to PSD permits. See 80 FR 23721. However, for facilities subject to major nonattainment NSR under the applicability provisions of SWCAA 400-800, we are proposing that SWCAA would be responsible for implementing those parts of WAC 173-400-117 as they relate to major nonattainment NSR permits. See 80 FR 23726. If finalized, the EPA is also proposing to modify the visibility protection Federal Implementation Plan contained in 40 CFR 52.2498 to reflect the approval of WAC 173-400-117 as it applies to implementation of the major nonattainment NSR program in SWCAA's jurisdiction.
Lastly, this SIP revision is not approved to apply in Indian reservations in the State, or any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction.
In this rule, the EPA is proposing to include in a final EPA rule regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, the EPA is proposing to incorporate by reference the regulations shown in the tables in section III.A.
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 proposed action merely approves the state's law as meeting Federal requirements and does not impose additional requirements beyond those imposed by the state's law. For that reason, this proposed 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
• Is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601
• Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);
• Does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);
• Is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);
• Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);
• Is not subject to the 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. This SIP revision is not approved to apply in Indian reservations in the State, or any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction.
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.
42 U.S.C. 7401
Health Resources and Services Administration (HRSA), Department of Health and Human Services (HHS).
Denial of petition for rulemaking.
In accordance with section 2114(c)(2)(B) of the Public Health Service Act, 42 U.S.C. 300aa-14(c)(2)(B), notice is hereby given concerning the reasons for not conducting a rulemaking proceeding to add neurological disorders or conditions as injuries associated with seasonal influenza vaccines to the Vaccine Injury Table.
Written comments are not being solicited.
Narayan Nair, MD, Director, Division of Injury Compensation Programs (DICP), Healthcare Systems Bureau, Health Resources and Services Administration, 5600 Fishers Lane, Room 8N146B, Rockville, Maryland 20857, or by telephone 301-443-6593.
The National Childhood Vaccine Injury Act of 1986, (Vaccine Act), Title III of Public Law 99-660, established the National Vaccine Injury Compensation Program (VICP) for persons found to be injured by vaccines.
The statute authorizing VICP provides for the inclusion of additional vaccines in VICP when they are recommended by the Centers for Disease Control and Prevention for routine administration to children.
(A) Receipt of any recommendation of the Commission, or
(B) 180 days after the date of the referral to the Commission,
On January 28, 2016, a private citizen submitted a petition to the Department of Health and Human Services (HHS) requesting that: (1) Any adverse neurological disorder or condition be added to the Table for the seasonal influenza vaccines; and (2) if any adverse neurological disorder or condition was too broad in scope, then at least anaphylaxis, Shoulder Injury Related to Vaccine Administration (SIRVA), vasovagal syncope, multiple sclerosis (MS), Guillain-Barré Syndrome (GBS), transverse myelitis (TM), and myelitis be added to the Table for the seasonal influenza vaccine. The petitioner asserted that based on Vaccine Adverse Event Reporting System (VAERS) data and Department of Justice (DOJ) quarterly reports on vaccine settlements, which were presented at Commission meetings, there is sufficient evidence to add these conditions as injuries associated with the seasonal influenza vaccine to the Table. The petitioner did not provide any medical or scientific literature to accompany the request.
Pursuant to the Vaccine Act, the petition was referred to the Commission on June 3, 2016. The Commission voted unanimously to recommend that the Secretary not proceed with rulemaking to amend the Table to include “any adverse neurological disorder or condition,” MS, TM, or myelitis as injuries associated with seasonal influenza vaccines as requested in the petition.
The petitioner requested the addition of any adverse neurological disorder or condition to the Table for the seasonal influenza vaccine. The petitioner alleged that the DOJ quarterly reports on vaccine settlement cases and VAERS data support the inclusion of all of these conditions to the Table. However, neither of these sources of data is sufficient to modify the Table. The DOJ quarterly report is the report that DOJ provides and discusses at the quarterly Commission meetings and is made available to the public at
The purposes of VAERS data are to: Detect new, unusual, or rare vaccine adverse events; identify potential patient risk factors for particular types of adverse events; identify vaccine lots with increased numbers or types of reported adverse events; and assess the safety of newly licensed vaccines. The VAERS data are considered a useful tool in vaccine safety, but VAERS reports by themselves generally cannot demonstrate that vaccines cause injuries.
In 2008, the Secretary contracted with the Institute of Medicine (IOM) to review the epidemiologic, clinical, and biological evidence regarding adverse health events associated with specific vaccines covered by VICP. The results of this review were published in the 2012 IOM Report, “
The petitioner also requested that certain conditions be added to the Table if “any adverse neurological disorder or condition” could not be added to the Table. These conditions include: Anaphylaxis, SIRVA, vasovagal syncope, MS, GBS, TM, and myelitis. The petitioner stated that VAERS and settlement data from quarterly reports support the inclusion of these conditions for seasonal influenza vaccines to the Table. However, as explained above, the VAERS data and the DOJ quarterly report do not demonstrate that vaccines cause injuries and do not establish causality. As stated previously, the 2012 IOM Report reviewed the medical and scientific literature regarding causal relationships between seasonal influenza vaccines and MS, TM, and myelitis. The IOM concluded that the evidence is inadequate to accept or reject a causal relationship between influenza vaccines and these conditions.
More recent studies support the lack of an association between the seasonal influenza vaccine and neurologic conditions, such as MS. The Williamson, et al. study found no substantiation to reports suggesting a link between MS and vaccines and that most of the studies that purported an increased risk of MS or relapse of MS after vaccination were small case series, which are methodologically less robust than other epidemiologic studies.
HHS proposed certain changes to the Vaccine Injury Table in a Notice of Proposed Rulemaking (NPRM) published in the
In conclusion, there is no reliable evidence to support the addition of “any adverse neurological disorder or condition,” MS, TM, or myelitis to the Table as injuries associated with the seasonal influenza vaccine. Therefore, the Table will not be amended at this time to include those injuries on the Table.
Office of the Chief Procurement Officer, Department of Homeland Security (DHS).
Proposed rule.
DHS is proposing to amend the Homeland Security Acquisition Regulation (HSAR) to add a new subpart, update an existing clause, and add a new contract clause to require contractors to complete training that addresses the protection of privacy, in accordance with the Privacy Act of 1974, and the handling and safeguarding of Personally Identifiable Information and Sensitive Personally Identifiable Information.
Interested parties should submit written comments to one of the addresses shown below on or before March 20, 2017, to be considered in the formation of the final rule.
Submit comments identified by HSAR Case 2015-003, Privacy Training, using any of the following methods:
•
Submit comments via the Federal eRulemaking portal by entering “HSAR Case 2015-003” under the heading “Enter Keyword or ID” and selecting “Search.” Select the link “Submit a Comment” that corresponds with “HSAR Case 2015-003.” Follow the instructions provided at the “Submit a Comment” screen. Please include your name, company name (if any), and “HSAR Case 2015-003” on your attached document.
•
•
Comments received generally will be posted without change to
Ms. Candace Lightfoot, Procurement Analyst, DHS, Office of the Chief Procurement Officer, Acquisition Policy and Legislation at (202) 447-0882 or email
DHS contracts currently require contractor and subcontractor employees to complete privacy training before accessing a Government system of records; handling Personally Identifiable Information (PII) or Sensitive PII (SPII); or designing, developing, maintaining, or operating a Government system of records. This training is completed upon award of the procurement and at least annually thereafter.
DHS is proposing to (1) include Privacy training requirements in the HSAR and (2) make the training more easily accessible by hosting it on a public Web site. This approach ensures all applicable DHS contractors and subcontractors are subject to the same requirements while removing the need for Government intervention to provide access to the Privacy training.
This proposed rule standardizes the Privacy training requirement across all DHS contracts by amending the HSAR to:
(1) Add the terms “personally identifiable information” and “sensitive personally identifiable information” at HSAR 3002.1, Definitions. The definition of “personally identifiable information” is taken from OMB Circular A-130 Managing Information as a Strategic Resource,
(2) Add a new subpart at HSAR 3024.70, Privacy Training addressing the requirements for privacy training. HSAR 3024.7001, Scope identifies the applicability of the subpart to contracts and subcontracts. HSAR 3024.7002, Definitions defines the term “handling.” The definition of “handling” was developed based upon a review of definitions for the term developed by other Federal agencies. HSAR 3024.7003, Policy identifies when contractors and subcontracts are required to complete the DHS privacy training. This subsection also requires the submission of training completion certificates for all contractor and subcontractor employees as a record of compliance. HSAR 3024.7004, Contract Clause, identifies when Contracting Officers must insert HSAR 3052.224-7X Privacy Training in solicitations and contracts. DHS welcomes respondents to offer their views on the following questions in particular:
A. What burden, if any, is associated with the requirement to complete DHS-developed privacy training?
B. What value, if any, is associated with providing industry the flexibility to develop its own privacy training given a unique set of Government requirements?
(3) Amend sub paragraph (b) of the HSAR 3052.212-70, Contract Terms and Conditions Applicable to DHS Acquisition of Commercial Items to add HSAR 3052.224-7X, Privacy Training. This change is necessary because HSAR 3052.224-7X is applicable to the acquisition of commercial items; and
(4) Add a new subsection at HSAR 3052.224-7X, Privacy Training to provide the text of the proposed clause. The proposed clause requires contractor and subcontractor employees to complete privacy training before accessing a Government system of records; handling Personally Identifiable Information (PII) or Sensitive PII (SPII); or designing, developing, maintaining, or operating a Government system of records. The training shall be completed within thirty (30) days of contract award and on an annual basis thereafter. The contractor shall maintain copies of training certificates for all contractor and subcontractor employees as a record of compliance and provide copies of the training certificates to the contracting officer. Subsequent training certificates to satisfy the annual privacy training requirement shall be submitted via email notification not later than October 31st of each year. The contractor shall attach training certificates to the email
These proposed revisions to the HSAR are necessary to ensure contractors and subcontractors properly handle PII and SPII. This includes PII and SPII contained in a system of records consistent with subsection (e) Agency requirements, and subsection (m) Government contractors, of the Privacy Act of 1974, Section 552a of title 5, United States Code (5 U.S.C. 552a).
Other applicable authorities that address the responsibility for Federal agencies to ensure appropriate handling and safeguarding of PII include the following Office of Management and Budget (OMB) memoranda and policies: OMB Memorandum M-07-16, “Safeguarding Against and Responding to the Breach of Personally Identifiable Information” issued May 22, 2007; OMB Memorandum M-10-23, “Guidance for Agency Use of Third-Party Web sites and Applications” issued June 25, 2010 (this memorandum contains the most current definition of PII, and clarifies the definition provided in M-07-16); OMB Circular No. A-130 “Managing Information as a Strategic Resource,” which identifies significant requirements for safeguarding and handling PII and reporting any theft, loss, or compromise of such information. DHS has also developed internal guidance that addresses the handling and protection of PII, including the DHS Privacy Incident Handling Guidance and the DHS Handbook for Safeguarding Sensitive Personally Identifiable Information. The DHS Privacy Incident Handling Guidance informs DHS and its components, employees, senior officials, and contractors of their obligation to protect PII, and establishes policies and procedures defining how they must respond to the potential loss or compromise of PII. The DHS Handbook for Safeguarding Sensitive Personally Identifiable Information sets minimum standards for how DHS personnel and contractors should handle SPII in paper and electronic form during their work activities.
This proposed rule is part of a broader initiative within DHS to (1) ensure contractors understand their responsibilities with regard to safeguarding controlled unclassified information (CUI); (2) contractor and subcontractor employees complete information technology (IT) security awareness training before access is provided to DHS information systems and information resources or contractor-owned and/or operated information systems and information resources where CUI is collected, processed, stored or transmitted on behalf of the agency; (3) contractor and subcontractor employees sign the DHS RoB before access is provided to DHS information systems, information resources, or contractor-owned and/or operated information systems and information resources where CUI is collected, processed, stored or transmitted on behalf of the agency; and (4) contractor and subcontractor employees complete privacy training before accessing a Government system of records; handling personally identifiable information (PII) and/or sensitive PII information; or designing, developing, maintaining, or operating a system of records on behalf of the Government.
Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is a significant regulatory action and, therefore, was subject to review under section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804. DHS has included a discussion of the estimated costs and benefits of this rule in the Paperwork Reduction Act supporting statement, which can be found in the docket for this rulemaking.
DHS expects this proposed rule may have an impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601,
DHS is proposing to amend the HSAR to require all contractor and subcontractor employees that will have access to a Government system of records; handle PII or SPII; or design, develop, maintain, or operate a system of records on behalf of the Government, complete training that addresses the requirements for the protection of privacy and the handling and safeguarding of PII and SPII. The purpose of this proposed rule is to require contractors to identify its employees who require access, ensure that those employees complete privacy training before being granted access and annually thereafter, provide the Government evidence of the completed training, and maintain evidence of completed training in accordance with the records retention requirements of the contract.
The objective of this rule is to require contractor and subcontractor employees to complete Privacy training before accessing a Government system of records; handling PII and/or SPII; or designing, developing, maintaining, or operating a Government system of records. This proposed rule requires contractors to identify who will be responsible for completing privacy training, and to emphasize and create awareness of the critical importance of privacy training in an effort to reduce the occurrences of privacy incidents.
The training imposed by this proposed rule is required by the provisions of the Privacy Act (5 U.S.C. 552a), Title III of the E-Government Act of 2002 and the Federal Information Security Modernization Act (FISMA) of 2014. This proposed rule requires contractors to identify its employees and subcontractor employees who require access to PII and SPII, ensure that those employees complete privacy training before being granted access to such information and annually thereafter, provide the Government evidence of the completed training, and maintain evidence of completed training.
This proposed rule will apply to contractor and subcontractor employees who require access to a Government system of records; handle PII or Sensitive PII; or design, develop, maintain, or operate a system of records on behalf of the Government. The estimated number of small entities to which the rule will apply is 6,628 respondents of which 4,162 are projected to be small businesses.
This estimate is based on a review and analysis of internal DHS contract data and Fiscal Year (FY) 2014 data reported to the Federal Procurement Data System (FPDS). It is anticipated that this rule will be primarily applicable to procurement actions with a Product and Service Code (PSC) of “D” Automatic Data Processing and Telecommunication and “R” Professional, Administrative and Management Support. PSCs will be adjusted as additional data becomes available through HSAR clause implementation to validate future burden projections.
The projected reporting and recordkeeping associated with this proposed rule is kept to the minimum necessary to meet the overall objectives. DHS minimized the burden associated with this proposed rule by developing the training and making it publicly accessible at
There are no rules that duplicate, overlap or conflict with this rule.
There are no practical alternatives that will accomplish the objectives of the proposed rule.
DHS will be submitting a copy of the IRFA to the Chief Counsel for Advocacy of the Small Business Administration. A copy of the IRFA may be obtained from the point of contact specified herein. DHS invites comments from small business concerns and other interested parties on the expected impact of this rule on small entities.
DHS will also consider comments from small entities concerning the existing regulations in subparts affected by this rule in accordance with 5 U.S.C. 610. Interested parties must submit such comments separately and should cite 5 U.S.C. 610 (HSAR Case 2015-003), in correspondence.
The Paperwork Reduction Act (44 U.S.C. chapter 35) applies because this proposed rule contains information collection requirements. Accordingly, DHS will be submitting a request for approval of a new information collection requirement concerning this rule to the Office of Management and Budget under 44 U.S.C. 3501,
A. Public reporting burden for this collection of information is estimated to be approximately 30 minutes (.50 hours) per response to comply with the requirements, including time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. The total annual projected number of responses per respondent is estimated at four (4). The estimated annual total burden hours are as follows:
B. Request for Comments Regarding Paperwork Burden.
You may submit comments identified by DHS docket number [DHS-2017-0008], including suggestions for reducing this burden, not later than March 20, 2017 using any one of the following methods:
(1) Via the internet at Federal eRulemaking Portal:
(2) Via email to the Department of Homeland Security, Office of the Chief Procurement Officer, at
Public comments are particularly invited on: Whether this collection of information is necessary for the proper performance of functions of the HSAR, and will have practical utility; whether our estimate of the public burden of this collection of information is accurate, and based on valid assumptions and methodology; ways to enhance the quality, utility, and clarity of the information to be collected; and ways in which we can minimize the burden of the collection of information on those who are to respond, through the use of appropriate technological collection techniques or other forms of information technology.
Requesters may obtain a copy of the supporting statement from the Department of Homeland Security, Office of the Chief Procurement Officer, Acquisition Policy and Legislation, via email to
Government procurement.
Therefore, DHS proposes to amend 48 CFR parts 3001, 3002, 3024 and 3052 to read as follows:
5 U.S.C. 301-302, 41 U.S.C. 1707, 41 U.S.C. 1702, 41 U.S.C. 1303(a)(2), 48 CFR part 1, subpart 1.3, and DHS Delegation Number 0702.
(a) * * *
“Personally Identifiable Information (PII)” means information that can be used to distinguish or trace an individual's identity, either alone or when combined with other information that is linked or linkable to a specific individual.
“Sensitive Personally Identifiable Information (SPII)” is a subset of PII, which if lost, compromised or disclosed without authorization, could result in substantial harm, embarrassment, inconvenience, or unfairness to an individual. Some forms of PII are sensitive as stand-alone elements.
(1) Examples of stand-alone SPII include: Social Security numbers (SSN), driver's license or state identification number, Alien Registration Numbers (A-number), financial account number, and biometric identifiers such as fingerprint, voiceprint, or iris scan.
(2) Additional examples of SPII include any groupings of information that contain an individual's name or other unique identifier plus one or more of the following elements:
(i) Truncated SSN (such as last 4 digits)
(ii) Date of birth (month, day, and year)
(iii) Citizenship or immigration status
(iv) Ethnic or religious affiliation
(v) Sexual orientation
(vi) Criminal history
(vii) Medical information
(viii) System authentication information such as mother's maiden name, account passwords or personal identification numbers (PIN)
(3) Other PII may be SPII depending on its context, such as a list of employees and their performance ratings or an unlisted home address or phone number. In contrast, a business card or public telephone directory of agency employees contains PII but is not SPII.
This section applies to contracts and subcontracts where contractor and subcontractor employees require access to a Government system of records; handle Personally Identifiable Information (PII) or Sensitive PII (SPII); or design, develop, maintain, or operate a Government system of records.
“Handling” means any use of Personally Identifiable Information (PII) or Sensitive PII (SPII), including but not limited to marking, safeguarding, transporting, disseminating, re-using, storing, capturing, and disposing of the information.
(a) Contractors are responsible for ensuring that contractor and subcontractor employees complete DHS privacy training initially upon award of the procurement, and at least annually thereafter, before contractor and subcontractor employees—
(1) Access to a Government system of records;
(2) Handle PII or SPII; or
(3) Design, develop, maintain, or operate a system of records on behalf of the Government.
(b) The contractor shall ensure employees identified in paragraph (a) of this section complete the required training, maintain evidence that the training has been completed and provide copies of the training completion certificates to the Contracting Officer and/or Contracting Officer's Representative for inclusion in the contract file.
(c) Each contractor and subcontractor employee who requires access to a Government system of records; handles PII or SPII; or designs, develops, maintains, or operates a Government system of records, shall be granted access or allowed to retain such access only if the individual has completed Department of Homeland Security privacy training requirements.
Contracting officers shall insert the clause at (HSAR) 48 CFR 3052.224-7X, Privacy Training, in solicitations and contracts when contractor and subcontractor employees may have access to a Government system of records; handle PII or SPII; or design, develop, maintain, or operate a system of records on behalf of the Government.
(b) * * *
___3052.224-7X Privacy Training
As prescribed in (HSAR) 48 CFR 3024.7004 contract clause, insert the following clause:
(a) The Contractor shall ensure that all Contractor and subcontractor employees complete the Department of Homeland Security (DHS) training titled, Privacy at DHS: Protecting Personally Identifiable Information accessible at
(1) Access a Government system of records;
(2) Handle personally identifiable information or sensitive personally identifiable information; or
(3) Design, develop, maintain, or operate a system of records on behalf of the Government.
(b) Training shall be completed within thirty (30) days of contract award and be completed on an annual basis thereafter not later than October 31st of each year. Any new Contractor or subcontractor employees assigned to the contract shall complete the training before accessing the information identified in paragraph (a) of this clause. The Contractor shall maintain copies of the training certificates for all Contractor and subcontractor employees as a record of compliance. Initial training certificates for each Contractor and subcontractor employee
(c) The Contractor shall insert the substance of this clause in all subcontracts and require subcontractors to include this clause in all lower-tier subcontracts.
Office of the Chief Procurement Officer, Department of Homeland Security (DHS).
Proposed rule.
DHS is proposing to amend the Homeland Security Acquisition Regulation (HSAR) to modify a subpart, remove an existing clause and reserve the clause number, update an existing clause, and add a new contract clause to address requirements for the safeguarding of Controlled Unclassified Information (CUI).
Comments on the proposed rule should be submitted in writing to one of the addresses shown below on or before March 20, 2017, to be considered in the formation of the final rule.
Submit comments identified by HSAR Case 2015-001, Safeguarding of Controlled Unclassified Information, using any of the following methods:
•
Submit comments via the Federal eRulemaking portal by entering “HSAR Case 2015-001” under the heading “Enter Keyword or ID” and selecting “Search.” Select the link “Submit a Comment” that corresponds with “HSAR Case 2015-001.” Follow the instructions provided at the “Submit a Comment” screen. Please include your name, company name (if any), and “HSAR Case 2015-001” on your attached document.
•
•
Comments received generally will be posted without change to
Ms. Shaundra Duggans, Procurement Analyst, DHS, Office of the Chief Procurement Officer, Acquisition Policy and Legislation at (202) 447-0056 or email
The purpose of this proposed rule is to implement adequate security and privacy measures to safeguard Controlled Unclassified Information (CUI) and facilitate improved incident reporting to DHS. This proposed rule does not apply to classified information. These measures are necessary because of the urgent need to protect CUI and respond appropriately when DHS contractors experience incidents with DHS information. Recent high-profile breaches of Federal information further demonstrate the need to ensure that information security protections are clearly, effectively, and consistently addressed in contracts. This proposed rule strengthens and expands existing HSAR language to ensure adequate security for CUI that is accessed by contractors; collected or maintained by contractors on behalf of an agency; and/or for Federal information systems that collect, process, store or transmit such information. The proposed rule identifies CUI handling requirements as well as incident reporting requirements, including timelines and required data elements. The proposed rule also includes inspection provisions and post-incident activities and requires certification of sanitization of Government and Government-Activity related files and information. Additionally, the proposed rule requires that contractors have in place procedures and the capability to notify and provide credit monitoring services to any individual whose Personally Identifiable Information (PII) or Sensitive PII (SPII) was under the control of the contractor or resided in the information system at the time of the incident.
This rule addresses the safeguarding requirements specified in the Federal Information Security Modernization Act (FISMA) of 2014 (44 U.S.C. 3551,
This proposed rule is part of a broader initiative within DHS to (1) ensure contractors understand their responsibilities with regard to safeguarding controlled unclassified information (CUI); (2) contractor and subcontractor employees complete
DHS is proposing to amend and expand an existing HSAR subpart. This proposed rule would (1) add new definitions; (2) clarify the applicability of the subpart; (3) remove an existing clause and reserve the clause number; (4) revise an existing clause; and (5) add a new clause to implement expanded safeguarding requirements and identify new policies for incident reporting, incident response, notification and credit monitoring. Each of these proposed changes are described in detail below.
(1) DHS is proposing to revise subpart 3002.101, Definitions, to define “adequate security,” “controlled unclassified information,” “Federal information,” “Federal information system,” “handling,” “information resources,” “information security,” and “information system,” ” and remove the definition of sensitive information. The definition of the terms “adequate security,” “Federal information,” and “Federal information system” is taken from OMB Circular A-130,
(2) DHS is proposing to revise subpart 3004.470, Security requirements for access to unclassified facilities, Information Technology resources, and sensitive information, to change the title of the subpart and to clarify the applicability of the subpart to the acquisition lifecycle. The title of the subpart would be changed to “Security requirements for access to unclassified facilities, information resources, and controlled unclassified information” and a new subsection for definitions would be added under the subpart. Accordingly, the subsections would be renumbered as follows: 3004.470-1 Scope, 3004.470-2 Definitions, 3004.470-3 Policy, and 3004.470-4 Contract Clauses. Originally, the title of this subpart contained the term “information technology resources;” however, this term is inconsistent with 44 U.S.C. 3502(6) which defines the term “information resources.” Subsection 3004.470-1, Scope, would be amended for consistency in terminology and to make clear the applicability of the subpart to the acquisition lifecycle. Subsection 3004.470-2, Definitions, would be added to define the term “incident.” The definition for “incident” is taken from FISMA 2014 (44 U.S.C. 3552(b)(2)). This term could not be defined at 3002.1, Definitions, because the meaning of the term “incident” in this subpart differs from the meaning it is given in other parts of the HSAR. Additionally, this definition is needed because this term appears in the clause at 3052.204-7X,
(3) Clause 3052.204-70, Security Requirements for Unclassified Information Technology Resources, would be removed and the clause number reserved. This change is necessary because the addition of the clause at 3052.204-7X
(4) A new clause at 3052.204-7X,
This section would add definitions, which also appear in part at 3002.1 Definitions and 3004.470-2 Definitions, as follows: “adequate security,” “Controlled Unclassified Information,” “Federal information,” “Federal information system,” “handling,” “Homeland Security Agreement Information,” “Homeland Security Enforcement Information,” “incident,” “information resources,” “information security,” “information system,” “Operations Security Information,” “Personnel Security Information,” and “Sensitive Personally Identifiable Information.” The definitions of these terms are needed because these terms appear in 3052.204-7X,
This section sets forth specific requirements for contractors and subcontractors when handling CUI in order to better protect against the threat of persistent cyber-attacks and prevent the compromise of CUI, including PII.
Handling requirements also include not using or redistributing any CUI collected, processed, stored, or transmitted by the contractor, except as specified in the contract and not maintaining SPII in the contractor's invoicing, billing, and other recordkeeping systems maintained to support financial or other administrative functions. DHS believes that maintaining SPII in the contractor's invoicing, billing, and other recordkeeping systems creates unnecessary risk of compromise and is not otherwise needed to achieve contract administration functions. DHS welcomes comments regarding whether other categories of CUI should be similarly excluded from a contractor's invoicing, billing, and other recordkeeping systems. Through these and other requirements set forth in the proposed clause and discussed in detail in the following sections, the Department believes that contractors and subcontractors will provide adequate security from the unauthorized access and disclosure of CUI.
FISMA defines a comprehensive framework for ensuring the protection of Government information, operations and assets against natural or man-made threats. This section sets forth information security requirements contractors operating a Federal information system must meet prior to collecting, processing, storing, or transmitting CUI in that information system as required by FISMA and set forth in NIST Special Publication 800-53,
Security authorization involves comprehensive testing and evaluation of security features (also known as controls) of an information system. It addresses software and hardware security safeguards; considers procedural, physical, and personnel security measures; and establishes the extent to which a particular design (or architecture), configuration, and implementation meets a specified set of security requirements throughout the life cycle of the information system. It also considers procedural, physical, and personnel security measures employed to enforce information security policy. The security authorization package includes a Security Plan, Contingency Plan, Contingency Plan Test Results, Configuration Management Plan, Security Assessment Plan, and Security Assessment Report. These documents are used to record the results of the security authorization process and provide evidence that the process was followed correctly. A Federal information system, which includes a contractor information system operating on behalf of an agency, must be granted an Authority to Operate (ATO) before it is granted permission to collect, process, store, or transmit CUI. The ATO is the official management decision given by a senior organizational official to authorize operation of an information system based on the implementation of an agreed-upon set of security controls.
The independent assessment is used to validate the security and privacy controls in place for the information system prior to submission of the security authorization package to the Government for review and acceptance. Once an ATO is accepted and signed by the Government, it is valid for three (3) years and must be renewed at that time unless otherwise specified in the ATO letter. The Government uses random security reviews as an additional level of verification to ensure security controls are in place, enforced and operating effectively. The contractor shall afford access to DHS, the Office of the Inspector General, other Government organizations, and contractors working in support of the Government access to the Contractor's facilities, installations, operations, documentation, databases, networks, systems, and personnel used in the performance of this contract to conduct security reviews. In addition, contractors operating information systems on behalf of the Government shall comply with Federal reporting and information system continuous monitoring requirements. Reporting requirements are determined by OMB on an annual basis and are defined in the Fiscal Year 2015 DHS Information Security Performance Plan.
This section sets forth incident reporting requirements for contractors and subcontractors when reporting known or suspected incidents, including known or suspected incidents that involve PII and/or SPII. The incident reporting requirements described in this section allow the Department to gather the information necessary to formulate an effective incident response plan for incident mitigation and resolution. These requirements include: Reporting all known or suspected incidents to the Component Security Operations Center and notifying the contracting officer and contracting officer's representative of the incident; reporting known or suspected incidents that involve PII or SPII within one hour of discovery and all other incidents within eight hours of discovery; encrypting CUI using FIPS 140-2 Security Requirements for
The timing for reporting incidents involving PII or SPII is consistent with OMB Memorandum M-07-16, Safeguarding Against and Responding to the Breach of Personally Identifiable Information. The timing for reporting incidents unrelated to PII or SPII was derived from existing Departmental policy for reporting incidents related to other categories of CUI such as CVI, Protected Critical Infrastructure Information (PCII), and Sensitive Security Information (SSI). Controlled unclassified information is required to be excluded from the subject or body of an email and encrypted to prevent further compromise of the information when reporting incidents. The additional data elements required when reporting incidents involving PII or SPII are needed to assist in the Department's understanding of the incident and aid in an effective response. DHS also wants to encourage industry to timely report incidents to the Department by making it clear that such reporting does not automatically mean the contractor has failed to provide adequate security or otherwise meet the requirements of the contract.
This section identifies incident response requirements and activities. Incident response activities such as inspections, investigations, forensic reviews, etc. are used to quickly assess, remediate and protect CUI and are conducted whenever an incident is reported to DHS. The goal of these activities is to determine what data was or could have been accessed by an intruder, build a timeline of intruder activity, determine methods and techniques used by the intruder, find the initial attack vector, identify any features/aspects in the information security protections, and provide remediation recommendations to restore the protection of the data. Incident response activities may also include contract compliance analyses.
This section sets forth the notification procedures and capability requirements for Contractors when notifying any individual whose PII and/or SPII was under the control of the Contractor or resided in the information system at the time of the incident. The method and content of any notification by the Contractor shall be coordinated with, and subject to prior written approval by the Contracting Officer utilizing the DHS Privacy Incident Handling Guidance. When appropriate, notification of those affected and/or the public allows those individuals affected by the incident the opportunity to take steps to help protect themselves. Such notification is also consistent with the “openness principle” of the Privacy Act which calls for agencies to inform individuals about how their information is being accessed and used, and may help individuals mitigate the potential harms resulting from an incident.
The Department realizes that there are existing state notification laws that industry must also follow. Therefore, DHS welcomes comments regarding the impact, if any, that existing state notification laws will have on industry's ability to comply with this notification requirement.
This section sets forth the requirement that the contractor, when appropriate, is required to provide credit monitoring services, including call center services, if directed by the Contracting Officer, to any individual whose PII or SPII was under the control of the contractor, or resided in the information system, at the time of the incident for a period beginning the date of the incident and extending not less than 18 months from the date the individual is notified. Credit monitoring is a commercial service that can assist individuals in early detection of instances of identity theft. Credit monitoring services notify individuals of changes that appear in their credit report, such as creation of new accounts, changes to their existing accounts or personal information, or new inquiries for credit. Such notification affords individuals the opportunity to take steps to minimize any harm associated with unauthorized or fraudulent activity. The section is only applicable when an incident involves PII or SPII.
The Department deliberately made the provision of notification and credit monitoring services independent from an assessment of fault or lack of compliance with the contract terms and conditions. In accordance with OMB Memorandum M-07-16, Safeguarding Against and Responding to the Breach of Personally Identifiable Information, agencies have the responsibility to notify individuals whose PII or SPII may have been compromised without unreasonable delay. This notification has often been delayed while detailed forensic analysis and contract compliance inspections are occurring. Under this new provision, notification and credit monitoring, when appropriate, will occur more rapidly as it is not dependent upon any determination of contractor fault or noncompliance. DHS is also aware that sophisticated cyber-attacks can occur despite compliance with contract requirements. In these instances, even though there is no contractor noncompliance, there may still be a need to notify individuals and provide credit monitoring services. Additionally, DHS wants to emphasize that the provisions for notification and credit monitoring services are only applicable when (1) contractor and/or subcontractor employees may have access to PII/SPII or (2) information systems are used to collect, process, store, or transmit PII/SPII on behalf of the agency. DHS is considering broadening the credit monitoring requirement to include identity protection, identity restoration, and related services. DHS welcomes comments regarding the impact, if any, of this change.
Upon the conclusion of the contract by expiration, termination, cancellation, or as otherwise identified in the contract, the Contractor must return all CUI to DHS or destroy it physically or logically as identified in the contract. This destruction must conform to the guidelines for media sanitization contained in NIST SP-800-88, Guidelines for Media Sanitization. Further, the contractor must certify and confirm sanitization of media using the template provided in Appendix G of the publication.
The purpose of this section is to make clear that the requirements of this clause do not rescind the Contractor's responsibility for compliance with other applicable U.S. Government statutory or regulatory requirements that may apply to its contract(s).
This section requires that contractors insert the clause at 3052.204-7X
(5) Clause 3052.212-70,
(6) Other considerations. DHS is considering making changes to subpart 3004.470-3, Contract Clauses, and the clause at 3052.204-71, Contractor Employee Access. These changes would harmonize the text of the clause with the requirements of the final version of 3052.204-7X
Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is a significant regulatory action and, therefore, was subject to review under Section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804.
This proposed rule addresses the safeguarding requirements specified in the FISMA, OMB Circular A-130,
To determine the estimated costs of these requirements DHS requested cost information from multiple vendors whose contracts with DHS include requirements similar to this proposed rule; obtained cost input from the Federal Risk and Authorization Management Program (FedRAMP), for which DHS is a participant; reviewed the Congressional Budget Office (CBO) Cost Estimate for the Personal Data Protection and Breach Accountability Act of 2011; reviewed pricing from the General Service Administration's (GSA) recently awarded Identity Protection Services (IPS) blanket purchase agreements (BPAs); and reviewed internal price data from DHS's Managed Compliance Services and notification and credit monitoring services contracts. These activities identified that: (1) The cost of an independent assessment can range from $30,000 to $150,000 with an average cost of $112,872; (2) the equipment costs to perform continuous monitoring can range from $76,340 to $350,000 with an average cost of $213,170 while the labor costs to perform continuous monitoring can range from $47,000 to $65,000 for an average cost of $55,674; (3) the cost of reporting an incident to DHS ranges between $500 and $1,500 per incident; (4) the cost of notifying individuals that there has been an incident with their PII ranges from $1.03 to $4.60 per person; (5) the cost of credit monitoring services range between $60 and $260 per person; (6) a specific cost for the certificate of sanitization of Government and Government-Activity-Related files and information cannot be determined as the methods of sanitization vary widely depending on the categorization of the system and the media on which the data is stored; and (7) costs associated with Full-time Equivalent (FTE) oversight of the requirements of proposed clause
There are a multitude of benefits associated with the requirements of proposed clause
DHS is proposing that vendors obtain an independent assessment to validate the security and privacy controls in place for an information system prior to submission of the security authorization package to the Government for review and acceptance. In general, when assessing compliance with a standard or set of requirements, there are three alternatives: (1) First party attestation or self-certification, (2) second party attestation (
The cost of an independent assessment varies widely depending upon the complexity of the information system, the categorization of the information system (low, moderate, or high impact), and the sophistication of the contractor. Additionally, DHS does not have a mechanism to track the costs of independent assessments performed under its contracts. Because of the multiple factors that influence the cost of an independent assessment and lack of a tracking mechanism for associated costs, DHS is unable to identify with specificity the costs of implementing this requirement. As such, we sought to identify a range of costs based on the actual data we were able to access. DHS performed the following activities to obtain this data:
• Requested cost information from multiple vendors whose contracts with DHS require an independent assessment as part of the security authorization process;
• Obtained cost input from FedRAMP, for which DHS is a participant, as the program requires cloud service providers to obtain an independent assessment from a Third Party Assessment Organization; and
• Reviewed internal data from DHS's Managed Compliance Services contract. DHS uses this contract to perform internal independent assessments.
The cost information received from DHS vendors ranged from $30,000 to $123,615. The vendors whose costs were on the higher end of this range included costs for the independent party as well as internal labor costs associated with performing the independent assessment whereas the vendor on the low end of the spectrum did not. FedRAMP data indicates the estimated costs on an independent assessment to be approximately $150,000 while costs under DHS's internal contract for this service ranges between $35,000 and $45,000. When considering the data from DHS's internal contract for independent assessment services, it is important to note that these figures do not capture the labor costs of the Government employees involved in the process as the Government does not typically track the costs incurred for services performed by its own workforce. Because of this, it is both anticipated and expected that contractor costs for independent assessments will exceed the costs the Government incurs as contractor costs typically include not only the cost of the independent third party but also internal labor costs to facilitate the independent assessment and resolve any resultant findings.
Based on the above data points, the cost of an independent assessment can range from $30,000 to $150,000 or an average cost of $112,872. Because it seems likely that most vendors will have to account for necessary staff time, the average cost was developed by averaging only those cost estimates that included both internal and external labor costs. Neither the range nor the average cost identified is absolute as there are multiple factors that influence the cost of this service. Internal historical data indicates it takes approximately 162 labor hours to complete and independent assessment. This adds to the variance as the costs are dependent upon the labor categories and rates used to perform the assessment. Also, it is important to note that the assessment is required to be performed by an independent party. As such, the actual cost of the assessment is largely dependent upon agreements that the contractor is responsible for negotiating. Contractors with preexisting relationships with entities that perform independent assessments may be able to obtain more competitive pricing. Contractors new to this requirement may not. DHS welcomes comments from industry regarding the estimated costs associated with compliance with the requirement to obtain an independent assessment.
Proposed clause
The costs associated with continuous monitoring are not fixed and can vary widely. For example, a contractor that has previously gone through DHS's security authorization process is more likely to have in place the hardware, software, and personnel to perform continuous monitoring. In this instance, the costs associated with performing this requirement would be lower than a contractor who does not have preexisting hardware, software, and
Because of the multiple factors that influence the cost of continuous monitoring, DHS is unable to identify with specificity the costs of implementing this requirement. As such, we sought to identify a range of costs based on the actual data we were able to access. DHS performed the following activities to obtain this data:
• Requested cost information from multiple vendors whose contracts with DHS include similar continuous monitoring requirements; and
• Reviewed internal historical data.
The cost information received from DHS vendors ranged from $65,000 to $397,000. Vendors on the lower end of this range already had the hardware and software in place to perform continuous monitoring as the costs proposed only include labor. Alternatively, the vendors on the higher end of this range documented costs associated with hardware, software, and labor. For example, the cost breakdown from the vendor that reported costs of $397,000 included a one-time equipment fee of $350,000 and annual labor costs of $47,000. Alternatively, the vendor that submitted costs of $65,000 only proposed labor costs and is using preexisting hardware and software to perform continuous monitoring.
A review of internal historical data indicates the cost of continuous monitoring ranges from $6,000 to $18,000. It is important to note that the internal historical data assumes the vendor has the appropriate tools to perform continuous monitoring (
Using the above data points, the equipment costs to perform continuous monitoring can range from $76,340 to $350,000 with an average cost of $213,170. The average cost was developed by averaging the equipment costs received. Alternatively, labor costs to perform continuous monitoring can range from $47,000 to $65,000 for an average cost of $55,674. The average cost was developed by averaging the labor costs received. Please note these ranges and average costs are not absolute as the costs associated with continuous monitoring vary based on the tools (
This proposed rule requires contractors to report known or suspected incidents that involve PII or sensitive PII (SPII) within one hour of discovery and all other incidents (
The cost to prepare and report an incident to DHS varies based on the type(s) of information impacted by the incident and the complexity of the incident. Proposed clause
To determine the cost of preparing and reporting an incident, DHS performed the following activities:
• Requested cost information from multiple vendors whose contracts with DHS include similar incident reporting requirements; and
• Reviewed internal historical data.
It was difficult to use the information submitted by the vendors queried to establish an estimated cost. The information provided either included both incident reporting and incident response (
In the event of an incident that impacts PII/SPII, it may be necessary to perform certain incident response activities such as notification and credit monitoring. Contractors should not assume that all incident response activities will take place when a known or suspected incident is reported to DHS as the determination on the appropriate incident response activities is based upon investigation of the known or suspected incident. DHS uses a deliberative process to investigate and determine if an incident has occurred. This process begins with the contractor's submission of an Incident report to the Component or DHS SOC. The SOC staff use the incident report information to investigate and determine if an actual incident occurred. More often than not, an incident has not occurred and further incident response activities are not needed. If the SOC determines that incident has occurred, additional investigation and analyses happen to determine the nature and scope of the incident and US-CERT is engaged as necessary. If the incident involves PII/SPII, the Government will determine if notification and the provision of credit monitoring services is appropriate. DHS believes notification and credit monitoring, when appropriate, will occur more rapidly as the provision of these services is no longer dependent upon any determination of contractor fault or noncompliance.
To determine the cost of notifying individuals, DHS performed the following activities:
• Requested cost information from multiple vendors whose contracts with
• Reviewed pricing from DHS's department-wide contract for credit monitoring services;
• Reviewed the CBO Cost Estimate for the Personal Data Protection and Breach Accountability Act of 2011;
• Reviewed pricing from the GSA's recently awarded IPS BPAs; and
• Reviewed GSA's Professional Services Schedule, Financial and Business Solutions, Category 520 19 Data Breach Analysis.
The cost information we received from DHS vendors indicates that vendors price these requirements using different methods. One vendor bundled the cost of notification in its continuous monitoring costs while another bundled these costs as with those associated with incident reporting. In these instances we are unable to determine which portion of the costs are associated with the notification requirements. The cost submitted by the one vendor that separately priced this requirement was $4.06 per person. The pricing for notification in the Department's internal contract for credit monitoring services is significantly lower than the costs proposed by DHS's vendors,
While the CBO report referenced above did not provide a cost estimate for notification, the following information was provided: “According to industry sources, the sensitive, personally identifiable information of millions of individuals is illegally accessed or otherwise breached every year. However, according to those sources, 46 states already have laws requiring notification in the event of a security breach. In addition, it is the standard practice of most businesses to notify individuals if a security breach occurs. Therefore, CBO estimates that the notification requirements would not impose significant additional costs on businesses.”
GSA's IPS BPAs contain bundled fixed unit pricing for services that not only exceed the requirements of proposed clause
Proposed clause
The costs associated with this requirement vary depending on the method the contractor uses to provide services. For example, some contractors choose to satisfy this requirement through cyber insurance while others choose to subcontract these services with credit monitoring service providers. To estimate a cost for credit monitoring services, DHS performed the following activities:
• Requested cost information from multiple vendors whose contracts with DHS include similar credit monitoring requirements;
• Reviewed pricing from DHS's department-wide contract for credit monitoring services;
• Reviewed the CBO Cost Estimate for the Personal Data Protection and Breach Accountability Act of 2011; and
• Reviewed pricing from the General Service Administration's (GSA) recently awarded Identity Protection Services (IPS) blanket purchase agreements (BPAs).
The cost information we received from DHS vendors indicates that vendors satisfy these requirements using different methods. One vendor used cyber insurance while others satisfied this requirements through subcontracts with credit monitoring service providers. In instances where subcontracts are used, the pricing ranged from $61.71 to $260 per person. We assume that this variance in cost stems from the vendor's ability to negotiate favorable pricing with its subcontractors. It is also important to note that credit monitoring service providers frequently offer volume discounts that can lower the costs of services. However, all vendors under contracts with DHS may not able to capitalize on these discounts as the amount of PII provided to a contractor is based upon the services being provided and can vary greatly from contract to contract.
The pricing in the Department's internal contract for credit monitoring services is significantly lower than the costs proposed by DHS's vendors,
As it relates to GSA's IPS BPAs, the published price lists do not mirror the credit monitoring provisions of DHS's proposed clause
Based on the aforementioned information, DHS believes the most likely costs for these services range between $60 and $260 per person. DHS welcomes comments from industry regarding the estimated costs associated with compliance with the requirement to provide credit monitoring. DHS also requests feedback from industry on how many individuals typically sign up for credit monitoring after being notified that an incident has occurred that impacts their PII/SPII?
Proposed clause
NIST SP 800-88 identifies the proper and applicable techniques and controls for sanitization and disposal decisions, considering the security categorization of the associated system's confidentiality. Applicable sanitization methods depend on the media in which the data is stored. Following sanitization, NIST SP 800-88 requires a certificate of media disposition to be completed for each piece of electronic media that has been sanitized. The proposed clause
As discussed above, the costs associated with oversight and compliance with the requirements contained in proposed clause
Feedback from industry has consistently indicated the need for transparency and clear and concise requirements as it relates to information security. The requirements of proposed clause
Proposed clause
Proposed clause
The content and method of any notification sent by a contractor must be coordinated with and approved by the contracting officer. At a minimum, this notification must include: A brief description of the incident; a description of the types of PII or SPII involved; a statement as to whether the PII or SPII was encrypted or protected by other means; steps individuals may take to protect themselves; what the contractor and/or the Government are doing to investigate the incident, to mitigate the incident, and to protect against any future incidents; and information identifying who individuals may contact for additional information. Such notification is consistent with the “openness principle” of the Privacy Act which calls for agencies to inform individuals about how their information is being accessed and used, and may help individuals mitigate the potential harms resulting from an incident.
Proposed clause
Proposed clause
Previously contractors were not consistently provided with specific incident reporting timelines. As such, the timeliness of incident reporting was determined by the contractor. Standardizing incident reporting timelines through proposed clause
DHS expects this proposed rule may have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601,
Cybersecurity has been identified as one of the most serious economic and national security challenges our nation faces. The frequency of cyber-attacks, including attempts to gain unauthorized access to CUI collected or maintained by or on behalf of an agency and information systems that collect, process, store, or transmit such information, has prompted the Government to expand its cybersecurity efforts across the Federal landscape. Part of the DHS mission is to protect the nation's cybersecurity and to coordinate responses to cyber-attacks and security vulnerabilities. As part of that mission, DHS is proposing to amend the HSAR to expand its current security measures for safeguarding CUI to include additional requirements for the safeguarding of CUI that is accessed by contractors, collected or maintained by contractors on behalf of the agency, and Federal information systems, which includes contractor information systems operating on behalf of the Government, that collect, process, store or transmit CUI. These proposed revisions to the HSAR are necessary to ensure the integrity, confidentiality, and availability of CUI.
The objective of this rule is to expand on existing Departmental IT security requirements. These existing IT security requirements are provided in the clause at HSAR 3052.204-70, Security Requirements for Unclassified Information Technology Resources, and applicable DHS policy and guidance. The existing clause is more narrowly focused on information systems connected to a DHS network or operated by a contractor for DHS. This rule proposes to remove the existing clause and provide a new expanded clause. Unlike the existing clause, this proposed rule extends the scope to require that CUI be safeguarded wherever such information resides, including government-owned and operated information systems, government-owned and contractor operated information systems, contractor-owned and/or operated information systems operating on behalf of the Government, and any situation where contractor and/or subcontractor employees may have access to CUI consistent with the requirements of FISMA. This proposed rule also establishes uniform incident reporting and response activities that contractors and subcontractors must comply with in the event of an incident. The proposed rule also requires contractors and subcontractors have in place procedures and the capability to notify and provide credit monitoring services to any individual whose Personally Identifiable Information (PII) or
The requirement to safeguard CUI is specified in the Federal Information Security Modernization Act of 2014 (44 U.S.C. 3551,
This rule will apply to DHS contractors that require access to CUI, collect or maintain CUI on behalf of the Government, or operate Federal information systems, which includes contractor information systems operating on behalf of the agency, that collect, process, store or transmit CUI.
For Fiscal Year (FY) 2014, DHS awarded nearly 13,000 new contract awards to large and small businesses, with over 35 percent of all contracts awarded to small businesses. The estimate of the number of small entities to which the proposed rule will apply was established by reviewing FPDS data for FY 2014, internal DHS contract data, experience with similar safeguarding requirements used in certain DHS contracts, and the most likely applicable Product and Service Codes (PSCs). The data review identified 2,525 unique vendors were awarded contracts under the most likely applicable PSCs in FY 2014, including small and large businesses. However, not all contractors awarded contracts under the most likely applicable PSCs will be subject to proposed clause
Although the proposed HSAR clause is new, DHS contractors are currently required to comply with Departmental IT security policy and guidance. It is assumed that the average DHS IT services contractor covered by this clause will a have high operational security readiness posture. However, the requirements of the proposed clause have been expanded to include professional services contractors that have access to CUI, collect or maintain CUI on behalf of the Government, and/or operate Federal information systems, including contractor information systems operating on behalf of the agency, that collect, process, store or transmit CUI to perform the requirements of their contract(s). While these contractors may not have the same operational security readiness posture of the average DHS IT services contractor, the expansion and implementation of these safeguarding requirements is necessary to further reduce risks and potential vulnerabilities.
Reporting and recordkeeping requirements include those requirements necessary to ensure adequate security controls are in place when contractor and/or subcontractor employees will have access to sensitive CUI, collect or maintain CUI on behalf of the Government, and/or operate Federal information systems, which includes contractor information systems operating on behalf of the agency, that are used to collect, process, store, or transmit CUI. The reporting and recordkeeping requirements vary depending on if an Authority to Operate (ATO) is required. If an ATO is not required, the reporting and recordkeeping requirements include: Incident Reporting, Notification (if the incident involves PII/SPII), Credit Monitoring (if the incident involves PII/SPII), and Certification of Sanitization. If an ATO is required, the reporting and recordkeeping requirements include: Incident Reporting, Notification (if the incident involves PII/SPII), Credit Monitoring (if the incident involves PII/SPII), Certification of Sanitization, Security Authorization Package, Independent Assessment, Renewal of ATO, and Federal Reporting and Continuous Monitoring.
Typical contract awards that may include the requirement for access to CUI include contracts awards with a PSC of “D” Automatic Data Processing and Telecommunication and “R” Professional, Administrative and Management Support. However, this is not an all-inclusive list. Additional PSCs will be added and projections will be adjusted as additional data becomes available through HSAR clause implementation. This continued process will assist in validating future projections. It is estimated that the average contractor will utilize a mid-level manager with IT expertise to ensure compliance with the requirements of this rule.
There are no rules that duplicate, overlap or conflict with this rule.
No significant alternatives were identified that would accomplish the stated objectives of the rule. The information security requirements associated with this rule are not geared towards a type of contractor; the requirements are based on the sensitivity of the information, the impact on the program, the Government and security in the event CUI is breached. That standard would not vary based on the size of the entity.
DHS will be submitting a copy of the IRFA to the Chief Counsel for Advocacy of the Small Business Administration. A copy of the IRFA may be obtained from the point of contact specified herein. DHS invites comments from small business concerns and other interested parties on the expected impact of this rule on small entities.
DHS will also consider comments from small entities concerning the existing regulations in subparts affected by this rule in accordance with 5 U.S.C. 610. Interested parties must submit such comments separately and should cite 5 U.S.C. 610,
The Paperwork Reduction Act (44 U.S.C. chapter 35) applies. The proposed rule contains information collection requirements. Accordingly, DHS will be submitting a request for approval of a new information collection requirement concerning this rule to the Office of Management and Budget under 44 U.S.C. 3501,
The collection requirements for this rule are based on a new HSAR clause, 3052.204-7X
A. The average public reporting burden for this collection of information is estimated to be approximately 50 hours per response to comply with the requirements, including time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. This average is based on an estimated 36 hours per response to comply with the requirements when an ATO
The total annual projected number of responses per respondent is estimated at 1. Based on aforementioned information the annual total burden hours are estimated as follows:
B. Request for Comments Regarding Paperwork Burden.
You may submit comments identified by DHS docket number [DHS-2017-0006], including suggestions for reducing this burden, not later than [insert date 60 days after publication in the
(1) Via the internet at Federal eRulemaking Portal:
(2) Via email to the Department of Homeland Security, Office of the Chief Procurement Officer, at
Public comments are particularly invited on: Whether this collection of information is necessary for the proper performance of functions of the HSAR, and will have practical utility; whether our estimate of the public burden of this collection of information is accurate, and based on valid assumptions and methodology; ways to enhance the quality, utility, and clarity of the information to be collected; and ways in which we can minimize the burden of the collection of information on those who are to respond, through the use of appropriate technological collection techniques or other forms of information technology.
Requesters may obtain a copy of the supporting statement from the Department of Homeland Security, Office of the Chief Procurement Officer, Acquisition Policy and Legislation, via email to
Government procurement.
Therefore, DHS proposes to amend 48 CFR parts 3001, 3002, 3004 and 3052 as follows:
5 U.S.C. 301-302, 41 U.S.C. 1707, 41 U.S.C. 1702, 41 U.S.C. 1303(a)(2), 48 CFR part 1, subpart 1.3, and DHS Delegation Number 0702.
(a) * * *
OMB Control No. 1600-0023 (Safeguarding of Controlled Unclassified Information)
“Adequate Security” means security protections commensurate with the risk resulting from the unauthorized access, use, disclosure, disruption,
“Controlled Unclassified Information (CUI)” is any information the Government creates or possesses, or an entity creates or possesses for or on behalf of the Government (other than classified information) that a law, regulation, or Government-wide policy requires or permits an agency to handle using safeguarding or dissemination controls. Within the context of DHS, this includes such information which, if lost, misused, disclosed, or, without authorization is accessed, or modified, could adversely affect the national or homeland security interest, the conduct of Federal programs, or the privacy of individuals. This definition includes the following CUI categories and subcategories of information:
(1) Chemical-terrorism Vulnerability Information (CVI) as defined in Title 6, Code of Federal Regulations, part 27 “Chemical Facility Anti-Terrorism Standards,” and as further described in supplementary guidance issued by an authorized official of the Department of Homeland Security (including the Revised Procedural Manual “Safeguarding Information Designated as Chemical-Terrorism Vulnerability Information” dated September 2008);
(2) Protected Critical Infrastructure Information (PCII) as set out in the Critical Infrastructure Information Act of 2002 (Title II, Subtitle B, of the Homeland Security Act, Public Law 107-296, 196 Stat. 2135), as amended, the implementing regulations thereto (Title 6, Code of Federal Regulations, part 29) as amended, the applicable PCII Procedures Manual, as amended, and any supplementary guidance officially communicated by an authorized official of the Department of Homeland Security (including the PCII Program Manager or his/her designee);
(3) Sensitive Security Information (SSI) as defined in Title 49, Code of Federal Regulations, part 1520, “Protection of Sensitive Security Information,” as amended, and any supplementary guidance officially communicated by an authorized official of the Department of Homeland Security (including the Assistant Secretary for the Transportation Security Administration or his/her designee) to include DHS MD 11056.1, “Sensitive Security Information (SSI)” and, within the Transportation Security Administration, TSA MD 2010.1, “SSI Program”;
(4) Homeland Security Agreement Information means information DHS receives pursuant to an agreement with state, local, tribal, territorial, and private sector partners that is required to be protected by that agreement. DHS receives this information in furtherance of the missions of the Department, including, but not limited to, support of the Fusion Center Initiative and activities for cyber information sharing consistent with the Cybersecurity Information Security Act;
(5) Homeland Security Enforcement Information means unclassified information of a sensitive nature lawfully created, possessed, or transmitted by the Department of Homeland Security in furtherance of its immigration, customs, and other civil and criminal enforcement missions, the unauthorized disclosure of which could adversely impact the mission of the Department;
(6) International Agreement Information means information DHS receives pursuant to an information sharing agreement or arrangement, with a foreign government, an international organization of governments or any element thereof, an international or foreign public or judicial body, or an international or foreign private or non-governmental organization, that is required by that agreement or arrangement to be protected;
(7) Information Systems Vulnerability Information (ISVI) means:
(i) DHS information technology (IT) internal systems data revealing infrastructure used for servers, desktops, and networks; applications name, version and release; switching, router, and gateway information; interconnections and access methods; mission or business use/need. Examples of information are systems inventories and enterprise architecture models. Information pertaining to national security systems and eligible for classification under Executive Order 13526, will be classified as appropriate;
(ii) Information regarding developing or current technology, the release of which could hinder the objectives of DHS, compromise a technological advantage or countermeasure, cause a denial of service, or provide an adversary with sufficient information to clone, counterfeit, or circumvent a process or system;
(8) Operations Security Information means information that could constitute an indicator of U.S. Government intentions, capabilities, operations, or activities or otherwise threaten operations security;
(9) Personnel Security Information means information that could result in physical risk to DHS personnel or other individuals that DHS is responsible for protecting;
(10) Physical Security Information means reviews or reports illustrating or disclosing facility infrastructure or security vulnerabilities related to the protection of Federal buildings, grounds, or property. For example, threat assessments, system security plans, contingency plans, risk management plans, business impact analysis studies, and certification and accreditation documentation;
(11) Privacy Information, which includes information referred to as Personally Identifiable Information. Personally Identifiable Information (PII) means information that can be used to distinguish or trace an individual's identity, either alone or when combined with other information that is linked or linkable to a specific individual; and
(12) Sensitive Personally Identifiable Information (SPII) is a subset of PII, which if lost, compromised or disclosed without authorization, could result in substantial harm, embarrassment, inconvenience, or unfairness to an individual. Some forms of PII are sensitive as stand-alone elements.
(i) Examples of stand-alone PII include: Social Security numbers (SSN), driver's license or state identification number, Alien Registration Numbers (A-number), financial account number, and biometric identifiers such as fingerprint, voiceprint, or iris scan.
(ii) Additional examples of SPII include any groupings of information that contain an individual's name or other unique identifier plus one or more of the following elements:
(A) Truncated SSN (such as last 4 digits)
(B) Date of birth (month, day, and year)
(C) Citizenship or immigration status
(D) Ethnic or religious affiliation
(E) Sexual orientation
(F) Criminal history
(G) Medical information
(H) System authentication information such as mother's maiden name, account passwords or personal identification numbers (PIN)
(iii) Other PII may be “sensitive” depending on its context, such as a list of employees and their performance ratings or an unlisted home address or phone number. In contrast, a business card or public telephone directory of agency employees contains PII but is not sensitive.
“Federal Information” means information created, collected, processed, maintained, disseminated, disclosed, or disposed of by or for the Federal Government, in any medium or form.
“Federal Information System” means an information system used or operated by an agency or by a contractor of an agency or by another organization on behalf of an agency.
“Handling” means any use of controlled unclassified information, including but not limited to marking, safeguarding, transporting, disseminating, re-using, and disposing of the information.
“Information Resources” means information and related resources, such as personnel, equipment, funds, and information technology.
“Information Security” means protecting information and information systems from unauthorized access, use, disclosure, disruption, modification, or destruction in order to provide—
(1) integrity, which means guarding against improper information modification or destruction, and includes ensuring information nonrepudiation and authenticity;
(2) confidentiality, which means preserving authorized restrictions on access and disclosure, including means for protecting personal privacy and proprietary information; and
(3) availability, which means ensuring timely and reliable access to and use of information.
“Information System” means a discrete set of information resources organized for the collection, processing, maintenance, use, sharing, dissemination, or disposition of information.
This section implements DHS policies for assuring adequate security of unclassified facilities, information resources, and controlled unclassified information (CUI) during the acquisition lifecycle.
As used in this subpart—
“Incident” means an occurrence that—
(1) actually or imminently jeopardizes, without lawful authority, the integrity, confidentiality, or availability of information or an information system; or
(2) constitutes a violation or imminent threat of violation of law, security policies, security procedures, or acceptable use policies.
(a) DHS requires that CUI be safeguarded wherever such information resides. This includes government-owned and operated information systems, government-owned and contractor operated information systems, contractor-owned and/or operated information systems operating on behalf of the agency, and any situation where contractor and/or subcontractor employees may have access to CUI. There are several Department policies and procedures (accessible at
(b) DHS requires contractor employees that require recurring access to Government facilities or access to CUI to complete such forms as may be necessary for security or other reasons, including the conduct of background investigations to determine fitness. Department policies and procedures that address contractor employee fitness are contained in Instruction Handbook Number 121-01-007, The Department of Homeland Security Personnel Suitability and Security Program. Compliance with these policies and procedures, as amended, is required.
(a) Contracting officers shall insert the basic clause at (HSAR) 48 CFR 3052.204-71, Contractor Employee Access, in solicitations and contracts when contractor and/or subcontractor employees require recurring access to Government facilities or access to CUI. Contracting officers shall insert the basic clause with its Alternate I for acquisitions requiring contractor access to Government information resources. For acquisitions in which contractor and/or subcontractor employees will not have access to Government information resources, but the Department has determined contractor and/or subcontractor employee access to CUI or Government facilities must be limited to U.S. citizens and lawful permanent residents, the contracting officer shall insert the clause with its Alternate II. Neither the basic clause nor its alternates shall be used unless contractor and/or subcontractor employees will require recurring access to Government facilities or access to CUI. Neither the basic clause nor its alternates should ordinarily be used in contracts with educational institutions.
(b) Contracting officers shall insert the clause at (HSAR) 48 CFR 3052.204-7X, Safeguarding of Controlled Unclassified Information, in solicitations and contracts where:
(1) Contractor and/or subcontractor employees will have access to CUI;
(2) CUI will be collected or maintained on behalf of the agency; or
(3) Federal information systems, which include contractor information systems operated on behalf of the agency, are used to collect, process, store, or transmit CUI.
(c) If the clauses prescribed in subsections (a) and/or (b) are included in a prime contract, the prime contractor shall include the clauses in subsections (a) and/or (b), in its contract(s) with subcontractors. If a subcontract includes the clauses prescribed in subsections (a) and/or (b) and the subcontractor has contracts with lower-tier subcontractors, the lower-tier subcontracts shall include the clauses in subsections (a) and/or (b).
As prescribed in (HSAR) 48 CFR 3004.470-4(b), insert the following clause:
(a)
“Adequate Security” means security protections commensurate with the risk resulting from the unauthorized access, use, disclosure, disruption, modification, or destruction of information. This includes ensuring that information hosted on behalf of an agency and information systems and applications used by the agency operate effectively and provide appropriate
“Controlled Unclassified Information (CUI)” is any information the Government creates or possesses, or an entity creates or possesses for or on behalf of the Government (other than classified information) that a law, regulation, or Government-wide policy requires or permits an agency to handle using safeguarding or dissemination controls. Within the context of DHS, this includes such information which, if lost, misused, disclosed, or, without authorization is accessed, or modified, could adversely affect the national or homeland security interest, the conduct of Federal programs, or the privacy of individuals. This definition includes the following CUI categories and subcategories of information:
(i) Chemical-terrorism Vulnerability Information (CVI) as defined in Title 6, Code of Federal Regulations, part 27 “Chemical Facility Anti-Terrorism Standards,” and as further described in supplementary guidance issued by an authorized official of the Department of Homeland Security (including the Revised Procedural Manual “Safeguarding Information Designated as Chemical-Terrorism Vulnerability Information” dated September 2008);
(ii) Protected Critical Infrastructure Information (PCII) as set out in the Critical Infrastructure Information Act of 2002 (Title II, Subtitle B, of the Homeland Security Act, Public Law 107-296, 196 Stat. 2135), as amended, the implementing regulations thereto (Title 6, Code of Federal Regulations, part 29) as amended, the applicable PCII Procedures Manual, as amended, and any supplementary guidance officially communicated by an authorized official of the Department of Homeland Security (including the PCII Program Manager or his/her designee);
(iii) Sensitive Security Information (SSI) as defined in Title 49, Code of Federal Regulations, part 1520, “Protection of Sensitive Security Information,” as amended, and any supplementary guidance officially communicated by an authorized official of the Department of Homeland Security (including the Assistant Secretary for the Transportation Security Administration or his/her designee) to include DHS MD 11056.1, “Sensitive Security Information (SSI)” and, within the Transportation Security Administration, TSA MD 2010.1, “SSI Program”;
(iv) Homeland Security Agreement Information means information DHS receives pursuant to an agreement with state, local, tribal, territorial, and private sector partners that is required to be protected by that agreement. DHS receives this information in furtherance of the missions of the Department, including, but not limited to, support of the Fusion Center Initiative and activities for cyber information sharing consistent with the Cybersecurity Information Security Act;
(v) Homeland Security Enforcement Information means unclassified information of a sensitive nature lawfully created, possessed, or transmitted by the Department of Homeland Security in furtherance of its immigration, customs, and other civil and criminal enforcement missions, the unauthorized disclosure of which could adversely impact the mission of the Department;
(vi) International Agreement Information means information DHS receives pursuant to an information sharing agreement or arrangement with a foreign government, an international organization of governments or any element thereof, an international or foreign public or judicial body, or an international or foreign private or non-governmental organization, that is required by that agreement or arrangement to be protected;
(vii) Information Systems Vulnerability Information (ISVI) means:
(A) DHS information technology (IT) internal systems data revealing infrastructure used for servers, desktops, and networks; applications name, version and release; switching, router, and gateway information; interconnections and access methods; mission or business use/need. Examples of information are systems inventories and enterprise architecture models. Information pertaining to national security systems and eligible for classification under Executive Order 13526, will be classified as appropriate;
(B) Information regarding developing or current technology, the release of which could hinder the objectives of DHS, compromise a technological advantage or countermeasure, cause a denial of service, or provide an adversary with sufficient information to clone, counterfeit, or circumvent a process or system;
(viii) Operations Security Information means information that could constitute an indicator of U.S. Government intentions, capabilities, operations, or activities or otherwise threaten operations security;
(ix) Personnel Security Information means information that could result in physical risk to DHS personnel or other individuals that DHS is responsible for protecting;
(x) Physical Security Information means reviews or reports illustrating or disclosing facility infrastructure or security vulnerabilities related to the protection of Federal buildings, grounds, or property. For example, threat assessments, system security plans, contingency plans, risk management plans, business impact analysis studies, and certification and accreditation documentation;
(xi) Privacy Information, which includes information referred to as Personally Identifiable Information (PII). PII means information that can be used to distinguish or trace an individual's identity, either alone, or when combined with other information that is linked or linkable to a specific individual; and
(xii) Sensitive Personally Identifiable Information (SPII) is a subset of PII, which if lost, compromised, or disclosed without authorization, could result in substantial harm, embarrassment, inconvenience, or unfairness to an individual. Some forms of PII are sensitive as stand-alone elements.
(A) Examples of stand-alone SPII include: Social Security numbers (SSN), driver's license or state identification number, Alien Registration Numbers (A-number), financial account number, and biometric identifiers such as fingerprint, voiceprint, or iris scan.
(B) Additional examples of SPII include any groupings of information that contain an individual's name or other unique identifier plus one or more of the following elements:
(
(
(
(
(
(
(
(
(C) Other PII may be SPII depending on its context, such as a list of employees and their performance ratings or an unlisted home address or phone number. In contrast, a business card or public telephone directory of agency employees contains PII but is not SPII.
“Federal information” means information created, collected, processed, maintained, disseminated, disclosed, or disposed of by or for the Federal Government, in any medium or form.
“Federal information system” means an information system used or operated by an agency or by a contractor of an agency or by another organization on behalf of an agency.
“Handling” means any use of controlled unclassified information, including but not limited to marking, safeguarding, transporting, disseminating, re-using, storing, capturing, and disposing of the information.
“Incident” means an occurrence that—
(i) actually or imminently jeopardizes, without lawful authority, the integrity, confidentiality, or availability of information or an information system; or
(ii) constitutes a violation or imminent threat of violation of law, security policies, security procedures, or acceptable use policies.
“Information Resources” means information and related resources, such as personnel, equipment, funds, and information technology.
“Information Security” means protecting information and information systems from unauthorized access, use, disclosure, disruption, modification, or destruction in order to provide—
(i) integrity, which means guarding against improper information modification or destruction, and includes ensuring information nonrepudiation and authenticity;
(ii) confidentiality, which means preserving authorized restrictions on access and disclosure, including means for protecting personal privacy and proprietary information; and
(iii) availability, which means ensuring timely and reliable access to and use of information.
“Information System” means a discrete set of information resources organized for the collection, processing, maintenance, use, sharing, dissemination, or disposition of information.
(b)
(1) Contractors and subcontractors must provide adequate security to protect CUI
(2) The Contractor shall not use or redistribute any CUI handled, collected, processed, stored, or transmitted by the Contractor except as specified in the contract.
(3) The Contractor shall not maintain SPII in its invoicing, billing, and other recordkeeping systems maintained to support financial or other administrative functions. It is acceptable to maintain in these systems the names, titles and contact information for the Contracting Officer's Representative (COR) or other Government personnel associated with the administration of the contract, as needed.
(4) Any Government data provided, developed, obtained under the contract, or otherwise under the control of the contractor, shall not become part of the bankruptcy estate in the event a contractor and/or subcontractor enters into bankruptcy proceedings.
(c)
(1)
(i)
(ii)
(2)
(i) Updating the SA package in the DHS Information Assurance Compliance System; or
(ii) Submitting the updated SA package directly to the COR.
(3)
(4)
(d)
(1) All known or suspected incidents shall be reported to the Component Security Operations Center (SOC) in accordance with
(2) The Contractor shall not include any CUI in the subject or body of any email. The Contractor shall transmit CUI using
(3) An incident shall not, by itself, be interpreted as evidence that the Contractor has failed to provide adequate information security safeguards for CUI, or has otherwise failed to meet the requirements of the contract.
(4) If an incident involves PII or SPII, in addition to the incident reporting guidelines in
(i) Data Universal Numbering System (DUNS);
(ii) Contract numbers affected unless all contracts by the company are affected;
(iii) Facility CAGE code if the location of the event is different than the prime contractor location;
(iv) Point of contact (POC) if different than the POC recorded in the System for Award Management (address, position, telephone, email);
(v) Contracting Officer POC (address, telephone, email);
(vi) Contract clearance level;
(vii) Name of subcontractor and CAGE code if this was an incident on a subcontractor network;
(viii) Government programs, platforms or systems involved;
(ix) Location(s) of incident;
(x) Date and time the incident was discovered;
(xi) Server names where CUI resided at the time of the incident, both at the Contractor and subcontractor level;
(xii) Description of the Government PII or SPII contained within the system; and
(xiii) Any additional information relevant to the incident.
(e)
(1) All determinations by the Department related to incidents, including response activities, notifications to affected individuals and/or Federal agencies, and related services (
(2) The Contractor shall provide full access and cooperation for all activities determined by the Government to be required to ensure an effective incident response, including providing all requested images, log files, and event information to facilitate rapid resolution of incidents.
(3) Incident response activities determined to be required by the Government may include, but are not limited to, the following:
(i) Inspections,
(ii) Investigations,
(iii) Forensic reviews,
(iv) Data analyses and processing, and
(v) Revocation of the Authority to Operate.
(4) The contractor shall preserve and protect images of known affected information systems identified in paragraph (b) of this section and all relevant monitoring/packet capture data for at least 90 days from submission of the incident report to allow DHS to request the media or decline interest.
(5) The Government, at its sole discretion, may obtain assistance from other Federal agencies and/or third-party firms to aid in incident response activities.
(f)
(1) The Contractor shall have in place procedures and the capability to notify any individual whose PII and/or SPII was under the control of the Contractor or resided in the information system at the time of the incident not later than 5 business days after being directed to notify individuals, unless otherwise approved by the Contracting Officer. The method and content of any notification by the Contractor shall be coordinated with, and subject to prior written approval by the Contracting Officer utilizing the DHS Privacy Incident Handling Guidance accessible at
(2) Subject to Government analysis of the incident and the terms of its instructions to the Contractor regarding any resulting notification, the notification method may consist of letters to affected individuals sent by first class mail, electronic means, or general public notice, as approved by the Government. Notification may require the Contractor's use of address verification and/or address location services. At a minimum, the notification shall include:
(i) A brief description of the incident;
(ii) A description of the types of PII or SPII involved;
(iii) A statement as to whether the PII or SPII was encrypted or protected by other means;
(iv) Steps individuals may take to protect themselves;
(v) What the Contractor and/or the Government are doing to investigate the incident, to mitigate the incident, and to protect against any future incidents; and
(vi) Information identifying who individuals may contact for additional information.
(g)
(1) Provide notification to affected individuals as described in paragraph (f).
(2) Provide credit monitoring services to individuals whose PII or SPII was under the control of the Contractor or resided in the information system at the time of the incident for a period beginning the date of the incident and extending not less than 18 months from the date the individual is notified. Credit monitoring services shall be provided from a company with which the Contractor has no affiliation. At a minimum, credit monitoring services shall include:
(i) Triple credit bureau monitoring;
(ii) Daily customer service;
(iii) Alerts provided to the individual for changes and fraud; and
(iv) Assistance to the individual with enrollment in the services and the use of fraud alerts.
(3) Establish a dedicated call center. Call center services shall include:
(i) A dedicated telephone number to contact customer service within a fixed period;
(ii) Information necessary for registrants/enrollees to access credit reports and credit scores;
(iii) Weekly reports on call center volume, issue escalation (
(iv) Escalation of calls that cannot be handled by call center staff to call center management or DHS, as appropriate;
(v) Customized Frequently Asked Questions, approved in writing by the Contracting Officer in coordination with the Headquarters or Component Privacy Officer; and
(vi) Information for registrants to contact customer service representatives and fraud resolution representatives for credit monitoring assistance.
(h)
(i)
(j)
(b) * * *
____3052.204-71 Contractor Employee Access.
____Alternate I
____Alternate II
____3052.204-7X Safeguarding of Controlled Unclassified Information.
Office of the Chief Procurement Officer, Department of Homeland Security (DHS).
Proposed rule.
DHS is proposing to amend the Homeland Security Acquisition Regulation (HSAR) to add a new subpart, update an existing clause, and add a new contract clause to standardize information technology security awareness training and DHS Rules of Behavior requirements for contractor and subcontractor employees who access DHS information systems and information resources or contractor-owned and/or operated information systems and information resources capable of collecting, processing, storing or transmitting controlled unclassified information (CUI).
Interested parties should submit written comments to one of the addresses shown below on or before March 20, 2017, to be considered in the formation of the final rule.
Submit comments identified by HSAR Case 2015-002, Information Technology Security Awareness Training, using any of the following methods:
•
Submit comments via the Federal eRulemaking portal by entering “HSAR Case 2015-002” under the heading “Enter Keyword or ID” and selecting “Search.” Select the link “Submit a Comment” that corresponds with “HSAR Case 2015-002.” Follow the instructions provided at the “Submit a Comment” screen. Please include your name, company name (if any), and “HSAR Case 2015-002” on your attached document.
•
•
Comments received generally will be posted without change to
Ms. Shaundra Duggans, Procurement Analyst, DHS, Office of the Chief Procurement Officer, Acquisition Policy and Legislation at (202) 447-0056 or email
DHS contracts currently require contractor and subcontractor employees to complete information technology (IT) security awareness training before accessing DHS information systems and information resources. This training is initially completed upon award of the procurement and at least annually thereafter. DHS contracts also require such employees to sign the DHS Rules of Behavior (RoB) before access is provided to DHS information systems and information resources. The DHS RoB is a document that defines the responsibilities and obligations imposed on all individuals with access to DHS information systems and information resources. The DHS RoB holds users accountable for actions taken while accessing DHS information systems and using DHS information resources capable of collecting, processing, storing or transmitting controlled unclassified information (CUI).
DHS is proposing to (1) include IT security awareness training and RoB requirements in the HSAR and (2) make the training and RoB more easily accessible by hosting them on a public Web site. This approach ensures all applicable DHS contractors and subcontractors are subject to the same IT security awareness training and RoB requirements while removing the need for Government intervention to provide access to the IT security awareness training and RoB.
This rule proposes to standardize the IT security awareness training and DHS RoB requirements across DHS contracts by amending the HSAR to:
(1) Add the terms “controlled unclassified information,” “information resources” and “information system” to HSAR 3002.1, Definitions and remove the definition of the term “sensitive information” at HSAR 3002.1, Definitions. The definition of “controlled unclassified information” is taken from its implementing regulation at 32 CFR part 2002. The definitions of “information resources” and “information system” are derived from 44 U.S.C. 3502(6) and 44 U.S.C. 3502(8) respectively. The definition of “sensitive information” is removed because it is being replaced with “controlled unclassified information” consistent with Executive Order 13556 and its implementing regulation at 32 CFR part 2002. These definitions are necessary because these terms appear in proposed HSAR 3039.70 Information Technology Security Awareness Training and HSAR 3052.239-7X, Information Technology Security Awareness Training.
(2) Add a new subpart at 3039.70, Information Technology Security Awareness Training. HSAR 3039.7001, Scope, identifies the applicability of the subpart to contracts and subcontracts where contractor and subcontractor employees may have access to DHS information systems and information resources or contractor-owned and/or operated information systems and information resources capable of collecting, processing, storing or transmitting CUI. HSAR 3039.7002, Policy, subparagraph (a) requires contractors and subcontractors that may have access to DHS information systems and information resources or contractor-owned and/or operated information systems and information resources capable of collecting, processing, storing or transmitting CUI to complete IT security awareness training initially upon award of the procurement and annually thereafter. This subsection requires the contractor to maintain evidence that the training has been completed and provide copies of the training completion certificates to the contracting officer. Subparagraph (b) requires contractor and subcontractor employees to sign the DHS RoB before receiving access to DHS information systems and/or information resources and before contractor-owned and/or operated information systems can be used to collect, process, store, or transmit CUI. This subsection requires the contractor to maintain signed copies of the DHS Rob and provide signed copies to the contracting officer. HSAR 3039.7003, Contract Clause, identifies when contracting officers must insert
(3) Amend subparagraph (b) of the clause at HSAR 3052.212-70, Contract Terms and Conditions Applicable to DHS Acquisition of Commercial Items, to add HSAR 3052.239-7X Information Technology Security Awareness Training. This change is necessary because HSAR 3052.239-7X is applicable to the acquisition of commercial items.
(4) Add a new subsection at HSAR 3052.239-7X, Information Technology Security Awareness Training, to provide the text of the proposed clause. The proposed clause requires contractor and subcontractor employees to complete IT security awareness training before accessing DHS information systems/information resources and before contractor-owned and/or operated information systems are used to collect, process, store, or transmit CUI. Training shall be completed within thirty (30) days of contract award and on an annual basis thereafter. The contractor shall maintain copies of training certificates for all contractor and subcontractor employees as a record of compliance and provide copies of the training certificates to the contracting officer. Subsequent training certificates to satisfy the annual IT security awareness training requirement shall be submitted via email notification not later than October 31st of each year. The contractor shall attach training certificates to the email notification and the email notification shall state the required training has been completed for all contractor and subcontractor employees. The proposed clause also requires the contractor to ensure all employees and subcontractor employees sign the DHS RoB before accessing DHS information systems and information resources. The DHS RoB shall also be signed before a contractor-owned and/or operated information system or information resource can be used to collect, process, store or transmit CUI and before contractor and/or subcontractor employees can access the information system or information resource. The contractor shall maintain signed copies of the DHS RoB for all contractor and subcontractor employees as a record of compliance and provide signed copies of the RoB to the contracting officer not later than thirty (30) days after contract award.
These proposed revisions to the HSAR are necessary to ensure contractors and subcontractors understand their roles and responsibilities in ensuring the security of systems and the confidentiality, integrity, and availability of CUI. They are consistent with the provisions of (1) the Federal Information Security Modernization Act of 2014 (FIMSA) (44 U.S.C. 3551,
This proposed rule is part of a broader initiative within DHS to (1) ensure contractors understand their responsibilities with regard to safeguarding controlled unclassified information (CUI); (2) contractor and subcontractor employees complete information technology (IT) security awareness training before access is provided to DHS information systems and information resources or contractor-owned and/or operated information systems and information resources where CUI is collected, processed, stored or transmitted on behalf of the agency; (3) contractor and subcontractor employees sign the DHS RoB before access is provided to DHS information systems, information resources, or contractor-owned and/or operated information systems and information resources where CUI is collected, processed, stored or transmitted on behalf of the agency; and (4) contractor and subcontractor employees complete privacy training before accessing a Government system of records; handling personally identifiable information (PII) and/or sensitive PII information; or designing, developing, maintaining, or operating a system of records on behalf of the Government.
Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is a significant regulatory action and, therefore, is subject to review under Section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804. DHS has included a discussion of the estimated costs and benefits of this rule in the Paperwork Reduction Act supporting statement, which can be found in the docket for this rulemaking.
DHS expects this proposed rule may have an impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601,
DHS is proposing to amend the HSAR to require that all contractor and subcontractor employees who will need access to DHS information systems and information resources or contractor-owned and/or operated information systems and information resources capable of collecting, processing, storing or transmitting CUI complete IT security awareness training and sign the DHS RoB before access to such systems and resources is granted. The purpose of this action is to require contractors to identify its employees who require access, ensure that those employees complete IT security awareness training before being granted access and annually thereafter, provide the Government evidence of the completed training, and maintain evidence of completed training in accordance with the records retention requirements of the contract.
The objective of this proposed rule is to require contractor and subcontractor employees to complete IT security awareness training before access is granted to DHS information systems and information resources or contractor-owned and/or operated information systems and information resources capable of collecting, processing, storing or transmitting CUI.
The training imposed by this rule is required by the provisions of FISMA (44 U.S.C. 3551,
This proposed rule will apply to contractor and subcontractor employees who require access to DHS information systems and information resources or contractor-owned and/or operated information systems and information resources capable of collecting, processing, storing or transmitting CUI. The estimated number of small entities to which the rule will apply is 2,185 respondents of which 1,212 are projected to be small businesses.
This estimate is based on a review and analysis of internal DHS contract data and Fiscal Year (FY) 2014 data reported to the Federal Procurement Data System (FPDS). It is anticipated that this rule will be primarily applicable to procurement actions with a Product and Service Code (PSC) of “D” Automatic Data Processing and Telecommunication. PSCs will be adjusted as additional data becomes available through HSAR clause implementation to validate future burden projections.
The projected reporting and recordkeeping associated with this proposed rule is kept to the minimum necessary to meet the overall objectives. For instance, DHS has minimized the burden by making the IT security awareness training and DHS RoB publicly accessible at
There are no rules that duplicate, overlap or conflict with this rule.
There are no practical alternatives that will accomplish the objectives of the proposed rule. In an effort to reduce duplication and to address common IT security training requirements across Government, DHS has partnered with the Defense Information Systems Agency (DISA) to provide its online IT security awareness training, CyberAwareness Challenge, for DHS contractor and subcontractor employees. Common IT security awareness training provides a streamlined, efficient, and cost-effective solution for DHS to provide IT security awareness training for contractor and subcontractor employees.
DHS will be submitting a copy of the IRFA to the Chief Counsel for Advocacy of the Small Business Administration. A copy of the IRFA may be obtained from the point of contact specified herein. DHS invites comments from small business concerns and other interested parties on the expected impact of this rule on small entities.
DHS will also consider comments from small entities concerning the existing regulations in subparts affected by this rule in accordance with 5 U.S.C. 610. Interested parties must submit such comments separately and should cite 5 U.S.C. 610, (HSAR Case 2015-002), in correspondence.
The Paperwork Reduction Act (44 U.S.C. chapter 35) applies because this proposed rule contains information collection requirements. Accordingly, DHS will be submitting a request for approval of a new information collection requirement concerning this rule to the Office of Management and Budget under 44 U.S.C. 3501,
A. Public reporting burden for this collection of information is estimated to be approximately 30 minutes (.50 hours) per response to comply with the requirements, including time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. The total annual projected number of responses per respondent is estimated to be four (4). The annual total burden hours are estimated as follows:
B. Request for Comments Regarding Paperwork Burden.
You may submit comments identified by DHS docket number [DHS-2017-0007], including suggestions for reducing this burden, not later than March 20, 2017 using any one of the following methods:
(1) Via the internet at Federal eRulemaking Portal:
(2) Via email to the Department of Homeland Security, Office of the Chief Procurement Officer, at
Requesters may obtain a copy of the supporting statement from the Department of Homeland Security, Office of the Chief Procurement Officer, Acquisition Policy and Legislation, via email to
Government procurement.
Therefore, DHS proposes to amend 48 CFR parts 3001, 3002, 3039 and 3052 as follows:
5 U.S.C. 301-302, 41 U.S.C. 1707, 41 U.S.C. 1702, 41 U.S.C. 1303(a)(2), 48 CFR part 1, subpart 1.3, and DHS Delegation Number 0702.
(a) * * *
“Controlled Unclassified Information (CUI)” is any information the Government creates or possesses, or an entity creates or possesses for or on behalf of the Government (other than classified information) that a law, regulation, or Government-wide policy requires or permits an agency to handle using safeguarding or dissemination controls. Within the context of DHS, this includes such information which, if lost, misused, disclosed, or, without authorization is accessed, or modified, could adversely affect the national or homeland security interest, the conduct of Federal programs, or the privacy of individuals. This definition includes the following CUI categories and subcategories of information:
(1) Chemical-terrorism Vulnerability Information (CVI) as defined in Title 6, Code of Federal Regulations, part 27 “Chemical Facility Anti-Terrorism Standards,” and as further described in supplementary guidance issued by an authorized official of the Department of Homeland Security (including the Revised Procedural Manual “Safeguarding Information Designated as Chemical-Terrorism Vulnerability Information” dated September 2008);
(2) Protected Critical Infrastructure Information (PCII) as set out in the Critical Infrastructure Information Act of 2002 (Title II, Subtitle B, of the Homeland Security Act, Public Law 107-296, 196 Stat. 2135), as amended, the implementing regulations thereto (Title 6, Code of Federal Regulations, part 29) as amended, the applicable PCII Procedures Manual, as amended, and any supplementary guidance officially communicated by an authorized official of the Department of Homeland Security (including the PCII Program Manager or his/her designee);
(3) Sensitive Security Information (SSI) as defined in Title 49, Code of Federal Regulations, part 1520, “Protection of Sensitive Security Information,” as amended, and any supplementary guidance officially communicated by an authorized official of the Department of Homeland Security (including the Assistant Secretary for the Transportation Security Administration or his/her designee) to include DHS MD 11056.1, “Sensitive Security Information (SSI)” and, within the Transportation Security Administration, TSA MD 2010.1, “SSI Program”;
(4) Homeland Security Agreement Information means information DHS receives pursuant to an agreement with state, local, tribal, territorial, and private sector partners that is required to be protected by that agreement. DHS receives this information in furtherance of the missions of the Department, including, but not limited to, support of the Fusion Center Initiative and activities cyber information sharing consistent with the Cybersecurity Information Security Act;
(5) Homeland Security Enforcement Information means unclassified information of a sensitive nature lawfully created, possessed, or transmitted by the Department of Homeland Security in furtherance of its immigration, customs, and other civil and criminal enforcement missions, the unauthorized disclosure of which could adversely impact the mission of the Department;
(6) International Agreement Information means information DHS receives pursuant to an information sharing agreement or arrangement, with a foreign government, an international organization of governments or any element thereof, an international or foreign public or judicial body, or an international or foreign private or non-governmental organization, that is required by that agreement or arrangement to be protected;
(7) Information Systems Vulnerability Information (ISVI) means:
(i) DHS information technology (IT) internal systems data revealing infrastructure used for servers, desktops, and networks; applications name, version and release; switching, router, and gateway information; interconnections and access methods; mission or business use/need. Examples of information are systems inventories and enterprise architecture models. Information pertaining to national security systems and eligible for
(ii) Information regarding developing or current technology, the release of which could hinder the objectives of DHS, compromise a technological advantage or countermeasure, cause a denial of service, or provide an adversary with sufficient information to clone, counterfeit, or circumvent a process or system;
(8) Operations Security Information means information that could constitute an indicator of U.S. Government intentions, capabilities, operations, or activities or otherwise threaten operations security;
(9) Personnel Security Information means information that could result in physical risk to DHS personnel or other individuals that DHS is responsible for protecting;
(10) Physical Security Information means reviews or reports illustrating or disclosing DHS facility infrastructure or security vulnerabilities related to the protection of Federal buildings, grounds, or property. For example, threat assessments, system security plans, contingency plans, risk management plans, business impact analysis studies, and certification and accreditation documentation;
(11) Privacy Information, which includes information referred to as Personally Identifiable Information (PII). PII means information that can be used to distinguish or trace an individual's identity, either alone or when combined with other information that is linked or linkable to a specific individual; and
(12) Sensitive Personally Identifiable Information (SPII) is a subset of PII, which if lost, compromised or disclosed without authorization, could result in substantial harm, embarrassment, inconvenience, or unfairness to an individual. Some forms of PII are sensitive as stand-alone elements.
(i) Examples of stand-alone PII include: Social Security numbers (SSN), driver's license or state identification number, Alien Registration Numbers (A-number), financial account number, and biometric identifiers such as fingerprint, voiceprint, or iris scan.
(ii) Additional examples of SPII include any groupings of information that contain an individual's name or other unique identifier plus one or more of the following elements:
(iii) Other PII may be SPII depending on its context, such as a list of employees and their performance ratings or an unlisted home address or phone number. In contrast, a business card or public telephone directory of agency employees contains PII but is not SPII.
“Information Resources” means information and related resources, such as personnel, equipment, funds, and information technology.
“Information System” means a discrete set of information resources organized for the collection, processing, maintenance, use, sharing, dissemination, or disposition of information.
5 U.S.C. 301-302, 41 U.S.C. 1707, 41 U.S.C. 1702, 41 U.S.C. 1303(a)(2), 48 CFR part 1, subpart 1.3, and DHS Delegation Number 0702.
This section applies to contracts and subcontracts where contractor and subcontractor employees may have access to DHS information systems and information resources or contractor-owned and/or operated information systems and information resources capable of collecting, processing, storing or transmitting controlled unclassified (CUI) information.
(a) Contractors and subcontractors that may have access to DHS information systems and information resources or contractor-owned and/or operated information systems and information resources capable of collecting, processing, storing or transmitting CUI shall take IT security awareness training initially upon award of the procurement and annually thereafter. The contractor shall ensure such employees complete the required training, maintain evidence that the training has been completed and provide copies of the training completion certificates to the Contracting Officer and/or Contracting Officer's Representative (COR) for inclusion in the contract file.
(b) The DHS Rules of Behavior (RoB) is a document that informs users of their responsibilities and obligations when accessing DHS information systems and/or information resources. The RoB also informs users that they will be held accountable for actions taken while accessing DHS information systems and/or using DHS information resources. Contractor and subcontractor employees shall sign the DHS RoB before receiving access to DHS information systems and/or information resources. In addition, contractor and subcontractor employees shall sign the DHS RoB before a contractor-owned and/or operated information system or information resource can be used to collect, process, store or transmit CUI. The contractor shall maintain signed copies of the DHS RoB for all contractor and subcontractor employees as a record of compliance, in accordance with the records retention requirements of the contract, and provide signed copies of the DHS RoB to the Contracting Officer and/or COR for inclusion in the contract file.
Contracting officers shall insert the clause at (HSAR) 48 CFR 3052.239-7X, Information Technology Security Awareness Training, in solicitations and contracts where contractor and subcontractor employees, during the course of performance, may gain access to DHS information systems and information resources or contractor-owned and/or operated information systems and information resources capable of collecting, processing, storing or transmitting CUI.
5 U.S.C. 301-302, 41 U.S.C. 1707, 41 U.S.C. 1702, 41 U.S.C. 1303(a)(2), 48 CFR part 1, subpart 1.3, and DHS Delegation Number 0702. Clause 3052.212-70 [Amended]
(b) * * *
As prescribed in (HSAR) 48 CFR 3039.7004 contract clause, insert the following clause:
(a)
(b)
(c)
Pipeline and Hazardous Materials Safety Administration (PHMSA), DOT.
Advance notice of proposed rulemaking (ANPRM).
PHMSA requests comment on certain provisions of the Fixing America's Surface Transportation (FAST) Act of 2015. The FAST Act directs the Secretary of Transportation to require Class I railroads that transport hazardous materials to generate accurate, real-time, and electronic train consist information. Further, the FAST Act includes provisions for the railroads to provide fusion centers with electronic train consist information to share with State and local first responders, emergency response officials, and law enforcement personnel during an accident, incident, or emergency. In support of developing regulations to implement the FAST Act mandates, PHMSA specifically requests comments and information on baseline changes, affected entities, and costs and benefits related to fusion centers collecting train consist information from railroads and disseminating this information in the event of an emergency.
Comments must be received by April 19, 2017.
You may submit comments identified by Docket No. PHMSA-2016-0015 (HM-263) by any of the following methods:
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Dirk Der Kinderen, (202) 366-4460, Standards and Rulemaking Division, Pipeline and Hazardous Materials Safety Administration, U.S. Department of Transportation, 1200 New Jersey Avenue SE., Washington, DC 20590-0001.
On December 4, 2015, President Barack Obama signed legislation titled, “Fixing America's Surface Transportation Act of 2015,” or the “FAST Act.” (See Pub. L. 114-94.) The FAST Act includes the “Hazardous Materials Transportation Safety Improvement Act of 2015” (sections 7001 through 7311), which instructs the Secretary of Transportation (“Secretary”) to make specific regulatory amendments to the Hazardous Materials Regulations (HMR; 49 CFR parts 171-180). The FAST Act requires Class I railroads to generate accurate, real-time, and electronic train consist information that can be provided “to State and local first responders, emergency response officials, and law enforcement personnel that are involved in the response to or investigation of an accident, incident, or public health or safety emergency involving the rail transportation of hazardous materials” and request such electronic train consist information. Section 7302 of the FAST Act is structured as follows:
• Section 7302(a)(1), (2), (5), and (7) apply to the sharing of the accurate, real-time, and electronic train consist information covering all hazardous materials with fusion centers.
• Section 7302(a)(3) and (4) apply to sharing advance notification and information on high-hazard flammable trains (HHFTs) with State Emergency Response Commissions (SERCs) in accordance with Emergency Order DOT-OST-2014-0067.
• Section 7302(a)(6) establishes security and confidentiality protections to prevent the public release of security-sensitive electronic train consist information or the advance notification of HHFT movements to unauthorized persons.
PHMSA intends to publish a notice of proposed rulemaking (NPRM) that will propose regulations to address §§ 7302(a)(1), (2), (5), (6) and (7) of the FAST Act. PHMSA is addressing the SERC notification portion of the FAST Act (§§ 7302(a)(3), (4) and (6)) in a separate rulemaking titled “Hazardous Materials: Oil Spill Response Plans and Information Sharing for High-Hazard Flammable Trains” (RIN: 2137-AF08).
Section 7302(a)(1)(A) directs the Secretary to issue regulations requiring Class I railroads transporting hazardous materials to generate accurate, real-time, and electronic train consist information, including:
• The identity, quantity, and location of hazardous materials on a train;
• The point of origin and destination of the train;
• Any emergency response information or resources required by the Secretary; and
• An emergency response point of contact designated by the Class I railroad.
Subparagraph (a)(1)(B) further directs the Secretary to issue regulations requiring Class I railroads to enter into a memorandum of understanding (MOU) with each applicable fusion center to provide the fusion center with secure and confidential access to the electronic train consist information for each train transporting hazardous materials in the jurisdiction of the fusion center.
Section 7302(a)(2) directs the Secretary to issue regulations requiring each applicable fusion center to provide the electronic train consist information to State and local first responders, emergency response officials, and law enforcement personnel who are involved in the response to or investigation of an accident, incident, or public health or safety emergency involving the rail transportation of hazardous materials and request such electronic train consist information.
Section 7302(a)(5) directs the Secretary to issue regulations prohibiting any Class I railroad, employee, or agent from withholding, or causing to be withheld, the train consist information from first responders, emergency response officials, and law enforcement personnel described in § 7302(a)(2) in the event of an incident, accident, or public health or safety emergency involving the rail transportation of hazardous materials.
Section 7302(a)(6) directs the Secretary to issue regulations establishing security and confidentiality protections, including protections from the public release of proprietary information or security-sensitive information, to prevent the release of real-time train consist information to unauthorized persons.
Section 7302(a)(7) instructs the Secretary to issue regulations allowing each Class I railroad to enter into an MOU with any Class II railroad or Class III railroad that operates trains over the Class I railroad's line to incorporate the Class II railroad or Class III railroad's (
The FAST Act requires the Secretary to issue regulations requiring fusion centers to participate in the gathering and dissemination of electronic train consist information. Section 7302(b)(4) of the FAST Act indicates that the term “fusion center” means a collaborative effort of two or more Federal, State, local, or Tribal government agencies that combines resources, expertise, or information with the goal of maximizing the ability of such agencies to detect, prevent, investigate, apprehend, and
Fusion centers (1) are owned and operated by State and local entities and designated by their respective governor;
The intelligence and information collected, analyzed, and shared may be strategic, as well as tactical. Information gathering and dissemination occur on an ongoing basis. Fusion centers are in a unique position to empower front-line law enforcement, public safety, fire service,
A fusion center differs from an emergency operations center (EOC). Fusion centers and EOCs serve distinct, but complementary roles in supporting the country's homeland security efforts. Fusion centers empower homeland security partners through the lawful gathering, analysis, and sharing of threat-related information, while EOCs primarily provide information and support to incident management and response/recovery coordination activities.
With respect to the FAST Act mandate to develop regulations applicable to fusion centers, PHMSA is requesting comment and information specific to the impact on State and local government fusion center operations and first responders, emergency response officials, law enforcement personnel, railroads, and any other entity that is impacted by this mandate. The purpose of this ANPRM is to inform the Regulatory Impact Analysis (RIA) of this rulemaking.
The request for comment, including information and data are focused on the baseline changes, implementation, and costs and benefits affecting entities—fusion centers, railroads, and first responders—that would be impacted by a rulemaking outlining regulations to prepare, gather, share, and acquire train consist information. While most of these questions are focused on fusion center operations, we welcome comments from all stakeholders on any of these questions.
1. How many fusion centers are located in your State, including those associated with major urban areas?
2. How many fusion centers in your State, including those associated with major urban areas, would be affected by the provisions of § 7302 of the FAST Act? How many would be required to collect and disseminate information? Would it be possible to designate one fusion center within your State to collect and disseminate train consist data?
3. How many Class II and III railroads would be affected by § 7302(a)(7) of the FAST Act? This section of the FAST Act allows Class I railroads to enter into an MOU with any Class II or Class III railroad that operates trains over the Class I railroad's line to incorporate the Class II or Class III railroads' train consist information within the existing framework described in § 7302(a)(1). How many Class I railroads would enter into an MOU?
4. Are fusion centers in your State 24/7 operations? If not, describe the coverage of operations on a daily/weekly basis?
5. Per the DHS Web site description of fusion center activities referenced in the subsection titles “Fusion Centers,” how frequently do fusion centers in your State receive, analyze, gather, and share threat-related information? Do fusion centers in your State currently perform these activities for hazardous materials on trains? Does performance of the activities occur based on a shipment or is it more routine and constant (
6. Describe the current level of information technology (IT) and data collection and information management system capabilities of your State's fusion centers. Do they have the ability to receive and disseminate real-time train consist information?
7. How many employees work at your State's fusion centers? How many fusion center employees are employees of your State, employees of localities, and other types of employees?
8. How does your State fund fusion center operations? How are grants used?
9. How do first responders currently receive information, or train consist information, for hazardous materials in your State?
10. How do railroads transmit train consist information for hazardous materials incidents? Do railroads currently send information on hazardous materials train consists to fusion centers? If so, is this information sent electronically, such as by the AskRail app, or by some other means?
11. Do railroad employees use electronic devices to update train consist information? Are these devices proprietary rail-specific devices, or off-the-shelf tablets or smartphones with apps that enable train consists to be updated and that information relayed to Railinc or some other railroad database?
12. PHMSA is also aware of handheld readers.
13. Have all Class I railroads developed means by which changes to hazardous material train consists can be updated in real-time and relayed electronically to the railroads or other entities?
14. Are there electronic systems that operate on a 24/7 basis to relay changes to train consists in real-time at all hours and locations throughout the day?
The following questions relate to how stakeholders would implement § 7302 of the FAST Act.
15. Would your State identify a particular fusion center to collect and disseminate information for your entire State, including major urban areas? If not, what other implementation alternatives would your State consider?
16. What type of IT solutions would you consider or require for your State's fusion center operations to receive, route, and disseminate real-time train consist information? Are there any IT or network solutions that would provide automated collection and routing to first responders on a 24/7 basis?
17. Would your State's fusion centers use the same employees to conduct criminal, terrorism, and hazardous material information collection and dissemination activities? Would employees require specialization in these areas?
18. How many and what types of additional employees would be required to implement the provisions of § 7302 of the FAST Act?
19. How many real-time train consist notifications would be received and disseminated by your State's fusion center operations? How long would it take to process, analyze, and disseminate notifications?
20. How would railroads transmit this information to fusion centers? If no system to relay this information to fusion centers exists, what resources and investments would be necessary to develop such a system (
21. If further IT development or other implementation resources are required, what is a reasonable time frame for railroads to develop these resources? What barriers might prevent the timely development and deployment of these resources?
22. How would first responders receive real-time train consist information? Would first responders need any additional communication and technology equipment or enhancements?
23. What is the additional cost to your State's fusion center operations to implement the provisions of § 7302 of the FAST Act? What are the initial startup planning and capital investment costs and how long would initial startup take in terms of months? What are the recurring operations and management (O&M) costs? What are the costs and frequencies of any upgrades beyond initial startup and O&M costs? What are the initial and recurring training costs? Please provide quantitative data if possible.
24. What is the cost to collect, maintain, and disseminate real-time train consist notification?
25. What are the costs associated with electronic devices to record and relay changes to train consists in real-time?
26. What are the costs to establish security and confidentiality protections, including protections from the public release of proprietary information or security-sensitive information, to prevent the release of real-time train consist information to unauthorized persons?
27. What are the costs for Class I railroads to enter into an MOU with any Class II railroad or Class III railroad that operates trains over the Class I railroad's line to incorporate the Class II railroad's or Class III railroad's train consist information within the existing framework described in § 7302(a)(1)?
28. What are the costs for Class I railroads to enter into an MOU with each applicable fusion center to provide the fusion center with secure and confidential access to the electronic train consist information for each train transporting hazardous materials in the jurisdiction of the fusion center?
29. What are the costs to first responders to receive information disseminated from fusion centers?
30. How and where would State fusion centers recover costs to implement the provisions of § 7302 of the FAST Act? Would implementation require grant funding? If so, from where or whom?
31. As a result of implementing § 7302 of the FAST Act, would there be a reduction in the response time and incident-related costs and damages? Would there be a reduction in the duration of evacuations? Please provide quantitative data if possible.
32. What kind of avoided consequences and benefits to communities will be realized as a result of implementing the provisions of § 7302 of the FAST Act? Avoided consequences may include reduced risks of harm to the public and environment in terms of fatalities, injuries and hospitalizations, property loss, and damages associated with release of hazardous materials into the environment.
33. Would railroads experience any business benefits from having accurate electronic records of train consists in real-time (
This ANPRM has not been designated a “significant regulatory action” under
Executive Order 13563, “Improving Regulation and Regulatory Review,” 76 FR 3821 (Jan. 21, 2011), supplements and reaffirms the principles, structures, and definitions governing regulatory review that were established in Executive Order 12866. Together, Executive Orders 12866 and 13563 require agencies to regulate in the “most cost-effective manner,” to make a “reasoned determination that the benefits of the intended regulation justify its costs,” and to develop regulations that “impose the least burden on society.”
Additionally, Executive Orders 12866 and 13563 require agencies to provide a meaningful opportunity for public participation. Therefore, PHMSA solicits comment on the questions raised in this ANPRM.
Executive Order 13132, “Federalism,” 64 FR 43255 (Aug. 10, 1999), requires agencies to assure meaningful and timely input by State and local officials in the development of regulatory policies that may 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.” We invite State and local governments with an interest in this rulemaking to comment on any effect that revisions to the HMR relative to the FAST Act mandate may cause.
Executive Order 13175, “Consultation and Coordination and Indian Tribal Governments,” 65 FR 67249 (Nov. 9, 2000), requires agencies to assure meaningful and timely input from Indian tribal government representatives in the development of rules that “significantly or uniquely affect” Indian communities and impose “substantial and direct compliance costs” on such communities. We invite Indian tribal governments to provide comment(s) on any potential impacts of a rulemaking to implement the FAST Act mandate.
The Regulatory Flexibility Act, 5 U.S.C. 601
As such, PHMSA solicits input from small entities on the questions presented in this ANPRM. If you believe the FAST Act mandate would have a significant economic impact on a substantial number of small entities, please submit a comment to PHMSA. In your comment, explain the extent of the impact, and whether there may be alternative approaches to consider that would minimize any significant impact on small business while still meeting the agency's statutory safety objectives.
Any future proposed rule would be developed in accordance with Executive Order 13272, “Proper Consideration of Small Entities in Agency Rulemaking,” 67 FR 53461 (Aug. 16, 2002), as well as DOT's procedures and policies, so as to promote compliance with the Regulatory Flexibility Act to ensure that potential impacts on small entities of a regulatory action are properly considered.
Section 1320.8(d), title 5, Code of Federal Regulations requires that PHMSA provide interested members of the public and affected agencies an opportunity to comment on information collection and recordkeeping requests. It is possible that new or revised information collection requirements could occur as a result of any future rulemaking action. We invite comment on the need for any collection of information and paperwork burdens that may apply as result of a future rulemaking.
The National Environmental Policy Act of 1969, 42 U.S.C. 4321-4375, requires Federal agencies to consider the consequences of major Federal actions and prepare a detailed statement on actions significantly affecting the quality of the human environment. The Council on Environmental Quality (CEQ) regulations require Federal agencies to conduct an environmental review considering (1) the need for the proposed action, (2) alternatives to the proposed action, (3) probable environmental impacts of the proposed action and alternatives, and (4) the agencies and persons consulted during the consideration process.
Anyone is able to search the electronic form of any written communications and comments received into any of our dockets by the name of the individual submitting the document (or signing the document, if submitted on behalf of an association, business, labor union, etc.). You may review DOT's complete Privacy Act Statement in the
Under Executive Order 13609, “Promoting International Regulatory Cooperation,” 77 FR 26413 (May 4, 2012), agencies must consider whether the impacts associated with significant variations between domestic and international regulatory approaches are unnecessary, or may impair the ability of American business to export and compete internationally. In meeting shared challenges involving health, safety, labor, security, environmental, and other issues, international regulatory cooperation can identify approaches that are at least as protective as those that are, or would be, adopted in the absence of such cooperation. International regulatory cooperation can also reduce, eliminate, or prevent unnecessary differences in regulatory requirements.
Similarly, the Trade Agreements Act of 1979, Public Law 96-39, as amended by the Uruguay Round Agreements Act, Public Law 103-465, prohibits Federal agencies from establishing any standards or engaging in related activities that create unnecessary obstacles to the foreign commerce of the United States. For purposes of these requirements, Federal agencies may participate in the establishment of international standards, so long as the standards have a legitimate domestic objective, such as providing for safety, and do not operate to exclude imports that meet this objective. The statute also requires consideration of international standards and, where appropriate, that they be the basis for U.S. standards.
PHMSA participates in the establishment of international standards in order to protect the safety of the
Federal hazardous materials transportation law, 49 U.S.C. 5101
A regulation identifier number (RIN) is assigned to each regulatory action listed in the Unified Agenda of Federal Regulations. The Regulatory Information Service Center publishes the Unified Agenda in April and October of each year. The RIN contained in the heading of this document can be used to cross-reference this action with the Unified Agenda.
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Proposed rule; request for comments.
NMFS has received an application, pursuant to the Marine Mammal Protection Act (MMPA), from the Alaska Aerospace Corporation (AAC) for authorization to take small numbers of marine mammals incidental to launching space launch vehicles and other smaller missile systems at the Pacific Spaceport Complex Alaska (PSCA) for the period of March 15, 2017, through March 14, 2022. NMFS is proposing regulations to govern that take, and requests comments on the proposed regulations.
Comments and information must be received no later than February 21, 2017.
You may submit comments on this document by any of the following methods:
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Stephanie Egger, Office of Protected Resources, NMFS, (301) 427-8401.
A copy of AAC's application and any supporting documents, as well as a list of the references cited in this document, may be obtained online at:
This proposed rule, to be issued under the authority of the MMPA, would establish a framework for authorizing the take of marine mammals incidental to launching space vehicles, target missiles, and other smaller missile systems at the PSCA. We received an application from AAC requesting 5-year regulations and authorization to take one species of marine mammals. Take would occur by Level B harassment only, incidental to the space vehicle launches (also referred to as rocket launches). The regulations would be valid from March 15, 2017, to March 14, 2022. Please see
Section 101(a)(5)(A) of the MMPA directs the Secretary of Commerce to allow, upon request, the incidental, but not intentional taking of small numbers of marine mammals by U.S. citizens who engage in a specified activity (other than commercial fishing) within a specified geographical region for up to five years if, after notice and public comment, the agency makes certain findings and issues regulations that set forth permissible methods of taking pursuant to that activity, as well as monitoring and reporting requirements. Section 101(a)(5)(A) of the MMPA and the implementing regulations at 50 CFR part 216, subpart I provide the legal basis for issuing this proposed rule containing 5-year regulations, and for any subsequent Letters of Authorization (LOA). As directed by this legal authority, this proposed rule contains mitigation, monitoring, and reporting requirements.
The following provides a summary of some of the major provisions within the proposed rulemaking for AAC's rocket launch activities. We have preliminarily determined that AAC's adherence to the proposed mitigation, monitoring, and reporting measures listed below would achieve the least adverse impact practicable on the affected marine mammals. They include:
• Required monitoring of Ugak Island to detect the presence and abundance of marine mammals before and after deployment of rocket launch operations.
• Required monitoring of Ugak Island to survey the presence and abundance of marine mammals once per year (outside of rocket launch operations).
• Required mitigation of using time-lapsed photography to determine the immediate response impacts to marine mammals during rocket launches, particularly during the pupping season (should rocket launches occur during that time).
An authorization for incidental takings shall be granted if NMFS finds that the taking will have a negligible impact on the species or stock(s), will not have an unmitigable adverse impact on the availability of the species or stock(s) for subsistence uses (where relevant), and if the permissible methods of taking and requirements pertaining to the mitigation, monitoring and reporting of such takings are set forth. NMFS has defined “negligible impact” in 50 CFR 216.103 as “an impact resulting from the specified activity that cannot be reasonably expected to, and is not reasonably likely to, adversely affect the species or stock through effects on annual rates of recruitment or survival.”
Except with respect to certain activities not pertinent here, the MMPA defines “harassment” as: Any act of pursuit, torment, or annoyance, which (i) has the potential to injure a marine mammal or marine mammal stock in the wild (Level A harassment); or (ii) has the potential to disturb a marine mammal or marine mammal stock in the wild by causing disruption of behavioral patterns, including, but not limited to, migration, breathing, nursing, breeding, feeding, or sheltering (Level B harassment).
On April 25, 2016, NMFS received a request for regulations from AAC for the taking of small numbers of marine mammals incidental to launching space launch vehicles long-range and other smaller missile systems at the PSCA. We received revised drafts on June 20, 2016, and September 19, 2016. On September 27, 2016, we published a notice of receipt of AAC's application in the
AAC proposes taking of small numbers of marine mammals incidental to rocket launch operations specifically noise from space vehicles and missile launches that may result in the Level B harassment of harbor seals (
PCSA is located on the Narrow Cape Peninsula, on Kodiak Island in the Gulf of Alaska. Kodiak Island is approximately 99 miles (mi) long and 10 to 60 mi wide. PSCA is approximately 22 air mi from the City of Kodiak, which is the largest settlement on the Kodiak Island. The land area occupied by PSCA is owned by the State of Alaska and is administered by AAC under terms of an Interagency Land Management Assignment (ILMA) issued by AAC's sister agency, the Alaska Department of Natural Resources. AAC conducts space vehicle and missile launches from the PSCA. Launch operations are authorized under license from the Federal Aviation Administration (FAA), Office of the Associate Administrator for Space Transportation, in accordance with the facility's Environmental Assessment (EA) and stipulations in the EA's Finding of No Significant Impact (FONSI) (FAA 1996) and subsequent licenses (FAA 1998, 2003, 2005, and 2013). The area considered to be affected by PSCA launch operations was defined in a September 1996 meeting involving AAC and its environmental consultant (University of Alaska Anchorage's Environment and Natural Resources Institute), and government agencies represented by the FAA, NMFS, the U.S. Fish and Wildlife Service (FWS), and the Alaska Department of Environmental Conservation (ADEC). Attendees at that meeting reviewed information on the known effects of rocket operations on the environment, and defined the expected impact area to be within a 6-mi radius of the launch pad area, inclusive of Ugak Island. A more recent EA was completed in April 2016 that addresses the potential environmental impacts of the proposed action where the FAA would modify the AAC launch site operator license for the PSCA. The EA evaluates the potential environmental impacts of modifying the launch site operator license to include medium-lift launch capability at PSCA with the addition of new infrastructure necessary to support these types of launches, including the construction of a launch pad and associated facilities.
There are several marine mammals present in the waters offshore, however, the only marine mammals anticipated to be affected by the specified activities are pinnipeds hauled out on Ugak Island.
The specified activity may occur at any time during the 5-year period of validity of the proposed regulations. Dates and duration of individual rocket launches are inherently uncertain. Launch timing is not determined by AAC, but is driven by customer needs that include variables ranging from: (1) Availability of down range assets necessary to support launch, (2) orbital parameters, and (3) exigencies requiring rapid response to requests for replacement of lost assets, or to augment existing ones to support vital defense, humanitarian, or commercial needs. Launches can, and do, occur year round. Typical launches will be spread out in time; however, some of these launches may occur in clusters to meet a customer's need.
Launch planning is a dynamic process, and launch delays, which can last from hours to more than a year, can and do occur. Launch delays occur due to variables ranging from technical issues to adverse weather. These factors have controlling influence over the numbers of vehicles by class that are actually launched in any given year from PSCA. Launches take place year round when all variables affecting launch decisions are in correct alignment.
AAC estimates the total number of vehicles that might be launched from PSCA over the course of the 5-year period covered by the requested rulemaking is 45, with an average of nine launches per year. However, in previous years, AAC did not launch the authorized number, but fewer or none in some years. Few launches are on contract at this time, so a specific distribution cannot be given. The first anticipated launch is estimated to occur in May 2017. Generally, the frequency will be separated by months or years; however, there may be limited instances of a rapid succession of launches in the course of hours, or days. Launches can, and do, occur year-round. The duration
The PSCA facility occupies 3,717 acres of state-owned lands on the eastern side of Kodiak Island. Ugak Island lies approximately three to four mi to the south/southeast of the launch pads on Kodiak Island (see Figure 2 in AAC's application). Ugak Island is about two mi long by about one mi wide. The land slopes steeply upward from a spit on the island's northern most point, which has previously been (although not in consistently in recent years) used as a Steller sea lion (
Orbital and suborbital launch vehicles (
PSCA launch azimuths range from 110 degrees to 220 degrees. The eastern most launch azimuth of 110 degrees is within a few degrees of most orbital launches, and crosses the extreme eastern edge of Ugak Island where several pinniped haulouts are found. Modeling done of Castor 120 space launches indicates the vehicle is passing through 45,000 ft altitude by the time it reaches the island about 70 seconds post launch (FAA 1996).
A typical launch vehicle is deployed by igniting the vehicle through a controlled means to send it on a very specific flight path. The ignition starts a burn on the ground that usually lasts less than several seconds after which the vehicle accelerates upward rapidly. During launch, burning fuel from the launch vehicle creates noise and light in the surrounding area. The components of a launch that may result in take are a source of noise and light on Kodiak Island created by the first stage vehicle motor, as the operation of launch vehicle engines produce sound pressures that may be high enough to cause a disturbance. Combustion noise and jet noise are the two main sources of sound pressures and are projected in all directions. The sound produced subsides to inaudible within a few minutes.
Another component of the AAC's launches includes security overflights. In the days preceding the launch, these occur approximately three times per day based on the long-term average. Flights associated with the launch will not approach occupied pinniped haulouts on Ugak Island by closer than 0.25 mi (0.4 kilometer (km)), and will maintain a vertical distance of 1,000 ft (305 meter (m)) from the haulouts when within 0.5 mi (0.8 km), unless indications of human presence or activity warrant closer inspection of the area to assure that national security interests are protected in accordance with law. Over the operational history of these flights, aircraft have been operated within the 0.25 mi limit on two occasions; both involved direct overflight of the Steller sea lion northwestern haulout spit, which was unoccupied each time the incursions occurred.
This section contains a brief technical background on sound, the characteristics of certain sound types and the proposed sound sources relevant to AAC's specified activity.
Pulsed sound sources (
Non-pulsed sounds can be tonal, narrowband, or broadband, brief or prolonged, and may be either continuous or non-continuous (ANSI 1995; NIOSH 1998). Some of these non-pulsed sounds can be transient signals of short duration but without the essential properties of pulses (
Sound travels in waves, the basic components of which are frequency, wavelength, velocity, and amplitude. Frequency is the number of pressure waves that pass by a reference point per unit of time and is measured in hertz (Hz) or cycles per second. Wavelength is the distance between two peaks of a sound wave; lower frequency sounds have longer wavelengths than higher frequency sounds and attenuate (decrease) more rapidly in shallower water. Amplitude is the height of the sound pressure wave or the `loudness' of a sound and is typically measured using the decibel (dB) scale. A dB is the ratio between a measured pressure (with sound) and a reference pressure (sound at a constant pressure, established by scientific standards). It is a logarithmic unit that accounts for large variations in amplitude; therefore, relatively small changes in dB ratings correspond to large changes in sound pressure. When referring to sound pressure levels (SPLs; the sound force per unit area), sound is referenced in the context of underwater sound pressure to 1 microPascal (μPa). One pascal is the pressure resulting from a force of one newton exerted over an area of one square meter. The source level (SL) represents the sound level at a distance of 1 m from the source (referenced to 1 μPa). The received level is the sound level at the listener's position. Note that all underwater sound levels in this document are referenced to a pressure of 1 µPa and all airborne sound levels in this document are referenced to a pressure of 20 µPa.
Root mean square (rms) is the quadratic mean sound pressure over the duration of an impulse, and is calculated by squaring all of the sound
Sound exposure level (SEL; represented as dB re 1 μPa
We now describe specific airborne acoustic sources for AAC. Sounds levels are different for each type of vehicle and further discussed below. Orbital and suborbital vehicles may be launched from several locations on site; however, no launch pads are closer to the haulouts on Ugak Island than LP1, from which the largest and, therefore, loudest vehicles will be launched. A description of each class of space launch and smaller launch vehicles are provided in the application and summarized here.
The Castor 120 was the base vehicle analyzed in the EA conducted by the FAA (US FAA 1996) in support of the decision to issue a launch license to AAC. The Castor 120 uses solid fuel and produces about 371,000 lbs of thrust. The motor mass is about 116,000 lbs and the motor is 347 inches (in) long and 93 in wide. Modeling shows the rocket is about eight mi above the earth's surface when it overflies Ugak Island, and that the sonic boom reaches earth between 21 to 35 mi down range, which is past the OCS and over the North Pacific abyss (US FAA 1996). Sound pressure from the Castor 120 at the spit on Ugak Island's northern most point was measured to be 101.4 dBA (dBA can be defined as dB with A-weighting designed to match the average frequency response of human hearing and enables comparison of the intensity of noise with different frequency characteristics) SEL. None of the vehicles expected to be flown from PSCA over the five-year period covered by this proposed rule is known to be louder than the Castor 120.
The Minotaur I is a small lift solid propellant space launch vehicle, the first stage of which is a modified Minuteman II. The first stage motor has a diameter of 4.5 ft. This launch vehicle has not yet been flown from PSCA. Sound pressure monitoring of two Minotaur I launches was accomplished at Vandenberg Air Force Base, California (VAFB). The data were collected 1.4 mi away from the launch point and show sound pressure levels of 104.9 to 107.0 dBA (SEL) at that distance. Sound energy at sea level decreases with the square of the distance, and given that the spit on Ugak Island's northern most point is two mi further (
The C-4 is a solid fueled vehicle and its first stage has a diameter of 6.1 ft, which is about 1.5 ft less than the Castor 120. Because it is significantly smaller in diameter than the Castor 120 and uses a similar fuel, it is anticipated that sound pressure levels at the spit on Ugak Island's northern most point would be less than those of the Castor 120.
The Strategic Target System (STARS) utilizes the first stage of the Polaris A-3, which is solid fueled and measures 4.5 ft in diameter. Several STARS systems have been flown from PSCA. Recorded sound pressure levels at Ugak Island have ranged from 90.2 to 91.4 dBA (SEL).
A number of smaller missile systems, such as tactical or target vehicles, have the possibility of being flown from PSCA. Representative smaller systems range from about a foot in diameter up to about four foot in diameter. Sound pressures from these smaller systems are not available, but will be substantially less than those from the space launch and ballistic vehicles described and pose little potential for disturbance to marine mammals.
Even smaller systems ranging down in size to several inches in diameter will conceivably be flown as well. Small sounding and research rockets (defined as less than 5,000 lbs in weight) will be excluded from this request, including its mitigations and reporting, as the rockets' small shape and energy are too small to transmit an appreciable sound pressure on Ugak Island, and are expected to be well below the threshold for an active response.
Table 1 provides motor diameters and representative sound pressures for various launch vehicles, some of which have been launched previously from PSCA. The listed vehicles include various ballistic launch vehicles and the small lift Castor 120 space launch vehicle, as well as smaller target/interceptor systems and tactical rocket systems. All PSCA sound measurements reported in Table 1 were taken at a distance of 3.5 mi from the launch pad at the nearest point of Ugak Island. It is important to note that the Castor 120 (previously launched from PSCA) is the loudest launch vehicle motor expected to be launched from PSCA over the 5-year period covered by the proposed regulations.
Spent first stage rocket motors impact the ocean from 11 to more than 300 mi down range, depending on launch vehicle. Sonic booms reach the earth's surface beyond the OCS (US FAA 1996). Both falling first stage rocket motors and sonic booms are too far from land to take pinnipeds and are not expected to affect whales.
Sections 4 and 5 of AAC's application and the monitoring reports contain detailed information on the abundance, status, and distribution of the species on Ugak Island from surveys that they have conducted over the last decade. This information is summarized below and may be viewed in detail at
Marine mammals under NMFS' jurisdiction that occur in the vicinity of PSCA include the harbor seal, Steller sea lion, gray whale (
Airborne noise is generally reflected at the sea surface outside of a 26 degrees cone extending downward from the ascending rocket (Richardson
After discussions with AAC and NOAA's Alaska Regional Office (AKR), it was determined there would be no take of Steller sea lions for the proposed activities. In the most recent National Marine Mammal Laboratory (NMML) survey (NOAA's Alaska Fisheries Science Center) of a location within the action area (July 2015) and of Ugak Island, no sea lions were observed (Fritz
In addition, AAC has been conducting regular aerial marine mammal surveys since 2006 as a requirement of their previous regulations and LOAs and has also documented Steller sea lion presence as rare. During their previous regulations (2011-2016), 17 aerial surveys were flown. During those surveys, Steller sea lions were only seen in one year with 19 observed in September 2011 at East Ugak Rock away from the Ugak spit haulout. This was the last sighting of Steller sea lions by AAC. Prior to 2011, sea lions were seen in small numbers on occasion during the 2006-2008 surveys. In 2006, 6 out of 14 surveys found sea lions, ranging from one to eight animals. In 2007, 1 out of 8 surveys revealed two sea lions. In 2008, 8 out of 8 surveys found one to five sea lions. AAC also noted that the Ugak spit haulout looks smaller than it has in the past (AAC 2016). The spit is under the influence of longshore currents and its geomorphology shifts over time (AAC 2016). This may now make it unsuitable as a haulout and it may have thus been abandoned by sea lions.
It was determined that take will not occur for Steller sea lions based on the historic and recent survey data available. Sea lions are likely absent from the area (except a rare visitor) and the likelihood of an animal being present during the nine times a year a launch may be planned is highly unlikely. Therefore, Steller sea lions are not discussed further in these proposed regulations.
The only marine mammals anticipated to be affected by the specified activities and proposed as take for Level B harassment are harbor seals hauled out on Ugak Island and therefore they are the only marine mammal discussed further in these proposed regulations.
Harbor seals range from Baja California north along the west coasts of Washington, Oregon, California, British Columbia, and Southeast Alaska; west through the Gulf of Alaska, Prince William Sound, and the Aleutian Islands; and north in the Bering Sea to Cape Newenham and the Pribilof Islands. The current statewide abundance estimate for Alaskan harbor seals is 205,090 (Boveng
Seals on Ugak Island are considered part of the South Kodiak stock (Table 3)—ranging from Middle Cape on the west coast of Kodiak Island southwest to Chirikof Island and east along the south coast of Kodiak Island to Spruce Island, including the Trinity Islands, Tugidak Island, Sitkinak Island, Sundstrom Island, Aiaktalik Island, Geese Islands, Two Headed Island, Sitkalidak Island, Ugak Island, and Long Island (Muto
Harbor seals are the most abundant marine mammal species found within the action area and present year-round. Based on AAC aerial survey counts from launch monitoring reports conducted since January 2006, approximately 97 percent of all harbor seals are found on the eastern shore of Ugak Island, approximately 5 mi from LP1. The eastern shore is backed by high steep cliffs that reach up to 1,000 ft above sea level. These cliffs form a visual and acoustic barrier to rocket operations, and limit effects on the species. Additionally, sound pressure recordings that showed surf and wind-generated sound pressures at sea level were generally in the greater than >70 dBA (SEL) range on the best weather and surf days (Cuccarese
Because access to Ugak Island harbor seal haulouts is difficult, little is known of how seals use these habitats. Harbor seals generally breed and molt where they haulout, so it is assumed that both of these activities take place on Ugak Island. This assumption is supported by the fact that young seals have routinely been seen there during aerial surveys. These haulouts are the only haulouts used by harbor seals within the 6-mi radius area designated as being affected by launch operations.
Harbor seals haul out on rocks, reefs, beaches, and drifting glacial ice (Allen and Angliss 2014). They are non-migratory; their local movements are associated with tides, weather, season, food availability, and reproduction, as well as sex and age class (Allen and Angliss 2014; Boveng
Marine mammals produce sounds in various contexts and use sound for various biological functions including, but not limited to (1) social interactions; (2) foraging; (3) orientation; and (4) predator detection. Interference with producing or receiving these sounds may result in adverse impacts. Audible distance, or received levels (RLs) will depend on the nature of the sound source, ambient noise conditions, and the sensitivity of the receptor to the sound (Richardson
While low-frequency cetaceans and pinnipeds have been observed to respond behaviorally to low- and mid-frequency sounds (
As discussed above, launch operations are a major source of acoustic stimuli on Kodiak Island and can reach pinniped haulouts on Ugak Island. The activities proposed for taking of marine mammals under these regulations have the potential to cause harassment through acoustic stimuli. The PSCA launch activities create two types of noise: continuous (but short-duration) noise, due mostly to combustion effects of launch vehicles; and impulsive noise, due to sonic boom effects. Generally, noise is generated from four sources during launches: (1) Combustion noise from launch vehicle chambers; (2) jet noise generated by the interaction of the exhaust jet and the atmosphere; (3) combustion noise from the post-burning of combustion products; and (4) sonic booms. Launch noise levels are highly dependent on the type of first-stage booster and the fuel used to propel the vehicle. Therefore, there is a great similarity in launch noise production within each class size of launch vehicles. For the proposed activity, sonic booms will reach the earth's surface beyond the OCS (US FAA 1996) and are not anticipated to impact marine mammals and are therefore not discussed further.
Noise from rocket launches may cause the pinnipeds to lift their heads, move towards the water, or enter the water. It is unlikely there would be significant visual disturbance as space vehicles would be too far away to cause significant stimuli. Modeling done of Castor 120 space launches indicates the vehicle is passing through 45,000 ft altitude by the time it reaches Ugak Island about 70 seconds following launch (US FAA 1996). Therefore, we have determined that the possibility of marine mammal harassment from visual stimuli associated with the proposed activities is so low as to be considered discountable and it is therefore not considered further.
Disturbance of pinnipeds caused by AAC's rocket launches would be expected to last for only short periods of time, separated by significant amounts of time in which no disturbance occurs. Because such disturbance is sporadic, rather than chronic, and of low intensity, individual marine mammals are unlikely to incur any detrimental impacts to vital rates or ability to forage and, thus, loss of fitness. Correspondingly, even local populations, are extremely unlikely to accrue any significantly detrimental impacts, much less the overall stocks of animals To comply with their previous regulations, AAC attempted to collect video footage of pinnipeds during launches; however, weather, technical, and accessibility issues prevented video from being obtained. Therefore, no immediate responses of pinnipeds to AAC launch noise have been documented. AAC will attempt another method of documenting pinniped response to launch noise by using time-lapsed photography methods. Time lapse photography has already been implemented by NOAA for other pinnipeds (Steller sea lions) in harsh conditions of the western Aleutians of the U.S. with great success.
The infrequent (approximately nine times per year) and brief (approximately one minute as heard from Ugak Island) nature of these sounds that would result from a rocket launch is not expected to alter the population dynamics of harbor seals which utilize Ugak Island as a haulout site. Current harbor seal numbers on Ugak Island total around 1,500 (R&M 2009), which is an increase of about 1,100 since the 1990s (ENRI 1995-1998); therefore, population dynamics of harbor seals have also not been negatively impacted from past launches originating from PSCA.
Harbor seal pups could be present at times during AAC's rocket launches, but harbor seal pups are extremely precocious, swimming and diving immediately after birth and throughout the lactation period, unlike most other phocids which normally enter the sea only after weaning (Lawson and Renouf 1985; Cottrell
Given that pups are precocious at birth, bonds between mothers and pups are known to form within minutes of birth, and other characteristics of mother/pup bonding described above, NMFS has preliminarily determined that Level A harassment or mortality is unlikely to occur and can therefore be discounted.
Finally, PSCA has conducted up to three security overflights per day in the days preceding a launch. Several studies of both harbor seals and Steller sea lions cited in Richardson
The following information provides background on marine mammal responses to launch noise that has been gathered under previous LOAs and Incidental Harassment Authorizations for similar rocket launch activities, including at VAFB in California, and been used to inform our analysis for AAC's proposed rocket launch activities.
Seals may leave a haulout site and enter the water due to the noise created by launch vehicles during launch operations. The percentage of seals leaving a haulout increases with noise level up to approximately 100 dB ASEL (A-weighted SEL), after which almost all seals leave, although data have shown that some percentage of seals have remained on shore during launches. Time-lapse video photography during four launch events at VAFB revealed that the seals that reacted to the launch noise, but did not leave the haulout were all adults. Because adult seals reacted less strongly than younger seals, this suggests that adults had possibly experienced other launch disturbances and had habituated to them.
The louder the launch noise, the longer it took for seals to begin returning to the haulout site and for the numbers to return to pre-launch levels. Seals may begin to return to the haulout site within 2-55 min of the launch disturbance, and the haulout site usually returned to pre-launch levels within 45-120 min. In two past Athena IKONOS launches with ASELs of 107.3 and 107.8 dB at the closest haulout site, seals began to haulout again approximately 16-55 min post-launch (Thorson
To justify that the potential for permanent threshold shift (PTS) is unlikely, Auditory Brainstem Response (ABR) testing on 21 seals during rocket launches at VAFB was conducted. VAFB launches create sonic booms over pinniped haulouts, therefore, noise from these launches are much louder than what would be audible at haulouts on Ugak Island (sonic booms are not audible from Ugak Island). To determine if harbor seals experience changes in their hearing sensitivity as a result of launch noise at VAFB, ABR testing was conducted on harbor seals for four Titan IV launches, one Taurus launch, and two Delta IV launches by the USAF in accordance with issued scientific research permits. Following standard ABR testing protocol, the ABR was measured from one ear of each seal using sterile, sub-dermal, stainless steel electrodes. A conventional electrode array was used, and low-level white noise was presented to the non-tested ear to reduce any electrical potentials generated by the non-tested ear. A computer was used to produce the click and an 8 kilohertz (kHz) tone burst stimuli, through standard audiometric headphones. Over 1,000 ABR waveforms were collected and averaged per trial. Initially the stimuli were presented at SPLs loud enough to obtain a clean reliable waveform, and then decreased in 10 dB steps until the response was no longer reliably observed. Once response was no longer reliably observed, the stimuli were then increased in 10 dB steps to the original SPL. By obtaining two ABR waveforms at each SPL, it was possible to quantify the variability in the measurements.
Good replicable responses were measured from most of the seals, with waveforms following the expected pattern of an increase in latency and decrease in amplitude of the peaks, as the stimulus level was lowered. One seal had substantial decreased acuity to the 8 kHz tone-burst stimuli prior to the launch. The cause of this hearing loss was unknown, but was most likely congenital or from infection. Another seal had a great deal of variability in waveform latencies in response to identical stimuli. This animal moved repeatedly during testing, which may have reduced the sensitivity of the ABR testing on this animal for both the click and 8 kHz tone burst stimuli. Two of the seals were released after pre-launch testing but prior to the launch of the Titan IV B-34, as the launch was delayed for many days, and five days is the maximum duration permitted to hold the seals for testing.
Detailed analysis of the changes in waveform latency and waveform replication of the ABR measurements for the 14 seals showed no detectable changes in the seals' hearing sensitivity as a result of exposure to the launch noise. The delayed start (1.75 to 3.5 hrs after the launches) for ABR testing allows for the possibility that the seals may have recovered from a temporary threshold shift (TTS) before testing began. However, it can be said with confidence that the post-launch tested animals did not have permanent hearing changes due to exposure to the launch noise from the Titan IV, Taurus, or Delta IV SLVs. These results are consistent with previous NMFS conclusions for such activities in its prior rulemakings (63 FR 39055, July 21, 1998; 69 FR 5720, February 6, 2004; 74 FR 6236, February 6, 2009). Given the distance from the pad area to Ugak Island and the measured sound levels from the Castor 120 (101.4 dB), for the loudest space vehicle used at the PSCA, pinniped auditory injury is not anticipated. Therefore, PTS is not a concern for pinnipeds exposed to launch noise from the PSCA as noise levels at this location are below those experienced during the VAFB launches, and sonic booms are not audible on Ugak Island.
NMFS does not anticipate a significant impact on any of the species or stocks of marine mammals from launches from PSCA. The effects of the activities are expected to be limited to short-term startle responses and localized behavioral changes. In general, if the received level of the noise stimulus exceeds both the background (ambient) noise level and the auditory threshold of the animals, and especially if the stimulus is novel to them, there may be a behavioral response. The probability and degree of response will also depend on the season, the group composition of the pinnipeds, and the type of activity in which they are engaged. Minor and brief responses, such as short-duration startle or alert reactions, are not likely to constitute disruption of behavioral patterns, such as migration, nursing, breeding, feeding, or sheltering and would not cause injury or mortality to marine mammals. On the other hand, startle and alert reactions accompanied by large-scale movements, such as stampedes into the water of hundreds of animals, may rise to the degree of Level A harassment because they could result in injury of individuals. In addition, such large-scale movements by dense aggregations of marine mammals or at pupping sites could potentially lead to takes by injury or death. However, there is no potential for large-scale movements leading to serious injury or mortality near for the harbor seals at the northern end of Ugak Island because, historically, the number of harbor seals hauled out near the site
The potential effects to marine mammals described in this section of the document do not take into consideration the proposed monitoring and mitigation measures described later in this document (see the “Proposed Mitigation” and “Proposed Monitoring and Reporting” sections) which, as noted, should affect the least adverse impact practicable on affected marine mammal species and stocks.
Solid fuel rocket boosters would fall into the ocean away from any known or potential haulouts. All sonic booms that reach the earth's surface would be expected to occur over open ocean beyond the OCS. Airborne launch sounds would mostly reflect or refract from the water surface and, except for sounds within a cone of approximately 26 degrees directly below the launch vehicle, would not penetrate into the water column. The sounds that would penetrate would not persist in the water for more than a few seconds. Overall, rocket launch activities from PSCA would not be expected to cause any impacts to habitats used by marine mammals, including pinniped haulouts, or to their food sources.
In order to issue an incidental take authorization (ITA) under section 101(a)(5)(A) of the MMPA, NMFS must set forth the permissible methods of taking pursuant to such activity, and other means of affecting the least adverse impact practicable on such species or stock and its habitat, paying particular attention to rookeries, mating grounds, and areas of similar significance, and on the availability of such species or stock for taking for certain subsistence uses.
To minimize impacts on pinnipeds at haulout sites, the AAC has proposed, as part of their specified activities, the following mitigation measures: (1) Security overflights immediately associated with the launch would not approach occupied pinniped haulouts on Ugak Island by closer than 0.25 mi (0.4 km), and would maintain a vertical distance of 1,000 ft (305 m) from the haulouts when within 0.5 mi (0.8 km), unless indications of human presence or activity warrant closer inspection of the area to assure that national security interests are protected in accordance with law; (2) if launch monitoring or quarterly aerial surveys indicate that the distribution, size, or productivity of the potentially affected pinniped populations has been affected due to the specified activity, the launch procedures and the monitoring methods would be reviewed, in cooperation with NMFS, and, if necessary, appropriate changes may be made through modifications to a given LOA, prior to conducting the next launch of the same vehicle under that LOA; (3) AAC will purchase and install time-lapsed photography systems in order to survey each of the three pinniped haulout locations around Ugak Island to confirm the abundance of pinnipeds at the haulouts and allow for the more complete surveying efforts. The number of camera systems, equipment capabilities, placement of the systems to be used, and the daily photo frequency will be determined through a cooperative effort between AAC, NMFS, and field experts; (4) AAC will conduct a correlation study in coordination with NMFS. The purpose of the study is to evaluate the effectiveness of the time-lapsed photography systems (specifically, the accuracy of the photography systems compared with aerial count surveys). The results of this study will determine the need to continue aerial surveys. The study will be conducted through a minimum of five launches; and (5) All Castor 120 equivalent launches will be conducted at LP1 which is equipped with a concrete and water-filled flame trench. The purpose of the flame trench is to direct smoke away from the launch pad and to absorb light and noise at their respective peaks (
NMFS has carefully evaluated AAC's proposed mitigation measures and considered a range of other measures in the context of ensuring that NMFS prescribes the means of affecting the least adverse impact practicable on the affected marine mammal species and stocks and their habitat. Our evaluation of potential measures included consideration of the following factors in relation to one another: (1) The manner and the degree to which the successful implementation of the measure is expected to minimize adverse impacts to marine mammals; (2) the proven or likely efficacy of the specific measure to minimize adverse impacts as planned; and (3) the practicability of the measure for applicant implementation, including consideration of personnel safety, and practicality of implementation. The proposed mitigation measures take scientific studies (Richardson
Based on our evaluation of the applicant's proposed measures, as well as other measures considered by NMFS or recommended by the public in the prior rulemaking, NMFS has preliminarily determined that the proposed mitigation measures provide the means of affecting the least adverse impacts practicable on marine mammals species or stocks and their habitat, paying particular attention to rookeries, mating grounds, and areas of similar significance.
In order to issue an ITA for an activity, Section 101(a)(5)(A) of the MMPA states that NMFS must set forth “requirements pertaining to the monitoring and reporting of such taking.” The MMPA implementing regulations at 50 CFR 216.104(a)(13) indicate that requests for ITAs must include the suggested means of accomplishing the necessary monitoring and reporting that will result in increased knowledge of the species and of the level of taking or impacts on populations of marine mammals that are expected to be present. AAC proposes the following for monitoring and reporting: (1) Deploy time-lapsed photography systems designed to monitor pinniped abundance and detect pinniped responses to rocket launches conducted under these regulations. AAC will monitor the effectiveness of these systems, comparing the results to aerial surveys from at least five launches; (2) Ensure the time-lapsed photography systems will be in place and operating in locations that allow for visual monitoring of all three pinniped haulouts during launches; (3) Relocate the time-lapsed photography systems in cooperation with NMFS after five launches if the system is not accurately capturing all three pinniped haulouts and total pinniped abundance during
The following text describes the potential range of takes possible of harbor seals on PSCA during launches. AAC estimates that up to 45 launches may occur from PSCA over the course of the 5-year period covered by the proposed rulemaking. Annually, AAC requests nine launches to be authorized. AAC estimates that no more than one launch would occur over a 4-week period, and it is likely the frequency of launches would be less than this estimate.
Harbor seals of all age classes hauled out on the northern shores of Ugak Island may become alert or flush into the water in response to rocket to launches from PSCA. The total number of harbor seals present on Ugak Island ranges up to a maximum of approximately 1,500 seals in the last ten years, and 1,150 seals in the last five years. However, approximately 97 percent of harbor seals are found at the eastern shore haulout where they are sheltered from launch effects by the 1,000 ft cliffs that stand between this haulout and PSCA. Only about three percent of harbor seals use the northern haulout across from PSCA because of the lack of suitable beaches. When present, the majority of counts at the northern haulout were of less than 25 individuals (Figure 1). An exceptional one-time high count of about 125 seals occurred within the last 10 years. The mean number of harbor seals present at the northern haulout is 10 seals with a standard deviation of 25 seals. Therefore, a representative harbor seal population at the northern haulout of 35 seals (the mean plus one standard deviation) is used for the following take estimate.
Assuming that all 35 harbor seals at the northern haulout are expected to be present and taken by Level B Harassment during a launch, and that all 9 launches are of the Castor 120 (loudest space vehicle), a maximum of 315 harbor seals annually could be taken by Level B harassment with 1,575 harbor seals taken over the 5-year effective period of the regulations. Depending on the type of rocket being launched, the time of day, time of the year, weather conditions, tide and swell conditions, the number of seals that may be taken will range between 0 and 35 per launch. Launches may occur at any time of the year, so any age classes and gender may be taken.
SELs from the loudest launch may reach approximately 101.4 dBA at the traditional Steller sea lion haulout (approximately 3.5 mi from the launch site) which is similar distance to the northern beaches where harbor seal haulout (approximately 4 mi from the launch site). Based on this recorded level and the fact that audible launch noise would be very short in duration, harbor seals are not expected to incur PTS, and the chance of TTS is low to unlikely. No injury or mortality of harbor seals is anticipated, nor would any be authorized. Therefore, NMFS proposes to authorize harbor seal take, by Level B harassment only, incidental to launches from PSCA.
As discussed above, security overflights associated with a launch would not closely approach or circle any pinniped. Therefore, incidental take from this activity is not anticipated. Should the pilot or crew on the plane observe pinnipeds reacting to their presence, the plane would increase altitude and note the number of animals reacting to the plane. These data would be included in AAC's marine mammal reports.
The primary monitoring method has involved conducting aerial surveys along set transect lines to observe and count harbor seals and Steller sea lions. Marine mammals other than harbor seals and Steller sea lions, although observed and recorded, were not specifically targeted by the launch-related aerial surveys. Marine mammal abundance and distribution were recorded during aerial surveys flown in a single-engine fixed-wing airplane with floats. The aerial survey route was designed for harbor seals and Steller sea lions and was flown using a Global Positioning System (GPS) for navigation. All surveys were intended to be flown within two hours of the daytime low tide and during mid-day, when haulout attendance peaks for harbor seals.
The aerial survey schedule during the formal monitoring period consisted of daily surveys one day prior to the launch, immediately following the launch (on the launch day), and each day of the three days following the launch date, weather conditions permitting (NMFS 2008). Two additional surveys were often conducted prior to the formal monitoring period at AAC's discretion. The two additional surveys were conducted to balance the pre-launch sample size with the three post-launch surveys to allow calculation of the variance in pre-launch counts for subsequent statistical analysis. The aerial surveys were flown 1,000 ft above sea level at 80-90 nautical mph and the flight line was kept ≥0.25 mi from known haulouts. Digital photographs of groups of pinnipeds (generally greater than 10 pinnipeds) were taken with a Nikon D70 camera (equipped with a 70 to 300 millimeter zoom lens) or a Canon Powershot S5 camera with image stabilized zoom. Images were reviewed on a personal computer and counts of pinnipeds were summarized from sets of overlapping images. All counts greater than 15 pinnipeds were made from digital images taken from the aircraft, unless the images were blurred or underexposed, in which cases the visual estimates were used.
Foul weather, daylight considerations, launch timing, and timing of tidal flux have all contributed to the difficulty in collecting the data. Foul weather precludes aerial surveys primarily due to visibility, excessive turbulence, and other dangerous conditions. In addition, rockets can often be launched during periods of weather that are not conducive to operation of small aircraft.
Total counts on Ugak Island (both the northern and eastern haulouts combined) have increased steadily and remained stable since the 1990s from several hundred (ENRI 1995-1998) up to a peak of about 1,500 in the last 10 years (R&M 2008). The number of harbor seals tallied at Ugak Island during the July 2008 FTX-03 surveys reached a record for monitoring surveys at 1,534 seals (R&M 2008). Table 5 presents daily counts, by species, of the marine mammals that have been observed during launch-related environmental monitoring activities from 2006-2008. Seal numbers in Table 5 are highest during August and September because they were conducted during the annual molt, when maximal
During the most effective period of the recent regulations (2011-2016), there were 17 quarterly surveys flown (Table 6). An average of 644 harbor seals was observed with a range of 32 to 1133 seals and standard deviation of 307 seals. From the first quarter of the calendar year through the fourth, the average number of seals was as follows: 441, 698, 608, and 810, respectively (AAC 2016).
Previous rocket launches did not appear to depress the daily attendance of pinnipeds at haulouts on Ugak Island (Table 7).
NMFS has defined “negligible impact” in 50 CFR 216.103 as “. . . an impact resulting from the specified activity that cannot be reasonably expected to, and is not reasonably likely to, adversely affect the species or stock through effects on annual rates of recruitment or survival.” A negligible impact finding is based on the lack of likely adverse effects on annual rates of recruitment or survival (
(1) The number of anticipated injuries, serious injuries, or mortalities;
(2) The number, nature, and intensity, and duration of Level B harassment (all relatively limited);
(3) The context in which the takes occur (
(4) The status of stock or species of marine mammals (
(5) Impacts on habitat affecting rates of recruitment/survival; and
(6) The effectiveness of monitoring and mitigation measures.
For reasons stated previously in this document, the specified activities are not likely to cause long-term behavioral disturbance, abandonment of the haulout area, serious injury, or mortality because:
(1) The possibility of injury, serious injury, or mortality may reasonably be considered discountable;
(2) The effects of the activities are expected to be limited to short-term startle responses and localized behavioral changes;
(3) The considerable evidence, based on over 10 years of monitoring data, suggesting no long-term changes in the use by harbor seal haulouts in the project area as a result of launch operations. Launches will not occur more than a maximum of nine times per year over the next five years. In past years, AAC has conducted zero to two launches on an annual basis. NMFS has analyzed the specified activity to include disturbance events of up to nine launches per year as AAC anticipate the capability to carry out more efficient mission turn-around time over the duration of the proposed regulations;
(4) Based on aerial survey data, the harbor seal population on Ugak Island has increased and is stable. As discussed previously, the population of harbor seals on Ugak Island has increased steadily from several hundred in the 1990s (ENRI 1995-1998) to a peak of about 1,500 in 2008 (R&M 2007a, 2007b, 2008, 2009). Therefore, NMFS does not believe there would be any long-term impact on the health of the population. Given harbor seals are considered a species that is easily disturbed, their resilience to launch effects suggest impacts from launches are short-term and negligible;
(5) Solid fuel rocket boosters would fall into the ocean away from any known or potential haulouts. All sonic booms that reach the earth's surface would be expected to occur over open ocean beyond the OCS. Airborne launch sounds would mostly reflect or refract from the water surface and, except for sounds within a cone of approximately 26 degrees directly below the launch vehicle, would not penetrate into the water column. The sounds that would penetrate would not persist in the water for more than a few seconds. Overall, rocket launch activities from PSCA would not be expected to cause any impacts to habitats used by marine mammals, including pinniped haulouts, or to their food sources or would impact their survival, and;
(6) Mitigation measures to reduce noise from launches once in the air are virtually impossible; however, the noise generated on the launch pad during ignition moves through a deep trench (called a flame trench or flame bucket) that diverts the noise/exhaust toward the northwest (away from Ugak Island).
In addition, improved monitoring would better enable AAC and NMFS to determine if impacts from rocket launches are having short-term and long-term impacts on the present day pinniped populations on Ugak Island. The time-lapse photography system would be able to detect impacts (takes) from launch exposure, including the number of pinnipeds flushing at the haulout sites, while quarterly aerial surveys would aid in determining long-term trends of pinniped abundance. The proposed monitoring measures contained within this notice are specifically designed to, among other things, determine if Level B Harassment is occurring due to rocket launches from AAC.
Based on the analysis contained herein of the likely effects of the specified activity on marine mammals and their habitat, and taking into consideration the implementation of the mitigation and monitoring measures, NMFS preliminarily finds that space vehicle and missile launches at the PSCA will have a negligible impact on the affected marine mammal species or stock.
The numbers of proposed authorized takes would be considered small relative to the relevant stocks or populations, eight percent for harbor seals. But, it is important to note that the number of expected takes does not necessarily represent of the number of individual animals expected to be taken. Our small numbers analysis accounts for this fact. Multiple exposures to Level B harassment can accrue to the same individuals over the course of an activity that occurs multiple times in the same area (such as AAC's proposed activity). This is especially likely in the case of species that have limited ranges and that have site fidelity to a location within the project area, as is the case with harbor seals.
As described above, harbor seals are non-migratory, rarely traveling more than 50 km from their haulout sites. Thus, while the estimated abundance of the South Kodiak stock of harbor seals is 19,199 (Muto
Based on the analysis contained herein of the likely effects of the specified activity on marine mammals and their habitat, and taking into consideration the implementation of the mitigation and monitoring measures, we preliminarily find that small numbers of marine mammals will be taken relative to the populations of the affected species or stocks.
Several communities on Kodiak Island use harbor seals (and Steller sea lions) for subsistence uses. The communities closest to Ugak Island are Old Harbor and Kodiak City; each is over 35 miles from Ugak Island. The Alaska Native Harbor Seal Commission quantified the Kodiak area subsistence take of harbor seals (and Steller sea lions) in a report issued in 2011. Within the last ten years, 2011, 2008, 2007, and 2006 were surveyed. On average, during the years surveyed in the last 10 years, Kodiak city took 35.3 harbor seals and Old Harbor took 35.2 harbor seals annually. Specific locations of take are not mentioned in this document.
Based on the distance from each community and the opportunities closer to each community, either a small fraction of the averages provided, or no take can be estimated from each community. It is possible that some fraction of the average number of harbor seals taken listed above were taken from Ugak Island specifically, but there is no documentation to support that conclusion.
There is no expectation that harbor seals will abandon sealing grounds, based on AAC's launches or the launches at other launch sites (
AAC will consult (as they have for previous regulations) with the Alaska Native Harbor Seal Commission as well as the Kodiak communities before the issuance of any final regulations to ensure project activities do not impact relevant subsistence uses of marine mammals implicated by this action.
There is one marine mammal species under NMFS' jurisdiction that is listed as endangered under the ESA with confirmed or possible occurrence in the action area, the Steller sea lion. NMFS and AAC consulted internally with AKR under the ESA on its proposed issuance of AAC's 2017 MMPA regulations and subsequent LOAs. It was determined that no effect would occur from the proposed activities; therefore, ESA consultation, formal or informal is not required.
In 1996, the FAA prepared an EA, and subsequently issued FONSI, for AAC's proposal to construct and operate a
Pursuant to the procedures established to implement section 6 of Executive Order 12866, the Office of Management and Budget has determined that this proposed rule is not significant.
Pursuant to section 605(b) of the Regulatory Flexibility Act (RFA), the Chief Counsel for Regulation of the Department of Commerce has certified to the Chief Counsel for Advocacy of the Small Business Administration that this proposed rule, if adopted, would not have a significant economic impact on a substantial number of small entities. A description of this rule and its purpose are found in the preamble to this proposed rule, and are not repeated here. The provisions of the rule will apply directly only to AAC. AAC is a public corporation of the State of Alaska involved in space vehicles and guided missiles, and it employs approximately 45 people. SBA's regulations implementing the RFA have no “small” size standards for public administration entities that administer and oversee government programs and activities that are not performed by private establishments. Accordingly, no small entity will be affected by this proposed rule.
The AAC may use a small number of contractors to provide services related to the proposed reporting requirements. However, none of the authorizations or requirements imposed by this action will result in any of AAC's contractors expending any resources in order to be in compliance with these proposed regulations. Thus, the rule would have no effect, directly or indirectly, on these small entities.
Because AAC is the only entity that would be directly affected by this proposed regulation and because the effects of this regulation would impose no costs on any of the contractors—whether they are large or small entities—there will be no significant economic impact on a substantial number of small entities. Accordingly, no regulatory flexibility analysis is necessary, and none has been prepared.
Notwithstanding any other provision of law, no person is 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 (PRA) unless that collection of information displays a currently valid OMB control number. This proposed rule contains a collection-of-information requirement subject to the provisions of the PRA. This collection has been approved previously by OMB under section 3504(b) of the PRA issued under OMB control number 0648-0151, which includes applications for LOAs and reports.
Exports, Fish, Imports, Indians, Labeling, Marine mammals, Penalties, Reporting and record-keeping requirements, Seafood, Transportation.
For reasons set forth in the preamble, 50 CFR part 217 is proposed to be amended as follows:
16 U.S.C. 1361
(a) Regulations in this subpart apply only to the AAC at the PSCA on Kodiak Island, Alaska, and those persons it authorizes to conduct activities on its behalf for the taking of marine mammals that occurs in the area outlined in paragraph (b) of this section and incidental to conducting up to nine space vehicle launches each year from PSCA, for a total of 45 launches over the 5-year period of these regulations.
(b) The incidental take of marine mammals under the activity identified in paragraph (a) of this section is limited to 315 harbor seals (
Under a Letter of Authorization (LOA) issued pursuant to § 216.106 of this chapter and § 217.70, the holder of the LOA (herein after AAC) and its contractors may incidentally, but not intentionally, take harbor seals by Level B harassment in the course of conducting space vehicle and missile launch activities within the area described in § 217.70(a), provided all terms, conditions, and requirements of these regulations and such Letter of Authorization are complied with.
Notwithstanding takings contemplated in § 217.70(b) and authorized by an LOA issued under § 216.106 of this chapter and § 217.76, no person in connection with the activities described in § 217.70 may:
(a) Take any marine mammal not specified in § 217.70(b);
(b) Take any marine mammal specified in § 217.70(b) other than by incidental, unintentional Level B harassment;
(c) Take a marine mammal specified in § 217.70(b) if NMFS determines such taking results in more than a negligible impact on the species or stocks of such marine mammal; or
(d) Violate, or fail to comply with, the terms, conditions, and requirements of this subpart or an LOA issued under § 216.106 of this chapter and § 217.76.
(a) When conducting operations identified in § 217.70(a), the mitigation measures contained in the LOA issued under § 216.106 of this chapter and § 217.76 must be implemented. The activity identified in § 217.70(a) must be conducted in a manner that minimizes, to the greatest extent practicable, adverse impacts on marine mammals and their habitats. These mitigation measures include (but are not limited to):
(1) Security overflights associated with a launch will not approach occupied pinniped haulouts on Ugak Island by closer than 0.25 miles (mi) (0.4 kilometer (km)), and will maintain a vertical distance of 1,000 feet (ft) (305 meter (m)) from the haulouts when within 0.5 mi (0.8 km), unless indications of human presence or activity warrant closer inspection of the area to assure that national security interests are protected in accordance with law;
(2) If launch monitoring detects pinniped injury or death, or if long-term trend counts from quarterly aerial surveys indicate that the distribution, size, or productivity of the potentially affected pinniped populations has been affected due to the specified activity, the launch procedures and the monitoring methods will be reviewed, in cooperation with NMFS, and, if necessary, appropriate changes may be made through modifications to a given LOA, prior to conducting the next launch of the same vehicle under that LOA;
(3) AAC will purchase and install time-lapsed photography systems in order to survey each of the three pinniped haulout locations around Ugak Island to confirm the abundance of pinnipeds at the haulouts and allow for the more complete surveying efforts. The number of camera systems, equipment capabilities, placement of the systems to be used, and the daily photo frequency will be determined through a cooperative effort between AAC, NMFS, and field experts;
(4) AAC will conduct a correlation study in coordination with NMFS. The purpose of the study is to evaluate the effectiveness of the time-lapsed photography systems (specifically, the accuracy of the photography systems compared with aerial count surveys). The results of this study will determine the need to continue aerial surveys. The study will be conducted through a minimum of five launches;
(5) All Castor 120 equivalent launches will be conducted at LP1 which is equipped with a concrete and water-filled flame trench. The purpose of the flame trench is to direct smoke away from the launch pad and to absorb light and noise at their, respective peaks (
(6) Additional mitigation measures as contained in an LOA.
(b) [Reserved]
(a) Holders of LOAs issued pursuant to § 216.106 of this chapter and § 217.76 for activities described in § 217.70(a) are required to cooperate with NMFS, and any other Federal, State, or local agency with authority to monitor the impacts of the activity on marine mammals. Unless specified otherwise in the LOA, the holder of the LOA must notify the Administrator, Alaska Region, NMFS, by letter, email or telephone, at least two weeks prior to each launch. If the authorized activity identified in § 217.70(a) is thought to have resulted in the mortality or injury of any marine mammals or take of marine mammals not identified in § 217.70(b), then the holder of the LOA must notify the Director, Office of Protected Resources, NMFS, or designee, by telephone (301-427-8401), within 48 hours of the injury or death.
(b) Holders of LOAs must designate qualified, on-site individuals approved in advance by NMFS, as specified in the LOA, to:
(1) Deploy for AAC, time-lapsed photography systems designed to monitor pinniped abundance and detect pinniped responses to rocket launches conducted under these regulations. AAC will monitor the effectiveness of these systems, comparing the results to aerial surveys from at least five launches;
(2) Ensure the time-lapsed photography systems will be in place and operating in locations that allow for visual monitoring of all three pinniped haulouts during launches.
(3) Relocate the time-lapsed photography systems in cooperation with NMFS after five launches if the system is not accurately capturing all three pinniped haulouts and total pinniped abundance during the launches;
(4) Review and log pinniped presence, abundance, behavior, and re-occupation time from the data obtained from the time-lapsed photography systems and report results to NMFS within 90 days of the first five launches under this system;
(5) Conduct one pre-launch aerial survey and one post-launch aerial survey for each launch. AAC will conduct a minimum of one aerial survey annually (in the event no launch occurs during a calendar year); and
(6) Conduct quarterly aerial surveys, ideally during mid-day coinciding with low tide, to obtain data on pinniped presence, abundance, and behavior within the action area to determine long-term trends in pinniped haulout use. Results of these quarterly surveys will be reported once as part of the annual report required under paragraph (e) of this section.
(c) Holders of LOAs must conduct additional monitoring as required under an LOA.
(d) Holders of an LOA must submit a report to the Alaska Region Administrator, NMFS, within 90 days after each launch. This report must contain the following information:
(1) Date(s) and time(s) of the launch;
(2) Location of the time-lapsed photography systems;
(3) Design of the monitoring program for the time-lapsed photography systems and a description of how data is stored and analyzed; and
(4) Results of the monitoring program for the time-lapsed photography
(i) Numbers of pinnipeds, by species and age class (if possible), present on the haulout prior to commencement of the launch;
(ii) Numbers of pinnipeds, by species and age class (if possible), that may have been harassed, including the number that entered the water as a result of launch noise;
(iii) The length of time pinnipeds remained off the haulout during post-launch monitoring;
(iv) Number of harbor seal pups that may have been injured or killed as a result of the launch; and
(v) Other behavioral modifications by pinnipeds that were likely the result of launch noise.
(e) An annual report must be submitted on March 1 of each year that will include results of the aerial quarterly trend counts of pinnipeds and comparison of the results using the time-lapsed photography systems on Ugak Island. Future aerial surveys may be reduced if the time-lapsed photography systems capture similar or better data than aerial surveys.
(f) A final report must be submitted at least 90 days prior to expiration of these regulations if new regulations are sought or 180 days after expiration of regulations. This report will:
(1) Summarize the activities undertaken and the results reported in all previous reports;
(2) Assess the impacts of launch activities on pinnipeds within the action area, including potential for pup injury and mortality;
(3) Assess the cumulative impacts on pinnipeds and other marine mammals from multiple rocket launches; and
(4) State the date(s), location(s), and findings of any research activities related to monitoring using time-lapsed photography systems on marine mammal populations.
(a) To incidentally take marine mammals pursuant to these regulations, AAC must apply for and obtain an LOA.
(b) An LOA, unless suspended or revoked, may be effective for a period of time not to exceed the expiration date of these regulations.
(c) If an LOA expires prior to the expiration date of these regulations, AAC must apply for and obtain a renewal of the LOA.
(d) In the event of projected changes to the activity or to mitigation and monitoring measures required by an LOA, AAC must apply for and obtain a modification of the LOA as described in § 217.77.
(e) The LOA will set forth:
(1) The number of marine mammals, by species and age class, authorized to be taken;
(2) Permissible methods of incidental taking;
(3) Means of effecting the least practicable adverse impact (
(4) Requirements for monitoring and reporting.
(f) Issuance of an LOA shall be based on a determination that the level of taking will be consistent with the findings made for the total taking allowable under these regulations.
(g) Notice of issuance or denial of an LOA will be published in the
(a) An LOA issued under § 216.106 of this chapter and § 217.76 for the activity identified in § 217.70(a) will be renewed or modified upon request by the applicant, provided that:
(1) The proposed specified activity and mitigation, monitoring, and reporting measures, as well as the anticipated impacts, are the same as those described and analyzed for these regulations (excluding changes made pursuant to the adaptive management provision in § 217.77(c)(1)), and
(2) NMFS determines that the mitigation, monitoring, and reporting measures required by the previous LOA under these regulations were implemented.
(b) For an LOA modification or renewal requests by the applicant that include changes to the activity or the mitigation, monitoring, or reporting (excluding changes made pursuant to the adaptive management provision in § 217.77(c)(1)) that do not change the findings made for the regulations or result in no more than a minor change in the total estimated number of takes (or distribution by species or years), NMFS may publish a notice of proposed LOA in the
(c) An LOA issued under § 216.106 of this chapter and § 217.76 for the activity identified in § 217.70(a) may be modified by NMFS under the following circumstances:
(1) Adaptive Management—NMFS may modify (including augment) the existing mitigation, monitoring, or reporting measures (after consulting with AAC regarding the practicability of the modifications) if doing so creates a reasonable likelihood of more effectively accomplishing the goals of the mitigation and monitoring set forth in the preamble for these regulations:
(i) Possible sources of data that could contribute to the decision to modify the mitigation, monitoring, or reporting measures in an LOA:
(A) Results from AAC's monitoring from the previous year(s);
(B) Results from other marine mammal and/or sound research or studies; and
(C) Any information that reveals marine mammals may have been taken in a manner, extent or number not authorized by these regulations or subsequent LOAs.
(ii) If, through adaptive management, the modifications to the mitigation, monitoring, or reporting measures are substantial, NMFS will publish a notice of proposed LOA in the
(2) Emergencies—If NMFS determines that an emergency exists that poses a significant risk to the well-being of the species or stocks of marine mammals specified in §§ 217.70(b) and 217.72(a), an LOA may be modified without prior notice or opportunity for public comment. Notice would be published in the
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Proposed rule; request for comments.
NMFS proposes to approve and implement measures included in Framework Adjustment 28 to the Atlantic Sea Scallop Fishery Management Plan, which the New England Fishery Management Council adopted and submitted to NMFS for approval. The purpose of Framework 28
Comments must be received by February 7, 2017.
The Council has prepared a draft environmental assessment (EA) for this action that describes the proposed measures and other considered alternatives and analyzes of the impacts of the proposed measures and alternatives. The Council submitted a decision draft of the framework to NMFS that includes the draft EA, a description of the Council's preferred alternatives, the Council's rationale for selecting each alternative, and an Initial Regulatory Flexibility Analysis (IRFA). Copies of the decision draft of the framework, the draft EA, and the IRFA, are available upon request from Thomas A. Nies, Executive Director, New England Fishery Management Council, 50 Water Street, Newburyport, MA 01950.
You may submit comments on this document, identified by NOAA-NMFS-2016-0155, by either of the following methods:
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Travis Ford, Fishery Policy Analyst, 978-281-9233.
The scallop fishery's management unit ranges from the shorelines of Maine through North Carolina to the outer boundary of the Exclusive Economic Zone. The Scallop Fishery Management Plan (FMP), established in 1982, includes a number of amendments and framework adjustments that have revised and refined the fishery's management. The Council sets scallop fishery specifications through specification or framework adjustments that occur annually or biennially. The Council adopted Framework 28 on November 17, 2016, and submitted the framework and draft EA to NMFS on December 21, 2016, for review and approval. This action includes catch, effort, and quota allocations and adjustments to the rotational area management program for fishing year 2017.
Framework 28 specifies measures for fishing year 2017, and includes default fishing year 2018 measures that will go into place should the next specifications-setting action be delayed beyond the start of fishing year 2018. NMFS will implement Framework 28, if approved, after the start of fishing year 2017; 2017 default allocation measures will go into place on March 1, 2017. The Council has reviewed the Framework 28 proposed rule regulations as drafted by NMFS and deemed them to be necessary and appropriate as specified in section 303(c) of the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act).
The Council set the proposed OFL based on a fishing mortality rate (F) of 0.48, equivalent to the overfishing F threshold updated through the 2014 assessment. The Council's Scientific and Statistical Committee recommended a scallop fishery ABC for the 2017 and 2018 fishing years of 103 million lb (46,737 mt) and 95 million lb (43,142 mt), respectively, after accounting for discards and incidental mortality. The Council based the proposed ABC and the equivalent total ACL for each fishing year on an F of 0.38, which is the F associated with a 25-percent probability of exceeding the OFL. The Scientific and Statistical Committee will reevaluate an ABC for 2018 when the Council develops the next framework adjustment in 2017.
Table 1 outlines the proposed scallop fishery catch limits. After deducting the incidental target total allowable catch (TAC), the research set-aside (RSA), and the observer set-aside, the remaining ACL available to the fishery is allocated according to the following fleet proportions established in Amendment 11 to the FMP (72 FR 20090; April 14, 2008): 94.5 percent allocated to the limited access scallop fleet (
This action would deduct 1.25 million lb (567 mt) of scallops annually for 2017 and 2018 from the ABC and set it aside as the Scallop RSA to fund scallop research and to compensate participating vessels through the sale of scallops harvested under RSA projects. As of March 1, 2017, this set-aside would be available for harvest by RSA-funded projects in open areas. Framework 28 would allow RSA to be harvested from the Mid-Atlantic Access Area (MAAA) once this action is approved and implemented, but would prevent RSA harvesting from access areas under 2018 default measures. Of this 1.25 million lb (567 mt) allocation, NMFS has already allocated 63,204 lb (28.7 mt) to previously-funded multi-year projects as part of the 2016 RSA awards process. NMFS is reviewing proposals submitted for consideration of 2017 RSA awards and will be selecting projects for funding in the near future.
This action would also set aside 1 percent of the ABC for the industry-funded observer program to help defray the cost to scallop vessels that carry an observer. The observer set-asides for fishing years 2017 and 2018 are 467 mt and 431 mt, respectively. The Council may adjust the 2018 observer set-aside when it develops specific, non-default measures for 2018.
This action would implement vessel-specific DAS allocations for each of the three limited access scallop DAS permit categories (
Because NMFS is likely to implement Framework 28, if approved, after March 1, 2017, full-time, part-time, and occasional vessels will receive 34.55, 13.82, and 2.88 DAS, respectively, on March 1, 2017, as default allocations. These allocations would be reduced as soon as we implement Framework 28, if approved.
For fishing year 2017 and the start of 2018, Framework 28 would keep the MAAA open as an access area and would also open the Nantucket Lightship Access Area (NLS) and Closed Area 2 Access Area (CA2). Closed Area 1 would remain closed. In addition, this action proposes to open the Elephant Trunk Closed Area and allow full-time vessels to choose to fish up to 18,000 lb (8,165 kg) of their 36,000-lb (16,330 kg) MAAA-allocation in this area. Because of the flexible trip option for the Elephant Trunk area, this action proposes to rename the area Elephant Trunk Flex Access Area (ETFA) for 2017. The Council approved this flexible trip option to reduce the fishing pressure on both the MAAA and the ETFA and to protect small scallops in the ETFA while still providing the option to fish in the area. There are sections of the ETFA where there is a mix of harvestable scallops and small scallops. Framework 28 also proposes a seasonal closure of the ETFA, from July 1 through September 30, to help reduce the discard mortality of small scallops during the warmest months of the year.
Table 3 proposes the limited access full-time allocations for all of the access areas, which could be taken in as many
For the 2017 fishing year only, a part-time limited access vessel would be allocated a total of 28,800 lb (13,064 kg) with a trip possession limit of 14,400 lb per trip (6,532 kg per trip). Of the 28,800-lb (13,064-kg) allocation, 14,400 lb (6,532 kg) would be allocated exclusively to the MAAA. The remaining 14,400 lb (6,532 kg) could be harvested and landed either from the MAAA or any one other available access area, (CA2, NLS, or ETFA). However, if a vessel chooses to harvest and land the remaining 14,400 lb (6,532 kg) from the ETFA and does not harvest up to the full allocation on a trip, it would only be allowed to land the remaining pounds either from the ETFA or the MAAA. For the 2018 fishing year, part-time limited access vessels would be allocated 14,400 lb (6,532 kg) in the MAAA only with a trip possession limit of 14,400 lb per trip (6,532 kg per trip).
For the 2017 fishing year only, an occasional limited access vessel would be allocated 6,000 lb (2,722 kg) with a trip possession limit of 6,000 lb per trip (2,722 kg per trip). Occasional vessels would be able to harvest 6,000 lb (2,722 kg) allocation from only one available access area (CA2, NLS, MAAA, or ETFA). For the 2018 fishing year, occasional limited access vessels would be allocated 6,000 lb (2,722 kg) in the MAAA only with a trip possession limit of 6,000 lb per trip (2,722 kg per trip).
Framework 26 changed the way we allocate access area effort to the limited access fleet from trip allocations (2 trips with an 18,000-lb (8,165-kg) possession limit in an area) to landings allocations (36,000 lb (16,330 kg) of landings with an 18,000-lb (8,165-kg) possession limit in an area). However, Framework 26 did not address trip exchanges because it only opened a single access area. This action clarifies that the owner of a vessel issued a limited access scallop permit may exchange unharvested scallop pounds allocated into one access area for another vessel's unharvested scallop pounds allocated into another Scallop Access Area. These exchanges may only be made for the amount of the current trip possession limit (18,000-lb (8,165-kg)). In addition, these exchanges would be made only between vessels with the same permit category: A full-time vessel may not exchange allocations with a part-time vessel, and vice versa.
In fishing year 2017, each limited access full-time vessel would be allocated 18,000 lb (8,165 kg) that may be landed from either the ETFA or the MAAA (flex allocation). Such flex allocation could be exchanged in full only for another access area allocation, but only the flex allocation could be landed from the ETFA. For example, if a Vessel A exchanges 18,000 lb (8,165 kg) of flex allocation for 18,000 lb (8,165 kg) of MAAA allocation with Vessel B, Vessel A would no longer be allowed to land allocation from the ETFA based on its MAAA allocation, but Vessel B could land up to 36,000 lb (16,330 kg) from the ETFA and/or the MAAA, combined.
This action proposes a 50-bushel shell stock possession limit inshore of the DAS demarcation line for limited access vessels fishing north of 42°20′ N. lat. Framework Adjustment 14 to the Scallop FMP (66 FR 21639; April 26, 2001) implemented a 50-bushel possession limit for shell stock south of 42°20′ N. lat. for limited access vessels inshore of the DAS demarcation line. This action would extend the restriction to all Federal waters for limited access vessels. This possession limit is intended to prevent limited access vessels from shucking scallops off the DAS clock. Vessels fishing exclusively north of 42°20′ N. lat. were exempt from this possession limit to allow a limited fishery to continue by some vessels that traditionally landed in-shell scallops in this area. Since Framework 14, there has been very little limited access effort north of 42°20′ N. lat. However, in the spring of 2016, there was a sharp increase in limited access activity in this area. During this increase in activity there were reports of vessels possessing greater than 50 bushels of shell stock inside of the VMS demarcation line for the purpose of shucking scallops off the DAS clock. This is a conservation and management concern because DAS allocations are set using landings per unit effort (LPUE). The LPUE calculation assumes that vessels are shucking scallops on the DAS clock. Given the recent increase in limited access effort in this area, this action proposes to extend the 50-bushel possession limit for shell stock for limited access vessels to all Federal waters.
Allocating the LAGC IFQ fleets' catch based on projected catch also has less potential to cause harm to the scallop biomass where these vessels fish. LAGC IFQ fleets are constrained by the available access areas and open areas defined in the Scallop FMP because regulations confine the fleets generally to nearshore dredge exemption areas. In addition, because of the size of the vessels in the LAGC IFQ fleet, and the 600-lb (272.2-kg) trip limit, harvest is more concentrated in near-shore areas. With an allocation based on stockwide ACL (including closed areas), the vessels could catch more scallops in the areas where the vessels are confined to than the areas might be able to handle biologically. Allocation based on projected landings of scallops available through area rotation reduces this risk.
Choosing to allocate based on 5.5 percent of the projected catch would result in an approximate 45 percent cut in the allocation from the current method of allocation (status quo) for 2017 (2.49 million lb (1,129 mt) based on projected catch compared to 5.5 million lb (2,512 mt) based on stock-wide ACL). The Council supported this measure, despite this large cut in the allocation, because the concept of spatial management for the LAGC IFQ fishery has support across both the limited access and the LAGC IFQ fleets and because it reduces the risk of LAGC IFQ allocations resulting in higher realized F rates in certain areas than predicted in the model. The Council felt that the intent of Amendment 11 was to limit the LAGC IFQ fleet harvest to 5.5 percent of the actual landings, not 5.5 percent of the ACL.
Because Framework 28 is likely to go into effect after the March 1 start of fishing year 2017, the default 2017 IFQ allocations will go into place automatically on March 1, 2017. This action implements IFQ allocations that are less than the default allocations. NMFS will send a letter to IFQ permit holders providing both default March 1, 2017, IFQ allocations and Framework 28 IFQ allocations so that vessel owners know what mid-year adjustments would occur should Framework 28 be approved.
This action proposes that vessels participating in RSA projects would be prohibited from harvesting RSA compensation from CA2, NLS, and ETFA during the 2017 fishing year to control F, reduce impacts on flatfish, and reduce impacts on high densities of scallops with growth potential. Further, this action proposes to prohibit the harvest of RSA compensation from the
This proposed rule includes a revision to the regulatory text to address a typographical error in the regulations. NMFS proposes this change consistent with section 305(d) of the MSA which provides that the Secretary of Commerce may promulgate regulations necessary to ensure that amendments to an FMP are carried out in accordance with the FMP and the MSA. This revision corrects the error at § 648.14(i)(4)(i)(G).
Pursuant to section 304(b)(1)(A) of the Magnuson-Steven Act, the NMFS Assistant Administrator has made a preliminary determination that this proposed rule is consistent with the FMP, other provisions of the Magnuson-Steven Act, and other applicable law. In making the final determination, NMFS will consider the data, views, and comments received during the public comment period.
This proposed rule does not contain policies with federalism implications under Executive Order 13132.
This proposed rule has been determined to be not significant for purposes of Executive Order 12866.
An IRFA has been prepared, as required by section 603 of the Regulatory Flexibility Act (RFA). The IRFA describes the economic impact this proposed rule, if adopted, would have on small entities. The IRFA consists of Framework 28 analyses, the draft IRFA, and the preamble to this proposed rule.
This action proposes the management measures and specifications for the Atlantic sea scallop fishery for 2017, with 2018 default measures. A description of the action, why it is being considered, and the legal basis for this action are contained in Framework 28 and the preamble of this proposed rule and are not repeated here.
This action contains no new collection-of-information, reporting, or recordkeeping requirements.
The proposed regulations do not create overlapping regulations with any state regulations or other federal laws.
The proposed regulations would affect all vessels with limited access and LAGC scallop permits. Framework 28 provides extensive information on the number and size of vessels and small businesses that would be affected by the proposed regulations, by port and state (see
The RFA defines a small business in shellfish fishery as a firm that is independently owned and operated with receipts of less than $11 million annually (see NMFS final rule revising the small business size standard for commercial fishing, 80 FR 81194, December 29, 2015). Individually-permitted vessels may hold permits for several fisheries, harvesting species of fish that are regulated by several different fishery management plans, even beyond those impacted by the proposed action. Furthermore, multiple permitted vessels and/or permits may be owned by entities with various personal and business affiliations. For the purposes of this analysis, “ownership entities” are defined as those entities with common ownership as listed on the permit application. Only permits with identical ownership are categorized as an “ownership entity.” For example, if five permits have the same seven persons listed as co-owners on their permit applications, those seven persons would form one “ownership entity,” that holds those five permits. If two of those seven owners also co-own additional vessels, that ownership arrangement would be considered a separate “ownership entity” for the purpose of this analysis.
On June 1 of each year, ownership entities are identified based on a list of all permits for the most recent complete calendar year. The current ownership dataset is based on the calendar year 2015 permits and contains average gross sales associated with those permits for calendar years 2013 through 2015. Matching the potentially impacted 2015 fishing year permits described above (limited access and LAGC IFQ) to calendar year 2015 ownership data results in 154 distinct ownership entities for the limited access fleet and 87 distinct ownership entities for the LAGC IFQ fleet. Of these, and based on the Small Business Administration guidelines, 141 of the limited access distinct ownership entities and 84 of the LAGC IFQ entities are categorized as small. The remaining 13 of the limited access and 3 of the LAGC IFQ entities are categorized as large entities, all of which are shellfish businesses.
Framework 28 has several specification alternatives with different open area DAS and access area allocations in addition to the “No Action” alternative (ALT1). Table 5 provides a description of these alternatives.
The estimated revenues and net revenue for the limited access scallop vessels and small business entities under all alternatives to the proposed action are expected to be higher than the No Action alternative and status quo levels in the short-term as well as in the long-term. The differences in terms of revenue and net revenue per limited access vessel of these specification alternatives are not significantly different than that of the proposed action.
The economic impacts of the status quo (5.5 percent of the ACL) and allocation based on spatial management (5.5 percent of the projected landings) alternatives are different for the LAGC IFQ vessels. The status quo management alternative would provide considerably higher allocations to the LAGC IFQ fleets (
Fisheries, Fishing, Recordkeeping and reporting requirements.
For the reasons set out in the preamble, 50 CFR part 648 is proposed to be amended as follows:
16 U.S.C. 1801
The revisions and additions read as follows:
(i) * * *
(1) * * *
(viii)
(B) Fish for scallops in, or possess or land scallops from, the NGOM on a scallop research set-aside compensation trip as described in § 648.56(d).
(2) * * *
(iii) * * *
(B) Fish for, possess, or land more than 50 bu (17.62 hL) of in-shell scallops inside the VMS Demarcation Line on or by a vessel, except as provided in the state waters exemption, as specified in § 648.54.
(vi) * * *
(B) Transit the Closed Area II Rotational Area or the Closed Area II Extension Rotational Area, as defined § 648.60(d) and (e), respectively, or the Elephant Trunk Flex Rotational Area, as defined in § 648.60(b), unless there is a compelling safety reason for transiting the area and the vessel's fishing gear is stowed and not available for immediate use as defined in § 648.2.
(C) Fish for, possess, or land scallops in or from the Elephant Trunk Flex Access Area in excess of the vessel's total Elephant Trunk Flex Access Area specific allocation as specified in § 648.59(b)(3)(i)(B)(
(3) * * *
(v) * * *
(E) Transit the Elephant Trunk Flex Rotational Area, Closed Area II Rotational Area, or the Closed Area II Extension Rotational Area, as defined § 648.60(b), (d), and (e), respectively, unless there is a compelling safety reason for transiting the area and the vessel's fishing gear is stowed and not available for immediate use as defined in § 648.2.
(4) * * *
(i) * * *
(G) Fish for, possess, or land more than 40 lb (18.1 kg) of shucked scallops, or 5 bu (1.76 hL) of in-shell scallops shoreward of the VMS Demarcation Line, or 10 bu (3.52 hL) of in-shell scallops seaward of the VMS Demarcation Line, when the vessel is not declared into the IFQ scallop fishery, unless the vessel is fishing in compliance with all of the requirements of the State waters exemption program, specified at § 648.54.
(e) Owners or operators of vessels issued limited access permits are prohibited from fishing for, possessing, or landing per trip more than 50 bu (17.6 hl) of in-shell scallops shoreward of the VMS Demarcation Line, unless when fishing under the state waters exemption specified under § 648.54.
The additions and revisions read as follows:
(a) * * *
(3)
(ii)
(6)
(iii)
(8) The following catch limits will be effective for the 2017 and 2018 fishing years:
(b) * * *
(3) The DAS allocations for limited access scallop vessels for fishing years 2017 and 2018 are as follows:
(h)
(2)
(i)
The additions and revisions read as follows:
(a) * * *
(2)
(3)
(b) * * *
(3) * * *
(i) * * *
(B) The following access area allocations and possession limits for limited access vessels shall be effective for the 2017 and 2018 fishing years:
(
(
(
(
(
(
(
(ii)
(B)
(e)
(1) 2017: Mid-Atlantic Access Area
(2) 2018: No access areas
(g) * * *
(3) * * *
(v) The following LAGC IFQ access area allocations will be effective for the 2017 and 2018 fishing years:
(b)
(2)
(b) * * *
(1)
Agricultural Research Service, USDA.
Notice of intent.
Notice is hereby given that the U.S. Department of Agriculture, Agricultural Research Service, intends to grant to BioWorks, Inc. of Victor, New York, an exclusive license to U.S. Patent No. 9,320,283, “TRICHODERMA ASPERELLUM TO REMEDIATE PHYTOPHTHORA RAMORUM-INFESTED SOIL”, issued on April 26, 2016.
Comments must be received on or before February 21, 2017.
Send comments to: USDA, ARS, Office of Technology Transfer, 5601 Sunnyside Avenue, Rm. 4-1174, Beltsville, Maryland 20705-5131.
Mojdeh Bahar of the Office of Technology Transfer at the Beltsville address given above; telephone: 301-504-5989.
The Federal Government's patent rights in this invention are assigned to the United States of America, as represented by the Secretary of Agriculture. It is in the public interest to so license this invention as BioWorks, Inc. of Victor, New York has submitted a complete and sufficient application for a license. The prospective exclusive license will be royalty-bearing and will comply with the terms and conditions of 35 U.S.C. 209 and 37 CFR 404.7. The prospective exclusive license may be granted unless, within thirty (30) days from the date of this published Notice, the Agricultural Research Service receives written evidence and argument which establishes that the grant of the license would not be consistent with the requirements of 35 U.S.C. 209 and 37 CFR 404.7.
Animal and Plant Health Inspection Service, USDA.
Notice.
We are advising the public that we have added Moldova to the Animal and Plant Health Inspection Service (APHIS) list maintained on the APHIS Web site of regions considered affected with African swine fever (ASF). We are taking this action because of the confirmation of ASF in Moldova.
Mr. Donald Link, Microbiologist/Import Risk Analyst, National Import Export Services, VS, 920 Main Campus Drive, Suite 200, Raleigh, NC 27606; (919) 855-7731;
The regulations in 9 CFR part 94 (referred to below as the regulations) govern the importation of specified animals and animal products to prevent the introduction into the United States of various animal diseases, including rinderpest, foot-and-mouth disease, bovine spongiform encephalopathy, swine vesicular disease, classical swine fever, and African swine fever (ASF). These are dangerous and destructive diseases of ruminants and swine.
Sections 94.8 and 94.17 of part 94 of the regulations contain requirements governing the importation into the United States of pork and pork products from regions of the world where ASF exists or is reasonably believed to exist and imposes restrictions on the importation of pork and pork products into the United States from those regions. ASF is a highly contagious disease of wild and domestic swine that can spread rapidly in swine populations with extremely high rates of morbidity and mortality. A list of regions where ASF exists or is reasonably believed to exist is maintained on the Animal and Plant Health Inspection Service (APHIS) Web site at
APHIS receives notice of ASF outbreaks from veterinary officials of the exporting country, from the World Organization for Animal Health (OIE), or from other publically available sources the Administrator determines to be reliable. In a report dated October 4, 2016, the veterinary authorities of Moldova reported to the OIE confirmation of an ASF outbreak in the Donduseni District of Moldova.
Although Moldova does not currently export pork or pork products to the United States, APHIS has determined that it is necessary to impose restrictions on the importation of pork and pork products from Moldova into the United States. Therefore, in response to this outbreak, APHIS added Moldova to the list of regions where ASF exists or is reasonably believed to exist.
As a result, pork and pork products from Moldova are subject to APHIS import restrictions designed to mitigate the risk of ASF introduction into the United States. These restrictions are effective retroactively to October 4, 2016.
7 U.S.C. 450, 7701-7772, 7781-7786, and 8301-8317; 21 U.S.C. 136 and 136a; 31 U.S.C. 9701; 7 CFR 2.22, 2.80, and 371.4.
Animal and Plant Health Inspection Service, USDA.
Notice.
We are advising the public of our decision to authorize the importation into the continental United States of fresh star apple fruit from Vietnam. Based on the findings of a pest risk analysis, which we made available to the public for review and comment through a previous notice, we have determined that the application of one or more designated phytosanitary measures will be sufficient to mitigate the risks of introducing or disseminating plant pests or noxious weeds via the importation of fresh star apple fruit from Vietnam.
Effective January 19, 2017.
Mr. Tony Román, Senior Regulatory Policy Specialist, Regulatory Coordination and Compliance, PPQ, APHIS, 4700 River Road, Unit 133, Riverdale, MD 20737-1231; (301) 851-2242.
Under the regulations in “Subpart-Fruits and Vegetables” (7 CFR 319.56-1 through 319.56-76, referred to below as the regulations), the Animal and Plant Health Inspection Service (APHIS) of the U.S. Department of Agriculture prohibits or restricts the importation of fruits and vegetables into the United States from certain parts of the world to prevent plant pests from being introduced into and spread within the United States.
Section 319.56-4 of the regulations contains a performance-based process for approving the importation of commodities that, based on the findings of a pest risk analysis (PRA), can be safely imported subject to one or more of the designated phytosanitary measures listed in paragraph (b) of that section. Under that process, APHIS publishes a notice in the
In accordance with that process, we published a notice
We solicited comments on the notice for 60 days ending September 19, 2016. We received one comment by that date, from a manufacturing company.
One measure identified in the PRA is that all consignments of fresh star fruit from Vietnam imported into the continental United States will be required to be treated with irradiation prior to arrival in the United States. The commenter argued that the fresh star fruit should also be allowed to be treated after its arrival in the United States.
While it is true that the phytosanitary treatment regulations in 7 CFR 305.9(a)(1) state that, where certified irradiation facilities are available, an approved irradiation treatment may be conducted for any imported regulated article either prior to shipment to the United States or in the United States, this is a general statement of the types of treatment APHIS deems allowable. The particulars of any treatment are examined on an individual basis as part of a country's market access request. In their request, the national plant protection organization (NPPO) of Vietnam specifically stipulated that fresh star fruit be subject to a pre-clearance program within Vietnam. In considering this request, APHIS determined that Vietnam possesses sufficient infrastructure to meet an in-country treatment requirement.
The PRA also indicates that the fruit must be individually wrapped in plastic prior to shipment to reduce the risk of post-treatment reinfestation. The commenter observed that the PRA does not specify why fruits will be required to be packaged in this manner rather than using insect-proof cartons as described in 7 CFR 305.9(f)(2)(i)(A). The commenter argued that the fresh star fruit should be packed in insect-proof cartons rather than individually wrapped in keeping with the regulations.
Individually wrapping fruit is an effective phytosanitary mitigation measure, which takes the place of insect-proof cartons. This measure was specifically proposed by the NPPO of Vietnam in its market access request. Its phytosanitary efficacy was considered as part of the PRA conducted by APHIS. We determined that such individual wrapping provides equal phytosanitary protection to insect-proofing cartons and pallets.
Therefore, in accordance with the regulations in § 319.56-4(c)(2)(ii), we are announcing our decision to authorize the importation into the continental United States of fresh star apple fruit from Vietnam subject to the following phytosanitary measures:
• The fresh star apple fruit must be imported as commercial consignments only;
• Each consignment of fresh star apple fruit must be accompanied by a phytosanitary certificate issued by the NPPO of Vietnam;
• Each consignment of fresh star apple fruit must be treated in accordance with 7 CFR part 305; and
• Each consignment of fresh star apple fruit is subject to inspection upon arrival at the port of entry to the United States.
These conditions will be listed in the Fruits and Vegetables Import Requirements database (available at
7 U.S.C. 450, 7701-7772, and 7781-7786; 21 U.S.C. 136 and 136a; 7 CFR 2.22, 2.80, and 371.3.
Farm Service Agency, USDA.
Notice; request for comments.
In accordance with the Paperwork Reduction Act of 1995, the Farm Service Agency (FSA) is requesting comments from all interested individuals and organizations on an extension with a revision of a currently approved information collection that supports Direct Loan Servicing-Regular programs. The information is used to determine borrower compliance with loan agreements, assist the borrower in achieving business goals, and regular servicing of the loan account such as graduation, subordination, partial release, and use of proceeds.
We will consider comments that we receive by March 20, 2017.
We invite you to submit comments on this notice. In your comments, include date, volume, and page number, and the OMB control number and the title of the information collection of this issue of the
•
•
You may also send comments to the Desk Officer for Agriculture, Office of Information and Regulatory Affairs, Office of Management and Budget, Washington, DC 20503. Copies of the information collection may be requested by contacting J. Lee Nault at the above address.
J. Lee Nault, (202) 720-6834.
FSA is requesting OMB approval on the estimated numbers, which are being provided currently in this request. The burden hours have been increased by 5,968 hours while the annual responses have reduced by 6,531.
For the following estimated total annual burden on respondents, the formula used to calculate the total burden hours is the estimated average time per responses multiplied by the estimated total annual of responses.
We are requesting comments on all aspects of this information collection to help us to:
(1) Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
(2) Evaluate the accuracy of the agency's estimate of burden of the collection of information including the validity of the methodology and assumptions used;
(3) Evaluate the quality, utility and clarity of the information technology; and
(4) Minimize the burden of the information collection on those who respond through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology.
All comments received in response to this notice, including names and addresses where provided, will be made a matter of public record. Comments will be summarized and included in the request for OMB approval.
Farm Service Agency, USDA.
Notice; request for comment.
In accordance with the Paperwork Reduction Act of 1995, the Farm Service Agency (FSA) is requesting comments from all interested individuals and organizations on an extension with a revision of a currently approved information collection associated with the Guaranteed Farm Loan Program. The collected information is needed to make and service loans guaranteed by FSA to eligible farmers and ranchers by commercial lenders and nontraditional lenders. FSA is also requesting approval to merge the information collection for the EZ Guarantee Program and the Micro Lender Program (MLP) (0560-0288) into the Guaranteed Farm Loan Program.
We will consider comments that we receive by March 20, 2017.
We invite you to submit comments on this notice. In your comments, include date, volume, and page number of this issue of the
•
•
You may also send comments to the Desk Officer for Agriculture, Office of
Trent Rogers, Senior Loan Specialist, (202) 720-3889.
The estimated total annual burden hours are amended due to the EZ Guarantee Program and the Micro Lender Program (MLP), which reduced the information collection requirements. Therefore, the burden hours are being provided currently in this request for OMB approval. The annual responses have been reduced by 23,764 while the burden hours reduced by 33,340 hours in the request.
For the following estimated total annual burden on respondents, the formula used to calculate the total burden hours is the estimated average time per responses multiplied by the estimated total annual of responses.
We are requesting comments on all aspects of this information collection to help us to:
(1) Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
(2) Evaluate the accuracy of the agency's estimate of burden of the collection of information including the validity of the methodology and assumptions used;
(3) Evaluate the quality, utility and clarity of the information technology; and
(4) Minimize the burden of the information collection on those who respond through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology.
All comments received in response to this notice, including names and addresses where provided, will be made a matter of public record. Comments will be summarized and included in the request for OMB approval.
Office of the Deputy Under Secretary for Food Safety, USDA.
Notice of public meeting and request.
The Office of Food Safety, U.S. Department of Agriculture (USDA), and the Food and Drug Administration (FDA), U.S. Department of Health and Human Services are sponsoring a public meeting on February 21, 2017, from 9:00 a.m. to 12:00 noon. The objective of the public meeting is to provide information and receive public comments on agenda items and draft United States (U.S.) positions discussed at the 49th Session of the Codex Committee on Food Additives (CCFA) of the Codex Alimentarius Commission (Codex), taking place in Macao SAR, China March 20-24, 2017. The USDA Office of Food Safety and FDA recognize the importance of providing interested parties the opportunity to obtain background information on the 49th Session of the CCFA and to address items on the agenda.
The public meeting is scheduled for Tuesday, February 21, 2017, from 9:00 a.m. to 12:00 p.m.
The public meeting will take place in Rooms 1A-001 and 1A-002, The Food and Drug Administration (FDA), Harvey Wiley Federal Building, 5001 Campus Drive, College Park, MD 20740.
Documents related to the 49th Session of the CCFA will be accessible via the Internet at the following address:
The U.S. Delegate to the 49th Session of the CCFA, Paul Honigfort,invites interested U.S. parties to submit their comments electronically to the following email address:
For further information about the 49th Session of the CCFA contact: Paul Honigfort, Ph.D., Consumer Safety Officer, Division of Food Contact Notifications, Office of Food Additive Safety, U.S. Food and Drug Administration 5001 Campus Drive, College Park, MD 20740, Telephone: (240) 402-1206, Fax: (301) 436-2965, email:
Daniel E. Folmer, Ph.D., Review Chemist, Division of Petition Review, Office of Food Additive Safety, CFSAN/FDA HFS-265, 5001 Campus Drive, College Park, MD 20740, Telephone: (240) 402-1269, Fax: (301) 436-2972, email:
Codex was established in 1963 by two United Nations organizations, the Food and Agriculture Organization (FAO) and the World Health Organization (WHO).
Through adoption of food standards, codes of practice, and other guidelines developed by its committees, and by promoting their adoption and implementation by governments, Codex seeks to protect the health of consumers and ensure that fair practices are used in trade.
The CCFA establishes or endorses permitted maximum levels for individual food additives; prepares priority lists of food additives for risk assessment by the Joint FAO/WHO Expert Committee on Food Additives (JECFA); assigns functional classes and International Numbering System (INS) numbers to individual food additives; recommends specifications of identity and purity for food additives for adoption by Codex; considers methods of analysis for the determination of additives in food; and considers and elaborates standards or codes for related subjects such as labeling of food additives when sold as such. The CCFA is hosted by China.
The following items on the agenda for the 49th Session of the CCFA will be discussed during the public meeting:
Each issue listed will be fully described in documents distributed, or to be distributed, by the Codex Secretariat prior to the meeting. Members of the public may access these documents at
At the February 21, 2017 public meeting, draft U.S. positions on the agenda items will be described and discussed, and attendees will have the opportunity to pose questions and offer comments. Written comments may be offered at the meeting or sent to the U.S. Delegate for the 49th Session of the CCFA, Paul Honigfort, Ph.D. at the following address:
Public awareness of all segments of rulemaking and policy development is important. Consequently, in an effort to ensure that minorities, women, and persons with disabilities are aware of this notice, FSIS will announce it online through the FSIS Web page located at:
FSIS will also make copies of this
Options range from recalls to export information to regulations, directives, and notices. Customers can add or delete subscriptions themselves, and have the option to password protect their accounts.
No agency, officer, or employee of the USDA shall, on the grounds of race, color, national origin, religion, sex, gender identity, sexual orientation, disability, age, marital status, family/parental status, income derived from a public assistance program, or political beliefs, exclude from participation in, deny the benefits of, or subject to discrimination any person in the United States under any program or activity conducted by the USDA.
To file a complaint of discrimination, complete the USDA Program Discrimination Complaint Form, which may be accessed online at
Send your completed complaint form or letter to USDA by mail, fax, or email:
Persons with disabilities who require alternative means for communication (Braille, large print, audiotape, etc.) should contact USDA's TARGET Center at (202) 720-2600 (voice and TDD).
Forest Service, USDA.
Revised notice of intent to extend the scoping period for the Fossil Creek Wild and Scenic River Environmental Impact Statement and Comprehensive River Management Plan.
The Coconino and Tonto national forests published a Notice of Intent in the
Comments concerning the scope of the analysis must be received by January 27, 2017. The draft environmental impact statement is expected in summer 2017, and the final environmental impact statement is expected in spring 2018.
Send written comments via email to
Contact Marcos Roybal, Fossil Creek Project Coordinator, by email at
Individuals who use telecommunication devices for the deaf (TDD) may call the Federal Information Relay Service (FIRS) at 1 (800) 877-8339 between 8 a.m. and 8 p.m., Eastern Time, Monday through Friday.
The purpose of the project is to prepare a CRMP for the Fossil Creek Wild and Scenic River to meet the requirements of Section 3(d)(1) of the WSRA. The CRMP is needed to provide for the protection or enhancement of Fossil Creek's water quality, free-flowing condition, and its ORVs, and to fulfill WSRA Section 3(b) requirements to establish river corridor boundaries and recreation and wild segment classifications.
Since the decommissioning of a historic hydropower dam in 2005, public use dramatically increased as visitors sought to explore the heavily publicized Arizona landscape. Recreational use during the high-use season (June-September), for example, increased from an estimated 20,000 visitors in 2006 to approximately 80,000 visitors by 2013, with thousands turned away daily at the entrance barricades due to overcrowding. River values that need protection from impacts of recreational use include water quality, recreation, geology, Western Apache traditional and contemporary cultural values, and biological values (especially the high diversity of fish and wildlife species). Impacts have resulted from uncontrolled dispersed camping, creation of unapproved camp sites, creation of unplanned trail systems, excessive littering, and human waste near the creek. Monitoring since 2011 indicates there are increasing impacts to upland vegetation that is habitat for wildlife species; damage to heritage sites; and unsafe conditions for visitors, Forest Service personnel and emergency responders. In April 2016, an interim management reservation system was successfully implemented to reduce the daily capacity of visitors during the high-use season; this interim management reservation system will remain in place until the CRMP's completion.
The Coconino and Tonto National Forests propose to establish a CRMP to guide management of the designated 17-mile Fossil Creek Wild and Scenic River corridor and to protect or enhance the area's outstandingly remarkable values. Within a range of alternatives, the proposed action is designated to include the most flexibility to increase capacity and recreation infrastructure—maximizing recreation opportunities in the future—while providing protection for sensitive river and tribal values at the same time through both a management plan and site-specific actions. Project actions would address recreation capacity, corridor access, recreation facilities, services, and public health and safety.
During all or part of the year, a reservation system would manage visitor use by limiting the number of people at one time (PAOT) in the river corridor. The initial PAOT in the river corridor would be set at the current 2016 reservation management level—approximately 154 vehicles and 780 PAOT, including administrative use. Over time, if appropriate, adaptive management would increase capacity to a permitted maximum of approximately 338 vehicles and 1,705 PAOT if infrastructure is built, management capacity allows, and visitor behavior promotes sustainable river value protection. The proposed action also includes the following potential elements:
• Existing recreation sites would be expanded, particularly at the Irving site.
• Additional trails would be developed to link recreation sites and provide a greater variety of opportunities for a different hiking levels.
• A portion of Forest Road 708 would become a motorized trail.
• A limited amount of camping would be allowed at designated sites.
• Opportunities for outfitters/guides and concessionaries would be provided.
• Limited or no waterplay would exist at some creek locations due to cultural or natural resource issues.
• Some system routes would be closed or decommissioned, and other restoration actions would occur.
The existing Coconino and Tonto Forest Plans would be programmatically amended under the 2012 Planning Rule to incorporate management direction for the Fossil Creek WSR corridor. The proposed amendments would add, replace, delete or revise (as needed) direction for the management of the Wild and Scenic River corridor.
A range of alternatives to the proposed action, including a no action alternative and three additional action alternatives, are being considered. The no action alternative (Alternative A) represents no change (a CRMP would not be established) and serves as the baseline for comparison of the effects of the action alternatives. The four action alternatives, which are based on extensive public engagement that has occurred since 2010, include: Alternative B (Enhanced Protections), Alternative C (Non-motorized Experience), Alternative D (Motorized Use and Refugia), and Alternative E (Long-term Adaptive Management—
Arizona Game and Fish Department has cooperating agency status in order to assist the Coconino and the Tonto National Forests in the preparation of the Fossil Creek Wild and Scenic River CRMP and EIS.
Laura Jo West, the Forest Supervisor on the Coconino National Forest, is the responsible official.
Given the purpose and need of the project, the Coconino Forest Supervisor will review the proposed action, other alternatives, and the effects analysis in the EIS in order to determine: (1) Which alternative, or combination of alternatives, should be implemented; (2) what actions will be taken to protect and enhance the river's water quality, free-flowing condition and its ORVs, as required by WSRA; (3) the location and extent of infrastructure development, restoration activities, and changes in permitted visitor capacity; (4) the design features, mitigation measures and monitoring requirements; and, (5) consistency with the forest plans in place at the time of the decision and the need for amendments.
Since 2010, public involvement regarding management of the Fossil Creek Wild and Scenic River has informed key issues and the alternatives that have been developed. Three key issues have arisen: (1) Recreation opportunities and recreational impacts on natural and cultural resources; (2) the level of recreation development; and (3) public health and safety. These issues form the basis for the alternatives presented in this Notice.
The Notice of Intent published on November 29, 2016 initiated the scoping process, which guides the development of the environmental impact statement. Several scoping meetings have been held, and interested parties should check the Fossil Creek CRMP Web page at
This project is subject to the objection process pursuant to 36 CFR 218 and is not being authorized under the Healthy Forest Restoration Act (HFRA). As such, those who provide specific written comments during designated comment periods in accordance with 36 CFR 218.5 will be eligible to participate in the objection process. Issues raised in objections must be based on previously submitted timely, specific written comments regarding the proposed project unless new information arises after designated opportunities (36 CFR 218.7). Several previous scoping periods have occurred since 2010, and provide standing to object under 36 CFR 218 to those who commented during designated comment periods.
It is important that reviewers provide their comments at such times and in such manner that they are useful to the agency's preparation of the environmental impact statement. Therefore, comments should be provided prior to the close of the comment period and should clearly articulate the reviewer's concerns and contentions.
Comments received in response to this solicitation, including names and addresses of those who comment, will be part of the public record for this proposed action. Comments submitted anonymously will be accepted and considered, but will not be eligible for objection per 36 CFR 218.5.
Commission on Civil Rights.
Announcement of meeting.
Notice is hereby given, pursuant to the provisions of the rules and regulations of the U.S. Commission on Civil Rights (Commission), and the Federal Advisory Committee Act (FACA), that a briefing meeting of the Connecticut Advisory Committee to the Commission will convene at 9:30 a.m. (EST) on Tuesday, February 7, 2017, in the Old Judiciary Room of the Capitol Building, 210 Capitol Avenue, Hartford, CT 06106.
Tuesday, February 7, 2017 (EST). at 9:30 a.m.—Briefing Meeting and Public Session
Old Judiciary Room of the Capitol Building, 210 Capitol Avenue, Hartford, CT 06106.
Barbara Delaviez at
The purpose of the briefing meeting is to examine the issue of solitary confinement in Connecticut correctional facilities. The Committee will hear from elected officials, correction officials, advocates, former inmates, and family members of incarcerated prisoners. The public is invited to the meeting and encouraged to address the committee following the presentations.
If other persons who plan to attend the meeting require other accommodations, please contact Evelyn Bohor at
Time will be set aside at the end of the briefing so that members of the public may address the Committee after the formal presentations have been completed. Persons interested in the issue are also invited to submit written comments; the comments must be received in the regional office by Tuesday, March 7, 2017. Written comments may be mailed to the Eastern Regional Office, U.S. Commission on Civil Rights, 1331 Pennsylvania Avenue, Suite 1150, Washington, DC 20425, faxed to (202) 376-7548, or emailed to Evelyn Bohor at
Records and documents discussed during the meeting will be available for public viewing as they become available at
Economic Development Administration, Department of Commerce.
Notice and Opportunity for Public Comment.
Pursuant to Section 251 of the Trade Act 1974, as amended (19 U.S.C. 2341
Any party having a substantial interest in these proceedings may request a public hearing on the matter. A written request for a hearing must be submitted to the Trade Adjustment Assistance for Firms Division, Room 71030, Economic Development Administration, U.S. Department of Commerce, Washington, DC 20230, no later than ten (10) calendar days following publication of this notice.
Please follow the requirements set forth in EDA's regulations at 13 CFR 315.9 for procedures to request a public hearing. The Catalog of Federal Domestic Assistance official number and title for the program under which these petitions are submitted is 11.313, Trade Adjustment Assistance for Firms.
On September 13, 2016, MTD Consumer Group, Inc., submitted a notification of proposed production activity to the Foreign-Trade Zones (FTZ) Board for its facility within FTZ 158—Site 17, in Verona, Mississippi. The notification was processed in accordance with the regulations of the FTZ Board (15 CFR part 400), including notice in the
On September 14, 2016, Best Chairs, Inc. d/b/a Best Home Furnishings submitted a notification of proposed production activity to the Foreign-Trade Zones (FTZ) Board for its facility within FTZ 177—Sites 5, 6, and 7, in Ferdinand, Cannelton and Paoli, Indiana.
The notification was processed in accordance with the regulations of the FTZ Board (15 CFR part 400), including notice in the
Pursuant to its authority under the Foreign-Trade Zones Act of June 18, 1934, as amended (19 U.S.C. 81a-81u), the Foreign-Trade Zones Board (the Board) adopts the following Order:
The Board's Executive Secretary is authorized to finalize designation of a subzone for the use of SEA and the requested removal of acreage from Site 8 upon the applicant's submission to the Executive Secretary of documentary evidence of the applicant's having reestablished its corporate existence and a definitive map(s) and acreage figure for the portion(s) of proposed Site 9 to be designated as the subzone for the use of SEA. This action is subject to the FTZ Act and the Board's regulations, including Section 400.13.
STIHL Incorporated (STIHL) submitted a notification of proposed production activity to the FTZ Board for its facilities in Virginia Beach, Virginia within FTZ Subzone 20E. The notification conforming to the requirements of the regulations of the FTZ Board (15 CFR 400.22) was received on December 23, 2016.
STIHL already has authority to produce outdoor power products within Subzone 20E. The current request would add an additional foreign status component to the scope of authority. Pursuant to 15 CFR 400.14(b), additional FTZ authority would be limited to the specific foreign-status component described in the submitted notification (as described below) and subsequently authorized by the FTZ Board.
Production under FTZ procedures could exempt STIHL from customs duty payments on the foreign-status materials/components used in export production. On its domestic sales, STIHL would be able to choose the duty rates during customs entry procedures that apply to the blowers, trimmers, sprayers, cutters, cultivators and chain saws (duty rate free to 4.7%) for the foreign-status component noted below and in the existing scope of authority. Customs duties also could possibly be deferred or reduced on foreign-status production equipment. The additional component sourced from abroad is lithium ion batteries (duty rate 3.4%).
Public comment is invited from interested parties. Submissions shall be addressed to the Board's Executive Secretary at the address below. The closing period for their receipt is February 28, 2017.
A copy of the notification will be available for public inspection at the Office of the Executive Secretary, Foreign-Trade Zones Board, Room 21013, U.S. Department of Commerce, 1401 Constitution Avenue NW., Washington, DC 20230-0002, and in the “Reading Room” section of the Board's Web site, which is accessible via
For further information, contact Christopher Kemp at
Enforcement and Compliance, International Trade Administration, Department of Commerce.
The Department of Commerce (the Department) is notifying the public that the Court of International Trade's (CIT's or the Court's) final judgment in this case is not in harmony with the Department's final scope ruling. Therefore, the Department finds that neither the plain language of the scope nor an analysis of the scope language using the criteria outlined in the Department's regulations support a finding that seamless unfinished oil country tubular goods (OCTG) (
Effective December 3, 2016.
John Drury, AD/CVD Operations, Office VI, Enforcement and Compliance,
On February 7, 2014, the Department issued the
Accordingly, the Department issued the
In
In its decision in
Because there is now a final court decision with respect to the
This notice is issued and published in accordance with sections 516A(e)(1), 751(a)(1), and 777(i)(1) of the Act.
International Trade Administration, U.S. Department of Commerce.
Notice of an Open Meeting.
The United States Travel and Tourism Advisory Board (Board) will hold an open meeting via teleconference on Wednesday, February 1, 2017. The Board was re-chartered in August 2015 and advises the Secretary of Commerce on matters relating to the U.S. travel and tourism industry. The purpose of the meeting is for Board members to deliberate a letter to the Secretary with an overview of the Board and its activities to date under the current charter term. The final agenda will be posted on the Department of Commerce Web site for the Board at
Wednesday, February 1, 2017 3:00 p.m.-3:30 p.m. EST. The deadline for members of the public to register, including requests for auxiliary aids, or to submit written comments for dissemination prior to the meeting, is 5:00 p.m. EST on January 25, 2017.
The meeting will be held by conference call. The call-in number and passcode will be provided by email to registrants. Requests to register (including for auxiliary aids) and any written comments should be submitted to: U.S. Travel and Tourism Advisory Board, U.S. Department of Commerce, M-800, 1300 Pennsylvania Avenue NW., Washington, DC 20230,
Joe Holecko, the United States Travel and Tourism Advisory Board, M-800, 1300 Pennsylvania Avenue NW., Washington, DC 20230, telephone: 202-482-4783, email:
International Trade Administration (ITA).
Notice.
The Department of Commerce, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to take this opportunity to comment on proposed and/or continuing information collections, as required by the Paperwork Reduction Act of 1995.
Written comments must be submitted on or before March 20, 2017.
Direct all written comments to Jennifer Jessup, Departmental Paperwork Clearance Officer, Department of Commerce, Room 6616, 14th and Constitution Avenue NW., Washington, DC 20230 (or via the Internet at
Requests for additional information or copies of the information collection instrument and instructions should be directed to David Ritchie, Department of Commerce, International Trade Administration, Room 20001, 1401 Constitution Avenue NW., Washington, DC, (or via the Internet at
The United States and Switzerland share the goal of enhancing privacy protection for their citizens, but take different approaches to protecting personal data. Given those differences, the Department of Commerce (DOC) developed the Swiss-U.S. Privacy Shield Framework (Privacy Shield) in consultation with the Swiss Administration, as well as with industry and other stakeholders, to provide organizations in the United States with a reliable mechanism for personal data transfers to the United States from Switzerland while ensuring the protection of the data as required by Swiss law.
On January 12, 2017, the Swiss Administration deemed the Privacy Shield Framework adequate to enable data transfers under Swiss law. To provide organizations the time needed to review the Privacy Shield Principles and the commitment that they entail, the DOC will begin accepting self-certification submissions from organizations on April 12, 2017. More information on the Privacy Shield is available at:
The DOC has issued the Privacy Shield Principles under its statutory authority to foster, promote, and develop international commerce (15 U.S.C. 1512). The International Administration (ITA) administers and supervises the Privacy Shield, including by maintaining and making publicly available an authoritative list of U.S. organizations that have self-certified to the DOC. U.S. organizations submit information to ITA to self-certify their compliance with Privacy Shield.
U.S. organizations considering self-certifying to the Privacy Shield should review the Privacy Shield Framework. In summary, in order to enter the Privacy Shield, an organization must (a) be subject to the investigatory and enforcement powers of the Federal Trade Commission (FTC), the Department of Transportation, or another statutory body that will effectively ensure compliance with the Principles; (b) publicly declare its commitment to comply with the Principles; (c) publicly disclose its privacy policies in line with the Principles; and (d) fully implement them.
Self-certification to the DOC is voluntary; however, an organization's failure to comply with the Principles after its self-certification is enforceable under Section 5 of the Federal Trade Commission Act prohibiting unfair and
In order to rely on the Privacy Shield for transfers of personal data from Switzerland, an organization must self-certify its adherence to the Principles to the DOC, be placed by ITA on the Privacy Shield List, and remain on the Privacy Shield List. To self-certify for the Privacy Shield, an organization must provide to the DOC a self-certification submission that contains the information specified in the Privacy Shield Principles. The Privacy Shield self-certification form would be the means by which an organization would provide the relevant information to ITA.
ITA has committed to follow up with organizations that have been removed from the Privacy Shield List. ITA will send questionnaires to organizations that fail to complete the annual certification or who have withdrawn from the Privacy Shield to verify whether they will return, delete, or continue to apply the Principles to the personal information that they received while they participated in the Privacy Shield, and if personal information will be retained, verify who within the organization will serve as an ongoing point of contact for Privacy Shield-related questions.
In addition, ITA has committed to conduct compliance reviews on an ongoing basis, including through sending detailed questionnaires to participating organizations. In particular, such compliance reviews shall take place when: (a) The DOC has received specific non-frivolous complaints about an organization's compliance with the Principles, (b) an organization does not respond satisfactorily to inquiries by the DOC for information relating to the Privacy Shield, or (c) there is credible evidence that an organization does not comply with its commitments under the Privacy Shield.
The proposed information collection for the Swiss-U.S. Privacy Shield Framework is substantially similar to the previously approved information collection for the EU-U.S. Privacy Shield Framework (OMB Control Number: 0625-0276).
The Privacy Shield self-certification is submitted electronically by organizations through the DOC's Privacy Shield Web site (
Comments are invited on: (a) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; (b) the accuracy of the agency's estimate of the burden (including hours and cost) of the proposed collection of information; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology.
Comments submitted in response to this notice will be summarized and/or included in the request for OMB approval of this information collection; they also will become a matter of public record.
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Notice; notification of quota for bowhead whales.
NMFS notifies the public of the aboriginal subsistence whaling quota for bowhead whales that it has assigned to the Alaska Eskimo Whaling Commission (AEWC), and of limitations on the use of the quota deriving from regulations of the International Whaling Commission (IWC). For 2017, the quota is 75 bowhead whales struck. This quota and other applicable limitations govern the harvest of bowhead whales by members of the AEWC.
Effective January 19, 2017.
Office for International Affairs and Seafood Inspection, National Marine Fisheries Service, 1315 East-West Highway, Silver Spring, MD 20910.
Carolyn Doherty, (301) 427-8385.
Aboriginal subsistence whaling in the United States is governed by the Whaling Convention Act (WCA) (16 U.S.C. 916
At the 64th Annual Meeting of the IWC, the Commission set catch limits for aboriginal subsistence use of bowhead whales from the Bering-Chukchi-Beaufort Seas stock. The bowhead catch limits were based on a joint request by the United States and the Russian Federation, accompanied by documentation concerning the needs of two Native groups: Alaska Eskimos and Chukotka Natives in the Russian Far East.
The IWC set a 6-year block catch limit of 336 bowhead whales landed. For each of the years 2013 through 2018, the number of bowhead whales struck may not exceed 67, except that any unused portion of a strike quota from any prior year may be carried forward. No more than 15 strikes may be added to the strike quota for any one year. At the end of the 2016 harvest, there were 15 unused strikes available for carry-forward, so the combined strike quota set by the IWC for 2017 is 82 (67 + 15).
An arrangement between the United States and the Russian Federation ensures that the total quota of bowhead whales landed and struck in 2017 will not exceed the limits set by the IWC. Under this arrangement, the Russian natives may use no more than seven
Through its cooperative agreement with the AEWC, NOAA has assigned 75 strikes to the Alaska Eskimos. The AEWC will in turn allocate these strikes among the 11 villages whose cultural and subsistence needs have been documented, and will ensure that its hunters use no more than 75 strikes.
The IWC regulations, as well as the NOAA regulation at 50 CFR 230.4(c), forbid the taking of calves or any whale accompanied by a calf.
NOAA regulations (at 50 CFR 230.4) contain a number of other prohibitions relating to aboriginal subsistence whaling, some of which are summarized here:
• Only licensed whaling captains or crew under the control of those captains may engage in whaling.
• Captains and crew must follow the provisions of the relevant cooperative agreement between NOAA and a Native American whaling organization.
• The aboriginal hunters must have adequate crew, supplies, and equipment to engage in an efficient operation.
• Crew may not receive money for participating in the hunt.
• No person may sell or offer for sale whale products from whales taken in the hunt, except for authentic articles of Native American handicrafts.
• Captains may not continue to whale after the relevant quota is taken, after the season has been closed, or if their licenses have been suspended. They may not engage in whaling in a wasteful manner.
Take notice that the Commission has received the following Natural Gas Pipeline Rate and Refund Report filings:
Any person desiring to intervene or protest in any of the above proceedings must file in accordance with Rules 211 and 214 of the Commission's Regulations (18 CFR 385.211 and 385.214) on or before 5:00 p.m. Eastern time on the specified comment date. Protests may be considered, but intervention is necessary to become a party to the proceeding.
Any person desiring to protest in any of the above proceedings must file in accordance with Rule 211 of the Commission's Regulations (18 CFR 385.211) on or before 5:00 p.m. Eastern time on the specified comment date.
The filings are accessible in the Commission's eLibrary system by clicking on the links or querying the docket number.
eFiling is encouraged. More detailed information relating to filing requirements, interventions, protests, service, and qualifying facilities filings can be found at:
Take notice that the Commission has received the following Natural Gas Pipeline Rate and Refund Report filings:
The filings are accessible in the Commission's eLibrary system by clicking on the links or querying the docket number.
Any person desiring to intervene or protest in any of the above proceedings must file in accordance with Rules 211 and 214 of the Commission's Regulations (18 CFR 385.211 and 385.214) on or before 5:00 p.m. Eastern time on the specified comment date. Protests may be considered, but intervention is necessary to become a party to the proceeding.
eFiling is encouraged. More detailed information relating to filing requirements, interventions, protests, service, and qualifying facilities filings can be found at:
Take notice that on December 30, 2016, Texas Eastern Transmission, LP (Texas Eastern), 5400 Westheimer Court, Houston, Texas 77056, filed an amendment to its application in Docket No. CP15-499-000, pursuant to section 7(c) of the Natural Gas Act (NGA) and Part 157 of the Commission's regulations for its proposed South Texas Expansion Project (Project). Specifically, Texas Eastern requests, in addition to the authorizations requested in the previous application, authorization to (i) construct, install, own, operate, and maintain new gas release measurement equipment and associated enclosures at its existing Vidor and Mont Belvieu Compressor Stations in Orange and Chambers Counties, Texas, respectively, and at its proposed Petronila Compressor Station in Nueces County, Texas, new gas coolers at its existing Blessing Compressor Station in Matagorda County, Texas, and a new tie-in to Pomelo Connector at Texas Eastern's proposed Petronila Compressor Station; (ii) acquire, by lease, 400,000 dekatherms per day (Dth/d) of capacity on Pomelo Connector, LLC's proposed pipeline; (iii) change the Project's targeted in-service date from May 1, 2017 to October 1, 2018; (iv) change the Project's capacity from 400,000 Dth/d to 396,000 Dth/d; and (v) remove from the Project's scope the meter and regulating station at the proposed Petronila Compressor Station. Texas Eastern further proposes to amend its incremental project recourse rate and to modify its Exhibit K, all as more fully set forth in the application which is on file with the Commission and open to public inspection. The filing may be viewed on the web at
Any questions concerning these applications may be directed to Berk Donaldson, General Manager, Rates & Certificates, Texas Eastern Transmission, LP, P.O. Box 1642, Houston, Texas 77251-1642, by telephone at (713) 627-4488, or by fax at (713) 627-5947.
Pursuant to section 157.9 of the Commission's rules, 18 CFR 157.9, within 90 days of this Notice the Commission staff will either: Complete its environmental analysis (EA) and place it into the Commission's public record (eLibrary) for this proceeding, or issue a Notice of Schedule for Environmental Review. If a Notice of Schedule for Environmental Review is issued, it will indicate, among other milestones, the anticipated date for the Commission staff's issuance of the EA for this proposal. The filing of the EA in the Commission's public record for this proceeding or the issuance of a Notice of Schedule will serve to notify federal and state agencies of the timing for the completion of all necessary reviews, and the subsequent need to complete all federal authorizations within 90 days of the date of issuance of the Commission staff's EA.
There are two ways to become involved in the Commission's review of this project. First, any person wishing to obtain legal status by becoming a party to the proceedings for this project should, on or before the comment date stated below, file with the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426, a motion to intervene in accordance with the requirements of the Commission's Rules of Practice and Procedure (18 CFR 385.214 or 385.211) and the Regulations under the NGA (18 CFR 157.10). A person obtaining party status will be placed on the service list maintained by the Secretary of the Commission and will receive copies of all documents filed by the applicant and by all other parties. A party must submit 5 copies of filings made with the Commission and must mail a copy to the applicant and to every other party in the proceeding. Only parties to the proceeding can ask for court review of Commission orders in the proceeding.
However, a person does not have to intervene in order to have comments considered. The second way to participate is by filing with the Secretary of the Commission, as soon as possible, an original and two copies of comments in support of or in opposition to this project. The Commission will consider these comments in determining the appropriate action to be taken, but the filing of a comment alone will not serve to make the filer a party to the proceeding. The Commission's rules require that persons filing comments in opposition to the project provide copies of their protests only to the party or parties directly involved in the protest.
Persons who wish to comment only on the environmental review of this project should submit an original and two copies of their comments to the Secretary of the Commission. Environmental commenters will be placed on the Commission's environmental mailing list, will receive copies of the environmental documents, and will be notified of meetings associated with the Commission's environmental review process. Environmental commenters will not be required to serve copies of filed documents on all other parties. However, the non-party commenters will not receive copies of all documents filed by other parties or issued by the Commission (except for the mailing of environmental documents issued by the Commission) and will not have the right to seek court review of the Commission's final order.
The Commission strongly encourages electronic filings of comments, protests and interventions in lieu of paper using the “eFiling” link at
Take notice that on January 12, 2016, Midcontinent Independent System Operator, Inc. submitted tariff filing per: Refund Report to be effective N/A, pursuant to the Federal Energy Regulatory Commission's (Commission) Order issued on October 4, 2016.
Any person desiring to intervene or to protest this filing must file in accordance with Rules 211 and 214 of the Commission's Rules of Practice and Procedure (18 CFR 385.211, 385.214). Protests will be considered by the Commission in determining the appropriate action to be taken, but will not serve to make protestants parties to the proceeding. Any person wishing to become a party must file a notice of intervention or motion to intervene, as appropriate. Such notices, motions, or protests must be filed on or before the comment date. On or before the comment date, it is not necessary to serve motions to intervene or protests on persons other than the Applicant.
The Commission encourages electronic submission of protests and interventions in lieu of paper using the “eFiling” link at
This filing is accessible on-line at
Take notice that the Commission received the following electric rate filings:
The filings are accessible in the Commission's eLibrary system by clicking on the links or querying the docket number.
Any person desiring to intervene or protest in any of the above proceedings must file in accordance with Rules 211 and 214 of the Commission's Regulations (18 CFR 385.211 and 385.214) on or before 5:00 p.m. Eastern time on the specified comment date. Protests may be considered, but intervention is necessary to become a party to the proceeding.
eFiling is encouraged. More detailed information relating to filing requirements, interventions, protests, service, and qualifying facilities filings can be found at:
Take notice that on December 22, 2016, pursuant to section 385.207(a)(4) of the Federal Energy Regulatory Commission's (Commission) Rules of Practice and Procedure, 18 CFR 385.207(a) (2016), and sections 366(b)(1), 366.3(d), and 366.4(b)(3) of Commission's regulations under the Public Utility Holding Company Act of
Any person desiring to intervene or to protest in this proceeding must file in accordance with Rules 211 and 214 of the Commission's Rules of Practice and Procedure (18 CFR 385.211 and 385.214) on or before 5:00 p.m. Eastern time on the specified comment date. Protests will be considered by the Commission in determining the appropriate action to be taken, but will not serve to make protestants parties to the proceeding. Any person wishing to become a party must file a notice of intervention or motion to intervene, as appropriate. Such notices, motions, or protests must be filed on or before the comment date. Anyone filing a motion to intervene or protest must serve a copy of that document on the Petitioner.
The Commission encourages electronic submission of protests and interventions in lieu of paper, using the FERC Online links at
Persons unable to file electronically should submit an original and 5 copies of the intervention or protest to the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426.
The filings in the above proceeding are accessible in the Commission's eLibrary system by clicking on the appropriate link in the above list. They are also available for review in the Commission's Public Reference Room in Washington, DC. There is an eSubscription link on the Web site that enables subscribers to receive email notification when a document is added to a subscribed docket(s). For assistance with any FERC Online service, please email
Take notice that the following hydroelectric application has been filed with the Commission and is available for public inspection:
a.
b.
c.
d.
e.
f.
g.
h.
i.
j.
All documents may be filed electronically via the Internet. See, 18 CFR 385.2001(a)(1)(iii) and the instructions on the Commission's Web site at
Please include the project number, P-2611-084, on any comments, motions, or protests filed.
k.
l.
m. Individuals desiring to be included on the Commission's mailing list should so indicate by writing to the Secretary of the Commission.
n.
o.
Environmental Protection Agency (EPA).
Notice of availability.
As part of its mission to protect human health and the environment, the Environmental Protection Agency publishes protective action guides (PAGs) to help federal, state, local and tribal emergency response officials make radiation protection decisions during emergencies. EPA, in coordination with a multi-agency working group within the Federal Radiological Preparedness Coordinating Committee, recently updated its guidance manual on this topic, titled “Protective Action Guides and Planning Guidance for Radiological Incidents” (referred to herein as the PAG Manual). On December 8, 2016, EPA announced availability of the updated 2016 PAG Manual in the
Samuel Hernandez, Standards and Risk Management Division, Office of Ground Water and Drinking Water, Mail Code 4607M, U.S. Environmental Protection Agency, 1200 Pennsylvania Avenue NW., Washington, DC 20460; telephone number: (202) 564-1735; email:
The historical and legal basis of EPA's role in the PAG Manual begins with the Reorganization Plan No. 3 of 1970, in which the Administrator of the EPA assumed all the functions of the Federal Radiation Council (FRC), including the charge to “. . . advise the President with respect to radiation matters, directly or indirectly affecting health, including guidance for all federal agencies in the formulation of radiation standards and in the establishment and execution of programs of cooperation with [s]tates.” (Reorg. Plan No. 3 of 1970, section 2(a) (7), 6(a) (2); § 274.h of the Atomic Energy Act of 1954, as amended (AEA), codified at 42 U.S.C. 2021(h)). Recognizing this role, the Federal Emergency Management Agency (FEMA) directed EPA, in its Radiological Emergency Planning and Preparedness Regulations, to “establish Protective Action Guides (PAGs) for all aspects of radiological emergency planning in coordination with appropriate federal agencies.” (44 CFR 351.22(a)). FEMA also tasked EPA with preparing “guidance for state and local governments on implementing PAGs, including recommendations on protective actions which can be taken to mitigate the potential radiation dose to the population.” (44 CFR 351.22(b)). All of this information was to “be presented in the Environmental Protection Agency (EPA) `Manual of Protective Action Guides and Protective Actions for Nuclear Incidents.' ” (44 CFR 351.22(b)).
Additionally, section 2021(h) charged the Administrator with performing “such other functions as the President may assign to him [or her] by Executive Order.” Executive Order 12656 states that the Administrator shall “[d]evelop, for national security emergencies, guidance on acceptable emergency levels of nuclear radiation. . . .” (Executive Order No. 12656, section 1601(2)). EPA's role in PAGs development was recognized by the
The PAG Manual provides federal, state and local emergency management officials with guidance for responding to radiological emergencies. A protective action guide is the projected dose to an individual from a release of radioactive material at which a specific protective action to reduce or avoid that dose is recommended. Emergency management officials use PAGs for making decisions regarding actions to protect the public from exposure to radiation during an emergency. Such actions include, but are not limited to, evacuation, shelter-in-place, temporary relocation and food restrictions.
Development of the PAGs was based on the following essential principles, which also apply to the selection of any protective action during an incident:
• Prevent acute effects.
• Balance protection with other important factors and ensure that actions result in more benefit than harm.
• Reduce risk of chronic effects.
The PAG Manual is not a legally binding regulation or standard and does not supersede any environmental laws. This guidance does not address or impact site cleanups occurring under other statutory authorities such as the EPA's Superfund program, the Nuclear Regulatory Commission's (NRC) decommissioning program, or other federal or state cleanup programs. As indicated by the use of non-mandatory language such as “may,” “should” and “can,” the PAG Manual only provides recommendations and does not confer any legal rights or impose any legally binding requirements upon any member of the public, states or any other federal agency. Rather, the PAG Manual recommends projected radiation doses at which specific actions may be warranted in order to reduce or avoid that dose. The PAG Manual is designed to provide flexibility to be more or less restrictive as deemed appropriate by decision makers based on the unique characteristics of the incident and the local situation.
PAGs do not represent “acceptable” routine exposure in the way that regulatory standards such as maximum contaminant levels do. PAGs are guidance levels to support emergency decision making by response authorities to avoid unnecessary radiation exposure. Development and implementation of PAGs is always guided by three basic principles: Prevent acute effects, balance protection with other important factors and ensure that actions result in more benefit than harm, and reduce risk of chronic effects.
On June 10, 2016, EPA published a
In response, EPA received over 60,000 comment letters from members of the public, state and local emergency response and health organizations, environmental advocates, industry associations and other stakeholders. Most of the comment letters expressed concerns with the proposed guidance. Commenters wrote that the proposed guidance could weaken the regulatory requirements of the Safe Drinking Water Act. In addition, environmental advocacy organizations indicated that the drinking water PAG dose levels were too high and insufficient to be protective of human health, and asked EPA to withdraw the proposed guidance and, in its place, use the National Primary Drinking Water Regulations for Radionuclides as the basis for any emergency response measures regarding drinking water.
Commenters also asserted that the proposed drinking water PAG did not conform to the National Environmental Policy Act (NEPA) as well as other regulations dealing with cleanup and waste management of radioactive contaminants. Commenters expressed doubts regarding the duration that the drinking water PAG would be implemented after an incident, claiming that the drinking water PAG could be in place for timeframes exceeding one year.
In response to comments, EPA has amended the drinking water guidance to emphasize, with regards to the scope of the drinking water PAG recommendations, that they are only intended to apply to nationally significant radiological contamination incidents, such as a disaster at a nuclear power plant, a radiological dispersal device or an improvised nuclear device, and for a duration that may last for weeks to months but not longer than one year.
Some commenters expressed concerns that PAGs would weaken drinking water standards and regulations. Environmental regulations or standards are legal limits designed to minimize health effects from everyday exposure to low levels of radiation over long periods. The PAG levels are guidance for emergency situations; they do not supplant any standards or regulations, nor do they affect the stringency or enforcement of any standards or regulations. The PAG levels are intended to be used only in an emergency when radiation levels have already exceeded environmental standards. The PAG levels trigger public safety measures to minimize radiation exposures during an emergency.
To develop guidance on drinking water considerations, EPA based its assessment on assumptions limiting exposures to a one-year timeframe. EPA expects that the responsible party for any drinking water system adversely impacted during a radiation incident will take action to return to compliance with Safe Drinking Water Act levels as soon as practicable.
The National Primary Drinking Water Regulations establish regulatory limits designed to minimize health effects from everyday exposure to low levels of radiation over long periods; those limits are not changing with this action. Emergency guides are temporary measures to minimize risk while enabling distribution of limited resources during an emergency response.
Estimated risk of excess cancer cases for lifetime exposure (70 years) to beta emitting radioactive contaminants in drinking water at 4 mrem/yr (the MCL) generally falls in a range of risks deemed acceptable by EPA. Estimated risks associated for a shorter (one-year) exposure to radioactivity in drinking water at the proposed PAG levels fall within a similar risk range.
The drinking water PAG meets NEPA policy goals because it is based on analyses, documentation and review procedures that are functionally equivalent to NEPA. “Activities for the development of federal radiation regulations and guidance in accordance with the Atomic Energy Act of 1954 are functionally equivalent to NEPA” (63 FR 58045, October 29, 1998).
Commenters questioned whether the EPA considered cumulative effects in developing the drinking water PAG. In developing the PAG Manual, EPA considered the potential for cumulative exposure from multiple exposure pathways including: plume inhalation, immersion, ground shine, drinking water ingestions and food, among others. However, EPA has determined that for implementation purposes, it is impractical to compartmentalize joint protective actions, since allocations of dose to different segments of the population based on individual exposure routes will depend on site-specific circumstances and are impossible to quantify. While the PAGs for the various pathways are separate, emergency management officials should consider all relevant exposure routes when making protective action decisions in an emergency. In addition, incident-specific factors like geographical location, ongoing weather, the isotopes released and population affected should be considered after a contamination event, and specific exposure routes should be identified to allow different types of protective actions to be aimed at the specific risks to be avoided.
Several commenters from state emergency management agencies and radiation control programs expressed support for EPA's proposal, stating that the guidance was well developed and technically sound; and that the incorporation of the drinking water PAG into the PAG Manual is a critical aspect of a coordinated emergency response after a radiation contamination incident.
Some commenters suggested that while they support the incorporation of the drinking water PAG, they believe the proposed PAG was too conservative and that EPA should consider establishing the PAG in the 2,000 to 10,000 mrem range.
EPA believes that the drinking water PAG should be consistent with and within the range of currently available guidance for other exposure pathways during the intermediate phase. Also, when possible, the drinking water PAG recommendations should be based on an additional level of protection to sensitive life-stages. For short-term incidents, as explained in the PAG Manual, it is appropriate to have a 500 mrem PAG level for drinking water for the general population and a lower-tier PAG level of 100 mrem for persons at sensitive life-stages, including pregnant women, nursing women, and children 15 years old and under. This approach of setting a two-tier level of protection incorporates suggestions submitted by commenters regarding the adequate consideration of children and sensitive subpopulations.
There is an abundance of caution built into the derivation of the drinking water PAG through a variety of assumptions, including conservative dose-response modeling; selection of the most sensitive life stages to derive the PAG for children through age 15 years; and, the assumption of no decay of isotopes over the calculated one-year exposure period, which may be appropriate in some situations. This action ensures that the protective measures it recommends are appropriate for all members of the public, including sensitive subpopulations.
Emergency management and radiation protection organizations that use the PAGs in their emergency plans are encouraged to incorporate this updated guidance as soon as possible. This may entail training, as well as the update of plans and procedures. Outreach and technical training will be conducted by EPA, the Federal Radiological Monitoring and Assessment Center and interagency partners of the PAG Subcommittee. FEMA expects certain organizations associated with nuclear power plant operations to use the PAG Manual in developing their emergency management plans. FEMA plans to begin using the new PAG Manual during their evaluation of offsite response organizations around nuclear power facilities 12 months after the publication of this document in the
For further information and related guidelines, see the EPA Web site:
Environmental Protection Agency.
Notice of decision.
The Environmental Protection Agency (“EPA”) is granting the California Air Resources Board (“CARB”) its request for an authorization of its amendments to its Commercial Harbor Craft regulations (“CHC Amendments”). EPA is also confirming that certain CHC amendments are within the scope of a prior EPA authorization. CARB's CHC Amendments primarily subject diesel-fueled engines on crew and supply, barge and dredge vessels to the in-use engine emission requirements of the original CHC regulations; allow CARB or EPA Tier 2 or higher tier certified off-road (“nonroad”) engines to be used as auxiliary or propulsion engines in both new and in-use CHC vessels; and clarify requirements and address certain issues that have arisen during CARB's implementation of the original CHC regulations. This decision is issued under the authority of the Clean Air Act (“CAA” or “Act”).
Petitions for review must be filed by March 20, 2017.
EPA has established a docket for this action under Docket ID EPA-HQ-OAR-2014-0534. All documents relied upon in making this decision, including those submitted to EPA by CARB, are contained in the public docket. Publicly available docket materials are available either electronically through
EPA's Office of Transportation and Air Quality (“OTAQ”) maintains a Web page that contains general information on its review of California waiver requests. Included on that page are links to prior waiver
David Dickinson, Attorney-Advisor, Transportation Climate Division, Office of Transportation and Air Quality, U.S. Environmental Protection Agency, 1200 Pennsylvania Avenue (6405J), NW., Washington, DC 20460. Telephone: (202) 343-9256. Fax: (202) 343-2800. Email:
EPA granted an authorization for California's initial set of CHC regulations on December 5, 2011.
In a letter dated May 28, 2014, CARB submitted to EPA its request pursuant to section 209(e) of the CAA, regarding authorization of its amendments to California's CHC regulations to reduce emissions from diesel engines on commercial harbor craft (“CHC Amendments”).
The CHC Amendments set forth a variety of in-use requirements, including extending the applicability of the CHC regulations to in-use crew and supply, barge, and dredge vessels that are equipped with federal Tier 0 and Tier 1 propulsion and auxiliary marine engines that operate within the Regulated California Waters.
CARB's CHC Amendments also include requirements that are applicable to both new and in-use engines. The original CHC regulation provided that new or in-use diesel propulsion or auxiliary engines for in-use harbor craft could not be sold, offered for sale, leased, rented, or acquired unless the engines were certified to at least federal Tier 2 or Tier 3 marine emission standards for a new engine of the same power rating and displacement in effect at the time of the aforementioned actions. The amendments now provide compliance flexibility to CHC owners or operators with the option of using EPA or CARB Tier 2 or higher tier certified off-road engines provided the engine or vessel manufacturer has complied with the provisions of 40 CFR 1042.605, which establishes requirements for marinized land-based engines.
California requested that EPA perform two types of review. First, CARB requested an EPA determination that certain provisions of the CHC Amendments are within the scope of a prior authorization issued by EPA, or in the alternative, merit full authorization (“Within-the-Scope Amendments”). CARB includes as part of the Within-the-Scope Amendments: The provisions allowing use of EPA or CARB certified off-road CI engines to comply with the new and in-use requirements for propulsion and/or auxiliary engines; the amendments that subject CHC engines registered and permitted by local air pollution districts prior to January 1, 2009, CHC auxiliary engines registered to CARB's PERP prior to January 1, 2009, and CHC auxiliary engines not permanently affixed to the vessel and registered in PERP on or after January 1, 2009 to the CHC Regulation; and the amendments that clarify swing engines are replacement engines subject to the CHC regulation's in-use requirements, along with the exemptions for replacement engines in in-use CHC vessels, the allowance of the use of existing engines to replace an older engine subject to in-use requirements, and the expansion of the availability of compliance extensions for CHC vessel fleets.
Second, CARB requests full authorization for amendments that establish new requirements (“Full Authorization Amendments”). The Full Authorization Amendments pertain to the new provisions establishing in-use requirements applicable to crew and supply, barge, and dredge vessels. The amendments extend the applicability of the previous requirement that specified categories of CHC vessels (ferries, excursions vessels tugboats, towboats, push boats, and multipurpose harbor craft) to meet emission limits equal to or cleaner than federal Tier 2 or Tier 3 new marine engine emission standards, as applicable and in effect for the year that in-use engine compliance is required under the compliance schedule set forth within the regulation.
Section 209(e)(1) of the Act permanently preempts any state, or political subdivision thereof, from adopting or attempting to enforce any standard or other requirement relating to the control of emissions for certain new nonroad engines or vehicles.
On July 20, 1994, EPA promulgated a rule interpreting the three criteria set forth in section 209(e)(2)(A) that EPA must consider before granting any California authorization request for nonroad engine or vehicle emission standards.
In order to be consistent with section 209(a), California's nonroad standards and enforcement procedures must not apply to new motor vehicles or new motor vehicle engines. To be consistent with section 209(e)(1), California's nonroad standards and enforcement procedures must not attempt to regulate engine categories that are permanently preempted from state regulation. To determine consistency with section 209(b)(1)(C), EPA typically reviews nonroad authorization requests under the same “consistency” criteria that are applied to motor vehicle waiver requests under section 209(b)(1)(C). That provision provides that the Administrator shall not grant California a motor vehicle waiver if she finds that California “standards and accompanying enforcement procedures are not consistent with section 202(a)” of the Act. Previous decisions granting waivers and authorizations have noted that state standards and enforcement procedures will be found to be inconsistent with section 202(a) if (1) there is inadequate lead time to permit the development of the necessary technology, giving appropriate consideration to the cost of compliance within that time,
In light of the similar language in sections 209(b) and 209(e)(2)(A), EPA has reviewed California's requests for authorization of nonroad vehicle or engine standards under section 209(e)(2)(A) using the same principles that it has historically applied in reviewing requests for waivers of preemption for new motor vehicle or new motor vehicle engine standards under section 209(b).
The law makes it clear that the waiver requests cannot be denied unless the specific findings designated in the statute can properly be made. The issue of whether a proposed California requirement is likely to result in only marginal improvement in California air quality not commensurate with its costs or is otherwise an arguably unwise exercise of regulatory power is not legally pertinent to my decision under section 209, so long as the California requirement is consistent with section 202(a) and is more stringent than applicable Federal requirements in the sense that it may result in some further reduction in air pollution in California.
This principle of narrow EPA review has been upheld by the U.S. Court of Appeals for the District of Columbia Circuit.
If California amends regulations that were previously authorized by EPA, California may ask EPA to determine that the amendments are within the scope of the earlier authorization. A within-the-scope determination for such amendments is permissible without a full authorization if three conditions are met. First, the amended regulations must not undermine California's previous determination that its standards, in the aggregate, are as protective of public health and welfare as applicable federal standards. Second, the amended regulations must not affect consistency with section 209 of the Act, following the same criteria discussed above in the context of full authorizations. Third, the amended regulations must not raise any “new issues” affecting EPA's prior authorizations.
In previous waiver and authorization decisions, EPA has recognized that the intent of Congress in creating a limited review based on the section 209(b)(1) criteria was to ensure that the federal government did not second-guess state policy choices. As the agency explained in one prior waiver decision:
It is worth noting . . . I would feel constrained to approve a California approach to the problem which I might also feel unable to adopt at the federal level in my own capacity as a regulator. The whole approach of the Clean Air Act is to force the development of new types of emission control technology where that is needed by compelling the industry to “catch up” to some degree with newly promulgated standards. Such an approach . . . may be attended with costs, in the shape of reduced product offering, or price or fuel economy penalties, and by risks that a wider number of vehicle classes may not be able to complete their development work in time. Since a balancing of these risks and costs against the potential benefits from reduced emissions is a central policy decision for any regulatory agency under the statutory scheme outlined above, I believe I am required to give very substantial deference to California's judgments on this score.
Similarly, EPA has stated that the text, structure, and history of the California waiver provision clearly indicate both a congressional intent and appropriate EPA practice of leaving the decision on “ambiguous and controversial matters of public policy” to California's judgment.
As the U.S. Court of Appeals for the D.C. Circuit has made clear in
The same logic applies to authorization requests. The Administrator's burden, on the other hand, is to make a reasonable evaluation of the information in the record in coming to the waiver decision. As the court in
With regard to the standard of proof, the court in
With regard to the protectiveness finding, the court upheld the Administrator's position that, to deny a waiver, there must be “clear and compelling evidence” to show that proposed enforcement procedures undermine the protectiveness of California's standards.
With respect to the consistency finding, the court did not articulate a standard of proof applicable to all proceedings, but found that the opponents of the waiver were unable to meet their burden of proof even if the standard were a mere preponderance of the evidence. EPA's past waiver decisions have consistently made clear that: “[E]ven in the two areas concededly reserved for Federal judgment by this legislation—the existence of `compelling and extraordinary' conditions and whether the standards are technologically feasible—Congress intended that the standards of EPA review of the State decision to be a narrow one.”
Upon review of CARB's request, EPA offered an opportunity for a public hearing, and requested written comment on issues relevant to a full section 209(e) authorization analysis, by publication of a
EPA did not receive a request for hearing and therefore no hearing was held. EPA did not receive any written comments. EPA's evaluation is based on the record, which includes CARB's authorization request and accompanying documents.
We initially evaluate California's Within-the-Scope Amendments by application of our traditional within-the-scope analysis, as CARB requested. If we determine that CARB's request does not meet the requirements for a within-the-scope determination, we then evaluate the request based on a full authorization analysis. In determining whether amendments can be viewed as
EPA sought comment on a range of issues, including those applicable to a within-the-scope analysis as well as those applicable to a full authorization analysis. No party submitted a comment that California's Within-the-Scope Amendments require a full authorization analysis. Given the lack of comments on this issue, and EPA's assessment of the nature of the amendments, EPA will evaluate California's Within-the-Scope Amendments by application of our traditional within-the-scope analysis, as CARB requested.
EPA can confirm that amended regulations are within the scope of a previously granted waiver of preemption if three conditions are met. First, the amended regulations must not undermine California's determination that its standards, in the aggregate, are as protective of public health and welfare as applicable federal standards. Second, the amended regulations must not affect consistency with section 202(a) of the Act. Third, the amended regulations must not raise any “new issues” affecting EPA's prior authorizations.
As noted above, CARB's authorization request also included the Full Authorization Amendments. EPA must grant an authorization of the Full Authorization Amendments unless the Administrator finds: (1) California's determination that its standards will be, in the aggregate, as protective of public health and welfare as applicable federal standards is arbitrary and capricious; (2) California does not need such California standards to meet compelling and extraordinary conditions; or (3) California's standards and accompanying enforcement procedures are not consistent with this section.
EPA's evaluation of the CHC Amendments, including the Within-the-Scope Amendments and Full Authorization Amendments, is set forth below. Because of the similarity of the within-the-scope criteria and the full authorization criteria, a discussion of both sets of the respective amendments take place within each authorization criterion. To the extent that the criteria are applied uniquely, or that additional criteria apply under either the within-the-scope analysis or the full authorization analysis, such application is also addressed below.
Section 209(e)(2)(i) of the Act instructs that EPA cannot grant an authorization if the agency finds that CARB was arbitrary and capricious in its determination that its standards are, in the aggregate, at least as protective of public health and welfare as applicable federal standards. CARB's Board made a protectiveness determination in Resolution 10-26, finding that “the California emission standards and other requirements related to the control of emissions in the amended regulation are, in the aggregate, at least as protective of public health and welfare than applicable federal standards.”
After evaluating the materials submitted by CARB, and since EPA has not adopted any standards or requirements for in-use CHC engines and based on the lack of any comments submitted to the record, I cannot find that California's Within-the-Scope Amendments undermine California's previous determination that its standards, in the aggregate, are at least as protective of public health and welfare as applicable federal standards. Thus I cannot deny CARB's within-the-scope request based on this criterion. Similarly, with regard to the Full Authorization Amendments I cannot make a finding that CARB's protectiveness determination is arbitrary and capricious and thus I cannot deny CARB's Full Authorization Amendments based on this criterion.
Section 209(e)(2)(ii) of the Act instructs that EPA cannot grant an authorization if the agency finds that California “does not need such California standards to meet compelling and extraordinary conditions.” EPA's inquiry under this second criterion (found both in paragraph 209(b)(1)(B) and 209(e)(2)(A)(ii)) has been to determine whether California needs its own mobile source pollution program (
California has asserted its longstanding position that the State continues to need its own nonroad engine program to meet serious air pollution problems.
There has been no evidence submitted to indicate that California's compelling and extraordinary conditions do not continue to exist. California, including the South Coast and the San Joaquin Valley air basins, continues to experience some of the worst air quality in the nation and continues to be in non-attainment with national ambient air quality standards for fine particulate matter (PM
Therefore, based on the record of this request and absence of comments or other information to the contrary, I cannot find that California does not continue to need such state standards, including the CHC regulations, to address the “compelling and extraordinary conditions” underlying the state's air pollution problems. I have determined that I cannot deny California authorization for its Full Authorization Amendments under section 209(e)(2)(A)(ii). As noted above, EPA's within-the-scope analysis (that is applicable to the Within-the-Scope Amendments) does not require an assessment of section 209(e)(2)(A)(ii).
Section 209(e)(2)(A)(iii) of the Act instructs that EPA cannot grant an authorization if California's standards and enforcement procedures are not consistent with “this section.” As described above, EPA's section 209(e) rule states that the Administrator shall not grant authorization to California if she finds (among other tests) that the “California standards and accompanying enforcement procedures are not consistent with section 209.” EPA has interpreted this requirement to mean that California standards and accompanying enforcement procedures (under both the full authorization and the within-the-scope analysis) must be consistent with at least sections 209(a), 209(e)(1), and 209(b)(1)(C), as EPA has interpreted this last subsection in the context of motor vehicle waivers. Thus, this can be viewed as a three-pronged test.
To be consistent with section 209(a) of the Clean Air Act, California's commercial harbor craft regulations must not apply to new motor vehicles or new motor vehicle engines. California's commercial harbor craft regulations apply to nonroad marine vessels and engines, not on-highway motor vehicles or engines. CARB states that the new vessel requirements regulate new diesel engines, and apply only to nonroad engines that are neither new motor vehicles nor new motor vehicle engines. No commenter presented otherwise; therefore, I cannot deny California's request on the basis that California's commercial harbor craft regulations are not consistent with section 209(a).
To be consistent with section 209(e)(1) of the Clean Air Act, California's commercial harbor craft regulations must not affect new farming or construction vehicles or engines that are below 175 horsepower, or new locomotives or their engines. CARB represents that commercial harbor craft engines are not used in locomotives and are not primarily used in farm and construction equipment vehicles. No commenter presented otherwise and EPA is otherwise not aware of any information to the contrary; therefore, I cannot deny California's request on the basis that California's commercial harbor craft requirements are not consistent with section 209(e)(1).
The requirement that California's standards be consistent with section 209(b)(1)(C) of the Clean Air Act effectively requires consistency with section 202(a) of the Act. California standards are inconsistent with section 202(a) of the Act if there is inadequate lead-time to permit the development of technology necessary to meet those requirements, giving appropriate consideration to the cost of compliance within that time. California's accompanying enforcement procedures would also be inconsistent with section 202(a) if the federal and California test procedures were not consistent. The scope of EPA's review of whether California's action is consistent with section 202(a) is narrow. The determination is limited to whether those opposed to the authorization or waiver have met their burden of establishing that California's standards are technologically infeasible, or that California's test procedures impose requirements inconsistent with the federal test procedure.
Congress has stated that the consistency requirement of section 202(a) relates to technological feasibility.
As described above, the Full Authorization Amendments require in-use Tier 0 and Tier 1 propulsion and auxiliary marine engines on crew and supply, barge, and dredge vessels to meet emission limits equal to or cleaner than federal Tier 2 or Tier 3 new marine engine certification standards in effect for the year that in-use engine compliance is required (based on the model year of the in-use engine and annual hours of operation). Vessel owners are provided the same compliance options that were available to owners of Tier 0 and Tier 1 marine engines in the initial CHC regulations: (1) Replacing an in-use engine with a new marine engine certified to applicable Tier 2 or Tier 3 marine standards, (2) demonstrating that the in-use marine engine already meets the most stringent Tier 2 or Tier 3 marine standards in effect for new engines of similar power rating and displacement, (
CARB maintains that the Within-the-Scope Amendments present no issue regarding technical feasibility or inconsistent test procedures as the amendments only maintain or relax the stringency of the original CHC regulation's in-use requirements.
EPA did not receive any comments suggesting that California's commercial harbor craft regulations are technologically infeasible.
Therefore, based on the record before us, I cannot find that the CHC Amendments are technologically infeasible or otherwise inconsistent with section 202(a). Therefore, I cannot deny CARB's authorization request for the Full Authorization Amendments and likewise cannot deny the within-the-scope request for the Within-the-Scope Amendments based on the section 202(a) criterion.
EPA has stated in the past that if California promulgates amendments that raise new issues affecting previously granted waivers or authorizations, we would not confirm that those amendments are within the scope of previous authorizations.
After evaluating California's CHC Amendments and CARB's submissions for EPA review as described above, I am taking the following actions. First, I am granting an authorization for the Full Authorization Amendments. Second, I confirm that the Within-the-Scope Amendments are within-the scope of EPA's previous authorization.
This decision will affect not only persons in California, but also manufacturers and/or owners/operators nationwide who must comply with California's requirements. In addition, because other states may adopt California's standards for which a section 209(e)(2)(A) authorization has been granted if certain criteria are met, this decision would also affect those states and those persons in such states.
As with past authorization and waiver decisions, this action is not a rule as defined by Executive Order 12866. Therefore, it is exempt from review by the Office of Management and Budget as required for rules and regulations by Executive Order 12866.
In addition, this action is not a rule as defined in the Regulatory Flexibility Act, 5 U.S.C. 601(2). Therefore, EPA has not prepared a supporting regulatory flexibility analysis addressing the impact of this action on small business entities.
Further, the Congressional Review Act, 5 U.S.C. 801,
Environmental Protection Agency (EPA).
Notice; request for comment.
The Environmental Protection Agency (EPA) receives from time to time Freedom of Information Act (FOIA) requests for documentation received or issued by EPA or data contained in EPA database systems pertaining to the export and import of Resource Conservation and Recovery Act (RCRA) hazardous waste from/to the United States, the export of cathode ray tubes (CRTs) and spent lead acid batteries (SLABs) from the United States, and the export and import of RCRA universal waste from/to the United States. These documents and data may identify or reference multiple parties, and describe transactions involving the movement of specified materials in which the parties propose to participate or have participated. The purpose of this notice is to inform “affected businesses” about the documents or data sought by these types of FOIA requests in order to provide the businesses with the opportunity to assert claims that any of the information sought that pertains to them is entitled to treatment as confidential business information (CBI), and to send comments to EPA supporting their claims for such treatment. Certain businesses, however, do not meet the definition of “affected business,” and are not covered by today's notice. They consist of any business that actually submitted to EPA any document at issue pursuant to applicable RCRA regulatory requirements and did not assert a CBI claim as to information that pertains to that business in connection with the document at the time of its submission; they have waived their right to do so at a later time. Nevertheless, other businesses identified or referenced in the documents that were submitted to EPA by the submitting business may have a right to assert a CBI claim concerning information that pertains to
Comments must be received on or before February 21, 2017. The period for submission of comments may be extended if, before the comments are due, you make a request for an extension of the comment period and it is approved by the EPA legal office. Except in extraordinary circumstances, the EPA legal office will not approve such an extension without the consent of any person whose request for release of the information under the FOIA is pending.
Submit your comments, identified by Docket ID No. EPA-HQ-OECA-2016-0745, by one of the following methods:
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The
Eva Kreisler, International Compliance Assurance Division, Office of Federal Activities, Office of Enforcement and Compliance Assurance, Environmental Protection Agency, Mailcode: 2254A, 1200 Pennsylvania Ave., NW., Washington, DC 20460; telephone number: (202) 564-8186; email address:
Today's notice relates to any documents or data in the following areas: (1) Export of Resource Conservation and Recovery Act (RCRA) hazardous waste, during calendar year 2016 or before, under 40 CFR part 262, subparts E and H; (2) import of RCRA hazardous waste, during calendar year 2016 or before, under 40 CFR part 262, subparts F and H; (3) transit of RCRA hazardous waste, during calendar year 2016 or before, under 40 CFR part 262, subpart H, through the United States and foreign countries; (4) export of cathode ray tubes, during calendar year 2016 or before, under 40 CFR part 261, subpart E; (5) exports of non-crushed spent lead acid batteries with intact casings, during calendar year 2016 or before, under 40 CFR part 266 subpart G; (6) export and import of RCRA universal waste, during calendar year 2016 or before, under 40 CFR part 273, subparts B, C, D, and F;(7) submissions from transporters, during calendar year 2016 or before, under 40 CFR part 263, or from treatment, storage or disposal facilities under 40 CFR parts 264 and 265, related to exports or imports of hazardous waste which occurred during calendar year 2016 or before, including receiving facility notices under 40 CFR 264.12(a)(1) and 265.12(a)(1) and import consent documentation under 40 CFR 264.71(a)3) and 265.71(a)(3).
EPA has previously published notices similar to this one in the
Specifically, EPA receives FOIA requests from time to time for documentation or data related to hazardous waste exports and imports that may identify or reference multiple parties, and that describe transactions involving the movement of specified materials in which the parties propose to participate or have participated. This notice informs “affected businesses,”
Certain businesses, however, do not meet the definition of “affected business,” and are not covered by today's notice. They consist of any business that actually submitted information responsive to a FOIA request, under the authority of 40 CFR parts 260 through 266 and 268, and did not assert a claim of business confidentiality covering any of that information at the time of submission. As set forth in the RCRA regulations at 40 CFR 260.2(b), “if no such [business confidentiality] claim accompanies the information when it is received by EPA, it may be made available to the public without further notice to the person submitting it.” Thus, for purposes of this notice and as a general matter under 40 CFR 260.2(b), a business that submitted to EPA the documents at issue, pursuant to applicable regulatory requirements, and that failed to assert a claim as to information that pertains to it at the time of submission, cannot later make a business confidentiality claim.
In addition, EPA may develop its own documents and organize into its database systems information that was originally contained in documents from submitting businesses relating to exports and imports of hazardous waste. If a submitting business fails to assert a CBI claim for the documents it submits to EPA at the time of submission, not only does it waive its right to claim CBI for those documents, but it also waives its right to claim CBI for information in EPA's documents or databases that is based on or derived from the documents that were originally submitted by that business.
In accordance with 40 CFR 2.204(c) and (e), this notice inquires whether any affected business asserts a claim that any of the requested information constitutes CBI, and affords such business an opportunity to comment to EPA on the issue. This notice also informs affected businesses that, if a claim is made, EPA would determine under 40 CFR part 2, subpart B, whether any of the requested information is entitled to business confidential treatment.
EPA's FOIA regulations at 40 CFR 2.204(c)(1) require an EPA office that is responsible for responding to a FOIA request for the release of business information (“EPA office”) to determine which businesses, if any, are affected businesses. “Affected business” is defined at 40 CFR 2.201(d) as: With reference to an item of business information, a business which has asserted (and not waived or withdrawn) a business confidentiality claim covering the information, or a business which could be expected to make such a claim if it were aware that disclosure of the information to the public was proposed.
This notice encompasses two distinct steps in the process of communication with affected businesses prior to EPA's making a final determination concerning the business confidentiality of the information at issue: the preliminary inquiry and the notice of opportunity to comment.
Section 2.204(c)(2)(i) provides, in relevant part: If the examination conducted under paragraph (c)(1) of § 2.204 discloses the existence of any business which, although it has not asserted a claim, might be expected to assert a claim if it knew EPA proposed to disclose the information, the EPA office shall contact a responsible official of each such business to learn whether the business asserts a claim covering the information.
Sections 2.204(d)(1)(i) and 2.204(e)(1) of Title 40 of the Code of Federal Regulations require that written notice be provided to businesses that have made claims of business confidentiality for any of the information at issue, stating that EPA is determining under 40 CFR part 2, subpart B, whether the information is entitled to business confidential treatment, and affording each business an opportunity to comment as to the reasons why it believes that the information deserves business confidential treatment.
Section 2.204(e)(1) of Title 40 of the Code of Federal Regulations requires that this type of notice be furnished by certified mail (return receipt requested), by personal delivery, or by other means which allows verification of the fact and date of receipt. EPA, however, has determined that in the present circumstances the use of a
All responses to this notice must be in the English language.
In accordance with 40 CFR 2.204(e)(1) and 2.205(d)(1), EPA will construe your failure to furnish timely comments in response to this notice as a waiver of your business's claim(s) of business confidentiality for any information in the types of documents identified in this notice.
If you believe that any of the information contained in the types of documents which are described in this notice and which are currently, or may become, subject to FOIA requests, is entitled to business confidential treatment, please specify which portions of the information you consider business confidential. Information not specifically identified as subject to a business confidentiality claim may be disclosed to the requestor without further notice to you.
For each item or class of information that you identify as being subject to your claim, please answer the following questions, giving as much detail as possible:
1. For what period of time do you request that the information be maintained as business confidential,
2. Information submitted to EPA becomes stale over time. Why should the information you claim as business confidential be protected for the time period specified in your answer to question no. 1?
3. What measures have you taken to protect the information claimed as business confidential? Have you disclosed the information to anyone other than a governmental body or someone who is bound by an agreement not to disclose the information further? If so, why should the information still be considered business confidential?
4. Is the information contained in any publicly available material such as the Internet, publicly available data bases, promotional publications, annual reports, or articles? Is there any means by which a member of the public could obtain access to the information? Is the information of a kind that you would customarily not release to the public?
5. Has any governmental body made a determination as to the business confidentiality of the information? If so, please attach a copy of the determination.
6. For each category of information claimed as business confidential, explain with specificity why and how release of the information is likely to cause substantial harm to your competitive position. Explain the specific nature of those harmful effects, why they should be viewed as substantial, and the causal relationship between disclosure and such harmful effects. How could your competitors make use of this information to your detriment?
7. Do you assert that the information is submitted on a voluntary or a mandatory basis? Please explain the reason for your assertion. If the business asserts that the information is voluntarily submitted information, please explain whether and why disclosure of the information would tend to lessen the availability to EPA of similar information in the future.
8. Any other issue you deem relevant.
Please note that you bear the burden of substantiating your business confidentiality claim. Conclusory allegations will be given little or no weight in the determination. If you wish to claim any of the information in your response as business confidential, you must mark the response “BUSINESS CONFIDENTIAL” or with a similar designation, and must bracket all text so claimed. Information so designated will be disclosed by EPA only to the extent allowed by, and by means of, the procedures set forth in, 40 CFR part 2, subpart B. If you fail to claim the information as business confidential, it may be made available to the requestor without further notice to you.
1. Submitting CBI. Do not submit this information to EPA through
2. Tips for Preparing Your Comments. When submitting comments, remember to:
• Identify the notice by docket number and other identifying information (subject heading,
• Explain your views as clearly as possible, avoiding the use of profanity or personal threats.
• Describe any assumptions and provide any technical information and/or data that you used.
• Provide specific examples to illustrate your concerns, and suggest alternatives.
• Make sure to submit your comments by the comment period deadline identified.
Environmental Protection Agency (EPA).
Notice of proposed action on petition.
The Environmental Protection Agency (EPA) is proposing to deny the Clean Air Act (CAA or Act) petition filed on December 9, 2013 (and amended on December 17, 2013), by the states of Connecticut, Delaware, Maryland, Massachusetts, New Hampshire, New York, Pennsylvania, Rhode Island and Vermont. The petition requested that the EPA add the states of
Submit your comments, identified by Docket ID No. EPA-HQ-OAR-2016-0596, at
Questions concerning this proposed notice should be directed to Ms. Gobeail McKinley, U.S. Environmental Protection Agency, Office of Air Quality Planning and Standards, Air Quality Policy Division, Mail code C539-01, Research Triangle Park, NC 27711, telephone (919) 541-5246; email at
To request a public hearing or information pertaining to a public hearing on this document, contact Ms. Pamela Long, U.S. Environmental Protection Agency, Office of Air Quality Planning and Standards, Air Quality Policy Division, (C504-01), Research Triangle Park, NC 27711; telephone number (919) 541-0641; fax number (919) 541-5509; email at:
Throughout this document wherever “we,” “us,” or “our” is used, we mean the U.S. EPA.
The information in this Supplementary Information section of this preamble is organized as follows:
In addition to being available in the docket, an electronic copy of this document will be posted at
The EPA is proposing to deny a petition filed pursuant to CAA section 176A(a) that requests the states of Illinois, Indiana, Kentucky, Michigan, North Carolina, Ohio, Tennessee, West Virginia and Virginia
Section 176A(a) of the CAA provides the Administrator with the authority to develop interstate transport regions for particular pollutants where the Administrator determines that interstate transport of air pollutants from one or more states contributes significantly to violations of air quality standards in other states. The creation of such an interstate transport region requires the establishment of a transport commission with representatives from each state that make recommendations for the mitigation of the interstate pollution. Congress created one such transport region by statute in CAA section 184(a) in 1990 in order to address the interstate transport of ozone pollution, referred to as the OTR. The statute establishes certain minimum control requirements that apply to sources of emissions in each state in the OTR intended to address transported ozone pollution and provides the Ozone Transport Commission (OTC), comprised of representatives of each state in the OTR, with the authority to recommend
The CAA provides other provisions for addressing the interstate transport of ozone pollution besides sections 176A and 184. In particular, the Act includes a specific provision addressing how the EPA and the states are to mitigate the specific sources of emissions that contribute to interstate ozone pollution transport. Section 110(a)(2)(D)(i)(I) of the CAA, also referred to as the “good neighbor” provision, requires that states develop state implementation plans (SIPs) to prohibit emissions that will “contribute significantly to nonattainment in, or interfere with maintenance by, any other state” with respect to a NAAQS. Pursuant to this provision, states have the primary responsibility for reducing the interstate transport of pollutants, including ozone. Should the states fail to fulfill this responsibility, the EPA is obligated to develop federal implementation plans (FIPs) to ensure that appropriate emissions reductions are achieved and that the air quality standards downwind are attained and maintained. The CAA also contains a provision in section 126(b) that permits states and political subdivisions to petition the Administrator for a finding that any major source or group of stationary sources emits in violation of the prohibition in the good neighbor provision. In response to such a finding, the EPA may promulgate additional limits on such sources, and these limits must then be included in a state's good neighbor SIP pursuant to CAA section 110(a)(2)(D)(ii). This provision provides a means for the EPA to mediate disputes between the states regarding the compliance of specific sources with the requirements of the good neighbor provision. As described in detail later in this document, states and the EPA have historically used their authority under CAA sections 110(a)(2)(D)(i)(I) and section 126 to develop SIPs and FIPs that target specific sources of ozone precursor emissions to address interstate ozone transport across the U.S., including with respect to air quality concerns stemming from interstate transport of ozone within the OTR.
Pursuant to these and other CAA authorities, the EPA and states within and outside the OTR have taken significant actions independently and in collaboration for many years to address ozone pollution problems by reducing precursor emissions (
Section 176A of the CAA provides the Administrator with discretion to determine whether to establish a new transport region or expand an existing transport region. The EPA has reviewed the request of the petitioners in light of the control requirements that apply to sources located in states now included in the OTR and that would apply to states if they were added and the other statutory authorities provided for addressing the interstate transport of ozone pollution. The EPA proposes to deny the CAA section 176A petition to add states to the OTR for the purpose of addressing the interstate ozone transport problem with respect to the 2008 ozone NAAQS. The EPA believes that, based on the reasons fully described in Section IV of this document, other CAA provisions (
Ground-level ozone causes a variety of negative effects on human health, vegetation, and ecosystems. In humans, acute and chronic exposure to ozone is associated with premature mortality and a number of morbidity effects, such as asthma exacerbation. In ecosystems, ozone exposure causes visible foliar injury, decreases plant growth, and affects ecosystem community composition. Ground-level ozone is not emitted directly into the air, but is a secondary air pollutant created by chemical reactions between NO
Precursor emissions can be transported downwind directly or, after transformation in the atmosphere, as ozone. Studies have established that ozone formation, atmospheric residence, and transport occurs on a regional scale (
While substantial progress has been made in reducing ozone in many urban areas, regional-scale ozone transport is still an important component of peak ozone concentrations during the summer ozone season. Model assessments have looked at impacts on peak ozone concentrations after potential emission reduction scenarios for NO
On March 12, 2008, the EPA promulgated a revision to the NAAQS, lowering both the primary and secondary standards to 75 ppb.
Subpart 1 of part D of title I of the CAA provides provisions governing general plan requirements for designated nonattainment areas. This subpart includes provisions providing for the development of transport regions to address the interstate transport of pollutants that contribute to NAAQS violations. In particular, section 176A(a) of the CAA provides that, on the EPA's own motion or by a petition from the Governor of any state, whenever the EPA has reason to believe that the interstate transport of air pollutants from one or more states contributes significantly to a violation of the NAAQS in one or more other states, the EPA may establish, by rule, a transport region for such pollutant that includes such states. The provision further provides that the EPA may add any state or portion of a state to any transport region whenever the Administrator has reason to believe that the interstate transport of air pollutants from such state significantly contributes to a violation of the standard in the transport region.
Section 176A(b) of the CAA provides that when the EPA establishes a transport region, the Administrator shall establish an associated transport commission, comprised of (at a minimum) the following: Governor or designee of each state, the EPA Administrator or designee, the Regional EPA Administrator and an air pollution control official appointed by the Governor of each state. The purpose of the transport commission is to assess the degree of interstate transport throughout the transport region and assess control strategies to mitigate the interstate transport.
Subpart 2 of part D of title I of the CAA provides provisions governing additional plan requirements for designated ozone nonattainment areas. Consistent with CAA section 176A found in subpart 1, subpart 2 included specific provisions focused on the interstate transport of ozone. In particular, CAA section 184(a) established a single transport region for ozone—the OTR—comprised of the states of Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, Vermont and the Consolidated Metropolitan Statistical Area that includes the District of Columbia and certain parts of northern Virginia.
Section 184(b) of the CAA established certain control requirements that each state in the OTR is required to implement within the state and which require certain controls on sources of NO
Section 182(f) of the CAA requires states to apply the same requirements to major stationary sources of NO
Additionally, under CAA section 184(c), the OTC may, based on a majority vote of the Governors on the Commission, recommend additional control measures not specified in the statute to be applied within all or part of the OTR if necessary to bring any areas in the OTR into attainment by the applicable attainment dates. If EPA approves such a recommendation, under CAA section 184(c)(5) the Administrator must declare each state's implementation plan inadequate and it must order the states to include the approved control measures in their revised plans pursuant to CAA section 110(k)(5) for the state to meet the requirements of CAA section 110(a)(2)(D). If a CAA section 110(k)(5) finding is issued, states have 1 year to revise their SIPs to include the approved measures.
States included in the OTR by virtue of CAA section 184(b)(1) were required to submit SIPs to the EPA addressing these requirements within 2 years of the 1990 CAA Amendments, or by November 15, 1992. Section 184(b)(1) of the CAA further provides that if states are later added to the OTR pursuant to CAA section 176A(a)(1), such states must submit SIPs addressing these requirements within 9 months after inclusion in the OTR.
Section 176A(a)(1) of the CAA states that the Administrator
The Administrator's discretion pursuant to CAA section 176A(a) has been affirmed by the U.S. District Court for the District of Columbia Circuit (D.C. Circuit). In
Several courts have held that the use of similarly non-mandatory language such as that found in CAA section 176A confers discretion on the agency to grant or deny a petition so long as it is supported by a “reasonable explanation.” For example, in
Consistent with
Similarly, in
In each of these cases previously discussed, the acting agency has been entitled to broad discretion to act on a pending petition so long as the agency provided a reasoned explanation. Notably, as each of these decisions focused on the case-specific circumstances relied upon by the acting agency to deny the pending petition, the courts did not speak to whether the agency might reach a different conclusion under different circumstances. Like the statutory provisions evaluated by the courts in these cases, the term “may” in CAA section 176A(a) means that the Administrator is permitted to exercise reasonable discretion in determining when to add new states to a transport region. While the Administrator must adequately explain the facts and policy concerns she relied on in acting on the petition and conform such reasons with the authorizing statute, review of such a decision is highly deferential. Thus, the agency is entitled to broad discretion when determining whether to grant or deny such a petition.
On December 9, 2013, the states of Connecticut, Delaware, Maryland, Massachusetts, New Hampshire, New York, Rhode Island and Vermont submitted a petition under CAA section 176A requesting that the EPA add to the OTR the states of Illinois, Indiana, Kentucky, Michigan, North Carolina, Ohio, Tennessee, West Virginia and the portion of Virginia currently not within the OTR. On December 17, 2013, the petition was amended to add the state of Pennsylvania as an additional state petitioner.
The petitioning states submitted a technical analysis which the petitioning states contend demonstrates that the nine named upwind states significantly contribute to violations of the 2008 ozone NAAQS in the OTR. The petitioning states acknowledge and include data used to support rulemakings promulgated by the EPA that addressed interstate transport with respect to both the 2008 ozone NAAQS and prior ozone NAAQS in order to further support their request. Moreover, the petitioners identified those areas that are designated nonattainment with respect to the 2008 ozone NAAQS within and outside the OTR and conducted a linear extrapolation to predict that certain areas will continue to be in nonattainment or will have difficulty maintaining attainment of the NAAQS after the EPA's 2008 ozone NAAQS final area designations in 2012. The petitioning states' 2018 modeling showed that, with on-the-way OTR measures, areas within the OTR and non-OTR would continue to have problems attaining the 2008 ozone NAAQS. Lastly, their 2020 modeling showed that with a 58 percent NO
The petitioners further note that the OTR states have adopted and implemented numerous and increasingly stringent controls on sources of VOCs and NO
At the time the petition was submitted, the EPA's most recent effort to address the interstate transport of ozone pollution was subject to litigation in the D.C. Circuit. As discussed in more detail later in this document, the EPA issued the Cross-State Air Pollution Rule (CSAPR) pursuant to section 110(a)(2)(D)(i)(I) of the CAA in order to address interstate transport with respect to the 1997 ozone NAAQS as well as the 1997 and 2006 fine particulate matter (PM
Since the petition was submitted, the EPA has received correspondence from both the upwind states and the petitioning states regarding the EPA's pending action on the petition. On February 14, 2014, the EPA received a letter from the environmental commissioners and directors representing the states of Illinois, Ohio, Indiana, Tennessee, Kentucky, Virginia, Michigan, West Virginia and North Carolina (in collaboration with LADCO) disagreeing with the basis for the petition and requesting that the EPA deny the petition. On May 29, 2015, the EPA received a letter from the Midwest Ozone Group urging that the EPA consider recent air quality, on-the-books measures between now and 2018 and other related information prior to any action on the petition. On July 7, 2015, the EPA received a letter from state representatives from the states of Ohio, Kentucky, Indiana, West Virginia, North Carolina and Michigan communicating the progress of the voluntary dialogue called the State Collaborative on Ozone Transport (SCOOT) that according to the letter, resulted in commitments, from
On April 6, 2016, the EPA received a letter from the petitioning states requesting immediate action to grant the CAA section 176A petition. The letter acknowledged the EPA's recent proposal to update the CSAPR to address interstate transport for the 2008 ozone NAAQS and urged the EPA to grant the petition because the proposed rulemaking would only partially address ozone transport problems in the eastern U.S. Further, the letter noted that granting the petition will also facilitate efforts to attain the 2015 ozone NAAQS, as well as future updates to the ozone NAAQS. On May 16, 2016, the EPA received a letter from the upwind states of Ohio, Kentucky, Indiana, West Virginia and Michigan requesting that the EPA deny the petition, claiming that the technical information used to support the petition was not comparable to current air quality and noting the EPA's proposed transport rule to address the 2008 ozone NAAQS. These communications can be found in the docket for this action.
This section describes the basis for the EPA's proposed denial of this CAA section 176A petition. Section IV.A of this document describes the alternative authorities provided by the CAA for addressing the interstate transport of ozone pollution and the flexibilities those provisions provide. Section IV.B of this document describes EPA's historical use of these authorities to address the interstate transport of ozone pollution and the advantages of those rulemakings for addressing current ozone nonattainment problems. Section IV.C of this document describes other measures that have achieved, and will continue to achieve, significant reductions in emissions of NO
As explained more fully later, the EPA believes an expansion of the OTR is unnecessary at this time and would not be the most efficient way to address the remaining interstate transport issues for the 2008 ozone NAAQS in states currently included in the OTR. Additional local and regional ozone precursor emissions reductions are expected in the coming years from already on-the-books rules (
The CAA provision that states and the EPA have used most for addressing interstate transport is section 110(a)(2)(D)(i)(I), often referred to as the “good neighbor” or “interstate transport” provision, requires states to prohibit certain emissions from in-state sources if such emissions impact the air quality in downwind states. Specifically, in keeping with the CAA's structure of shared state and federal regulatory responsibility, CAA section 110(a)(2)(D)(i)(I) requires all states, within 3 years of promulgation of a new or revised NAAQS, to submit SIPs that contain adequate provisions prohibiting any source or other type of emissions activity within the state from emitting any air pollutant in amounts which will contribute significantly to nonattainment in, or interfere with maintenance by, any other state with respect to any NAAQS. Thus, each state is required to submit a SIP that demonstrates the state is adequately controlling sources of emissions that would impact downwind states' air quality relative to the NAAQS in violation of the good neighbor provision.
Once a state submits a good neighbor SIP, the EPA must evaluate the SIP to determine whether it meets the statutory criteria of the good neighbor provision, and then approve or disapprove, in whole or in part, the state's submission in accordance with CAA section 110(k)(3). In the event that a state does not submit a required SIP addressing the good neighbor provision, the EPA publishes in the
Section 110(k)(5) of the CAA also provides a means for the EPA to reopen previously approved SIPs, including good neighbor SIPs, if the EPA determines that an approved SIP is substantially inadequate to attain or maintain the NAAQS, to adequately mitigate interstate pollutant transport, or to otherwise comply with requirements of the CAA. The EPA can use its authority under CAA section 110(k)(5) to call for re-submission of the SIP to correct the inadequacies under CAA 110(a)(2)(D)(i)(I), and if the state fails to make the required submission, the EPA can promulgate a FIP under CAA section 110(c) to address the inadequacies.
Finally, section 126 of the CAA provides states with an additional opportunity to bring to the EPA's attention specific instances where a source or a group of sources in a specific state may be emitting in excess of what the good neighbor provision would allow. Section 126(b) of the CAA provides that any state or political subdivision may petition the Administrator of the EPA to find that any major source or group of stationary sources in upwind states emits or would emit any air pollutant in violation of the prohibition of CAA section 110(a)(2)(D)(i).
The flexibility provided by these statutory provisions is different from that provided by the requirements imposed upon states in the OTR. With limited exceptions described previously, states in the OTR must impose a uniform set of requirements on sources within each state. While the OTR states may impose additional requirements with the consent of the OTC and the EPA, the states generally must comply with the minimum requirements imposed by the statute. The good neighbor provision, by contrast, provides both the states and the EPA with the flexibility to develop a remedy targeted at a particular air quality problem, including the flexibility to tailor the remedy to address the particular precursor pollutants and sources that would most effectively address the downwind air quality problem. As described later, the EPA has previously promulgated four interstate transport rulemakings pursuant to these authorities in order to quantify the specific emission reductions required in certain eastern states in order to comply with the requirements of CAA section 110(a)(2)(D)(i)(I) with respect to downwind nonattainment and maintenance concerns with respect to the NAAQS for ozone and PM
In order to address the regional transport of ozone pursuant to the CAA's good neighbor provision under section 110(a)(2)(D)(i)(I), the EPA has promulgated four regional interstate transport rules focusing on the reduction of NO
In each of these rulemakings, the EPA identified those sources and pollutants that were most effective in addressing the particular air quality problem identified through the course of the EPA's analysis. This allowed the EPA to craft targeted remedies that provided efficient and effective means of addressing the particular air quality problem. In each of the regional transport rules, the EPA analysis has continued to demonstrate that NO
Through a 2-year effort (starting in 1995 and ending in 1997) known as the Ozone Transport Assessment Group (OTAG), the EPA worked in partnership with the 37 eastern-most states and the District of Columbia, industry representatives, and environmental groups to address the interstate transport of ozone pollution. OTAG identified and evaluated flexible and cost-effective strategies for reducing long-range transport of ozone and ozone precursors. Based on the OTAG process, the EPA engaged in a rulemaking to promulgate a final action commonly referred to as the NO
Through the OTAG process, the states concluded that widespread NO
In order to quantify necessary NO
At the time the NO
In parallel with issuing the SIP call, the EPA reviewed petitions submitted pursuant to CAA section 126(b) by eight states requesting that the EPA find that stationary sources in upwind states contribute significantly to ozone nonattainment in the petitioning states. Because the section 126 petitions raised many of the same issues as those being addressed in NO
The D.C. Circuit subsequently issued two orders affecting implementation of the NO
Ultimately, the NO
The CAIR was published in May 2005 and addressed both the 1997 PM
The rule set statewide emission budgets for large EGUs that reduced emissions of annual SO
When the EPA promulgated the final CAIR, the EPA also issued a national rule finding that certain states had failed to submit SIPs to address the requirements of CAA section 110(a)(2)(D)(i) with respect to the 1997 PM
In response to the court's remand of CAIR, on July 6, 2011, the EPA promulgated CSAPR, which requires certain states to significantly improve air quality by reducing power plant emissions that contribute to ozone and/or fine particle pollution in other states. CSAPR requires sources in a total of 28 states to reduce annual SO
CSAPR set emissions budgets for certain states according to the applicable NAAQS—annual NO
The timing of CSAPR's implementation was affected by a number of court actions. CSAPR was the subject to nearly four years of litigation in both the D.C. Circuit and the Supreme Court. CSAPR was generally upheld by the courts, but for the remand of certain state budgets, and implementation of the trading programs began in 2015.
On October 26, 2016, the EPA published an update to CSAPR intended to respond to the D.C. Circuit's remand of certain NO
The CSAPR Update analysis found that emissions from eight of the nine states named in the section 176A petition, in addition to a number of other states, were linked to downwind projected nonattainment and/or maintenance receptors, in the eastern U.S., in 2017 with respect to the 2008 ozone NAAQS. 81 FR 74506, 74538-39. For one state named in the CAA section 176A petition, North Carolina, the EPA determined in the CSAPR Update that the state was not linked to any downwind receptors and, therefore, will not significantly contribute to nonattainment or interfere with maintenance of the 2008 ozone NAAQS in any other state pursuant to the good neighbor provision. 81 FR 74506, 74537-38.
For those states linked to downwind air quality problems, the EPA evaluated timely and cost-effective emissions reductions achievable in each state in order to quantify the amount of emissions constituting each state's significant contribution to nonattainment and interference with maintenance of the standard pursuant to the good neighbor provision. The EPA focused its analysis on: (1) Emissions reductions achievable by 2017 in order to assist downwind states with meeting the applicable attainment deadline for the 2008 ozone NAAQS (81 FR 74521), (2) reductions in only NO
The EPA concluded that the emissions reductions achieved by implementation of the budgets constitute a portion of most affected states' significant contribution to nonattainment or interference with maintenance of the 2008 ozone NAAQS at these downwind receptors. 81 FR 74508, 74522.
The EPA is continuing the work necessary to address its remaining obligation to promulgate FIPs fully addressing the good neighbor provision with respect to the 2008 ozone NAAQS for 21 states. The EPA intends to continue to collect information and undertake analyses to evaluate potential future emission reductions from non-EGUs and EGUs that may be necessary to fully quantify each state's interstate transport obligations for the 2008 ozone NAAQS in a future action.
In addition to the significant efforts to implement the good neighbor provision for the 2008 and prior ozone NAAQS described in Section IV.B of this document, there are numerous federal and state emission reduction rules that have already been adopted which have resulted or will result in the further reduction of ozone precursor emissions, including emissions from states named in the section 176A petition. Many of these rules directly require sources to achieve reductions of NO
The majority of man-made NO
The EPA establishes emissions standards under various CAA authorities for numerous classes of automobile, truck, bus, motorcycle, earth mover, aircraft, and locomotive engines, and for the fuels used to power these engines. The pollutant reduction benefits from new engine standards increase each year as older and more-polluting vehicles and engines are replaced with newer, cleaner models. The benefits from fuel programs generally begin as soon as a new fuel is available. Further, the ongoing emission reductions from mobile source federal programs such as those listed previously will provide for substantial emissions reductions well into the future, and will complement state and local efforts to attain the 2008 ozone NAAQS.
There are several existing national rules that continue to achieve emission reductions through 2025 and beyond with more protective emission standards for on-road vehicles that include: Control of Air Pollution from Motor Vehicles: Tier 3 Motor Vehicle Emission and Fuel Standards;
Similarly, already adopted regulations for non-road engines and equipment that will achieve further reductions include: Control of Emissions of Air Pollution from Nonroad Diesel Engines and Fuel;
Similarly, a number of already-adopted stationary source rules will drive further regional reductions in ozone precursor emissions, including: boiler maximum achievable control technology standards under CAA section 112 and the Mercury and Air Toxics Standards. These rules target specific sources and have the co-benefit of reducing ozone precursors which also reduce interstate ozone pollution transport. For example, the measures to address Regional Haze best available retrofit technology determinations often include power plant pollution controls that can achieve NO
Other existing rules that will achieve NO
The EPA expects existing federal and state rules, and also those that may be promulgated in the future, will have the co-benefit of reducing ozone precursor emissions even if they do not directly address interstate transport of ozone pollution. These rules will result in reductions in ozone concentrations that will help areas attain the 2008 ozone NAAQS. For example, the Regional Haze Rule requires states to revise their regional haze SIPs
As a result of the rules and programs listed previously, various other state programs and efforts, and wider economic trends, ozone levels across the nation and the OTR have been declining. Ozone levels across the nation are expected to further decline over the next several years due to emissions controls already in place. The EPA's emissions projections in support of the 2015 ozone NAAQS modeling show declining emissions of NO
The EPA is proposing to deny the CAA section 176A petition because we believe that the statute provides other, more effective means of addressing the impact of interstate ozone transport on the states within the OTR with respect to the 2008 ozone NAAQS. As described in Section IV of this document, the statute provides several provisions that allow states and the EPA to address interstate ozone transport with a remedy better tailored to the nature of the air quality problem, focusing on those precursor emissions and sources that most directly impact downwind ozone nonattainment and maintenance problems and which can be controlled most cost-effectively. The EPA and states are actively using these provisions, as demonstrated by the numerous federal and state measures that have reduced, and will continue to reduce, the VOC and NO
While the Act contains several provisions, both mandatory and discretionary, to address interstate pollution transport, the EPA's decision whether to grant or deny a CAA section 176A petition to expand an existing transport region is discretionary. Section 176A of the CAA states that the Administrator
We believe that the continued use of the authority provided by the good neighbor provision to address the interstate transport of ozone pollution plus other regulations that are already in place will permit the states and EPA to achieve necessary additional reductions to address the 2008 ozone NAAQS without the need to implement the additional requirements that inclusion in the OTR would entail. As described in Section IV.A and B of this document, this approach to address the interstate transport of ozone is a proven, efficient, and cost-effective means of addressing downwind air quality concerns that the agency has employed and refined over nearly two decades. However, the EPA notes that the addition of states to the OTR pursuant to the section 176A authority—and the additional planning requirements that would entail—could be given consideration as an appropriate means to address the interstate transport requirements of the CAA should the agency depart from its current approach to addressing these requirements.
As described in this document, the CAA provides the agency with the authority to mitigate the specific sources that contribute to interstate pollution through the approval of SIPs or promulgation of FIPs to satisfy the requirements of the good neighbor provision, CAA section 110(a)(2)(D)(i)(I), and through the related petition process under section 126. This authority gives the EPA and states numerous potential policy approaches to address interstate pollution transport of ozone, and the EPA has consistently and repeatedly used its authority under CAA section 110(a)(2)(D)(i)(I) to approve state plans
As explained previously, it does not appear that adding states to an OTR under CAA section 176A will afford the states and EPA with the flexibility to focus on specific sources and ozone precursor emissions tailored to address the downwind state's current air quality and needed remedy to achieve attainment of the 2008 NAAQS. The statute prescribes a specific set of controls for a variety of sources to control emissions of both VOCs and NO
The implementation of controls within the OTR, when combined with the numerous federal and state emission reduction programs that have already been adopted that have resulted in the reduction of ozone precursor emissions either directly or as a co-benefit of those regulations, have helped to significantly reduce ozone levels. These programs will continue to reduce ozone precursor emissions and ozone concentrations both within and outside of the OTR over many years to come. However, the EPA believes the most efficient way to address the current 2008 ozone NAAQS nonattainment and interstate transport problems is to continue to rely on the ability to flexibly target the necessary reductions through this combination of targeted programs such as the implementation of the CSAPR Update Rule, the further utilization of the CSAPR framework, development of local attainment plans, and consideration of additional emissions limitations resulting from action on CAA section 126 petitions.
As discussed in Section III.C. of this document, CAA section 176A provides that the Administrator may exercise reasonable discretion in administering the agency's regulatory agenda by determining whether or not to approve or deny a section 176A petition, so long as the EPA's action is supported by a reasonable interpretation within the context of the statute. The EPA has reviewed the request of the petitioners to add additional states to the OTR in light of required control strategies for ozone transport regions and the other statutory tools available to the agency and states to address the interstate transport of ozone pollution. The agency believes that continuing its longstanding and effective use of the existing and expected control programs under the CAA's mandatory good neighbor provision embodied in section 110(a)(2)(D)(i)(I), including implementation of the CSAPR Update beginning in 2017 and technical work now underway to establish a full remedy for the 2008 NAAQS as well as to implement the good neighbor provision for the more stringent 2015 NAAQS, is a more effective approach for addressing regional interstate ozone transport problems relative to the 2008 ozone standard.
The EPA is proposing to deny the petitioning states' request to add additional states to the OTR for the purpose of addressing interstate transport of the 2008 ozone NAAQS at this time. The agency will instead continue to use other authorities available within the CAA in order to address the long range interstate transport of ozone pollution. This document is specific to the 2008 ozone NAAQS, but the EPA notes that under different circumstances the OTR provisions have been an effective tool for air quality management, and could be similarly effective in the future for addressing interstate transport of ozone pollution. Accordingly, nothing in this document should be read to limit states' ability to file a different petition under 176A or to prejudge the outcome of such a petition if filed. The EPA requests comment on the proposed denial of the petition based on the EPA's preferred approach to addressing interstate transport with respect to the 2008 ozone NAAQS pursuant to these other CAA authorities.
Section 307(b)(1) of the CAA indicates which Federal Courts of Appeal have venue for petitions of review of final actions by the EPA. This section provides, in part, that petitions for review must be filed in the Court of Appeals for the District of Columbia Circuit if (i) the agency action consists of “nationally applicable regulations promulgated, or final action taken, by the Administrator,” or (ii) such action is locally or regionally applicable, if “such action is based on a determination of nationwide scope or effect and if in taking such action the Administrator finds and publishes that such action is based on such a determination.” The EPA finds that any final action related to this document is “nationally applicable” and of “nationwide scope and effect” within the meaning of CAA section 307(b)(1). Through this document, the EPA interprets section 176A of the CAA, a provision which has nationwide applicability. In addition, this document is a response to a petition which would, if granted, extend
42 U.S.C. 7401
Environmental Protection Agency (EPA).
Notice.
In June 2016, the Frank R. Lautenberg Chemical Safety for the 21st Century Act amended the Toxic Substances Control Act (TSCA). EPA is announcing an interpretation of TSCA section 14 concerning confidential business information (CBI) claims for information submitted to EPA. EPA interprets the revised TSCA section 14(c)(3) as requiring substantiation of non-exempt CBI claims at the time the information claimed as CBI is submitted to EPA.
This action is effective on March 20, 2017.
This announcement is directed to the public in general. It may, however, be of particular interest to you if you manufacture (defined by statute to include import) and/or process chemicals covered by TSCA (15 U.S.C. 2601
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2.
The amended TSCA provides new requirements relating to the assertion, substantiation and review of CBI claims. EPA is interpreting the revised TSCA section 14(c)(3) as requiring substantiation of all CBI claims at the time the information claimed as CBI is submitted to EPA, except for claims for information subject to TSCA section 14(c)(2).
This action facilitates the Agency's implementation of TSCA section 14(g) to review all CBI claims for chemical identity, with limited exceptions, as well as to review a representative sample of at least 25% of other non-exempt claims.
EPA has determined that TSCA section 14(c)(3), 15 U.S.C. 2613(c)(3), requires an affected business to substantiate all TSCA CBI claims, except for information subject to TSCA section 14(c)(2), at the time the affected business submits the claimed information to EPA.
TSCA section 14(c)(1)(a) requires an affected business to assert a claim for protection from disclosure concurrent with submission of the information in accordance with existing or future rules. TSCA section 14(c)(3) in turn requires an affected business submitting a claim to protect information from disclosure to substantiate the claim, also in accordance with existing or future rules. The language of TSCA section 14(c)(3) is as follows:
“(3) Substantiation requirements. Except as provided in paragraph (2), a person asserting a claim to protect information from disclosure under this section shall substantiate the claim, in accordance with such rules as the Administrator has promulgated or may promulgate pursuant to this section.”
EPA interprets TSCA section 14(c)(3) to require substantiation for all TSCA CBI claims, except for information
EPA's interpretation is supported by legislative history for the recent amendments to TSCA. Both the Senate and House intended to require substantiation of CBI claims. See S. Rpt. 114-67 (observing, on page 5, that “section 14 [of pre-amendment TSCA] and EPA's implementation of it has been criticized for failing to require . . . . up-front substantiation of confidentiality claims,” and, on page 22, stating that, under the Senate bill, “all new claims for protection of information not presumed to be protected from disclosure must be substantiated by the claimant”); H. Rpt. 114-176 at 29 (a confidentiality claim must “include . . . . a justification for each claim of confidentiality”); Senate Environment and Public Works Committee summary: “Reforming the Toxic Substances Control Act” at 3 (
It might be maintained that TSCA section 14(c)(3) does not impose a substantiation requirement, but merely authorizes EPA to promulgate rules requiring substantiation. Alternatively, it might be maintained that the section does impose a substantiation requirement, but that the requirement must be effectuated through EPA rulemaking.
The first reading does not effectuate the legislative intent to require substantiation. In addition, the provision is not worded as a mere grant of authority. Numerous other provisions of TSCA—both of the pre-amended statute and of the Lautenberg amendments—demonstrate that Congress used more straightforward language when it intended simply to grant EPA rulemaking or other authority (
The second reading amounts to a revision of the legislative text. TSCA section 14(c)(3) does not require EPA to undertake rulemaking; it merely acknowledges that EPA “may” do so. Unless this “may” were read as “shall”, EPA would be under no obligation to promulgate the rules required to carry out the objective of requiring substantiation. Here again, numerous other provisions of TSCA demonstrate that Congress used clear language—and included deadlines—when it intended to require EPA to promulgate regulations (
Having determined that TSCA section 14(c)(3) requires substantiation of all non-exempt TSCA CBI claims, EPA believes the provision is best interpreted as requiring substantiation
Reading the law as requiring substantiation concurrent with the CBI claim also comports with the legislative history. In addition to the history cited earlier in this document, the Senate Report, on p. 5, noted stakeholder concerns that, under pre-amendment TSCA, the lack of a requirement for up-front substantiation resulted in “an over-abundance of CBI claims, some of which may not be legitimate.” Interpreting TSCA section 14(c)(3) as requiring substantiation of a CBI claim concurrent with the claim's submission best effectuates the expressed intent of Congress.
This interpretation is consistent with the requirement in TSCA section 14(g)(1) that EPA review most confidentiality claims for chemical identity and at least 25% of claims for other types of non-exempt information within 90 days after the receipt of the claim. An approach under which substantiations were submitted at some point after assertion of CBI claims would significantly reduce (and has already significantly reduced) the short period for such CBI reviews. To date, for each review, the Agency must contact each affected business, request the submission of a substantiation, and allow a period of time for the affected business to submit the substantiation. Since timely substantiation provides critical information for completing CBI reviews, it is reasonable to conclude that Congress intended for claims to be substantiated at the time the CBI claim is asserted.
When the amendments to TSCA became law on June 22, 2016, EPA published initial Questions and Answers (Q and A's) in an effort to respond to the inquiries and requests concerning EPA's views on the new law. EPA needed to issue guidance to the public as quickly as possible on a broad range of matters under the amendments, since the amendments became effective
Operationally, given the large volume of CBI claims, including those that the Agency has already received and those that the Agency expects to receive in the future, it is administratively efficient to interpret the statute as requiring up-front substantiation, which necessarily saves the Agency the time and resources that would otherwise be spent in attempting to contact the affected business. Up-front substantiation will also significantly enhance EPA's ability to meet the review deadlines in TSCA section 14(g). Further, requiring substantiation concurrent with submission will mitigate any need for an affected business to request an extension to substantiate a CBI claim. Additionally, requiring the affected business to provide justification at the time of submission may help limit unwarranted claims of CBI. Based on this further review, for the reasons stated above, EPA has concluded that the provision is best read as creating a requirement to substantiate non-exempt TSCA CBI claims concurrent with their submission.
Existing EPA confidentiality rules at 40 CFR part 2, section 2.204(e), provide substantiation questions that the Agency may specifically request answers to, pursuant to the procedures in those regulations. While those specific questions are not dictated by the self-executing substantiation requirement in TSCA section 14(c)(3), EPA suggests that companies look to those questions for guidance as to how to fulfill the TSCA section 14(c)(3) substantiation requirement for information that is not currently subject to an existing regulatory up-front substantiation requirement. The answers to those questions typically form the basis of EPA final confidentiality determinations, and substantiations that do not address those questions might not provide sufficient information to uphold a determination, pursuant to TSCA section 14(g)(1), that information claimed as CBI is eligible for confidential protection. For information that is currently subject to a regulatory up-front substantiation requirement (for example, chemical identity CBI claims in the Chemical Data Reporting rule, under 40 CFR 711.30), the terms of that requirement, including the substantiation questions required, will continue to govern the substantiation.
EPA has revised its Web pages on CBI to assist compliance with this interpretation of TSCA section 14. The Web pages list the substantiation questions from 40 CFR 2.204(e) and provide information on substantiation exemptions and on how the substantiations should be directed to the Agency.
Because EPA is providing this interpretation of TSCA section 14(c)(3) for the first time in this document, the Agency is setting different procedures for those who have submitted or will submit information claimed as CBI under TSCA before the effective date of this action,
Those submissions containing information claimed as CBI filed on or after the effective-date of this action (
Those submissions containing information claimed as CBI filed between June 22, 2016 and March 20, 2017, must provide a substantiation for all information claimed as confidential, other than information exempt from substantiation pursuant to TSCA section 14(c)(2). The Agency is giving submitters until September 18, 2017 to provide substantiations and direct them to the Agency. If a substantiation has already been provided to EPA with the submission or in response to a substantiation request, no additional substantiation need be filed for the same information. Be aware, however, that if some non-exempt information claimed as confidential in a particular submission has already been substantiated and some has not, the unsubstantiated information claimed as CBI in the submission must still be substantiated by September 18, 2017. The CBI claims, and the substantiations, may then be reviewed consistent with the provisions of TSCA, its implementing regulations and in accordance with the Agency procedures set forth in 40 CFR part 2. Once September 18, 2017 has passed, if no substantiation has been received for a claim, then EPA will provide the affected business 30 days' notice and a final opportunity to substantiate. The notice will inform the affected business that any CBI claims not substantiated at the end of the 30 days will be considered withdrawn, and the information may be made public with no further notice to the affected business.
EPA's electronic reporting systems for TSCA submissions have been modified to require substantiations for non-exempt CBI claims in submissions filed on or after March 20, 2017. Any new paper TSCA submissions that are directed to the Agency after that date must include substantiations for all non-exempt CBI claims at the time of submission.
For electronic submissions made using EPA's Central Data Exchange (CDX) during the period from June 22, 2016 to March 20, 2017 that were not substantiated, affected businesses must provide substantiation for CBI claims using the amendment processes for the particular submission type. Information on electronic reporting, including how to make amendments, can be found at
For any paper TSCA submissions that were submitted to the Agency during the period from June 22, 2016 to March 20, 2017, the affected business must submit substantiations for any non-exempt CBI claims that have not yet been substantiated. Submit these substantiations to: TSCA Confidential Business Information Center (7407M), WJC East; Room 6428; Attn: TSCA CBI Substantiations. U.S. Environmental Protection Agency, 1200 Pennsylvania Avenue NW., Washington, DC 20460-0001.
Courier Deliveries should be directed to:
U.S. EPA, Office of Pollution Prevention and Toxics, Confidential Business Information Center (CBIC), Attn: TSCA CBI Substantiations. 1201 Constitution Avenue NW., WJC East; Room 6428 Washington, DC 20004-3302, (202) 564-8930.
More information on how to substantiate CBI claims for paper submissions can be found at
15 U.S.C. 2601
Environmental Protection Agency (EPA).
Notice of decision.
The Environmental Protection Agency (“EPA”) is granting the California Air Resources Board (“CARB”) request for authorization of amendments to its Airborne Toxic Control Measure for In-Use Diesel-Fueled Transport Refrigeration Units (“TRU”) and TRU Generator Sets and Facilities Where TRUs Operate (together “2011 TRU Amendments”). EPA's decision also confirms that certain of the 2011 TRU amendments are within the scope of prior EPA authorizations. The 2011 TRU Amendments primarily provide owners of TRU engines with certain flexibilities; clarify recordkeeping requirements for certain types of TRU engines; establish requirements for businesses that arrange, hire, contract, or dispatch the transport of goods in TRU-equipped trucks, trailers, or containers; and address other issues that arose during the initial implementation of the regulation. This decision is issued under the authority of the Clean Air Act (“CAA” or “Act”).
Petitions for review must be filed by March 20, 2017.
EPA has established a docket for this Notice of Decision under Docket ID EPA-HQ-OAR-2015-0224. All documents relied upon in making this decision, including those submitted to EPA by CARB, are contained in the public docket. Publicly available docket materials are available either electronically through
EPA's Office of Transportation and Air Quality (“OTAQ”) maintains a Web page that contains general information on its review of California waiver and authorization requests. Included on that page are links to prior waiver
David Dickinson, Attorney-Advisor, Transportation and Climate Division, Office of Transportation and Air Quality, U.S. Environmental Protection Agency, 1200 Pennsylvania Ave. NW., (6405J), Washington, DC 20460. Telephone: (202) 343-9256. Fax: (202) 343-2804. Email:
EPA granted an authorization for California's initial set of TRU regulations on January 9, 2009.
By letter dated March 2, 2015, CARB submitted a request to EPA for authorization of amendments to its TRU regulations
California requested EPA perform two types of review. First, CARB requested an EPA determination that certain provisions of the 2011 amendments are within the scope of the prior authorizations, or in the alternative, merit full authorization (“Within-the-Scope Amendments”). The Within-the-Scope Amendments provide owners of 2003 and older MY TRUs an extension of the ULETRU compliance date if the TRUs complied with the LETRU standard by specified dates. Such TRU engines that are 2001 MY and older are given an extension to December 31, 2016 for the ULETRU deadline, 2002 MY TRUs are given a new deadline of December 31, 2017, and 2003 MY TRUs are given a new deadline of December 31, 2018. The Within-the-Scope Amendments also provide up to a one-year extension of the compliance dates if owners demonstrate that compliant technology is unavailable or is delayed due to financing, delivery, or installation and provides other flexibilities based upon certain requirements. In addition, the Within-the-Scope Amendments provide a host of new or clarified exemptions including: (1) Clarification that non-operational TRUs are generally exempt from compliance with the performance standards, but are still prohibited from being sold, rented or leased to a person that could reasonably be expected to operate such TRUs in California; (2) a limited exemption for TRU-equipped trucks and trailers used by mobile catering companies to feed emergency responders, such as firefighters (such engines are subject to registration and other requirements); (3) an exemption for non-compliant, non-operational TRUs on refrigerated railcars that travel through California based on CARB's Executive Officer approval under certain contingencies; and (4) an exemption for railway carriers from the owner/operator requirements for TRUs not owned by the railway carrier. Lastly, the Within-the-Scope Amendments clarify that the in-use performance standards and associated compliance deadlines are to be based on the year the TRU unit itself was manufactured (including the potential for a prior model year TRU engine to be installed in limited circumstances), instead of basing the compliance deadline on the model year of the TRU engine.
Second, CARB requested full authorization for amendments that revise standards or establish new requirements (“Full Authorization Amendments”). These provisions include amendments that require new replacement engines to meet more stringent requirements (based on the new replacement engine's model year or effective model year) than the original TRU engines. The Full Authorization Amendments also provide that to the extent TRUs now may be repowered with rebuilt engines such rebuilt engines must meet more stringent emission standards than the standards of the original engine, and provided the engines are rebuilt by engine rebuilders in compliance with federal and state engine rebuilding requirements for off-road compression ignition engines.
Section 209(e)(1) of the Act permanently preempts any state, or political subdivision thereof, from adopting or attempting to enforce any standard or other requirement relating to the control of emissions for certain new nonroad engines or vehicles.
On July 20, 1994, EPA promulgated a rule interpreting the three criteria set forth in section 209(e)(2)(A) that EPA must consider before granting any California authorization request for nonroad engine or vehicle emission standards.
In order to be consistent with section 209(a), California's nonroad standards and enforcement procedures must not apply to new motor vehicles or new motor vehicle engines. To be consistent with section 209(e)(1), California's nonroad standards and enforcement procedures must not attempt to regulate engine categories that are permanently preempted from state regulation. To determine consistency with section 209(b)(1)(C), EPA typically reviews nonroad authorization requests under the same “consistency” criteria that are applied to motor vehicle waiver requests under section 209(b)(1)(C). That provision provides that the Administrator shall not grant California a motor vehicle waiver she finds that California “standards and accompanying enforcement procedures are not consistent with section 202(a)” of the Act. Previous decisions granting waivers and authorizations have noted that state standards and enforcement procedures will be found to be inconsistent with section 202(a) if (1) there is inadequate lead time to permit the development of the necessary technology, giving appropriate consideration to the cost of compliance within that time,
In light of the similar language in sections 209(b) and 209(e)(2)(A), EPA has reviewed California's requests for authorization of nonroad vehicle or engine standards under section 209(e)(2)(A) using the same principles that it has historically applied in reviewing requests for waivers of preemption for new motor vehicle or new motor vehicle engine standards under section 209(b).
The law makes it clear that the waiver requests cannot be denied unless the specific findings designated in the statute can properly be made. The issue of whether a proposed California requirement is likely to result in only marginal improvement in California air quality not commensurate with its costs or is otherwise an arguably unwise exercise of regulatory power is not legally pertinent to my decision under section 209, so long as the California requirement is consistent with section 202(a) and is more stringent than applicable Federal requirements in the sense that it may result in some further reduction in air pollution in California.
This principle of narrow EPA review has been upheld by the U.S. Court of Appeals for the District of Columbia Circuit.
If California amends regulations that have been previously authorized by EPA, California may ask EPA to determine that the amendments are within the scope of the earlier authorization. A within-the-scope determination for such amendments is permissible without a full authorization review if three conditions are met. First, the amended regulations must not undermine California's previous determination that its standards, in the aggregate, are as protective of public health and welfare as applicable federal standards. Second, the amended regulations must not affect consistency with section 209 of the Act, following the same criteria discussed above in the context of full authorizations. Third, the amended regulations must not raise any new issues affecting EPA's prior waiver or authorization decisions.
In previous waiver decisions, EPA has recognized that the intent of Congress in creating a limited review based on the section 209(b)(1) criteria was to ensure that the federal government did not second-guess state policy choices. As the agency explained in one prior waiver decision:
It is worth noting * * * I would feel constrained to approve a California approach to the problem which I might also feel unable to adopt at the federal level in my own capacity as a regulator. The whole approach of the Clean Air Act is to force the development of new types of emission control technology where that is needed by compelling the industry to “catch up” to some degree with newly promulgated standards. Such an approach * * * may be attended with costs, in the shape of reduced product offering, or price or fuel economy penalties, and by risks that a wider number of vehicle classes may not be able to complete their development work in time. Since a balancing of these risks and costs against the potential benefits from reduced emissions is a central policy decision for any regulatory agency under the statutory scheme outlined above, I believe I am required to give very substantial deference to California's judgments on this score.
Similarly, EPA has stated that the text, structure, and history of the California waiver provision clearly indicate both a congressional intent and appropriate EPA practice of leaving the decision on “ambiguous and controversial matters of public policy” to California's judgment.
As the U.S. Court of Appeals for the D.C. Circuit has made clear in
[T]he language of the statute and its legislative history indicate that California's regulations, and California's determinations that they must comply with the statute, when presented to the Administrator are presumed to satisfy the waiver requirements and that the burden of proving otherwise is on whoever attacks them. California must present its regulations and findings at the hearing and thereafter the parties opposing the waiver request bear the burden of persuading the Administrator that the waiver request should be denied.
The Administrator's burden, on the other hand, is to make a reasonable evaluation of the information in the record in coming to the waiver decision. As the court in
With regard to the standard of proof, the court in
[. . .]consider all evidence that passes the threshold test of materiality and * * * thereafter assess such material evidence against a standard of proof to determine whether the parties favoring a denial of the waiver have shown that the factual circumstances exist in which Congress intended a denial of the waiver.
In that decision, the court considered the standards of proof under section 209 for the two findings related to granting a waiver for an “accompanying enforcement procedure.” Those findings involve: (1) Whether the enforcement procedures impact California's prior protectiveness determination for the associated standards, and (2) whether the procedures are consistent with section 202(a). The principles set forth by the court, however, are similarly applicable to an EPA review of a request for a waiver of preemption for a standard. The court instructed that “the standard of proof must take account of the nature of the risk of error involved in any given decision, and it therefore varies with the finding involved. We need not decide how this standard operates in every waiver decision.”
With regard to the protectiveness finding, the court upheld the Administrator's position that, to deny a waiver, there must be “clear and compelling evidence” to show that proposed enforcement procedures undermine the protectiveness of California's standards.
With respect to the consistency finding, the court did not articulate a standard of proof applicable to all proceedings, but found that the opponents of the waiver were unable to meet their burden of proof even if the standard were a mere preponderance of the evidence. Although
The CAA directs EPA to offer an opportunity for public hearing on authorization requests from California. On November 17, 2015, EPA published a
First, EPA requested comment on whether the 2011 amendments for which CARB requested a within-the-scope determination should be considered under a within-the-scope analysis. We specifically requested comment on whether the Within-the-Scope Amendments (1) undermine California's previous determination that its standards, in the aggregate, are at least as protective of public health and welfare as comparable federal standards, (2) affect the consistency of California's requirement with section 209 of the Act, or (3) raise any other new issue affecting EPA's previous authorization determinations.
Second, EPA requested comment on whether the Within-the-Scope Amendments would satisfy the criteria for full authorization if they do not meet the criteria for within-the-scope analysis.
Third, EPA sought comment on whether the Full Authorization Amendments, for which CARB requested full authorization, satisfy the full authorization criteria. We specifically requested comment on whether (1) California's protectiveness determination (
EPA received no request for a public hearing. Consequently, EPA did not hold a public hearing. EPA received one written comment and a response comment from CARB, discussed below.
We initially evaluate California's Within-the-Scope Amendments by
EPA sought comment on a range of issues, including those applicable to a within-the-scope analysis as well as those applicable to a full authorization analysis. No party submitted a comment that California's Within-the-Scope Amendments require a full authorization analysis. Given the lack of comments on this issue, and EPA's assessment of the nature of the amendments, EPA will evaluate California's Within-the-Scope Amendments by application of our traditional within-the-scope analysis, as CARB requested.
EPA can confirm that amended regulations are within the scope of a previously granted waiver of preemption if three conditions are met. First, the amended regulations must not undermine California's determination that its standards, in the aggregate, are as protective of public health and welfare as applicable federal standards. Second, the amended regulations must not affect consistency with section 202(a) of the Act. Third, the amended regulations must not raise any “new issues” affecting EPA's prior authorizations.
As noted above, CARB's authorization request also included the Full Authorization Amendments. EPA must grant an authorization of the Full Authorization Amendments unless the Administrator finds: (1) California's determination that its standards will be, in the aggregate, as protective of public health and welfare as applicable federal standards is arbitrary and capricious; (2) California does not need such California standards to meet compelling and extraordinary conditions; or (3) California's standards and accompanying enforcement procedures are not consistent with this section.
EPA's evaluation of the 2011 TRU Amendments, including the Within-the-Scope Amendments and Full Authorization Amendments, is set forth below. Because of the similarity of the within-the-scope criteria and the full authorization criteria, a discussion of both sets of respective amendments take place within each authorization criterion. To the extent that the criteria are applied uniquely, or that additional criteria apply under either the within-the-scope analysis or the full authorization analysis, such application is also addressed below.
In its March 2, 2015 letter requesting a within-the-scope determination, CARB stated that in approving the amendments to the TRU ATCM, the Board approved Resolution 11-35.
After evaluating the materials submitted by CARB, and since EPA has not adopted any standards or requirements for in-use TRU systems or engines, and based on no comments submitted to the record, I cannot find that California's TRU amendments undermine California's previous determination that its standards, in the aggregate, are at least as protective of public health and welfare as applicable federal standards. Thus I cannot deny CARB's within-the-scope request based on this criterion. Similarly, with regard to the Full Authorization Amendments I cannot make a finding that CARB's protectiveness determination is arbitrary and capricious and thus I cannot deny CARB's Full Authorization Amendments based on this criterion.
Section 209(e)(2)(A)(ii) instructs that EPA cannot grant an authorization if the Agency finds that California “does not need such California standards to meet compelling and extraordinary conditions . . . .” EPA's inquiry under this second criterion (found both in paragraphs 209(b)(1)(B) and 209(e)(2)(A)(ii)) has been to determine whether California needs its own mobile source pollution program (
EPA does not examine the section 209(e)(2)(A)(ii) criterion in the context of within-the-scope requests since the original regulations (that received a previous authorization from EPA) have already been evaluated under this criterion. However, should CARB adopt amendments that require a full authorization assessment (
California has asserted its longstanding position that the State continues to need its own nonroad engine program to meet serious air pollution problems.
There has been no evidence submitted to indicate that California's compelling and extraordinary conditions do not continue to exist. California, including the South Coast and the San Joaquin Valley air basins, continues to experience some of the worst air quality in the nation and continues to be in non-attainment with national ambient
We received no contrary evidence or comments contesting California's longstanding determination that its TRU ATCM program is needed to address the state's compelling and extraordinary conditions, nor did we receive any suggestion that CARB's nonroad program is not still necessary. In addition, EPA is not aware of any other information that would suggest that California no longer needs its nonroad emission program. Therefore, based on the record of this request and absence of comments or other information to the contrary, I cannot find that California does not continue to need such state standards, including the 2011 TRU Amendments, to address the “compelling and extraordinary conditions” underlying the state's air pollution problems.
Section 209(e)(2)(A)(iii) of the Act instructs that EPA cannot grant an authorization if California's standards and enforcement procedures are not consistent with “this section.” As described above, EPA's section 209(e) rule states that the Administrator shall not grant authorization to California if she finds (among other tests) that the “California standards and accompanying enforcement procedures are not consistent with section 209.” EPA has interpreted the requirement to mean that California standards and accompanying enforcement procedures must be consistent with at least section 209(a), section 209(e)(1), and section 209(b)(1)(C), as EPA has interpreted this last subsection in the context of motor vehicle waivers.
Section 209(a) of the Clean Air Act prohibits states or any political subdivisions of states from setting emission standards for new motor vehicles or new motor vehicle engines. Section 209(a) is modified in turn by section 209(b) which allows California to set such standards if other statutory requirements are met. To find a standard to be inconsistent with section 209(a) for purposes of section 209(e)(2)(A)(iii), EPA must find that the standard in question actually regulates new motor vehicles or new motor vehicle engines.
To be consistent with section 209(e)(1) of the Clean Air Act, California's standards or other requirements relating to the control of emissions must not relate to new engines which are used in farm or construction equipment or vehicles and which are smaller than 175 horsepower (hp), and new locomotives or new engines used in locomotives.
In its authorization request, CARB states that in granting an authorization for the initial TRU ATCM regulation, EPA found that the TRU ATCM was consistent with CAA sections 209(a) and 209(e)(1) because the ATCM did not apply to new motor vehicles and engines or to new engines under 175 hp used in farm and construction vehicles or equipment or to new locomotives or locomotive engines.
Therefore, I cannot deny California's request on the basis that 2011 TRU Amendments are not consistent with section 209(a) and section 209(e)(1).
The requirement that California's standards be consistent with section 209(b)(1)(C) of the Clean Air Act effectively requires consistency with section 202(a) of the Act. To determine this consistency, EPA has applied to California nonroad standards the same test it has used previously for California motor vehicle standards; namely, state standards are inconsistent with section 202(a) of the Act if there is inadequate lead-time to permit the development of technology necessary to meet those requirements, giving appropriate consideration to the cost of compliance within that timeframe. California's accompanying enforcement procedures would also be inconsistent with section 202(a) if federal and California test procedures conflicted. The scope of EPA's review of whether California's action is consistent with section 202(a) is narrow. The determination is limited to whether those opposed to the authorization or waiver have met their burden of establishing that California's standards are technologically infeasible, or that California's test procedures impose requirements inconsistent with the federal test procedures.
The legislative history of section 209 (including the “consistency with section 202(a)” requirement in 209(b)(1)(C)) indicates that this provision is intended to relate to technological feasibility.
With regard to the Within-the-Scope Amendments, CARB notes that the amendments are designed to provide owners with greater flexibility to comply with the existing TRU ATCM's in-use requirements. The amendments were not the result of non-existing technologies according to CARB, but rather that the Board determined that special considerations were necessary to accommodate TRU owners during implementation of the rule, including the availability of certain diesel emission control devices or the availability of cleaner Tier 4 standard engines in the later model years. With regard to the amendments that specify requirements for repowering TRUs with new replacement engines and the allowance for owners to repower TRUs with rebuilt engines, CARB notes that these amendments do not modify the pre-existing compliance dates that EPA previously authorized and EPA has previously addressed rebuilding
EPA received comment acknowledging that the technology for data collection and record reporting currently exists, but that additional development will be necessary to ensure that the technology will provide the necessary information for reporting purposes while also providing the necessary security and safeguards to protect proprietary information of both the original equipment manufacturers (“OEMs”) and the equipment owner.
As noted above, EPA's determination is limited to whether those opposed to the authorization or waiver have met their burden of establishing that California's standards are technologically infeasible. I agree that the Within-the-Scope Amendments are designed to relax (
EPA has stated in the past that if California promulgates amendments that raise new issues affecting previously granted waivers or authorizations, we would not confirm that those amendments are within the scope of previous authorizations.
After evaluating CARB's 2011 TRU Amendments described above, EPA is taking the following actions. First, I am granting an authorization for the Full Authorization Amendments. Second, I confirm that the Within-the-Scope Amendments are within the scope of the previous EPA authorizations.
This decision will affect persons not only in California, but also manufacturers and/or owners/operators nationwide who must comply with California's requirements. In addition, because other states may adopt California's standards for which a section 209(e)(2)(A) authorization has been granted if certain criteria are met, this decision would also affect those states and those persons in such states.
As with past authorization and waiver decisions, this action is not a rule as defined by Executive Order 12866. Therefore, it is exempt from review by the Office of Management and Budget as required for rules and regulations by Executive Order 12866.
In addition, this action is not a rule as defined in the Regulatory Flexibility Act, 5 U.S.C. 601(2). Therefore, EPA has not prepared a supporting regulatory flexibility analysis addressing the impact of this action on small business entities.
Further, the Congressional Review Act, 5 U.S.C. 801,
Environmental Protection Agency (EPA).
Notice of proposed settlement agreement; request for public comment.
In accordance with section 113(g) of the Clean Air Act, as amended (“CAA”), notice is hereby given of a proposed settlement agreement to address a lawsuit filed by Sierra Club in the United States Court of Appeals for the District of Columbia Circuit:
Written comments on the proposed settlement agreement must be received by February 21, 2017.
Submit your comments, identified by Docket ID number EPA-HQ-OGC-2017- 0030, online at
Jonathan Skinner-Thompson, Air and Radiation Law Office (2344A), Office of General Counsel, U.S. Environmental Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460; telephone: (202) 564-0291; fax number (202) 564-5603; email address:
Sierra Club filed a petition for review of EPA's final action titled “Revisions to Ambient Monitoring Quality Assurance and Other Requirements” (“final action”) at 81 FR 17,248 (Mar. 28, 2016). In the final action, EPA revised requirements pertaining to public inspection of proposed annual monitoring network plans under 40 CFR 58.10.
Under the terms of the proposed settlement agreement, Sierra Club would agree to dismiss its case with prejudice upon EPA's issuance of two nonbinding guidance documents. The first guidance document would be issued to state and local monitoring agencies and would make public inspection recommendations concerning proposed monitoring plans. The second guidance document would be issued to EPA regional offices and would make recommendations for stakeholder notification of submitted monitoring plan approvals and disapprovals. The United States also would agree to make a payment in settlement of Sierra Club's claim for fees and costs. Please review the settlement agreement for additional details, available in the public docket at EPA-HQ-OGC-2017-0030.
For a period of 30 days following the date of publication of this notice, the Agency will receive written comments relating to the proposed settlement agreement from persons who were not named as parties or intervenors to the litigation in question. EPA or the Department of Justice may withdraw or withhold consent to the proposed settlement agreement if the comments disclose facts or considerations that indicate that such consent is inappropriate, improper, inadequate, or inconsistent with the requirements of the Act. Unless EPA or the Department of Justice determines that consent to the agreement should be withdrawn or withheld, the terms of the agreement will be affirmed.
The official public docket for this action under Docket ID No. EPA-HQ-OGC-2017-0030 contains a copy of the proposed settlement agreement. The official public docket is available for public viewing at the Office of Environmental Information (OEI) Docket in the EPA Docket Center, EPA West, Room 3334, 1301 Constitution Ave. NW., Washington, DC. The EPA Docket Center Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Public Reading Room is (202) 566-1744, and the telephone number for the OEI Docket is (202) 566-1752.
An electronic version of the public docket is available through
It is important to note that EPA's policy is that public comments, whether submitted electronically or in paper, will be made available for public viewing online at
You may submit comments as provided in the
If you submit an electronic comment, EPA recommends that you include your name, mailing address, and an email address or other contact information in the body of your comment and with any disk or CD ROM you submit. This ensures that you can be identified as the submitter of the comment and allows EPA to contact you in case EPA cannot read your comment due to technical difficulties or needs further information on the substance of your comment. Any identifying or contact information provided in the body of a comment will be included as part of the comment that is placed in the official public docket, and made available in EPA's electronic public docket. If EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, EPA may not be able to consider your comment.
Use of the
Environmental Protection Agency (EPA).
Notice of availability for comment.
The Director of the Water Division, Environmental Protection Agency (EPA) Region 6 today proposes to reissue the National Pollutant Discharge Elimination System (NPDES) general permit for the Territorial Seas of Texas (No. TXG260000) for discharges from existing and new dischargers and New Sources in the Offshore Subcategory of the Oil and Gas Extraction Point Source Category as authorized by section 402 of the Clean Water Act, 33 U.S.C. 1342. The permit will supersede the previous general permit (TXG260000) issued on February 8, 2012 and published in the
Comments must be received by March 6, 2017.
Ms. Evelyn Rosborough, Region 6, U.S. Environmental Protection Agency, 1445 Ross Avenue, Dallas, Texas 75202-2733. Telephone: (214) 665-7515. Email:
A complete draft permit and a fact sheet more fully explaining the proposal may be obtained from Ms. Rosborough. In addition, the Agency's current administrative record on the proposal is available for examination at the Region's Dallas offices during normal working hours after providing Ms. Rosborough 24 hours advance notice. A copy of the proposed permit, fact sheet, and this
EPA intends to use the proposed reissued permit to regulate discharges from oil and gas extraction facilities located in the territorial seas off Texas. To obtain discharge authorization, operators of such facilities must submit a new Notice of Intent (NOI). To determine whether your (facility, company, business, organization, etc.) is regulated by this action, you should carefully examine the applicability criteria in Part I, Section A.2 of the permit. If you have questions regarding the applicability of this action to a particular entity, consult the person listed in the
State certification under section 401 of the CWA; consistency with the Texas Coastal Management Program; and compliance with National Environmental Policy Act, Endangered Species Act, Magnuson-Stevens Fishery Conservation and Management Act, Historic Preservation Act, Paperwork Reduction Act, and Regulatory Flexibility Act requirements are discussed in the fact sheet to the proposed permit.
Environmental Protection Agency (EPA).
Notice of final permit issuance.
All ten EPA Regions today are issuing the 2017 National Pollutant Discharge Elimination System (NPDES) general permit for stormwater discharges from construction activities to waters of the United States, also referred to as the “2017 Construction General Permit (CGP).” The 2017 CGP replaces the existing general permit (the “2012 CGP”) covering stormwater discharges from construction activities that expires on February 16, 2017. EPA is issuing this permit for five (5) years, during which time the permit will make available coverage to eligible operators in all areas of the country where EPA is the NPDES permitting authority. This
The 2017 CGP will become effective on February 16, 2017. This effective date will provide dischargers with the immediate opportunity to comply with Clean Water Act requirements in light of the expiration of the 2012 CGP at midnight on February 16, 2017. In accordance with 40 CFR part 23, specifically 23.2, this permit shall be considered issued for the purpose of judicial review on January 25, 2017. Under section 509(b) of the Clean Water Act, judicial review of this general permit can be requested by filing a petition for review in the United States Court of Appeals within 120 days after the permit is considered issued. Under section 509(b)(2) of the Clean Water Act, this permit may not be challenged later in civil or criminal proceedings to enforce this permit. In addition, this permit may not be challenged in any other agency proceedings. Deadlines for submittal of notices of intent are provided in Part 1.4.3 of the permit. The permit also provides additional dates for compliance with the terms of the permit.
For further information on the permit, contact the appropriate EPA Regional office listed in Section I.C of this notice, or Emily Halter, EPA Headquarters, Office of Water, Office of Wastewater Management at tel.: 202-564-3324 or email:
This section is organized as follows:
This permit covers the following entities, as categorized in the North American Industry Classification System (NAICS):
EPA does not intend the preceding table to be exhaustive, but provides it as a guide for readers regarding the types of activities that EPA is now aware of that could potentially be affected by this action. Other types of entities not listed in the table could also be affected. To determine whether your site is covered by this action, you should carefully examine the definition of “construction activity” and “small construction activity” in existing EPA regulations at 40 CFR 122.26(b)(14)(x) and 122.26(b)(15), respectively. If you have questions regarding the applicability of this action to a particular entity, consult one of the persons listed for technical information in the preceding
Coverage under this permit is available to operators of eligible projects located in those areas where EPA is the permitting authority. A list of eligible areas is included in Appendix B of the permit. Eligibility for permit coverage is limited to operators of “new sites,” operators of “existing sites,” “new operators of permitted sites,” and operators of “emergency-related projects.” A “new site” is a site where construction activities commenced on or after February 16, 2017. An “existing site” is a site where construction activities commenced prior to February 16, 2017. A “new operator of a permitted site” is an operator that through transfer of ownership and/or operation replaces the operator of an already permitted construction site that is either a “new site” or an “existing site.” An “emergency-related project” is a project initiated in response to a public emergency
This permit makes coverage available to eligible operators for stormwater discharges from construction activities that occur in areas not covered by an approved state NPDES program. The areas of geographic coverage of this permit are listed in Appendix B, and include the states of New Hampshire, Massachusetts, New Mexico, and Idaho as well as most Indian country lands, and areas in selected states operated by a federal operator. Permit coverage is also available to eligible operators in Puerto Rico, the District of Columbia, and the Pacific Island territories, among others.
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Electronic versions of this permit and fact sheet are available on EPA's NPDES Web site at
An electronic version of the public docket is available through the EPA's electronic public docket and comment system, EPA Dockets. You may use EPA Dockets at
For EPA Region 1, contact Suzanne Warner at tel.: (617) 918-1383 or email at
For EPA Region 2, contact Stephen Venezia at tel.: (212) 637-3856 or email at
For EPA Region 3, contact Carissa Moncavage at tel.: (215) 814-5798 or email at
For EPA Region 4, contact Michael Mitchell at tel.: (404) 562-9303 or email at
For EPA Region 5, contact Brian Bell at tel.: (312) 886-0981 or email at
For EPA Region 6, contact Suzanna Perea at tel.: (214) 665-7217 or email at:
For EPA Region 7, contact Mark Matthews at tel.: (913) 551-7635 or email at:
For EPA Region 8, contact Amy Clark at tel.: (303) 312-7014 or email at:
For EPA Region 9, contact Eugene Bromley at tel.: (415) 972-3510 or email at
For EPA Region 10, contact Margaret McCauley at tel.: (206) 553-1772 or email at
The Clean Water Act (“CWA”) establishes a comprehensive program “to restore and maintain the chemical, physical, and biological integrity of the Nation's waters.” 33 U.S.C. 1251(a). The CWA also includes the objective of attaining “water quality which provides for the protection and propagation of fish, shellfish and wildlife and * * * recreation in and on the water.” 33 U.S.C. 1251(a)(2)). To achieve these goals, the CWA requires EPA to control discharges of pollutants from point sources through the issuance of NPDES permits.
The Water Quality Act of 1987 (WQA) added section 402(p) to the CWA, which directed EPA to develop a phased approach to regulate stormwater discharges under the NPDES program. 33 U.S.C. 1342(p). EPA published a final regulation in the
NPDES permits for construction stormwater discharges are required under Section 402(a)(1) of the CWA to include conditions to meet technology-based effluent limits established under Section 301 and, where applicable, Section 306. Effluent Limitations Guidelines (ELGs) and New Source Performance Standards (NSPS) are technology-based effluent limitations that are based on the degree of control that can be achieved using various levels of pollutant control technology as defined in Subchapter III of the CWA.
Once a new national standard is established in accordance with these sections, NPDES permits must incorporate limits based on such technology-based standards. See CWA sections 301 and 306, 33 U.S.C. 1311 and 1316, and 40 CFR 122.44(a)(1). On December 1, 2009, EPA published final regulations establishing technology-based ELGs and NSPSs for the Construction & Development (C&D) point source category, which became effective on February 1, 2010. See 40 CFR part 450, and 74 FR 62996 (December 1, 2009). The Construction & Development Rule, or “C&D rule,” was amended on March 6, 2014 to satisfy EPA's agreements pursuant to a settlement of litigation that challenged the 2009 rule. See 79 FR 12661. All NPDES construction stormwater NPDES permits issued by EPA or states after this date must incorporate the requirements in the C&D rule.
The final 2017 CGP is substantially similar to the 2012 CGP. It includes effluent limitations
As stated above, all NPDES construction permits issued by EPA or states after March 6, 2014 must incorporate the requirements in the C&D rule, as amended. The non-numeric effluent limitations in the C&D rule are designed to prevent the mobilization and discharge of sediment and sediment-bound pollutants, such as metals and nutrients, and to prevent or minimize exposure of stormwater to construction materials, debris, and other sources of pollutants on construction sites. In addition, these non-numeric effluent limitations reduce the generation of dissolved pollutants. Soil on construction sites can contain a variety of pollutants such as nutrients, pesticides, herbicides, and metals. These pollutants may be present naturally in the soil, such as arsenic or selenium, or they may have been contributed by previous activities on the site, such as agriculture or industrial activities. These pollutants, once mobilized by stormwater, can detach from the soil particles and become dissolved pollutants. Once dissolved, these pollutants would not be removed by down-slope sediment controls. Source control through minimization of soil erosion is therefore the most effective way of controlling the discharge of these pollutants.
The non-numeric effluent limits in the C&D rule, upon which the technology-based requirements in the permit are based, include the following:
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1. Control stormwater volume and velocity to minimize soil erosion in order to minimize pollutant discharges;
2. Control stormwater discharges, including both peak flowrates and total stormwater volume, to minimize channel and streambank erosion and scour in the immediate vicinity of discharge points;
3. Minimize the amount of soil exposed during construction activity;
4. Minimize the disturbance of steep slopes;
5. Minimize sediment discharges from the site. The design, installation and maintenance of erosion and sediment controls must address factors such as the amount, frequency, intensity and duration of precipitation, the nature of resulting stormwater discharge, and soil characteristics, including the range of soil particle sizes expected to be present on the site;
6. Provide and maintain natural buffers around waters of the United States, direct stormwater to vegetated areas and maximize stormwater infiltration to reduce pollutant discharges, unless infeasible;
7. Minimize soil compaction. Minimizing soil compaction is not required where the intended function of a specific area of the site dictates that it be compacted; and
8. Unless infeasible, preserve topsoil. Preserving topsoil is not required where the intended function of a specific area of the site dictates that the topsoil be disturbed or removed.
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1. Minimize the discharge of pollutants from equipment and vehicle washing, wheel wash water, and other wash waters. Wash waters must be treated in a sediment basin or alternative control that provides
2. Minimize the exposure of building materials, building products, construction wastes, trash, landscape materials, fertilizers, pesticides, herbicides, detergents, sanitary waste and other materials present on the site to precipitation and to stormwater. Minimization of exposure is not required in cases where the exposure to precipitation and to stormwater will not result in a discharge of pollutants, or where exposure of a specific material or product poses little risk of stormwater contamination (such as final products and materials intended for outdoor use); and
3. Minimize the discharge of pollutants from spills and leaks and implement chemical spill and leak prevention and response procedures.
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1. Wastewater from washout of concrete, unless managed by an appropriate control;
2. Wastewater from washout and cleanout of stucco, paint, form release oils, curing compounds and other construction materials;
3. Fuels, oils, or other pollutants used in vehicle and equipment operation and maintenance; and
4. Soaps or solvents used in vehicle and equipment washing.
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The fact sheet details how EPA has incorporated these requirements into the final 2017 CGP. The discussion in the fact sheet includes a summary of each provision and the agency's rationale for articulating the provision in this way.
EPA's regulations at 40 CFR 122.44(d)(1) require permitting authorities to include additional or more stringent permit requirements when necessary to achieve water quality standards. The 2012 CGP contained several provisions to protect water quality and the 2017 CGP includes those same provisions. The permit includes a narrative WQBEL requiring that discharges be controlled as necessary to meet applicable water quality standards. Failure to control discharges in a manner that meets applicable water quality standards is a violation of the permit.
In addition to the narrative WQBEL, the permit contains related provisions that act together to further protect water quality. Many of these provisions were also included in the 2012 CGP. For example, the permit requires operators to implement stormwater control measures and to take corrective action in response to any exceedance of applicable water quality standards. To provide further protection, the permit also requires more stringent site inspection frequencies and stabilization deadlines for constructions sites that discharge to sensitive waters, such as those waters that are impaired for sediment or nutrients, which are parameters typically associated with stormwater discharges from construction sites, or waters identified by a state, tribe, or EPA as requiring enhanced protection under antidegradation requirements. Additionally, EPA received CWA Section 401 certifications for the 2017 CGP. Some of these certifications include additional water quality-based conditions that are required by states, Indian country lands, and territories, that become legally binding permit limits and conditions in specific geographic areas where the permit is available.
A new water quality protection established in the 2017 CGP is a modified approach to site stabilization deadlines based on the concept of phasing construction disturbances, where sites that disturb more than five (5) acres total over the course of a construction project are required to stabilize within a more stringent timeframe if they do not limit disturbances to five (5) acres or less at any one time. This modified approach is summarized below and is discussed in more detail in the fact sheet.
The 2017 CGP includes several new or modified requirements, which are summarized below and discussed in more detail in the fact sheet. The final 2017 CGP and the fact sheet can be found at
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• The type of construction site (select one or more of 9 options);
• A yes/no question asking if there is demolition of a structure with at least 10,000 square feet of floor space that was built or renovated before January 1, 1980; and
• A yes/no question asking whether the predevelopment land use was used for agriculture.
Following issuance of the 2017 CGP, EPA plans to provide further assistance to construction operators, state permitting authorities, and other interested parties on various aspects of this new permit. The following activities or documents are planned:
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EPA will consider additional outreach to support the 2017 CGP based on the level of interest and demand.
EPA expects the economic impact on entities that will likely seek coverage under this permit, including small businesses, to be minimal. A copy of EPA's economic analysis, titled “Cost Impact Analysis for the 2017 Construction General Permit (CGP),” is available in the docket for this permit. The economic impact analysis indicates that while there may be some incremental increase in the costs of complying with the 2017 CGP over the 2012 CGP, these costs will not have a significant economic impact on a substantial number of small entities.
This analysis evaluates the cost implications of the key changes to the permit. Each change is examined in light of the 2012 CGP's requirements, where applicable. The objective of this examination is to show where or to what extent the 2017 CGP includes requirements that impose an incremental increase in costs on operators above and beyond costs that are already accounted for in the 2012 CGP, which incorporated the C&D rule and defines the baseline of costs to which operators are currently subject.
The C&D rule baseline costs estimate the cost of compliance for all construction activities required to obtain NPDES permit coverage to implement the stormwater controls required by the Effluent Limitations Guideline. While the C&D rule applies to permitted construction activities under the NPDES program nationwide, the 2017 CGP provides coverage to a sub-set of those activities in areas not covered by an approved state NPDES program, which accounts for approximately 5-6 percent of the construction stormwater permitted universe under the NPDES program.
Calculating the total cost of EPA's construction stormwater program under the 2017 CGP is challenging for several reasons. NPDES general permits, such as the CGP, are issued to no one operator in particular, with multiple operators obtaining coverage under the general permit after it is issued. Therefore, the 2017 CGP has an inherently unknown permitted universe at the time of permit issuance. EPA can estimate that approximately 25,000 operators will seek coverage under the 2017 CGP during its five-year life span, based on data from previous CGPs.
However, the total cost calculation is dependent on many other factors and assumptions that are difficult to estimate or extrapolate for the entire CGP permitted universe. Although many operators under the CGP share similar operations and discharge properties, the variables that would need to be accounted for in estimating the total cost of compliance vary widely across individual construction sites, for example, total area and duration that land is disturbed, slope, climate and precipitation patterns, soil type, topography, and previous land use. In addition, factors such as labor and material costs vary across the country. Given that EPA does not know and does not collect data on all of the specific operator characteristics necessary to make an accurate estimate, EPA is not able to estimate the total cost of
Part 3.2 has a new requirement in the 2017 CGP for operators discharging to waters impaired for PCBs. Buildings and structures originating or remodeled between the years of 1950-1979 often contain PCBs in materials such as caulk and paint. Without proper controls, the demolition of such structures can cause PCBs to be released into the environment and discharged into waters of the U.S. during storm events. To address this concern, EPA has added a new provision that requires controls to be implemented to minimize exposure of PCB-containing building materials to precipitation and stormwater, and to ensure that such materials are disposed in compliance with applicable state, federal, and local laws. The requirement is limited to the demolition of buildings or structures with at least 10,000 square feet of floor space built or renovated before January 1, 1980 on sites that discharge to waters with known impairments for PCBs.
Over 4,500 water bodies are currently listed in the PCB-polluted category, making this the sixth-highest water pollution cause nationwide. This includes 81,610 miles of rivers and streams, 3,204,534 acres of lakes and ponds, and 400,094 square miles of bays and estuaries that are impaired for PCBs. EPA does not currently have data on the number of construction projects subject to EPA's CGP that involve demolition of a structure with at least 10,000 square feet of floor space built or renovated before January 1, 1980 on sites that discharge to waters impaired for PCBs. Therefore, at this time, EPA does not have an estimate for the number of operators that will be affected by this new requirement. However, EPA added a new question on the NOI form asking about the prevalence of demolition of a structure with at least 10,000 square feet of floor space that was built or renovated before January 1, 1980. When reissuing this permit, EPA will review the data submitted on the NOI forms as well as information on the implementation of this requirement, as necessary, to determine whether to revise the applicability of the requirement or associated cost impact analysis.
Under Executive Order 12866 (58 FR 51735, October 4, 1993), this action is a “significant regulatory action.” Accordingly, EPA submitted this action to the Office of Management and Budget (OMB) for review under Executive Orders 12866 and 13563 (76 FR 3821, January 21, 2011) and any changes made in response to OMB recommendations have been documented in the docket for this action.
Executive Order (EO) 12898 (59 FR 7629 (Feb. 16, 1994)) establishes federal executive policy on environmental justice. Its main provision directs federal agencies, to the greatest extent practicable and permitted by law, to make environmental justice part of their mission by identifying and addressing, as appropriate, disproportionately high and adverse human health or environmental effects of their programs, policies, and activities on minority populations and low-income populations in the United States.
EPA has determined that the 2017 CGP will not have disproportionately high and adverse human health or environmental effects on minority or low-income populations because the requirements in the permit apply equally to all construction projects that disturb one or more acres in areas where EPA is the permitting authority, and the erosion and sediment control provisions increase the level of environmental protection for all affected populations.
In compliance with Executive Order 13175, EPA consulted with tribal officials to gain an understanding of and, where necessary, address the tribal implications of the permit. In the course of this consultation, EPA conducted the following activities:
• August 5, 2015—EPA mailed notification letters to all Tribal leaders, initiating consultation and coordination on the draft 2017 CGP. The consultation period was from August 17, 2015 to October 13, 2015.
• August 11, 2015—EPA presented a brief overview of the 2012 CGP and information regarding the upcoming consultation to the National Tribal Caucus.
• August 12, 2015—EPA presented a brief overview of the 2012 CGP and information regarding the upcoming consultation to the National Tribal Water Council.
• September 22, 2015—EPA held a consultation teleconference call; 18 Tribes were represented. EPA responded to the general questions raised on the call.
• On October 14, 2015, EPA received one set of comments from a Tribe in the State of Washington. EPA evaluated and considered the comments during the finalization of the 2017 CGP; EPA responded to the formal comments submitted in writing during the comment period in the Agency's final action.
• EPA will provide email notification to Tribes of today's final 2017 CGP.
EPA also notes that as part of the finalization of 2017 CGP, it completed the Section 401 certification procedures with all applicable tribes where the 2017 CGP applies (see Appendix B).
Clean Water Act, 33 U.S.C. 1251
Environmental Protection Agency.
Notice of decision.
The Environmental Protection Agency (“EPA”) is granting the California Air Resources Board (“CARB”) its request for an authorization of its amendments to its Off-Highway Recreational Vehicle regulation (“OHRV Amendments”). The OHRV Amendments establish new evaporative emission standards and test procedures for 2018 and subsequent model year OHRVs. The California OHRV category encompasses a wide variety of vehicles, including off-road motorcycles, all-terrain vehicles (“ATVs”), off-road sport and utility vehicles, sand cars, and golf carts. This decision is issued under the authority of the Clean Air Act (“CAA” or “Act”).
Petitions for review must be filed by March 20, 2017.
EPA has established a docket for this action under Docket ID EPA-HQ-OAR-2016-0181. All documents relied upon in making this decision, including those submitted to EPA by CARB, are contained in the public docket. Publicly available docket materials are available either electronically through
EPA's Office of Transportation and Air Quality (“OTAQ”) maintains a Web page that contains general information on its review of California waiver and authorization requests. Included on that page are links to prior waiver
David Dickinson, Attorney-Advisor, Transportation Climate Division, Office of Transportation and Air Quality, U.S. Environmental Protection Agency, 1200 Pennsylvania Avenue, (6405J), NW., Washington, DC 20460. Telephone: (202) 343-9256. Fax: (202) 343-2800. Email:
CARB first adopted exhaust emission standards and test procedures applicable to OHRVs and the engines used in OHRVs in 1994, and EPA authorized California to enforce such standards and test procedures in 1996.
In 2002, EPA adopted regulations that established both exhaust and evaporative emission standards for nonroad recreational vehicles and engines, including off-road motorcycles and ATVs.
In a letter dated February 26, 2016, CARB submitted to EPA its request pursuant to section 209(e) of the CAA, regarding authorization of its OHRV Amendments.
The OHRV Amendments differ from preexisting OHRV requirements because they impose a 1.0 g/day evaporative emissions standard for the complete OHRV fuel system. Previously the OHRV regulation only required fuel tanks and fuel hoses to meet specific permeation standards. The OHRV Amendments comprehensively address all potential sources of evaporative emissions, including running losses (evaporative emissions generated during vehicle operation), hot soak (evaporative emission generated directly after vehicle operation), and diurnal losses (evaporative emissions generated during long term storage). The OHRV
Section 209(e)(1) of the Act permanently preempts any state, or political subdivision thereof, from adopting or attempting to enforce any standard or other requirement relating to the control of emissions for certain new nonroad engines or vehicles.
On July 20, 1994, EPA promulgated a rule interpreting the three criteria set forth in section 209(e)(2)(A) that EPA must consider before granting any California authorization request for nonroad engine or vehicle emission standards.
In order to be consistent with section 209(a), California's nonroad standards and enforcement procedures must not apply to new motor vehicles or new motor vehicle engines. To be consistent with section 209(e)(1), California's nonroad standards and enforcement procedures must not attempt to regulate engine categories that are permanently preempted from state regulation. To determine consistency with section 209(b)(1)(C), EPA typically reviews nonroad authorization requests under the same “consistency” criteria that are applied to motor vehicle waiver requests under section 209(b)(1)(C). That provision provides that the Administrator shall not grant California a motor vehicle waiver if she finds that California “standards and accompanying enforcement procedures are not consistent with section 202(a)” of the Act. Previous decisions granting waivers and authorizations have noted that state standards and enforcement procedures will be found to be inconsistent with section 202(a) if (1) there is inadequate lead time to permit the development of the necessary technology, giving appropriate consideration to the cost of compliance within that time,
In light of the similar language in sections 209(b) and 209(e)(2)(A), EPA has reviewed California's requests for authorization of nonroad vehicle or engine standards under section 209(e)(2)(A) using the same principles that it has historically applied in reviewing requests for waivers of preemption for new motor vehicle or new motor vehicle engine standards under section 209(b).
The law makes it clear that the waiver requests cannot be denied unless the specific findings designated in the statute can properly be made. The issue of whether a proposed California requirement is likely to result in only marginal improvement in California air quality not commensurate with its costs or is otherwise an arguably unwise exercise of regulatory power is not legally pertinent to my decision under section 209, so long as the California requirement is consistent with section 202(a) and is more stringent than applicable Federal requirements in the sense that it may result in some further reduction in air pollution in California.
This principle of narrow EPA review has been upheld by the U.S. Court of Appeals for the District of Columbia Circuit.
In previous waiver and authorization decisions, EPA has recognized that the intent of Congress in creating a limited review based on the section 209(b)(1) criteria was to ensure that the federal government did not second-guess state policy choices. As the agency explained in one prior waiver decision:
It is worth noting . . . I would feel constrained to approve a California approach to the problem which I might also feel unable to adopt at the federal level in my own capacity as a regulator. The whole approach of the Clean Air Act is to force the development of new types of emission control technology where that is needed by compelling the industry to “catch up” to some degree with newly promulgated standards. Such an approach . . . may be attended with costs, in the shape of reduced product offering, or price or fuel economy penalties, and by risks that a wider number of vehicle classes may not be able to complete their development work in time. Since a balancing of these risks and costs against the potential benefits from reduced emissions is a central policy decision for any regulatory agency under the statutory scheme outlined above, I believe I am required to give very substantial deference to California's judgments on this score.
Similarly, EPA has stated that the text, structure, and history of the California waiver provision clearly indicate both a congressional intent and appropriate EPA practice of leaving the decision on “ambiguous and controversial matters of public policy” to California's judgment.
As the U.S. Court of Appeals for the D.C. Circuit has made clear in
[T]he language of the statute and its legislative history indicate that California's regulations, and California's determinations that they must comply with the statute, when presented to the Administrator are presumed to satisfy the waiver requirements and that the burden of proving otherwise is on whoever attacks them. California must present its regulations and findings at the hearing and thereafter the parties opposing the waiver request bear the burden of persuading the Administrator that the waiver request should be denied.
The same logic applies to authorization requests. The Administrator's burden, on the other hand, is to make a reasonable evaluation of the information in the record in coming to the waiver decision. As the court in
With regard to the standard of proof, the court in
[. . .] consider all evidence that passes the threshold test of materiality and . . . thereafter assess such material evidence against a standard of proof to determine whether the parties favoring a denial of the waiver have shown that the factual circumstances exist in which Congress intended a denial of the waiver.
With regard to the protectiveness finding, the court upheld the Administrator's position that, to deny a waiver, there must be “clear and compelling evidence” to show that proposed enforcement procedures undermine the protectiveness of California's standards.
With respect to the consistency finding, the court did not articulate a standard of proof applicable to all proceedings, but found that the opponents of the waiver were unable to meet their burden of proof even if the standard were a mere preponderance of the evidence. EPA's past waiver decisions have consistently made clear that: “[E]ven in the two areas concededly reserved for Federal judgment by this legislation—the existence of `compelling and extraordinary' conditions and whether the standards are technologically feasible—Congress intended that the standards of EPA review of the State decision to be a narrow one.”
Upon review of CARB's request, EPA offered an opportunity for a public hearing, and requested written comment on issues relevant to a section 209(e)(2)(A) authorization analysis, by publication of a
EPA did not receive a request for hearing and therefore no hearing was held. EPA did not receive any written comments. EPA's evaluation is based on the record, which includes CARB's authorization request and accompanying documents.
Section 209(e)(2)(i) of the Act instructs that EPA cannot grant an authorization if the agency finds that CARB was arbitrary and capricious in its determination that its standards are, in the aggregate, at least as protective of public health and welfare as applicable federal standards. CARB's Board made a protectiveness determination in Resolution 13-33, declaring that “the Amendments approved for adoption herein will not cause California emission standards, in the aggregate, to be less protective of public health and welfare than applicable federal standards.”
After evaluating the materials submitted by CARB, and since EPA has not adopted any comparable standards or requirements for OHRVs, and based on the lack of any comments submitted to the record, I cannot find that CARB's protectiveness determination is arbitrary and capricious and thus I cannot deny CARB's authorization request based on this criterion.
Section 209(e)(2)(A)(ii) of the Act instructs that EPA cannot grant an authorization if the agency finds that California “does not need such California standards to meet compelling and extraordinary conditions.” EPA's inquiry under this second criterion (found both in paragraph 209(b)(1)(B) and 209(e)(2)(A)(ii)) has been to determine whether California needs its own mobile source pollution program (
California has asserted its longstanding position that the State continues to need its own nonroad engine program to meet serious air pollution problems.
There has been no evidence submitted to indicate that California's compelling and extraordinary conditions do not continue to exist. California, including the South Coast and the San Joaquin Valley air basins, continues to experience some of the worst air quality in the nation and continues to be in non-attainment with national ambient air quality standards for PM
Therefore, based on the record of this request and absence of comments or other information to the contrary, I cannot find that California does not continue to need such state standards, including the OHRV Amendments, to address the “compelling and extraordinary conditions” underlying the state's air pollution problems. I have determined that I cannot deny California authorization for its OHRV Amendments based on the section 209(e)(2)(A)(ii) criterion.
Section 209(e)(2)(A)(iii) of the Act instructs that EPA cannot grant an authorization if California's standards and enforcement procedures are not consistent with “this section.” As described above, EPA's section 209(e) rule states that the Administrator shall not grant authorization to California if she finds (among other tests) that the “California standards and accompanying enforcement procedures are not consistent with section 209.” EPA has interpreted this requirement to mean that California standards and accompanying enforcement procedures must be consistent with at least sections 209(a), 209(e)(1), and 209(b)(1)(C), as EPA has interpreted this last subsection in the context of motor vehicle waivers. Thus, this can be viewed as a three-pronged test.
To be consistent with section 209(a) of the Clean Air Act, California's OHRV Amendments (and CARB's underlying OHRV regulation) must not apply to new motor vehicles or new motor vehicle engines. California's OHRV regulation applies to a wide variety of vehicles, including off-road motorcycles, ATVs, off-road sport and utility vehicles, sand cars, and golf carts. CARB states that the OHRV Amendments, much like the previously authorized OHRV regulation, do not apply to the categories of preempted mobile sources. No commenter presented otherwise, and EPA is not otherwise aware of any contrary evidence; therefore, EPA cannot deny California's request on the basis that California's OHRV regulation (including the OHRV Amendments) is not consistent with section 209(a).
To be consistent with section 209(e)(1) of the Clean Air Act, California's OHRV regulation must not affect new farming or construction vehicles or engines that are below 175 horsepower, or new locomotives or their engines. CARB presents that OHRV engines are not used in locomotives and are not primarily used in farm and construction equipment or vehicles. No commenter presented otherwise, and EPA is not otherwise aware of any contrary evidence; therefore, I cannot deny California's request on the basis that California's OHRV regulation
The requirement that California's standards be consistent with section 209(b)(1)(C) of the Clean Air Act effectively requires consistency with section 202(a) of the Act. California standards are inconsistent with section 202(a) of the Act if there is inadequate lead-time to permit the development of technology necessary to meet those requirements, giving appropriate consideration to the cost of compliance within that time. California's accompanying enforcement procedures would also be inconsistent with section 202(a) if the federal and California test procedures were not consistent. The scope of EPA's review of whether California's action is consistent with section 202(a) is narrow. The determination is limited to whether those opposed to the authorization or waiver have met their burden of establishing that California's standards are technologically infeasible, or that California's test procedures impose requirements inconsistent with the federal test procedure.
Congress has stated that the consistency requirement of section 202(a) relates to technological feasibility.
CARB states that its Staff Report explains the technology needed to comply with the primary diurnal evaporative emission standards and that such technology clearly exists as it is being used by manufacturers of on-road mobile sources.
With regard to test procedure consistency, CARB states that the OHRV Amendments present no issue of incompatibility between California and federal test procedures since there are no analogous federal standards or associated test procedures applicable to 2018 and subsequent model year nonroad recreational vehicles and engines.
EPA did not receive any comments that suggests California's OHRV Amendments regulations are technologically infeasible. In addition, EPA believes that CARB has reasonably identified, within the lead time provided, the types of technologies that can be used to meet the OHRV Amendments. EPA is not otherwise aware of any evidence to suggest such technologies cannot be employed in the manner CARB has identified. In addition, EPA finds no basis to determine that CARB's test procedures are incompatible with federal test procedures given the lack of applicable federal evaporative emission standards and test procedures.
Therefore, based on the record before us, I cannot find that the OHRV Amendments are technologically infeasible or otherwise inconsistent with section 202(a). Therefore, I cannot deny CARB's authorization based on the section 202(a) criterion.
After evaluating California's OHRV Amendments and CARB's submissions for EPA review as described above, I am granting an authorization for the OHRV Amendments.
This decision will affect not only persons in California, but also manufacturers and/or owners/operators nationwide who must comply with California's requirements. In addition, because other states may adopt California's standards for which a section 209(e)(2)(A) authorization has been granted if certain criteria are met, this decision would also affect those states and those persons in such states.
As with past authorization and waiver decisions, this action is not a rule as defined by Executive Order 12866. Therefore, it is exempt from review by the Office of Management and Budget as required for rules and regulations by Executive Order 12866.
In addition, this action is not a rule as defined in the Regulatory Flexibility Act, 5 U.S.C. 601(2). Therefore, EPA has not prepared a supporting regulatory flexibility analysis addressing the impact of this action on small business entities.
Further, the Congressional Review Act, 5 U.S.C. 801,
Environmental Protection Agency (EPA).
Notice.
EPA will hold a public meeting to receive input and information to assist the Agency in its efforts to establish the scope of risk evaluations under development for the ten chemical substances designated on December 19, 2016 for risk evaluations pursuant to the Toxic Substances Control Act (TSCA), as amended by the Frank R. Lautenberg Chemical Safety for the 21st Century Act. In particular, EPA is providing the public an opportunity to identify information specifically related to the conditions of use for the ten chemical substances (
To request accommodation of a disability, please contact the meeting logistics person listed under
You may be potentially affected by this action if you manufacture (defined under TSCA to include import), process, distribute in commerce, use or dispose of any of the ten chemical substances identified for risk evaluation in the
The docket for this meeting, identified by docket identification (ID) number EPA-HQ-OPPT-2017-0002, is available at
EPA is required to conduct chemical risk evaluations under section 6(b) the Toxic Substances Control Act (TSCA), as amended by the Frank R. Lautenberg Chemical Safety for the 21st Century Act, to determine whether a chemical substance presents an unreasonable risk of injury to health or the environment. (15 U.S.C. 2605(b)(4)). Pursuant to TSCA section 6(b)(2)(A), EPA identified ten chemical substances for initial risk evaluations under TSCA in the
The first step in the risk evaluation process, as outlined in TSCA, is to issue a scoping document for each chemical substance within six months of its designation in the
At the public meeting, EPA will provide an overview briefing to describe the information the Agency has
In view of the statutory deadline to complete these ten risk evaluations, it will be difficult, and may not be possible, for EPA to adjust the scope of the evaluations following release of the scoping document under TSCA section 6(b)(4)(D). In addition, EPA notes that the scoping document is a foundation for determining the scope of preemption arising after final risk evaluations (TSCA section 18(a)(1)(B)). Thus, EPA requests that members of the public provide any available information relating to the scope of the risk evaluations at the February meeting or to the docket by March 1, 2017. EPA will likely not be able to accommodate information as to scope received after that time.
The meeting will be accessible remotely for registered participants. Registered participants will receive information on how to connect remotely to the meeting prior to its start.
Anyone may register to attend the meeting as observers and may also register to provide oral comments on the day of the meeting. A registered speaker is encouraged to focus on issues directly relevant to the meeting's subject matter. Each speaker is allowed no more than 5 minutes to provide oral comments. To accommodate as many registered speakers as possible, speakers may present oral comments only, without visual aids or written material.
Anyone may submit written materials to the dockets described in Unit IV.C.
To attend the meeting in person or to receive remote access, you must register no later than February 10, 2017, using one of the methods described under
Members of the public may register to attend as observers or speak if planning to offer oral comments during the scheduled public comment period. To register for the meeting online, you must provide your full name, organization or affiliation, and contact information to the on-line signup or to the meeting registration contact person listed under
You may also elect to provide information to EPA's dockets for the ten chemical substances for which risk evaluations have begun. EPA has established separate dockets for each of the ten chemical substances for risk evaluation to facilitate receipt of information which may be useful to the Agency's risk evaluations. As noted above, EPA is asking the public for assistance in identifying information specifically related to the conditions of use (
Information can be submitted by one of the following methods:
15 U.S.C. 2605.
Environmental Protection Agency (EPA).
Notice; request for nominations for peer reviewers and request for public comment.
The Environmental Protection Agency (EPA) is announcing the release of materials for public comment that relate to the expert external peer review of documents intended to support the EPA's Safe Drinking Water Act assessment of lead in drinking water. EPA invites the public to nominate scientific experts to be considered as peer reviewers for the contract-managed peer review. Nominations of peer review candidates will be accepted by EPA's contractor, Eastern Research Group, Inc. (ERG). EPA also requests public comment on the draft report entitled “Proposed Modeling Approaches for a Health Based Benchmark for Lead in Drinking Water” and the draft charge questions for the expert peer review panel. These materials will be reviewed by an expert peer review panel and public comments will be made available to the peer reviewers for consideration in their review.
The nominations for expert peer review candidates must be received by ERG on or before February 21, 2017. Comments on the draft lead modeling report and draft peer review panel charge questions must be received by EPA on or before March 6, 2017.
Any interested person or organization may nominate scientific experts to be considered as peer reviewers. Nominations should be submitted to ERG no later than February 21, 2017 by one of the following methods:
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•
Nominations should include all nominee information outlined in section III of the
Submit your comments on the draft lead modeling report and draft charge, identified by Docket ID No. EPA-HQ-OW-2016-0686, to the Federal eRulemaking Portal:
Questions concerning nominations of expert peer reviewers should be directed to Eastern Research Group, Inc. (ERG), 110 Hartwell Avenue, Lexington, MA 02421; by email at
For additional information concerning the draft lead modeling report and draft peer review charge questions, please contact Erik Helm at the U.S. Environmental Protection Agency, Office of Ground Water and Drinking Water, Standards and Risk Management Division, (Mail Code 4607M), 1200 Pennsylvania Avenue NW., Washington, DC 20460; by phone: 202-566-1049; or by email:
EPA's Office of Ground Water and Drinking Water is in the process of considering National Primary Drinking Water Regulations for Lead and Copper: Regulatory Revisions (LCR) to improve public health protection by making changes to rule requirements under the Safe Drinking Water Act (SDWA). EPA has engaged with stakeholder groups and the public to inform revisions to the LCR. As part of this work, the EPA's National Drinking Water Advisory Committee (NDWAC) Lead and Copper Rule Working Group was established to inform NDWAC advice to the Administrator on recommendations to strengthen public health protections of the Lead and Copper Rule. In December 2015, the NDWAC provided specific recommendations to the EPA Administrator for LCR revisions related to lead service line replacement, public education, corrosion control treatment, copper, tap sampling, and the establishment of a “household action level.
While EPA has not yet determined the specific role of a household action level in the revised LCR, the Agency has developed potential scientific modeling approaches to define the relationship between lead levels in drinking water and blood lead levels, particularly for sensitive life stages such as formula fed infants and children up to age seven. EPA is using the terminology “health based benchmark” to refer to this concept. EPA is conducting an expert peer review of alternative approaches to inform future consideration of a health based benchmark for the LCR revisions. The purpose of this review is to obtain feedback on various lead modeling methods that can be used to characterize the relationship between lead in drinking water and children's blood lead levels.
EPA has developed three approaches that model how lead in drinking water influences blood lead levels (BLLs) of children. All the approaches use the Integrated Exposure Uptake and Biokinetic (IEUBK) Model for Lead in Children. Approaches 1 and 2 assess the relationship between water lead concentration and potential BLLs at different points in the IEUBK predicted distribution of BLLs. Approach 3 uses EPA's Stochastic Human Exposure and Dose Simulation model for multimedia, multipathway chemicals (SHEDS-Multimedia), coupled with IEUBK, to determine the drinking water lead concentrations that would result in BLLs at particular percentiles of a simulated national distribution of BLLs for children at various ages.
EPA's draft lead modeling report entitled “Proposed Modeling Approaches for a Health Based Benchmark for Lead in Drinking Water” and the draft charge for the peer review panel are available electronically and can be accessed using the Public Docket at
Environmental Protection Agency (EPA).
Notice of the availability of funds.
The Environmental Protection Agency (EPA) plans to make available approximately $13 million to provide supplemental funds to Revolving Loan Fund (RLF) capitalization grants previously awarded competitively under section 104(k)(3) of the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA). Brownfields Cleanup Revolving Loan Fund pilots awarded under section 104(d)(1) of CERCLA that have not transitioned to section 104(k)(3) grants are not eligible to apply for these funds. EPA will consider awarding supplemental funding only to RLF grantees who have demonstrated an ability to deliver programmatic results by making at least one loan or subgrant. The award of these funds is based on the criteria described at CERCLA 104(k)(4)(A)(ii).
The Agency is now accepting requests for supplemental funding from RLF grantees. Requests for funding must be submitted to the appropriate EPA Regional Brownfields Coordinator (listed below) by March 1, 2017. Funding requests for hazardous substances and/or petroleum funding will be accepted. Specific information on submitting a request for RLF supplemental funding is described below and additional information may be obtained by contacting the EPA Regional Brownfields Coordinator.
This action is effective January 19, 2017.
A request for supplemental funding must be in the form of a letter addressed to the appropriate Regional Brownfields Coordinator (see listing below) with a copy to Pankaj Arora,
Pankaj Arora, U.S. EPA, (202) 566-1388 or the appropriate Brownfields Regional Coordinator.
The Small Business Liability Relief and Brownfields Revitalization Act added section 104(k) to CERCLA to authorize federal financial assistance for brownfields revitalization, including grants for assessment, cleanup and job training. Section 104(k) includes a provision for EPA to, among other things, award grants to eligible entities to capitalize Revolving Loan Funds and to provide loans and subgrants for brownfields cleanup. Section 104(k)(4)(A)(ii) authorizes EPA to make additional grant funds available to RLF grantees for any year after the year for which the initial grant is made (noncompetitive RLF supplemental funding) taking into consideration:
(I) The number of sites and number of communities that are addressed by the revolving loan fund;
(II) the demand for funding by eligible entities that have not previously received a grant under this subsection;
(III) the demonstrated ability of the eligible entity to use the revolving loan fund to enhance remediation and provide funds on a continuing basis; and
(IV) such other similar factors as the [Agency] considers appropriate to carry out this subsection.
In order to be considered for supplemental funding, grantees must demonstrate that they have significantly depleted funds (both EPA grant funding and any available pre- or post-closeout program income) and that they have a clear plan for quickly utilizing requested additional funds. Grantees must demonstrate that they have made at least one loan or subgrant prior to applying for this supplemental funding and have significantly depleted existing available funds. For FY2017, EPA defines “significantly depleted funds” as $400,000 or less remaining unliquidated obligations from all of the EPA RLF grant funding and available pre- or post-closeout program income from all the open or closed EPA RLF grants. Additionally, the RLF recipient must have demonstrated a need for supplemental funding based on, among other factors, the number of sites that will be addressed; demonstrated the ability to make loans and subgrants for cleanups that can be started and completed expeditiously (
Federal Communications Commission.
Notice.
This document commences a hearing to determine whether Acumen Communications (Acumen) is qualified to be and to remain a Federal Communications Commission (Commission) licensee, and as a consequence thereof, whether any or all of its licenses should be revoked, and whether any or all of the applications to which Acumen is a party should be denied. As discussed more fully below, based on the totality of the evidence, there are substantial and material questions of fact as to whether Acumen
Each party to the proceeding (except for the Chief, Enforcement Bureau), in person or by counsel, shall file with the Commission, by January 30, 2017, a written appearance stating that the party will appear on the date fixed for hearing and present evidence on the issues specified herein.
Federal Communications Commission, 445 12th Street SW., Washington, DC 20554.
Pamela Kane, Special Counsel, Enforcement Bureau, (202) 418-2393.
This is a summary of the Commission's Order to Show Cause, Hearing Designation Order and Notice of Opportunity for Hearing (Order) in WT Docket No. 17-17, DA 17-33, adopted on January 9, 2017, and released on January 10, 2017. The full text of the Order is available for inspection and copying during regular business hours in the FCC Reference Center, 445 12th Street SW., Room CY-A257, Portals II, Washington, DC 20554. This document is available in alternative formats (computer diskette, large print, audio record, and Braille). Persons with disabilities who need documents in these formats may contact the FCC by email:
1. In this Order, the Commission commences a hearing proceeding before a Commission Administrative Law Judge to determine whether the pending applications of Acumen Communications should be granted, and whether Acumen's licenses should be revoked. Acumen represented to the Commission in fifty (50) license applications that no party directly or indirectly controlling Acumen has ever been convicted of a felony by any state or federal court. The information before us indicates that Hector Manuel Mosquera, a party directly or indirectly controlling Acumen, was convicted of a felony by a state court in California. The evidence further indicates that Mr. Mosquera signed Acumen's applications in which Acumen answered “N” to the felony question.
2. Accordingly,
(a) To determine whether Hector Manuel Mosquera directly or indirectly controls Acumen.
(b) To determine whether Acumen engaged in misrepresentation and/or lack of candor in its applications with the Commission.
(c) To determine whether Acumen failed to amend its pending applications, in willful and/or repeated violation of section 1.65 of the Commission's rules.
(d) To determine, in light of the evidence adduced pursuant to the foregoing issues, whether Acumen is qualified to be and remain a Commission licensee.
(e) To determine, in light of the foregoing issues, whether the authorizations for which Acumen is the licensee should be revoked.
(f) To determine, in light of the foregoing issues, whether the captioned applications filed by or on behalf of Acumen should be granted.
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Federal Election Commission.
Tuesday, January 24, 2017 at 10:00 a.m. and its continuation at the conclusion of the open meeting on January 25, 2017.
999 E Street NW., Washington, DC.
This meeting will be closed to the public.
Compliance matters pursuant to 52 U.S.C. 30109.
Matters concerning participation in civil actions or proceedings or arbitration.
Judith Ingram, Press Officer, Telephone: (202) 694-1220.
Federal Housing Finance Agency.
Notice.
The Federal Housing Finance Agency (FHFA) has adjusted the cap on average total assets that is used in determining whether a Federal Home Loan Bank (Bank) member qualifies as a “community financial institution” (CFI) to $1,148,000,000, based on the annual percentage increase in the Consumer Price Index for all urban consumers (CPI-U), as published by the Department of Labor (DOL). These changes took effect on January 1, 2017.
Kaitlin Hildner, Division of Federal Home Loan Bank Regulation, (202) 649-3329,
The Federal Home Loan Bank Act (Bank Act) confers upon insured depository institutions that meet the statutory definition of a CFI certain advantages over non-CFI insured depository institutions in qualifying for Bank membership, and in the purposes for which they may receive long-term advances and the collateral they may pledge to secure advances.
As of January 1, 2017, FHFA has increased the CFI asset cap to $1,148,000,000, which reflects a 1.7 percent increase in the unadjusted CPI-U from November 2015 to November 2016. Consistent with the practice of other Federal agencies, FHFA bases the annual adjustment to the CFI asset cap on the percentage increase in the CPI-U from November of the year prior to the preceding calendar year to November of the preceding calendar year, because the November figures represent the most recent available data as of January 1st of the current calendar year. The new CFI asset cap was obtained by applying the percentage increase in the CPI-U to the unrounded amount for the preceding year and rounding to the nearest million, as has been FHFA's practice for all previous adjustments.
In calculating the CFI asset cap, FHFA uses CPI-U data that have not been seasonally adjusted (
The Commission hereby gives notice of the filing of the following agreements under the Shipping Act of 1984. Interested parties may submit comments on the agreements to the Secretary, Federal Maritime Commission, Washington, DC 20573, within twelve days of the date this notice appears in the
By Order of the Federal Maritime Commission.
The companies listed in this notice have applied to the Board for approval, pursuant to the Bank Holding Company
The applications listed below, as well as other related filings required by the Board, are available for immediate inspection at the Federal Reserve Bank indicated. The applications will also be available for inspection at the offices of the Board of Governors. Interested persons may express their views in writing on the standards enumerated in the BHC Act (12 U.S.C. 1842(c)). If the proposal also involves the acquisition of a nonbanking company, the review also includes whether the acquisition of the nonbanking company complies with the standards in section 4 of the BHC Act (12 U.S.C. 1843). Unless otherwise noted, nonbanking activities will be conducted throughout the United States.
Unless otherwise noted, comments regarding each of these applications must be received at the Reserve Bank indicated or the offices of the Board of Governors not later than February 14, 2017.
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General Services Administration (GSA).
Notice of a new system of records.
GSA proposes to establish a new system of records subject to the Privacy Act of 1974. The proposed system is a single sign-on platform to facilitate access to government services.
The system of records notice is effective upon its publication in today's
Submit comments identified by “Notice-ID-2016-03, Notice of New System of Records” by any of the following methods:
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Call the GSA Chief Privacy Officer at telephone 202-322-8246; or email
GSA proposes to establish a new system of records subject to the Privacy Act of 1974, 5 U.S.C. 552a. The proposed system is a single sign-on platform to facilitate access to government services. The previously published notice, at 81 FR 57912, on August 24, 2016, is being replaced. The system is a single, secure platform through which members of the public can log-in and access services from participating federal agencies (partner agencies). All federal agencies are eligible to participate, and those that do will be listed on the
Identity proofing is the process of verifying that a person is who they say they are. Personally Identifiable Information (PII) must be collected from a
The identity proofing process between
Once a user is proofed at LOA1, that user's account information will be assigned a meaningless, but unique,
The information in
Unclassified.
The system is owned and maintained by GSA, housed in secure datacenters in continental United States. Contact the System Manager listed below for additional information.
Joel Minton, Director,
E-Government Act of 2002 (Pub. L. 107-347, 44 U.S.C. 3501 note), 6 U.S.C. 1523 (b)(1)(A)-(E), and 40 U.S.C. 501.
The purpose of the system is to provide a single, secure platform through which members of the public can log-in and access services from partner agencies, and to increase user security by facilitating identity proofing and authentication as necessary in order to access specific government services.
Anyone with an email account and access to a phone is able to create an account at any time. Individuals in this system of records are members of the public seeking electronic access to a service from a participating Federal agency (partner agency), including anyone attempting to authenticate and/or identity proof for the purpose of obtaining a credential to electronically access a partner agency's services. All federal agencies are eligible to participate, and those that do will be listed on the Login.gov information page.
The information collected by
If a third party identity proofing service is unable to proof the user based on the user's LOA3 account information,
Each third party identity proofing service will send information back to
Each partner agency whose services the user accesses via
The sources for information in the system are the individual
In addition to those disclosures generally permitted under 5 U.S.C. 552a(b) of the Privacy Act, all or a portion of the records or information contained in this system may be disclosed to authorized entities, as is determined to be relevant and necessary, outside GSA as a routine use pursuant to 5 U.S.C. 552a(b)(3) as follows:
a. To the Department of Justice or other Federal agency conducting litigation or in proceedings before any court, adjudicative or administrative body, when: (a) GSA or any component thereof, or (b) any employee of GSA in his/her official capacity, or (c) any employee of GSA in his/her individual capacity where DOJ or GSA has agreed to represent the employee, or (d) the United States or any agency thereof, is a party to the litigation or has an interest in such litigation, and GSA determines that the records are both relevant and necessary to the litigation.
b. To NIST-compliant third party identity proofing services, as necessary to identity proof an individual for access to a service at the required level of assurance.
c. To an appropriate Federal, State, tribal, local, international, or foreign law enforcement agency or other appropriate authority charged with investigating or prosecuting a violation or enforcing or implementing a law, rule, regulation, or order, where a record, either on its face or in conjunction with other information, indicates a violation or potential violation of law, which includes criminal, civil, or regulatory violations and such disclosure is proper and consistent with the official duties of the person making the disclosure.
d. To a Member of Congress or his or her staff in response to a request made on behalf of and at the request of the individual who is the subject of the record.
e. To the Office of Management and Budget (OMB) and the Government Accountability Office (GAO) in accordance with their responsibilities for evaluation or oversight of Federal programs.
f. To an expert, consultant, or contractor of GSA in the performance of a Federal duty to which the information is relevant.
g. To the National Archives and Records Administration (NARA) for records management purposes.
h. To appropriate agencies, entities, and persons when (1) GSA suspects or has confirmed that there has been a breach of the system of records; (2) GSA has determined that as a result of the suspected or confirmed breach there is a risk of harm to individuals, GSA (including its information systems, programs and operations), the Federal Government, or national security; and (3) the disclosure made to such
i. To another Federal agency or Federal entity, when GSA determines that information from this system of records is reasonably necessary to assist the recipient agency or entity in (1) responding to a suspected or confirmed breach or (2) preventing, minimizing, or remedying the risk of harm to individuals, the recipient agency or entity (including its information systems, programs, and operations), the Federal Government, or national security, resulting from a suspected or confirmed breach.
All records are stored electronically in a database. User account information is encrypted in transit and at rest.
The user's email address and phone number, which are part of LOA1 account information, can be retrieved using
System records will be retained and disposed of in accordance with NARA's General Records Schedule (GRS) Transmittal 26, section 3.2 “System access records” covering user profiles, log-in files, password files, audit trail files and extracts, system usage files, and cost-back files used to assess charges for system use. The guidance instructs, “Destroy 6 years after password is altered or user account is terminated, but longer retention is authorized if required for business use.”
Records in the system are protected from unauthorized access and misuse through various administrative, technical and physical security measures. Technical security measures within GSA include restrictions on computer access to authorized individuals, required use of strong passwords that are frequently changed and regular review of security procedures and best practices to enhance security. Access to the
Individuals or users wishing to access their own records may do so by providing their email address, password, and a multi-factor authentication token (
Users can modify, or amend, any of their user account information by accessing it in their account. Users that want access to partner agency records, or to contest the contents of those records, need to make a request with that agency.
Users create their account information and, thereafter, access it by providing their email address, password, and a multi-factor authentication token (
None.
This notice replaces the previously published notice at 81 FR 57912, on August 24, 2016.
Centers for Disease Control and Prevention (CDC), Department of Health and Human Services (HHS).
Notice with comment period.
The Centers for Disease Control and Prevention (CDC), as part of its continuing efforts to reduce public burden and maximize the utility of government information, invites the general public and other Federal agencies to take this opportunity to comment on proposed and/or continuous information collection, as required by the Paperwork Reduction Act of 1995. This notice invites comments on the CDC Chronic Disease Management Information System (CDMIS). The Management Information System is a central repository for the work plans of state oral health programs. This includes their goals, objectives, performance milestones, indicators, oral health program performance activities and budget information.
Written comments must be received on or before March 20, 2017.
You may submit comments, identified by Docket No. CDC-2016-0114 by any of the following methods:
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To request more information on the proposed project or to obtain a copy of
Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501-3520), Federal agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. In addition, the PRA also requires Federal agencies to provide a 60-day notice in the
CDC Oral Health Management Information System (OMB Control Number 0920-0739, expires 5/31/2017)—Revision—Division of Oral Health (DOH), National Center for Chronic Disease Prevention and Health Promotion (NCCDPHP), Centers for Disease Control and Prevention (CDC).
The CDC Division of Oral Health (DOH) works with state health departments to improve the oral health of the nation. Targeted efforts include building and/or maintaining effective public health capacity for the implementation, evaluation, and dissemination of evidence-based practices in oral disease prevention and advancement of oral health. Through a cooperative agreement program (Program Announcement DP13-1307), DOH has provided funding to 21 states over a five-year period, in which 3 are basic level awardees and 18 are enhanced level. The current cooperative agreement went into effect in September 2013 and builds on previously funded collaborations involving DOH and state programs.
DOH is currently approved to collect annual progress and activity reports from state-based oral health programs. Historically, an electronic reporting system has been in place since 2007 and was enhanced in 2008 to capture information about grantees' success stories. This system, formerly known as the Management Overview for Logistics, Analysis, and Reporting (MOLAR) system was retired in 2013-14. The new cooperative agreement, DP13-1307, was transitioned to the enhanced CDMIS platform in Fiscal Year (FY) 2013 to align with the CDC Funding Opportunity Announcement (FOA) redesign required for all domestic, non-research FOAs. The redesign emphasized evaluation, performance measurement, and outcomes. The information collected in CDMIS improved CDC's ability to disseminate information about successful public health approaches that can be replicated or adapted for use in other states.
The initial data for DP13-1307 was entered into CDMIS when the cooperative agreement began. Subsequently, only annual progress reports are required for basic and enhanced level awardees. This has resulted in no changes in how the information is collected as well as a reduction in the burden of information required by awardees. The estimated burden for system maintenance and annual reporting is three hours for basic level awardees and nine hours for enhanced level.
The revised method provides a more accurate depiction of burden per respondent in comparison to the method presented in previous OMB requests for approval, which were based on a long-term average burden per response. Even though reports will be submitted to CDC annually, states may enter updates into the MIS at any time. CDC uses all information collected to monitor awardee activities and to provide any technical assistance or follow-up support that may be needed.
OMB approval is requested for three years. Participation in the progress reporting system is a condition of the award for all funded state oral health programs.
All information will be collected electronically and there are no costs to respondents other than their time. The total estimated annualized burden hours are 171.
National Institute for Occupational Safety and Health (NIOSH), Centers for Disease Control and Prevention, Department of Health and Human Services (HHS).
Notice.
HHS gives notice of a decision to designate a class of employees from the Pantex Plant in Amarillo, Texas, as an addition to the Special Exposure Cohort (SEC) under the Energy Employees Occupational Illness Compensation Program Act of 2000.
Stuart L. Hinnefeld, Director, Division of Compensation Analysis and Support, NIOSH, 1090 Tusculum Avenue, MS C-46, Cincinnati, OH 45226-1938, Telephone 1-877-222-7570. Information requests can also be submitted by email to
42 U.S.C. 7384q(b). 42 U.S.C. 7384
On January 4, 2017, as provided for under 42 U.S.C. 7384
All employees of the Department of Energy, its predecessor agencies, and their contractors and subcontractors who worked at the Pantex Plant in Amarillo, Texas, during the period from January 1, 1951, through December 31, 1957, for a number of work days aggregating at least 250 work days, occurring either solely under this employment or in combination with work days within the parameters established for one or more other classes of employees in the Special Exposure Cohort.
This designation will become effective on February 3, 2017, unless Congress provides otherwise prior to the effective date. After this effective date, HHS will publish a notice in the
Centers for Disease Control and Prevention (CDC), Department of Health and Human Services (HHS).
General notice—notice of revision of confidentiality pledges under the Confidential Information Protection and Statistical Efficiency Act.
Under 44 U.S.C. 3506(e) and 44 U.S.C. 3501, CDC's National Center for Health Statistics (NCHS) is announcing revisions to the confidentiality pledge(s) it provides to its respondents under the Confidential Information Protection and Statistical Efficiency Act (44 U.S.C. 3501) (CIPSEA). These revisions are required by the passage and implementation of provisions of the Federal Cybersecurity Enhancement Act of 2015 (H.R. 2029, Division N, Title II, Subtitle B, Sec. 223), which permit and require the Secretary of the Department of Homeland Security (DHS) to provide Federal civilian agencies' information technology systems with cybersecurity protection for their Internet traffic. More details on this announcement are presented in the
These revisions become effective January 19, 2017.
Questions about this notice should be addressed to the Information Collection Review Office, Centers for Disease Control and Prevention, 1600 Clifton Road NE., MS-D74, Atlanta, Georgia 30329.
Leroy A. Richardson by telephone at 404-639-7570 (this is not a toll-free number); by email
Federal statistics provide key information that the Nation uses to measure its performance and make informed choices about budgets, employment, health, investments, taxes, and a host of other significant topics. The overwhelming majority of Federal surveys are conducted on a voluntary basis. Respondents, ranging from businesses to households to institutions, may choose whether or not to provide the requested information. Many of the most valuable Federal statistics come from surveys that ask for highly sensitive information such as proprietary business data from companies or particularly personal information or practices from individuals. The CDC's National Center for Health Statistics (NCHS) protects all data collected under its authority under the confidentiality provisions of section 308(d) of the Public Health service Act (42 U.S.C. 242m). Strong and trusted confidentiality and exclusively statistical use pledges under the Confidential Information Protection and Statistical Efficiency Act (CIPSEA) and similar statistical confidentiality pledges are effective and necessary in honoring the trust that businesses, individuals, and institutions, by their responses, place in statistical agencies.
Under CIPSEA and similar statistical confidentiality protection statutes, many Federal statistical agencies make statutory pledges that the information respondents provide will be seen only by statistical agency personnel or their sworn agents, and will be used only for statistical purposes. CIPSEA and similar statutes protect the confidentiality of information that agencies collect solely for statistical purposes and under a pledge of confidentiality. These acts protect such statistical information from administrative, law enforcement, taxation, regulatory, or any other non-statistical use and immunize the information submitted to statistical agencies from legal process. Moreover, many of these statutes carry criminal penalties of a Class E felony (fines up to $250,000, or up to five years in prison, or both) for conviction of a knowing and willful unauthorized disclosure of covered information.
As part of the Consolidated Appropriations Act for Fiscal Year 2016 signed on December 17, 2015, the Congress included the Federal Cybersecurity Enhancement Act of 2015 (H.R. 2029, Division N, Title II, Subtitle B, Sec. 223). This Act, among other provisions, permits and requires the Secretary of the Department of Homeland Security (DHS) to provide Federal civilian agencies' information
When such a signature is found, the Internet packets that contain the malware signature are shunted aside for further inspection by DHS personnel. Because it is possible that such packets entering or leaving a statistical agency's information technology system may contain a small portion of confidential statistical data, statistical agencies can no longer promise their respondents that their responses will be seen only by statistical agency personnel or their sworn agents. However, they can promise, in accordance with provisions of the Federal Cybersecurity Enhancement Act of 2015, that such monitoring can be used only to protect information and information systems from cybersecurity risks, thereby, in effect, providing stronger protection to the integrity of the respondents' submissions.
Consequently, with the passage of the Federal Cybersecurity Enhancement Act of 2015, the Federal statistical community has an opportunity to welcome the further protection of its confidential data offered by DHS' Einstein 3A cybersecurity protection program. The DHS cybersecurity program's objective is to protect Federal civilian information systems from malicious malware attacks. The Federal statistical system's objective is to ensure that the DHS Secretary performs those essential duties in a manner that honors the Government's statutory promises to the public to protect their confidential data. Given that the Department of Homeland Security is not a Federal statistical agency, both DHS and the Federal statistical system have been successfully engaged in finding a way to balance both objectives and achieve these mutually reinforcing objectives.
However, many current CIPSEA and similar statistical confidentiality pledges promise that respondents' data will be seen only by statistical agency personnel or their sworn agents. Since it is possible that DHS personnel could see some portion of those confidential data in the course of examining the suspicious Internet packets identified by Einstein 3A sensors, statistical agencies need to revise their confidentiality pledges to reflect this process change.
Therefore, NCHS is providing this notice to alert the public to these confidentiality pledge revisions in an efficient and coordinated fashion. Below is a table listing NCHS's current Paperwork Reduction Act (PRA) OMB Control numbers and information collection titles and their associated revised confidentiality pledge(s) for the Information Collections whose confidentiality pledges will change to reflect the statutory implementation of DHS' Einstein 3A monitoring for cybersecurity protection purposes.
The following NCHS statistical confidentiality pledge will now apply to the Information Collections whose Paperwork Reduction Act Office of Management and Budget numbers and titles are listed below.
We take your privacy very seriously. All information that relates to or describes identifiable characteristics of individuals, a practice, or an establishment will be used only for statistical purposes. NCHS staff, contractors, and agents will not disclose or release responses in identifiable form without the consent of the individual or establishment in accordance with section 308(d) of the Public Health Service Act (42 U.S.C. 242m) and the Confidential Information Protection and Statistical Efficiency Act of 2002 (CIPSEA, Title 5 of Public Law 107-347). In accordance with CIPSEA, every NCHS employee, contractor, and agent has taken an oath and is subject to a jail term of up to five years, a fine of up to $250,000, or both if he or she willfully discloses ANY identifiable information about you. In addition, NCHS complies with the Federal Cybersecurity Enhancement Act of 2015. This law requires the federal government to protect federal computer networks by using computer security programs to identify cybersecurity risks like hacking, internet attacks, and other security weaknesses. If information sent through government networks triggers a cyber threat indicator, the information may be intercepted and reviewed for cyber threats by computer network experts working for, or on behalf of the government.
National Institute for Occupational Safety and Health (NIOSH), Centers for Disease Control and Prevention, Department of Health and Human Services (HHS).
Notice.
HHS gives notice of a decision to designate a class of employees from Area IV of the Santa Susana Field Laboratory in Ventura County, California, as an addition to the Special Exposure Cohort (SEC) under the Energy Employees Occupational Illness Compensation Program Act of 2000.
Stuart L. Hinnefeld, Director, Division of Compensation Analysis and Support, NIOSH, 1090 Tusculum Avenue, MS C-46, Cincinnati, OH 45226-1938, Telephone 1-877-222-7570. Information requests can also be submitted by email to
42 U.S.C. 7384q(b). 42 U.S.C. 7384
On January 6, 2017, as provided for under 42 U.S.C. 7384
All employees of the Department of Energy, its predecessor agencies, and their contractors and subcontractors who worked in any area at Area IV of the Santa Susana Field Laboratory in Ventura County, California, from January 1, 1965, through December 31, 1988, for a number of work days aggregating at least 250 work days, occurring either solely under this employment or in combination with work days within the parameters established for one or more other classes of employees included in the Special Exposure Cohort.
This designation will become effective on February 5, 2017, unless Congress provides otherwise prior to the effective date. After this effective date, HHS will publish a notice in the
Centers for Medicare & Medicaid Services, HHS.
Notice.
The Centers for Medicare & Medicaid Services (CMS) is announcing an opportunity for the public to comment on CMS' intention to collect information from the public. Under the Paperwork Reduction Act of 1995 (PRA), federal agencies are required to publish notice in the
Comments on the collection(s) of information must be received by the OMB desk officer by February 21, 2017.
When commenting on the proposed information collections, please reference the document identifier or OMB control number. To be assured consideration, comments and recommendations must be received by the OMB desk officer via one of the following transmissions: OMB, Office of Information and Regulatory Affairs, Attention: CMS Desk Officer, Fax Number: (202) 395-5806
To obtain copies of a supporting statement and any related forms for the proposed collection(s) summarized in this notice, you may make your request using one of following:
1. Access CMS' Web site address at
2. Email your request, including your address, phone number, OMB number, and CMS document identifier, to
3. Call the Reports Clearance Office at (410) 786-1326.
Reports Clearance Office at (410) 786-1326.
Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501-3520), federal agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. The term “collection of information” is defined in 44 U.S.C. 3502(3) and 5 CFR 1320.3(c) and includes agency requests or requirements that members of the public submit reports, keep records, or provide information to a third party. Section 3506(c)(2)(A) of the PRA (44 U.S.C. 3506(c)(2)(A)) requires federal agencies to publish a 30-day notice in the
1.
Centers for Medicare & Medicaid Services, HHS.
Notice.
The Centers for Medicare & Medicaid Services (CMS) is announcing an opportunity for the public to comment on CMS' intention to collect information from the public. Under the Paperwork Reduction Act of 1995 (the PRA), federal agencies are required to publish notice in the
Comments must be received by March 20, 2017.
When commenting, please reference the document identifier or OMB control number. To be assured consideration, comments and recommendations must be submitted in any one of the following ways:
1.
2.
To obtain copies of a supporting statement and any related forms for the proposed collection(s) summarized in this notice, you may make your request using one of following:
1. Access CMS' Web site address at
2. Email your request, including your address, phone number, OMB number, and CMS document identifier, to
3. Call the Reports Clearance Office at (410) 786-1326.
Reports Clearance Office at (410) 786-1326.
This notice sets out a summary of the use and burden associated with the following information collections. More detailed information can be found in each collection's supporting statement and associated materials (see
Under the PRA (44 U.S.C. 3501-3520), federal agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. The term “collection of information” is defined in 44 U.S.C. 3502(3) and 5 CFR 1320.3(c) and includes agency requests or requirements that members of the public submit reports, keep
1.
2.
Please note that on December 16, 2016 (81 FR 91175), a notice published in the
Centers for Medicare & Medicaid Services (CMS), HHS.
Notice of meeting.
This notice announces that a public meeting of the Medicare Evidence Development & Coverage Advisory Committee (MEDCAC) (“Committee”) will be held on Wednesday, March 22, 2017. This meeting will specifically focus on obtaining the MEDCAC's recommendations regarding what health outcomes in studies for heart failure treatment technologies should be of interest to CMS. This meeting is open to the public in accordance with the Federal Advisory Committee Act (5 U.S.C. App. 2, section 10(a)).
We will be broadcasting the meeting live via Webcast at
Maria Ellis, Executive Secretary for MEDCAC, Centers for Medicare & Medicaid Services, Center for Clinical Standards and Quality, Coverage and Analysis Group, S3-02-01, 7500 Security Boulevard, Baltimore, MD 21244 or contact Ms. Ellis by phone (410-786-0309) or via email at
MEDCAC, formerly known as the Medicare Coverage Advisory Committee (MCAC), is advisory in nature, with all final coverage decisions resting with CMS. MEDCAC is used to supplement CMS' internal expertise. Accordingly, the advice rendered by the MEDCAC is most useful when it results from a process of full scientific inquiry and thoughtful discussion, in an open forum, with careful framing of recommendations and clear identification of the basis of those recommendations. MEDCAC members are valued for their background, education, and expertise in a wide variety of scientific, clinical, and other related fields. (For more information on MCAC, see the MEDCAC Charter (
This notice announces the Wednesday, March 22, 2017, public meeting of the Committee. During this meeting, the Committee will discuss recommendations regarding what health outcomes in studies for heart failure treatment technologies should be of interest to CMS. Background information about this topic, including panel materials, is available at
The Committee will deliberate openly on the topics under consideration. Interested persons may observe the deliberations, but the Committee will not hear further comments during this time except at the request of the chairperson. The Committee will also allow a 15-minute unscheduled open public session for any attendee to address issues specific to the topics under consideration. At the conclusion of the day, the members will vote and the Committee will make its recommendation(s) to CMS.
CMS' Coverage and Analysis Group is coordinating meeting registration. While there is no registration fee, individuals must register to attend. You may register online at
This meeting will be held in a federal government building; therefore, federal security measures are applicable. The Real ID Act, enacted in 2005, establishes minimum standards for the issuance of state-issued driver's licenses and identification (ID) cards. It prohibits Federal agencies from accepting an official driver's license or ID card from a state unless the Department of Homeland Security determines that the state meets these standards. Beginning October 2015, photo IDs (such as a valid driver's license) issued by a state or territory not in compliance with the Real ID Act will not be accepted as identification to enter Federal buildings. Visitors from these states/territories will need to provide alternative proof of identification (such as a valid passport) to gain entrance into CMS buildings. The current list of states from which a Federal agency may accept driver's licenses for an official purpose is found at
• Presentation of government-issued photographic identification to the Federal Protective Service or Guard Service personnel.
• Inspection of vehicle's interior and exterior (this includes engine and trunk inspection) at the entrance to the grounds. Parking permits and instructions will be issued after the vehicle inspection.
• Inspection, via metal detector or other applicable means, of all persons entering the building. We note that all items brought into CMS, whether personal or for the purpose of presentation or to support a presentation, are subject to inspection. We cannot assume responsibility for coordinating the receipt, transfer, transport, storage, set-up, safety, or timely arrival of any personal belongings or items used for presentation or to support a presentation.
Individuals who are not registered in advance will not be permitted to enter the building and will be unable to attend the meeting. The public may not enter the building earlier than 45 minutes prior to the convening of the meeting.
All visitors must be escorted in areas other than the lower and first floor levels in the Central Building.
This document does not impose information collection requirements, that is, reporting, recordkeeping or third-party disclosure requirements. Consequently, there is no need for review by the Office of Management and Budget under the authority of the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35).
5 U.S.C. App. 2, section 10(a).
Food and Drug Administration, HHS.
Notice of availability.
The Food and Drug Administration (FDA or Agency) is announcing the availability of a draft guidance for industry (GFI) #187 entitled “Regulation of Intentionally Altered Genomic DNA in Animals.” This draft guidance revises GFI #187 entitled “Regulation of Genetically Engineered Animals Containing Heritable Recombinant DNA Constructs” (current GFI #187). Current GFI #187 clarifies FDA's requirements
Although you can comment on any guidance at any time (see 21 CFR 10.115(g)(5)), to ensure that the Agency considers your comment on this draft guidance before it begins work on the final version of the guidance, submit either electronic or written comments on the draft guidance by April 19, 2017.
You may submit comments as follows:
Submit electronic comments in the following way:
•
• If you want to submit a comment with confidential information that you do not wish to be made available to the public, submit the comment as a written/paper submission and in the manner detailed (see “Written/Paper Submissions” and “Instructions”).
Submit written/paper submissions as follows:
•
• For written/paper comments submitted to the Division of Dockets Management, FDA will post your comment, as well as any attachments, except for information submitted, marked and identified, as confidential, if submitted as detailed in “Instructions.”
• Confidential Submissions—To submit a comment with confidential information that you do not wish to be made publicly available, submit your comments only as a written/paper submission. You should submit two copies total. One copy will include the information you claim to be confidential with a heading or cover note that states “THIS DOCUMENT CONTAINS CONFIDENTIAL INFORMATION.” The Agency will review this copy, including the claimed confidential information, in its consideration of comments. The second copy, which will have the claimed confidential information redacted/blacked out, will be available for public viewing and posted on
Submit written requests for single copies of the guidance to the Policy and Regulations Staff (HFV-6), Center for Veterinary Medicine, Food and Drug Administration, 7519 Standish Pl., Rockville, MD 20855. Send one self-addressed adhesive label to assist that office in processing your requests. See the
Laura R. Epstein, Center for Veterinary Medicine (HFV-1), Food and Drug Administration, 7519 Standish Pl., Rockville, MD 20855, 301-796-8558,
FDA is announcing the availability, for public comment, of draft revised GFI #187 entitled “Regulation of Intentionally Altered Genomic DNA in Animals.” This draft guidance revises current GFI #187 entitled “Regulation of Genetically Engineered Animals Containing Heritable recombinant DNA Constructs” to expand the scope of the guidance to address animals intentionally altered through use of genome editing techniques. FDA is also requesting comment on nomenclature and on whether certain types of genome editing may pose minimal risk. Before finalizing the draft revised guidance, the agency intends to modify its regulatory approach if it receives evidence demonstrating low risk.
In the
Draft revised GFI #187 is intended to clarify that, unless otherwise excluded,
Similar to current GFI #187, draft revised GFI #187 is intended to clarify FDA's requirements and recommendations for producers and developers of animals with intentionally altered genomic DNA. Current GFI #187 and draft revised GFI #187 describe how the new animal drug provisions of the FD&C Act apply with respect to the intentionally altered genomic DNA of such animals.
Animals may have intentional genomic alterations that are heritable or non-heritable (
FDA requests comment on draft revised GFI #187. In particular, we request comments on two major categories of questions.
1. In the first, we seek the public's input on how to refer to these animals. In the past, FDA has used the term “genetically engineered” to refer to animals containing recombinant DNA constructs intended to alter the structure or function of the body of the animal. For this draft revised guidance, we have used the phrase “animals whose genomes have been altered intentionally.” Other terms that could be used include “genome edited animals,” “intentionally altered animals,” or expanding the term “genetically engineered” to include the deliberate modification of the characteristics of an organism by manipulating its genetic material. The public is encouraged to suggest other phrases that are accurate and inclusive.
2. The second set of questions for which we seek public input is on whether there is any existing empirical evidence demonstrating that certain types of genome editing may pose minimal risk, with particular emphasis on the following:
a. Are there categories of animals whose genomes have been intentionally altered for which specific empirical evidence indicates that there are no significant target animal, user safety, food safety, or environmental risks? If so, what is that evidence?
b. Are there categories of animals whose genomes have been intentionally altered for which empirical evidence exists to demonstrate that genome editing is durable on a genotypic and phenotypic level and would continue to be durable over the lifetime of a particular product? If so, what is that evidence?
c. Is there empirical evidence to demonstrate that there are degrees of introduced changes (
d. Is there empirical evidence that indicates that the degree of taxonomic relationship between the introduced gene and the recipient animal influences the health of that recipient animal or the extent to which the trait is expressed? If so, what is that evidence?
We noted in current GFI #187 that we might issue a separate guidance on the regulation of GE animals bearing non-heritable alterations. Draft revised GFI #187 removes references to this and other guidance documents that we intend to develop in the future. This was not done to indicate that we no longer intend to issue such guidance documents. In light of changing priorities over time, we may issue other guidance documents before developing those identified in current GFI #187, and therefore decided we should not indicate in the text of the revised guidance any additional guidance documents that we may develop in the future.
Current GFI #187 states, “FDA is discussing with other agencies the best approach for oversight of GE insects. Future guidance may be developed to address them.” Draft revised GFI #187 eliminates this language. As indicated in the
This level 1 draft guidance is being issued consistent with FDA's good guidance practices regulation (21 CFR 10.115). The draft guidance, when finalized, will represent the current thinking of FDA on Regulation of Intentionally Altered Genomic DNA in Animals. It does not establish any rights for any person and is not binding on FDA or the public. You can use an alternative approach if it satisfies the requirements of the applicable statutes and regulations.
This draft guidance refers to previously approved collections of information found in FDA regulations. These collections of information are subject to review by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). The collections of information have been approved under OMB Control Nos. 0910-0032, 0910-0045, 0910-0117, and 0910-0284.
Persons with access to the Internet may obtain the draft guidance at either
Food and Drug Administration, HHS.
Notice.
The meeting of the Psychopharmacologic Drugs Advisory Committee scheduled for February 16, 2017, is cancelled. This meeting was announced in the
Kalyani Bhatt, Center for Drug Evaluation and Research, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 31, Rm. 2417, Silver Spring, MD 20993-0002, 301-796-9001, FAX: 301-847-8533, email:
Food and Drug Administration, HHS.
Notification; establishment of docket; request for comments.
The Food and Drug Administration (FDA or we) is announcing the establishment of a docket to receive comments on the use of genome editing techniques to produce new plant varieties that are used for human or animal food. We invite comment on specific questions contained in this document related to foods derived from such genome edited plant varieties. FDA is taking this action to help inform our thinking about foods derived from new plant varieties produced using genome editing techniques.
Submit either electronic or written comments by April 19, 2017.
You may submit comments as follows:
Submit electronic comments in the following way:
•
• If you want to submit a comment with confidential information that you do not wish to be made available to the public, submit the comment as a written/paper submission and in the manner detailed (see “Written/Paper Submissions” and “Instructions”).
Submit written/paper submissions as follows:
•
• For written/paper comments submitted to the Division of Dockets Management, FDA will post your comment, as well as any attachments, except for information submitted, marked and identified, as confidential, if submitted as detailed in “Instructions.”
• Confidential Submissions—To submit a comment with confidential information that you do not wish to be made publicly available, submit your comments only as a written/paper submission. You should submit two copies total. One copy will include the information you claim to be confidential with a heading or cover note that states “THIS DOCUMENT CONTAINS CONFIDENTIAL INFORMATION.” We will review this copy, including the claimed confidential information, in our consideration of comments. The second copy, which will have the claimed confidential information redacted/blacked out, will be available for public viewing and posted on
Recently, new technologies have emerged that are intended to alter the genomes of various organisms, including plants. FDA is aware that these technologies make it easier for plant developers to produce new plant varieties with targeted genetic modifications. Using deoxyribonucleic acid (DNA) sequence information from a plant, plant breeders can make targeted changes to a plant's DNA sequence to alter expression of traits in the plant. These new methods include processes using targeted nucleases (clustered regulatory interspersed short palindromic repeat associated nucleases, zinc-finger nucleases, meganucleases, and transcription activator-like effector nucleases or targeted oligonucleotides (oligonucleotide-directed mutagenesis) intended to modify a plant's DNA sequence by insertion, deletion, or substitution of nucleotides at a specific site in a plant's genome. The process of producing these targeted DNA sequence alterations is often referred to as “genome editing.”
In the
Producers of foods from plant varieties developed using genome editing techniques, like all food producers, have an obligation under the Federal Food, Drug, and Cosmetic Act (the FD&C Act) to ensure that the foods they offer consumers are safe and in compliance with applicable legal requirements (57 FR 22984 at 22985), available at
To help inform our thinking on foods derived from new plant varieties produced using genome editing, we invite comment on the following questions:
1. In what ways are the food safety risks associated with human and animal foods from genome edited plants the same as or different from those associated with other plant development methods (
• To what extent is the scientific knowledge of and experience with current new plant varieties (such as those developed with in vitro recombinant DNA technologies that have gone through the voluntary consultation process) relevant to the safety assessment and regulatory status of food from new plant varieties produced using genome editing? Is there additional scientific knowledge that would be relevant specifically to the safety assessment and regulatory status of new plant varieties produced using genome editing? Please provide data and/or information to support your view.
2. Are there categories of genome edited plant varieties for which there are scientific bases to conclude that foods from such categories are unlikely to present food safety risks different from or greater than those for traditional plant breeding? Similarly, are there categories of genome edited plant varieties for which the regulatory status of the food derived from such plant varieties can be said to be no different from that of traditionally-bred plants? If there are such categories, is there a basis upon which to determine that there would be no reason to include them in any voluntary premarket consultation process? If so, please describe the characteristics of such categories (including, for example, information about the types of phenotypes and modifications (insertions, deletions or substitutions) achieved through genome editing) and provide data and/or information for why plant varieties in these categories are unlikely to present food safety risks or regulatory status questions. Regulatory status questions may include, for example, whether food from the new plant variety contains an unapproved food or color additive such that premarket review and approval is required (see sections 409 and 721 of the FD&C Act). As another example, if food from the new plant variety has a different nutritional profile from food from traditionally-bred plants, then certain labeling may be required to disclose a material change in the food.
a. If such categories exist, how do plant developers ensure the safety of foods from new plant varieties in these categories? For example, how are safety assessments of foods from these varieties accomplished, and what data and information are or should be considered in such assessments?
b. If certain categories of genome edited plants do not raise questions of safety or regulatory status, should there nevertheless be a mechanism separate from the voluntary premarket consultation process through which plant developers may voluntarily notify FDA about their intent to market a food derived from a genome edited new plant variety that falls within these categories? If so, what process should plant developers use to notify FDA? What kind of information should be included in such a notification to FDA?
c. Given that genome editing techniques can give rise to a broad range of plant modifications, from simple gene deletions to totally novel genes, and that some such modifications can be achieved through traditional breeding, please discuss the basis upon which to determine that there would or would not be a reason to include, in any voluntary premarket consultation process, foods from genome edited crops with modifications that could have been achieved through traditional breeding.
3. Are there categories of genome edited plant varieties for which there are scientific bases to conclude that foods from these categories are more likely than traditionally-bred plants to present food safety risks? If so, please describe the characteristics of these categories (including, for example, information about the types of phenotypes and modifications (insertions, deletions or substitutions) achieved through genome editing) and provide data and/or information to support why plant varieties in these categories are more likely to present food safety risks than traditionally-bred plants.
4. What steps can we take to help small firms, including those who may be considering using genome editing to produce new plant varieties for use in human or animal food, to engage with FDA about any questions related to food safety or the regulatory status of foods from their new plant varieties? Please provide supporting data and other information to support your comments and responses to this question.
Food and Drug Administration, HHS.
Notice.
The Food and Drug Administration (FDA) is announcing an opportunity for public comment on the proposed collection of certain information by the Agency. Under the Paperwork Reduction Act of 1995 (the PRA), Federal Agencies are required to publish notice in the
Submit either electronic or written comments on the collection of information by March 20, 2017.
You may submit comments as follows:
Submit electronic comments in the following way:
•
• If you want to submit a comment with confidential information that you do not wish to be made available to the public, submit the comment as a written/paper submission and in the manner detailed (see “Written/Paper Submissions” and “Instructions”).
Submit written/paper submissions as follows:
•
• For written/paper comments submitted to the Division of Dockets Management, FDA will post your comment, as well as any attachments, except for information submitted, marked and identified, as confidential, if submitted as detailed in “Instructions.”
• Confidential Submissions—To submit a comment with confidential information that you do not wish to be made publicly available, submit your comments only as a written/paper submission. You should submit two copies total. One copy will include the information you claim to be confidential with a heading or cover note that states “THIS DOCUMENT CONTAINS CONFIDENTIAL INFORMATION.” The Agency will review this copy, including the claimed confidential information, in its consideration of comments. The second copy, which will have the claimed confidential information redacted/blacked out, will be available for public viewing and posted on
FDA PRA Staff, Office of Operations, Food and Drug Administration, Three White Flint North, 10A63, 11601 Landsdown St., North Bethesda, MD 20852,
Under the PRA (44 U.S.C. 3501-3520), Federal Agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. “Collection of information” is defined in 44 U.S.C. 3502(3) and 5 CFR 1320.3(c) and includes Agency requests or requirements that members of the public submit reports, keep records, or provide information to a third party. Section 3506(c)(2)(A) of the PRA (44 U.S.C. 3506(c)(2)(A)) requires Federal Agencies to provide a 60-day notice in the
With respect to the following collection of information, FDA invites comments on these topics: (1) Whether the proposed collection of information is necessary for the proper performance of FDA's functions, including whether the information will have practical utility; (2) the accuracy of FDA's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; (3) ways to enhance the quality, utility, and clarity of the information to be collected; and (4) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques, when appropriate, and other forms of information technology.
Under section 519 of the Federal Food, Drug, and Cosmetic Act (the FD&C Act) (21 U.S.C. 360i) authorizes FDA to require (1) manufacturers to report medical device-related deaths, serious injuries, and malfunctions; and (2) user facilities to report device-related deaths directly to manufacturers and FDA and serious injuries to the manufacturer. Section 213 of the Food and Drug Administration Modernization Act of 1997 (Pub. L. 105-115) amended section 519(b) of the FD&C Act relating to mandatory reporting by user facilities of deaths, serious injuries, and serious illnesses associated with the use of medical devices. This amendment legislated the replacement of universal user facility reporting by a system that is limited to a “subset of user facilities that constitutes a representative profile of user reports” for device-related deaths and serious injuries. This amendment is reflected in section 519(b)(5)(A) of the FD&C Act. This legislation provides FDA with the opportunity to design and implement a national surveillance network, composed of well-trained clinical facilities, to provide high-quality data on medical devices in clinical use. This system is called MedSun.
FDA is seeking OMB clearance to continue to use electronic data collection to obtain the information on Form FDA 3500A (approved under OMB control number 0910-0291) related to medical devices and tissue products from the user facilities participating in MedSun, to obtain a demographic profile of the facilities, and for additional questions which will permit FDA to better understand the cause of reported adverse events. Participation in the program is voluntary and includes approximately 250 facilities.
In addition to collecting data on the electronic adverse event report form, MedSun collects additional information from participating sites about reported problems emerging from the MedSun hospitals. This data collection is also voluntary and is collected on the same Web site as the report information.
The burden estimate is based on the number of facilities participating in MedSun (250). FDA estimates an average of 15 reports per site annually. This estimate is based on MedSun working to promote reporting in general from the sites, as well as promoting reporting from specific parts of the hospitals, such as the pediatric intensive care units, the electrophysiology laboratories, and the hospital laboratories.
FDA estimates the burden of this collection of information as follows:
Food and Drug Administration, HHS.
Notice of availability.
The Food and Drug Administration (FDA or Agency) is announcing the availability of a draft guidance for industry and review staff entitled “Drug and Device Manufacturer Communications With Payors, Formulary Committees, and Similar Entities—Questions and Answers.” This draft guidance provides answers to common questions regarding the communication of health care economic information (HCEI) about approved prescription drugs by medical product manufacturers, packers, distributers, and their representatives (firms) to payors, formulary committees, or other similar entities with knowledge and expertise in the area of health care economic analysis (collectively referred to as payors). This draft guidance also provides answers to common questions about firms' communications regarding investigational drugs and devices (investigational products) to payors before FDA approval or clearance of such products. The Agency is issuing this draft guidance to explain FDA's current thinking on frequently asked questions regarding such communications in order to provide clarity for firms and payors.
Although you can comment on any guidance at any time (see 21 CFR 10.115(g)(5)), to ensure that the Agency considers your comment on this draft guidance before it begins work on the final version of the guidance, submit either electronic or written comments on the draft guidance by April 19, 2017.
You may submit comments as follows:
Submit electronic comments in the following way:
•
• If you want to submit a comment with confidential information that you do not wish to be made available to the public, submit the comment as a written/paper submission and in the manner detailed (see “Written/Paper Submissions” and “Instructions”).
Submit written/paper submissions as follows:
•
• For written/paper comments submitted to the Division of Dockets Management, FDA will post your comment, as well as any attachments, except for information submitted, marked and identified, as confidential, if submitted as detailed in “Instructions.”
• Confidential Submissions—To submit a comment with confidential information that you do not wish to be made publicly available, submit your comments only as a written/paper submission. You should submit two copies total. One copy will include the information you claim to be confidential with a heading or cover note that states “THIS DOCUMENT CONTAINS CONFIDENTIAL INFORMATION.” The Agency will review this copy, including the claimed confidential information, in its consideration of comments. The second copy, which will have the claimed confidential information redacted/blacked out, will be available for public viewing and posted on
Submit written requests for single copies of this draft guidance to the Division of Drug Information, Center for Drug Evaluation and Research, Food and Drug Administration, 10001 New Hampshire Ave., Hillandale Building, 4th Floor, Silver Spring, MD 20993-0002; the Office of Communication, Outreach and Development, Center for Biologics Evaluation and Research, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 71, Rm. 3128, Silver Spring, MD 20993-0002; the Office of the Center Director, Guidance and Policy Development, Center for Devices and Radiological Health, Food and Drug Administration, 10903 New Hampshire Ave., Bldg.66, Rm. 5431, Silver Spring, MD 20993-0002. Send one self-addressed adhesive label to assist that office in processing your requests. See the
Elaine Hu Cunningham, Center for Drug Evaluation and Research, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 51, Rm. 3203, Silver Spring, MD 20993-0002, 301-
FDA is announcing the availability of a draft guidance for industry and review staff entitled “Drug and Device Manufacturer Communications With Payors, Formulary Committees, and Similar Entities—Questions and Answers.” This draft guidance provides answers to common questions regarding firms' communications of HCEI about their approved prescription drugs to payors. This draft guidance also addresses common questions relating to firms' dissemination of information about investigational products to payors before FDA approval or clearance of such products. For purposes of this draft guidance, the term “payors” collectively refers to payors, formulary committees, or other similar entities with knowledge and expertise in the area of health care economic analysis that are responsible for making drug selection, formulary management, and/or coverage and reimbursement decisions on a population basis regarding drugs and/or devices for health care organizations, which may include entities such as integrated health care delivery networks, hospitals, and hospital systems.
FDA is aware that payors seek a range of information on effectiveness, safety, and cost-effectiveness of approved drugs, including information from firms, to help support their drug selection, formulary management, and/or coverage and reimbursement decisions on a population basis. This information may differ from and may be in addition to the information FDA reviews in order to make drug approval decisions. Because coverage and reimbursement decisions by payors impact a large number of patients, FDA believes it is essential that HCEI provided by firms to payors about their approved drugs be truthful and non-misleading.
With respect to HCEI regarding approved drugs, section 502(a) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 352(a)), as amended by section 114 of the Food and Drug Administration Modernization Act of 1997 (Pub. L. 105-115) and section 3037 of the 21st Century Cures Act (Pub. L. 114-255), includes a provision regarding communication of HCEI about such drugs to payors. Section 502(a) indicates that HCEI provided to payors carrying out their responsibilities for the selection of drugs for coverage or reimbursement shall not be considered to be false or misleading if the HCEI relates to an FDA-approved indication for the drug, is based on competent and reliable scientific evidence, and includes, where applicable, a conspicuous and prominent statement describing any material differences between the health care economic information and the FDA-approved labeling for the drug. Section III.A of this draft guidance provides FDA's current thinking on key concepts in section 502(a) and recommendations for how firms can communicate HCEI about approved drugs to payors in accordance with this section to help ensure that payors have information needed to make informed drug selection, formulary management, and/or coverage and reimbursement decisions and to help ensure that the information is not false or misleading. Section III.A also discusses how FDA's requirements for submission of promotional materials apply to HCEI about approved drugs disseminated by firms to payors. If a firm disseminates HCEI about an approved drug in accordance with this draft guidance, when finalized, FDA does not intend to consider such information false or misleading. In addition, FDA does not intend to use HCEI about approved drugs disseminated consistent with this draft guidance, when finalized, as providing evidence of a new intended use.
FDA also recognizes that due in part to their need, in some situations, to plan for and make coverage and reimbursement decisions far in advance of the effective date of such decisions, payors are also interested in receiving information from drug and device firms about medical products that are not yet approved or cleared by FDA for any use (referred to in this draft guidance as investigational products). Section III.B discusses FDA's thinking with respect to communication by firms to payors of information about investigational products. As with HCEI about approved prescription drugs, it is essential that information provided by firms about their investigational products be truthful and non-misleading. Therefore, section III.B also lays out a series of recommendations to help achieve these goals.
Elsewhere in this issue of the
In addition, FDA is announcing in this issue of the
FDA will consider the feedback it receives in all three of these dockets as the Agency continues to review its policies on firm communications about medical products, and interested persons may wish to review the documents FDA has issued in all three dockets before submitting comments to any of the relevant dockets.
This draft guidance is being issued consistent with FDA's good guidance practices regulation (21 CFR 10.115). This draft guidance, when finalized, will represent the current thinking of FDA on certain commonly asked questions regarding firms' communications with payors. It does not establish any rights for any person and is not binding on FDA or the public. You can use an alternative approach if it satisfies the requirements of the applicable statutes and regulations.
Under the Paperwork Reduction Act of 1995 (the PRA) (44 U.S.C. 3501-3520), Federal Agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. “Collection of information” is defined in 44 U.S.C. 3502(3) and 5 CFR 1320.3(c) and includes Agency requests
With respect to the following collection of information, FDA invites comments on these topics: (1) Whether the proposed collection of information is necessary for the proper performance of FDA's functions, including whether the information will have practical utility; (2) the accuracy of FDA's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; (3) ways to enhance the quality, utility, and clarity of the information to be collected; and (4) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques, when appropriate, and other forms of information technology.
Furthermore, FDA recommends that firms include other information when disseminating HCEI materials, as applicable, to provide a balanced and complete presentation. Such information includes a statement of the FDA-approved indication of the drug and a copy of the most current FDA-approved labeling. Under section 502(a), firms must also include a conspicuous and prominent statement to describe any material differences between the HCEI and the FDA-approved labeling. HCEI materials should also disclose whether certain studies or data sources were omitted from an economic analysis and how such selective inclusion of studies or data sources may alter the conclusions presented in the analysis. Moreover, FDA recommends that HCEI materials disclose important risk information associated with the approved use of the drug, and pursuant to section 502(a), must disclose any additional risk information related to assumptions that vary from the approved labeling. Finally, HCEI materials should disclose potential financial or affiliation biases to the extent reasonably known by firms at the time of dissemination.
If firms choose to make communications to payors about investigational products, FDA recommends that firms include a clear statement with their communications that the product is under investigation and that the safety or effectiveness of the product has not been established. In addition, FDA recommends providing information related to the stage of product development (
Based on the post-marketing submissions of promotional materials using Form FDA 2253 received in calendar year (CY) 2015 for prescription drugs, FDA estimates that approximately 400 firms will disseminate 4,000 distinct HCEI materials annually. FDA estimates that it will take firms approximately 20 hours to compile and draft the information that this draft guidance recommends should be included if they choose to disseminate HCEI materials to payors.
Based on the number of prescription drugs and devices approved/cleared in CY 2015, FDA estimates that approximately 520 firms will prepare 1,040 distinct communications of information to payors about their investigational products annually. FDA estimates that it will take firms approximately 0.5 hours to compile and draft the information that this draft guidance recommends should be provided with communications to payors about investigational products. In addition, FDA estimates that approximately half of the firms will spend approximately 2 hours to compile and provide 520 distinct communications of followup information regarding previously communicated information to payors about their investigational products annually.
FDA estimates the burden of this collection of information as follows:
This draft guidance also refers to previously approved collections of information found in FDA regulations. The collections of information in 21 CFR 314.81(b)(3)(i) (Form FDA 2253) have been approved under OMB control number 0910-0001.
Although section 502(a) is specific to approved drugs and section III.A of this draft guidance addresses firms' communications of HCEI to payors only about approved drugs, FDA is interested in whether similar principles to those outlined in that section should apply to firms' communications of HCEI to payors about approved/cleared devices or whether different principles should be considered. FDA is specifically interested in identifying principles that, if applied to communications of HCEI about approved/cleared devices, could help ensure that such information is truthful and non-misleading and aids payors in making informed selection and/or coverage and reimbursement decisions about these products. FDA is interested in comments from interested parties on any of the topics addressed in this draft guidance and specifically requests comments from interested parties on the extent to which the principles provided in section III.A could be applicable to communications of HCEI about approved/cleared devices. To the extent that interested parties believe that different considerations should apply to medical devices or that guidance is needed on additional issues with respect to medical device firms' communications of HCEI about approved/cleared medical devices to payors, FDA is interested in input on those topics as well.
FDA is also seeking comments from interested parties regarding communications of HCEI about animal drugs. Although FDA recognizes that the audience for HCEI about animal drugs may be different from that identified in section III.A as a result of differences in how payment decisions are made for animal drugs, FDA is interested in learning the extent to which the principles provided in section III.A could be applicable to communications of HCEI about animal drugs with appropriate audiences for such information. To the extent that commenters believe that different considerations should apply to animal drugs or that guidance is needed on additional issues with respect to animal drug firms' communications of HCEI about approved new animal drugs to appropriate audiences, FDA is interested in input on those topics as well.
Persons with access to the Internet may obtain the draft guidance at
Food and Drug Administration, HHS.
Notice of availability.
In June 2014, the Food and Drug Administration (FDA) and the U.S. Environmental Protection Agency (EPA) (the Agencies) jointly released a draft update to a March 2004 document entitled “What You Need to Know About Mercury in Fish and Shellfish.” FDA and EPA are now announcing revised fish advice that contains advice and supplemental questions and answers for those who want to understand the advice in greater detail.
In the
The RCAC meeting was held on November 3 and 4, 2014, and the transcript of the meeting became available on December 2, 2014. The meeting addressed the draft updated fish advice in great detail and included presentations by the Agencies on both the substance and the presentation of the draft updated fish advice, and included presentations by invited experts in risk communications. The meeting also provided members of the public with an opportunity to express their views to the RCAC and to officials of the Agencies who were in attendance. FDA and EPA concluded that the thoroughness of this public meeting, in addition to the public comments received and still to be received, removed the need for additional public meetings, and announced in the
In August 2016, an external peer review of FDA-EPA's method for categorizing species of fish into consumption categories was conducted at the request of FDA and EPA. Information on the external peer review and FDA's and EPA's responses to the peer review are available at
The 2004 advice was issued to help individuals in the target population limit their exposure to mercury while still obtaining the health benefits of fish consumption. The 2004 advice recommended avoiding four types of commercially available fish that have the highest average mercury concentrations: Tilefish, shark, swordfish, and king mackerel. The advice further recommended that women in the target population eat up to—but not exceed—12 ounces per week of most other types of commercially available fish. It recommended limiting consumption of one species, white (albacore) tuna, to no more than 6 ounces per week. For local fish caught by family and friends, the advice recommended following locally posted fish advisories regarding safe catch. Where no such advice exists, it recommends limiting consumption of locally caught fish to 6 ounces per week and eating no other fish that week.
While the 2004 advice encourages fish consumption as part of a healthy diet, it does not encourage consumption of a minimum amount of fish. In June 2014, FDA and EPA issued the draft updated advice to encourage women who are pregnant or breastfeeding to consume 8 to 12 ounces of a variety of fish per week to maximize the potential benefits that fish could provide. The Agencies also proposed to modify the wording and organization of the 2004 advice in order to enhance the likelihood that it will be followed by the target audience.
The revised fish advice is designed to encourage women who are pregnant and breastfeeding to consume 8 to12 ounces of a variety of fish per week, and it includes further modified wording and organization to further enhance the likelihood that it will be followed by the target audience. The revised fish advice includes a chart and supplemental questions and answers. The chart provides recommendations for how often the target audience (pregnant women, women who might become pregnant, breastfeeding women, and young children) should eat more than 60 different fish, based on mercury concentrations.
FDA and EPA used sampling data from FDA and, to a limited extent, from the U.S. National Marine Fisheries Service as the source for mercury amounts in fish (Ref. 6), with support from other sources (Refs. 7 through 12). The revised fish advice makes the following recommendations for the target audience:
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The revised fish advice presents the recommended consumption for more than 60 fish in a color-coded chart. The fish are presented in categories of “Best Choices,” those which the target audience can eat 2 to 3 servings a week; “Good Choices,” which the target audience can eat 1 serving a week; and “Choices to Avoid.” See Ref. 13 for a description of how FDA and EPA
The Agencies reorganized the questions and answers (Qs and As) into topic areas, simplified the responses, and added new questions as a result of comments received during the comment period. The chart includes a link to two fish advice Web sites (
FDA and EPA received over 200 comments from States, industry, academia, various organizations, and concerned individuals. The comments covered a range of topics from the scientific basis of the advice to communication. There was a wide range of opinions expressed in the comments, not all of which were relevant to the advice. The majority of the comments pertained to the clarity and effectiveness of how the advice was presented. In response to comments, the Agencies revised the presentation of the advice, as discussed in part III of this document. Other comments suggested a more restrictive set of consumption recommendations or disagreed with setting consumption th resholds for specific species of fish or for any but the species highest in mercury. After reviewing the comments, FDA and EPA adopted an approach in which fish species are separated into three categories based on average measured mercury content (“Best Choices,” “Good Choices,” and “Choices to Avoid”). An evaluation of available information led the Agencies to recommend eating 2 to 3 servings a week for some fish and 1 serving a week for others. The advice to eat 2 to 3 servings of a variety of fish a week is consistent with the recommendation in the 2015-2020 Dietary Guidelines for Americans that women who are pregnant or breastfeeding consume at least 8 and up to 12 ounces of a variety of fish lower in mercury per week. Consuming 8 to12 ounces of fish per week while pregnant or breastfeeding would be a significant dietary change for most women. In a survey of over 1,200 pregnant women conducted by FDA in 2005, median fish consumption was 1.8 ounces per week (Ref. 14).
The approach in the revised fish advice differs from that taken in the draft updated fish advice not only in that it categorizes more than 60 fish types, but also in its analytical basis. In categorizing the fish species for recommended consumption, the revised fish advice compares the reference dose (RfD) developed by EPA (Ref. 15) to the predicted exposure from the consumption of different fish species. Because the RfD is a rate of exposure that a person can experience over a lifetime without appreciable risk of harm and includes a 10-fold uncertainty factor to allow for variability among individuals and groups, this was a highly protective approach for determining which fish belong in each category. Specifically, the RfD for mercury is protective of neurodevelopmental effects from a critical window of development for a fetus during pregnancy. We believe the new approach is more protective of public health. This new approach is also consistent with a number of the comments received, and the external peer review conducted.
Overall, the reviewers agreed upon the necessity of mercury fish advice for pregnant women, those trying to get pregnant, and children, to encourage fish consumption while helping to avoid mercury. The reviewers were generally supportive of the technical information and methodology used to support the scientific basis for the fish consumption recommendations. The reviewers made suggestions to improve clarity, transparency, and presentation, and to enhance the scientific underpinnings of the fish advice. The reviewers suggested supplementing FDA's data on mercury levels in seafood with other published sources to support the fish categorization for species with small sample sizes and/or large variability in mercury levels. The reviewers also provided various suggestions of where additional details could be added to aid the reader and support the conclusions. FDA and EPA implemented many of the reviewers' recommendations. A report of the FDA-EPA response to the peer review is available at
The revised fish advice and supplemental questions and answers are available electronically at
The following references are on display in the Division of Dockets Management (HFA-305), Food and Drug Administration, 5630 Fishers Lane, Rm. 1061, Rockville, MD 20852 and are available for viewing by interested persons between 9 a.m. and 4 p.m., Monday through Friday; they are also available electronically at
Food and Drug Administration, HHS.
Notice of availability.
The Food and Drug Administration (FDA or Agency) is announcing the availability of a draft guidance for industry (GFI) #236 entitled “Regulation of Mosquito-Related Products.” This draft guidance provides information regarding regulatory oversight of mosquito-related products, defined as those articles for use in or on mosquitoes. We are clarifying circumstances under which such products are regulated by FDA as new animal drugs under the Federal Food, Drug, and Cosmetic Act (the FD&C Act) and other circumstances under which such products are regulated by the Environmental Protection Agency (EPA) as pesticides under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA).
Although you can comment on any guidance at any time (see 21 CFR 10.115(g)(5)), to ensure that the Agency considers your comment on this draft guidance before it begins work on the final version of the guidance, submit either electronic or written comments on the draft guidance by February 21, 2017.
You may submit comments as follows:
Submit electronic comments in the following way:
•
• If you want to submit a comment with confidential information that you do not wish to be made available to the public, submit the comment as a written/paper submission and in the manner detailed (see “Written/Paper Submissions” and “Instructions”).
Submit written/paper submissions as follows:
•
• For written/paper comments submitted to the Division of Dockets Management, FDA will post your comment, as well as any attachments, except for information submitted, marked and identified, as confidential, if submitted as detailed in “Instructions.”
• Confidential Submissions—To submit a comment with confidential information that you do not wish to be made publicly available, submit your comments only as a written/paper submission. You should submit two copies total. One copy will include the information you claim to be confidential with a heading or cover note that states “THIS DOCUMENT CONTAINS CONFIDENTIAL INFORMATION.” The Agency will review this copy, including the claimed confidential information, in its consideration of comments. The second copy, which will have the claimed confidential information redacted/blacked out, will be available for public viewing and posted on
Submit written requests for single copies of the guidance to the Policy and Regulations Staff (HFV-6), Center for Veterinary Medicine, Food and Drug Administration, 7519 Standish Pl., Rockville, MD 20855. Send one self-addressed adhesive label to assist that office in processing your requests. See the
Laura R. Epstein, Center for Veterinary Medicine (HFV-1), Food and Drug Administration, 7519 Standish Pl., Rockville, MD 20855, 301-796-8558,
FDA is announcing the availability of a draft guidance for industry (GFI) #236 entitled “Regulation of Mosquito-Related Products.” This draft guidance provides information for industry and other stakeholders regarding regulatory oversight of mosquito-related products, defined as those articles for use in or on mosquitoes. Given the public health implications of mosquito control, FDA is providing this draft guidance to clarify the regulatory oversight of mosquito-related products, including but not limited to those produced through biotechnology. This guidance is important in light of the public health urgency of countering the spread of mosquito-borne disease, such as that caused by the Zika virus. Vector control is a critical element of the effort to combat the spread of mosquito-borne disease. Novel mosquito control technologies have gained greater attention as an element of this effort; however, there has been some confusion with respect to FDA's and EPA's respective jurisdiction over such mosquito-related products. We are clarifying circumstances under which such products are regulated by FDA as new animal drugs under the FD&C Act and other circumstances under which such products are regulated by the EPA as pesticides under FIFRA. FDA is clarifying that the phrase “articles (other than food) intended to affect the structure or any function of the body of man or other animals” in the FD&C Act's drug definition (21 U.S.C. 321(g)(1)(C)) does not include articles intended to function as pesticides by preventing, destroying, repelling, or mitigating mosquitoes for population control purposes. FDA believes that this interpretation is consistent with congressional intent and provides a rational approach for dividing responsibilities between FDA and EPA in regulating mosquito-related products.
This level 1 draft guidance is being issued consistent with FDA's good guidance practices regulation (21 CFR 10.115). The draft guidance, when finalized, will represent the current thinking of FDA on Regulation of Mosquito-Related Products. It does not establish any rights for any person and is not binding on FDA or the public. You can use an alternative approach if it satisfies the requirements of the applicable statutes and regulations.
Persons with access to the Internet may obtain the draft guidance at either
Food and Drug Administration, HHS.
Notice of availability.
The Food and Drug Administration (FDA or Agency) is announcing the availability of a draft guidance for industry entitled “Medical Product Communications That Are Consistent With the FDA-Required Labeling—Questions and Answers.” This draft guidance provides information for manufacturers, packers, and distributors and their representatives (collectively “firms”) of drugs and medical devices for humans, including those that are licensed as biological products, and animal drugs (collectively “medical products”), about how FDA evaluates their medical product communications, including their promotional materials, that present information that is not contained in the FDA-required labeling for the product but that may be consistent with the FDA-required labeling for the product. The Agency is issuing this draft guidance to explain FDA's current thinking on commonly asked questions regarding such communications in order to provide clarity for firms.
Although you can comment on any guidance at any time (see 21 CFR 10.115(g)(5)), to ensure that the Agency considers your comment on this draft guidance before it begins work on the final version of the guidance, submit either electronic or written comments on the draft guidance by April 19, 2017.
You may submit comments as follows:
Submit electronic comments in the following way:
•
• If you want to submit a comment with confidential information that you do not wish to be made available to the public, submit the comment as a written/paper submission and in the manner detailed (see “Written/Paper Submissions” and “Instructions”).
Submit written/paper submissions as follows:
•
• For written/paper comments submitted to the Division of Dockets Management, FDA will post your comment, as well as any attachments, except for information submitted, marked and identified, as confidential, if submitted as detailed in “Instructions.”
• Confidential Submissions—To submit a comment with confidential information that you do not wish to be made publicly available, submit your comments only as a written/paper submission. You should submit two copies total. One copy will include the information you claim to be confidential with a heading or cover note that states “THIS DOCUMENT CONTAINS CONFIDENTIAL INFORMATION.” The Agency will review this copy, including the claimed confidential information, in its consideration of comments. The second copy, which will have the claimed confidential information redacted/blacked out, will be available for public viewing and posted on
Submit written requests for single copies of the draft guidance to the Division of Drug Information, Center for Drug Evaluation and Research, Food and Drug Administration, 10001 New Hampshire Ave., Hillandale Building, 4th Floor, Silver Spring, MD 20993-0002; Office of Communication, Outreach and Development, Center for Biologics Evaluation and Research, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 71, Rm. 3128, Silver Spring, MD 20993-0002; Division of Small Manufacturers, International and Consumer Assistance, Office of Communication, Education and Radiation Programs, Center for Devices and Radiological Health, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 66, Rm. 4613, Silver Spring, MD 20993-0002; or to Communications Staff (HFV-12), Center for Veterinary Medicine, Food and Drug Administration, 7519 Standish Pl., Rockville, MD 20855. Send one self-addressed adhesive label to assist that office in processing your requests. See the
Kristin Davis, Office of Policy, Office of the Commissioner, 10903 New Hampshire Ave., Bldg. 32, Rm. 4252, Silver Spring, MD 20993-0002, 301-796-0418; or Catherine Gray, Center for Drug Evaluation and Research, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 51, Rm. 3203, Silver Spring, MD 20993-0002, 301-796-1200; or Stephen Ripley, Center for Biologics Evaluation and Research, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 71, Rm. 7301, Silver Spring, MD 20993-0002, 240-402-7911; or Angela Krueger, Center for Devices and Radiological Health, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 66, Rm. 1666, Silver Spring, MD 20993-0002, 301-796-6380; or Thomas Moskal, Center for Veterinary Medicine, Food and Drug Administration, 7519 Standish Pl. (HFV-1), Rockville, MD 20855, 240-402-6251.
FDA is announcing the availability of a draft guidance for industry entitled “Medical Product Communications That Are Consistent With the FDA-Required Labeling—Questions and Answers.” This draft guidance provides information for firms about how FDA evaluates their medical product communications, including their promotional materials, that present information that is not contained in the FDA-required labeling
FDA determines whether a medical product is safe and effective for use under the conditions prescribed, recommended, or suggested in the proposed labeling submitted to FDA with the product's marketing application or submission (and for devices, also during the classification process). In making this determination, FDA evaluates whether the conditions of use in the proposed labeling are supported by the required levels and types of evidence of safety and effectiveness and whether the benefits of using the product under those specific conditions of use outweigh the risks of the product. After FDA approves or clears a medical product, the FDA-required labeling sets forth the conditions of use under which the product has been shown to meet the relevant standard for marketing, and it provides directions and information on how to use the product safely and effectively under those conditions.
Medical product firms have expressed interest in communicating, including in promotional materials, data and
The draft guidance describes FDA's thinking on these topics. As explained in the draft guidance, a firm's communication of information that is not contained in the product's FDA-required labeling, but that is determined to be consistent with the FDA-required labeling, is not alone considered evidence of a new intended use. However, even if a communication is consistent with the FDA-required labeling, the representations or suggestions made about the product would misbrand the product and could subject firms to enforcement action if the representations or suggestions are false or misleading. Accordingly, the draft guidance both describes FDA's thinking on the types of information that are consistent with the FDA-required labeling and provides general recommendations for how this information can be conveyed in a truthful and non-misleading way. The draft guidance also provides some examples to illustrate these concepts. The recommendations provided in the draft guidance to help ensure that communications are not false or misleading are specific to communications that are consistent with the FDA-required labeling; communication of information that is not consistent with the FDA-required labeling is outside the scope of these recommendations.
Elsewhere in this issue of the
In addition, FDA is announcing in this issue of the
FDA will consider the feedback it receives in all three of these dockets as the Agency continues to review its policies on firm communications about medical products, and interested persons may wish to review the documents FDA has issued in all three dockets before submitting comments to any of the relevant dockets.
This draft guidance is being issued consistent with FDA's good guidance practices regulation (21 CFR 10.115). The draft guidance, when finalized, will represent the current thinking of FDA on certain commonly asked questions regarding firms' communications for their medical products that may be consistent with the FDA-required labeling. It does not establish any rights for any person and is not binding on FDA or the public. You can use an alternative approach if it satisfies the requirements of the applicable statutes and regulations.
Under the Paperwork Reduction Act of 1995 (the PRA) (44 U.S.C. 3501-3520), Federal Agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. “Collection of information” is defined in 44 U.S.C. 3502(3) and 5 CFR 1320.3(c) and includes Agency requests or requirements that members of the public submit reports, keep records, or provide information to a third party. Section 3506(c)(2)(A) of the PRA (44 U.S.C. 3506(c)(2)(A)) requires Federal Agencies to provide a 60-day notice in the
With respect to the following collection of information, FDA invites comments on these topics: (1) Whether the proposed collection of information is necessary for the proper performance of FDA's functions, including whether the information will have practical utility; (2) the accuracy of FDA's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; (3) ways to enhance the quality, utility, and clarity of the information to be collected; and (4) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques, when appropriate, and other forms of information technology.
Specifically, FDA recommends that various aspects of study design and methodology for studies relied on in such communications be disclosed to provide material contextual information (
Furthermore, FDA recommends that firms accurately characterize and contextualize the relevant information about the product, including by disclosing unfavorable or inconsistent findings. FDA also recommends that firms disclose material contextual information from the FDA-required labeling in these communications, such as data and information from studies in the FDA-required labeling that are relevant to the data or information presented in the communication (
According to FDA data, approximately 162,000 FDA-regulated promotional materials are prepared by approximately 500 firms annually. Of these materials, we estimate approximately 5 percent contain unique presentations of information consistent with FDA-required labeling, as that term is described in the draft guidance, submitted by approximately 64 percent (or 324) of the firms. Anticipating the number of these FDA-regulated promotional materials will soon increase to 6 percent, we estimate the 324 firms will prepare and disseminate annually 9,720 FDA-regulated promotional materials that contain unique presentations of information that is consistent with FDA-required labeling, as that term is described in the draft guidance, and that therefore are recommended to include the proposed third party disclosures. Based on our experience reviewing FDA-regulated promotional materials for medical products, we estimate it will take respondents approximately 4 hours per unique presentation to prepare and incorporate the disclosures recommended in the draft guidance, if they choose to disseminate this information.
We estimate the burden of this collection of information as follows:
Persons with access to the Internet may obtain the draft guidance at either
Health Resources and Services Administration (HRSA), Department of Health and Human Services.
Notice.
In compliance with the requirement for opportunity for public comment on proposed data collection projects, HRSA announces plans to submit an Information Collection Request (ICR), described below, to the Office of Management and Budget (OMB). Prior to submitting the ICR to OMB, HRSA seeks comments from the public regarding the burden estimate, below, or any other aspect of the ICR.
Comments on this ICR must be received no later than March 20, 2017.
Submit your comments to
To request more information on the proposed project or to obtain a copy of the data collection plans and draft instruments, email
When submitting comments or requesting information, please include the information request collection title for reference.
OMB No. 0915-0318—Revision.
The forms will continue to require recipients to report on how funds are allocated and spent on core medical and non-core services for persons living with HIV, and on various program components, such as administration, planning and evaluation, and quality management. The A & E Reports are identical in the types of information they collect. However, the first report tracks the allocation of the award at the beginning of the grant cycle and the second report tracks actual expenditures (including carryover dollars) at the end of the grant cycle. The CLC form identifies a recipient's contracts with service providers for the current grant year, the contract amount, and the types of services being provided.
HRSA specifically requests comments on (1) the necessity and utility of the proposed information collection for the proper performance of the agency's functions, (2) the accuracy of the estimated burden, (3) ways to enhance the quality, utility, and clarity of the information to be collected, and (4) the use of automated collection techniques or other forms of information technology to minimize the information collection burden.
Health Resources and Services Administration (HRSA), Department of Health and Human Services.
Notice.
In compliance with the Paperwork Reduction Act of 1995, HRSA has submitted an Information Collection Request (ICR) to the Office of Management and Budget (OMB) for review and approval. Comments submitted during the first public review of this ICR will be provided to OMB. OMB will accept further comments from the public during the review and approval period.
Comments on this ICR should be received no later than February 21, 2017.
Submit your comments, including the ICR Title, to the desk officer for HRSA, either by email to
To request a copy of the clearance requests submitted to OMB for review, email the HRSA Information Collection Clearance Officer at
When submitting comments or requesting information, please include the information request collection title for reference, in compliance with Section 3506(c)(2)(A), the Paperwork Reduction Act of 1995.
Health Resources and Service Administration (HRSA), Department of Health and Human Services (HHS).
Notice of Meeting.
In accordance with the Federal Advisory Committee Act, notice is hereby given about a meeting of the Advisory Committee on Heritable Disorders in Newborns and Children (ACHDNC). This meeting will be open to the public but advance registration is required. Information regarding the ACHDNC can be found at
The meeting will be held on February 9, 2017, from 9:00 a.m. to 5:00 p.m. EST.
This meeting will be a webinar. The public can join the meeting by registering in advance. The registration link is available at
Anyone requesting information regarding the ACHDNC should contact Alaina Harris, Maternal and Child Health Bureau (MCHB), HRSA, Room 18W66, 5600 Fishers Lane, Rockville, Maryland 20857; email:
ACHDNC, as authorized by the Public Health Service Act (PHS), Title XI, § 1111 (42 U.S.C. 300b-10), was established to advise the Secretary of HHS about the development of newborn screening activities, technologies, policies, guidelines, and programs for effectively reducing morbidity and mortality in newborns and children having, or at risk for, heritable disorders. In addition, ACHDNC recommendations regarding additional conditions/inherited disorders for screening that have been adopted by the Secretary are included in the Recommended Uniform Screening Panel and constitute part of the comprehensive guidelines supported by HRSA. Pursuant to section 2713 of the PHS, codified at 42 U.S.C. 300gg-13, non-grandfathered health plans are required to cover screenings included in the HRSA-supported comprehensive guidelines without charging a co-payment, co-insurance, or deductible for plan years (
ACHDNC will hear presentations and discussions on topics related to newborn screening activities, technologies, policies, guidelines, and programs for effectively reducing morbidity and mortality in newborns and children having, or at risk for, heritable disorders. ACHDNC will also hear updates from the Laboratory Standards and Procedures workgroup, Follow-up and Treatment workgroup, and Education and Training workgroup. Agenda items are subject to changes as priorities indicate. ACHDNC will not be voting on a proposed addition of a condition to the Recommended Uniform Screening Panel. The detailed meeting
Members of the public may submit written and/or present oral comments at the meeting. All comments are part of the official ACHDNC record. Advance registration is required to submit written comments and/or present oral comments. Written comments must be submitted by February 6, 2017, 11:59 p.m. EST to be included in the February meeting briefing book. Written comments should identify the individual's name, address, email, telephone number, professional or business affiliation, type of expertise (
Individuals who wish to provide oral comments must register by February 6, 2017, 11:59 p.m. EST. To ensure that all individuals who have registered to make oral comments can be accommodated, time may be allocated per speaker. Individuals who are associated with groups or have similar interests may be requested to combine their comments and present them through a single representative. No audiovisual presentations are permitted. For additional information or questions on public comments, please contact Alaina Harris, MCHB, HRSA; email:
Individuals who need special assistance, such as sign language interpretation or other reasonable accommodations, should notify Alaina Harris at
Health Resources and Services Administration (HRSA), Department of Health and Human Services.
Notice.
In compliance with the requirement for opportunity for public comment on proposed data collection projects of the Paperwork Reduction Act of 1995, HRSA announces plans to submit an Information Collection Request (ICR), described below, to the Office of Management and Budget (OMB). Prior to submitting the ICR to OMB, HRSA seeks comments from the public regarding the burden estimate, below, or any other aspect of the ICR.
Comments on this ICR should be received no later than March 20, 2017.
Submit your comments to
To request more information on the proposed project or to obtain a copy of the data collection plans and draft instruments, email
When submitting comments or requesting information, please include the information request collection title for reference, in pursuant to Section 3506(c)(2)(A), the Paperwork Reduction Act of 1995.
HRSA specifically requests comments on (1) the necessity and utility of the proposed information collection for the proper performance of the agency's functions, (2) the accuracy of the estimated burden, (3) ways to enhance the quality, utility, and clarity of the information to be collected, and (4) the use of automated collection techniques or other forms of information technology to minimize the information collection burden.
Office of the Secretary, HHS.
Notice.
In compliance with section 3506(c)(2)(A) of the Paperwork Reduction Act of 1995, the Office of the Secretary (OS), Department of Health and Human Services, announces plans to submit an Information Collection Request (ICR), described below, to the Office of Management and Budget (OMB). The ICR is for extending the use of the approved information collection assigned OMB control number 0937-0198, which expires on May 31, 2017. Prior to submitting the ICR to OMB, OS seeks comments from the public regarding the burden estimate, below, or any other aspect of the ICR.
Comments on the ICR must be received on or before March 20, 2017.
Submit your comments to
When submitting comments or requesting information, please include the document identifier 0937-0198-60D for reference.
OS specifically requests comments on (1) the necessity and utility of the proposed information collection for the proper performance of the agency's functions, (2) the accuracy of the estimated burden, (3) ways to enhance the quality, utility, and clarity of the information to be collected, and (4) the use of automated collection techniques or other forms of information technology to minimize the information collection burden.
Office of the Secretary, HHS.
In compliance with the requirement of section 3506(c)(2)(A) of the Paperwork Reduction Act of 1995,
To obtain copies of the supporting statement and any related forms for the proposed paperwork collections referenced above, email your request, including your address, phone number, OMB number, to
Reinstatement without change and 3 Year Extension and assignment as a Common Form.
Agencies are currently using a variety of forms to account for both Federally owned and grantee owned equipment and property. During the public consultation process mandated by Public Law 106-107, grant recipients requested a standard form to help them submit appropriate property information when required. The Public Law 106-107 Post Awards Subgroup developed a new standard form, the Tangible Personal Property Report, for submission of the required data. The form consists of the cover sheet (SF-428), three attachments to be used as required: Annual Report, SF-428-A; Final Report, SF-428-B; Disposition Request/Report, SF-428-C and a Supplemental Sheet, SF-428S to provide detailed individual item information when required. We are requesting a three-year clearance of this collection and that it be designated as a Common Form.
Office of Medicare Hearings and Appeals (OMHA), HHS.
Notice.
This quarterly notice lists the OMHA Case Processing Manual (OCPM) manual instructions that were published from October through December, 2016. This manual standardizes the day-to-day procedures for carrying out adjudicative functions, in accordance with applicable statutes, regulations and OMHA directives, and gives OMHA staff direction for processing appeals at the OMHA level of adjudication.
Amanda Axeen, by telephone at (571) 777-2705, or by email at
The Office of Medicare Hearings and Appeals (OMHA), a staff division within the Office of the Secretary of the U.S. Department of Health and Human Services (HHS), administers the nationwide Administrative Law Judge hearing program for Medicare claim, organization and coverage determination, and entitlement appeals under sections 1869, 1155, 1876(c)(5)(B), 1852(g)(5), and 1860D-4(h) of the Social Security Act (the Act). OMHA ensures that Medicare beneficiaries and the providers and suppliers that furnish items or services to Medicare beneficiaries, as well as Medicare Advantage Organizations (MAOs), Medicaid State Agencies, and applicable plans have a fair and impartial forum to address disagreements with Medicare coverage and payment determinations made by Medicare contractors, MAOs, or Part D Plan Sponsors (PDPSs), and determinations related to Medicare eligibility and entitlement, Part B late enrollment penalty, and income-related monthly adjustment amounts (IRMAA) made by the Social Security Administration (SSA).
The Medicare claim, organization and coverage determination appeals processes consist of four levels of administrative review, and a fifth level of review with the Federal district
Sections 1869, 1155, 1876(c)(5)(B), 1852(g)(5), and 1860D-4(h) of the Act are implemented through the regulations at 42 CFR part 405 subparts I and J; part 417, subpart Q; part 422, subpart M; part 423, subparts M and U; and part 478, subpart B. As noted above, OMHA administers the nationwide Administrative Law Judge hearing program in accordance with these statutes and applicable regulations. As part of that effort, OMHA is establishing a manual, the OMHA Case Processing Manual (OCPM). Through the OCPM, the OMHA Chief Administrative Law Judge establishes the day-to-day procedures for carrying out adjudicative functions, in accordance with applicable statutes, regulations and OMHA directives. The OCPM provides direction for processing appeals at the OMHA level of adjudication for Medicare Part A and B claims; Part C organization determinations; Part D coverage determinations; and SSA eligibility and entitlement, Part B late enrollment penalty, and IRMAA determinations.
Section 1871(c) of the Act requires that we publish a list of all Medicare manual instructions, interpretive rules, statements of policy, and guidelines of general applicability not issued as regulations at least every 3 months in the
This quarterly notice provides the specific updates to the OCPM that have occurred in the 3-month period. A hyperlink to the available chapters on the OMHA Web site is provided below. The OMHA Web site contains the most current, up-to-date chapters and revisions to chapters, and will be available earlier than we publish our quarterly notice. We believe the OMHA Web site list provides more timely access to the current OCPM chapters for those involved in the Medicare claim, organization and coverage determination and entitlement appeals processes. We also believe the Web site offers the public a more convenient tool for real time access to current OCPM provisions. In addition, OMHA has a listserv to which the public can subscribe to receive immediate notification of any updates to the OMHA Web site. This listserv avoids the need to check the OMHA Web site, as update notifications are sent to subscribers as they occur. If accessing the OMHA Web site proves to be difficult, the contact person listed above can provide the information.
This notice lists the OCPM chapters and subjects published during the quarter covered by the notice so the reader may determine whether any are of particular interest. We expect this notice to be used in concert with future published notices. The OCPM can be accessed at
The OCPM is used by OMHA adjudicators and staff to administer the OMHA program. It offers day-to-day operating instructions, policies, and procedures based on statutes and regulations, and OMHA directives.
The following is a list and description of new or revised OCPM provisions and the subject matter. For future quarterly notices, we will list only the specific updates to the list of manual provisions that have occurred in the covered 3-month period. This information is available on our Web site at
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of the following meeting.
The meeting will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of the following meeting.
The meeting will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
Notice is hereby given of a change in the meeting of the National Heart, Lung, and Blood Institute Special Emphasis Panel, January 24, 2017, 02:00 p.m. to January 24, 2017, 04:00 p.m., National Institutes of Health, 6701 Rockledge Drive, Bethesda, MD, 20892 which was published in the
Dr. Sunnarborg's January 24, 2017, teleconference has been rescheduled to January 30, 2017, 09:30 a.m. to January 30, 2017, 11:00 a.m. The meeting is closed to the public.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of the following meeting.
The meeting will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of the following meetings.
The meetings will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications/contract proposals and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications/contract proposals, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of the following meeting.
The meeting will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of a meeting of the Board of Scientific Counselors, National Institute of Mental Health.
The meeting will be closed to the public as indicated below in accordance
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of the following meeting.
The meeting will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of the following meetings.
The meetings will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of the following meeting.
The meeting will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
Administration for Children and Families, HHS.
Notice.
Statement of Organizations, Functions, and Delegations of Authority. The Administration for Children and Families (ACF) has reorganized the Office of Refugee Resettlement (ORR). Based on internal evaluation and feedback from external stakeholders related to making ORR programs more efficient, responsive, and better organized to meet ORR's statutory obligations, this reorganization aims to increase efficiencies and better align organizational structures with programmatic requirements and to increase the effectiveness of all ORR programs. To accomplish those goals, this reorganization realigns ORR's four current programmatic divisions to create two dedicated program offices, the Refugee Programs and the Unaccompanied Children Programs. Within the Unaccompanied Children Programs, it renames the Division of Children's Services to the Division of Unaccompanied Children Operations and creates two new divisions, the Division of Planning and Logistics, and the Division of Unaccompanied Children's Health. It also renames the Division of Policy to the Division of Policy and Procedures and changes the Budget Team to the Division of Strategic Planning, Budget, and Analysis.
Robert Carey, Office of Refugee Resettlement, 330 C Street SW., Washington, DC 20201, (202) 401-4556.
This notice amends Part K of the Statement of Organization, Functions, and Delegations of Authority of the Department of Health and Human Services (HHS), Administration for Children and Families (ACF), as follows: Chapter KR, Office of Refugee Resettlement, as last amended by 80 FR 33269-33270, June 11, 2015.
I. Under Chapter KR, Office of Refugee Resettlement, delete KR.10 Organization in its entirety and replace with the following:
II. Under Chapter KR, Office of Refugee Resettlement, delete KR.20 Functions in its entirety and replace with the following:
The Office of the Director coordinates with the lead refugee and entrant program offices of other Federal departments; provides leadership in representing refugee and entrant programs, policies and administration to a variety of governmental entities and other public and private interests; and, acts as the coordinator of the total refugee and entrant resettlement effort
The Division of Policy and Procedures assesses and evaluates ORR programs and their legal authorities and proactively recommends policy development, legislative proposals, and operational and management actions to comply with statutory parameters as they relate to each of the program areas. The Division advises the ORR Director, deputies, division directors, and staff on a wide range of significant and sensitive policy-related matters and strategies for attaining ORR policy objectives including reviewing proposed legislation and assisting with responding to Congressional inquiries. The Division identifies major emerging legislative and policy issues, assesses impacts, develops policy options and strategies, and implements policy initiatives, including the drafting of policies, guidance and regulations. The Division consults with the ORR operating divisions in the creation and clearance of procedures, consistent with established regulations, policies and guidance, and implements training on policies and procedures for ORR staff. The Division of Policy and Procedures develops clearance and informational memoranda, briefing materials and summary statements for ORR, ACF, and department leadership on complex and sensitive ORR matters. The Division collaborates with the ORR operating divisions and regional staff to clarify and enhance existing policies and guidance, particularly in areas where the work of two or more divisions overlap. The Division of Policy and Procedures serves as the ORR point of contact for other ACF and HHS offices related to legal and evaluation issues, such as OGC, OLAB, GAO, and OIG. The Division represents ORR on interagency working groups and collaborates with both government and private sector leaders on ORR policy-related issues and developments.
The Division of Strategic Planning, Budget and Analysis leads ORR in the development, tracking, and implementation of strategic goals and performs budget, data analysis, and compliance functions for the office. The Division prepares annual budget estimates and related materials and performs allocation and tracking of funds for all programs. The Division performs analysis on the changing needs of the populations served by ORR programs, provides leadership to identify data needs and sources, and formulates data and reporting requirements. The Division also leads the office in the development of strategic goals and objectives and ensures that policies and operational and management activities are designed to achieve ORR, ACF and department goals. The Division develops and maintains standard monitoring procedures for the office and ensures the regular monitoring of ORR grant funds.
B. The Refugee Programs are responsible for carrying out programs that provide assistance to refugees, asylees, Cuban and Haitian entrants, and certain Amerasians and victims of severe forms of trafficking in persons. The Refugee Programs oversee the movement of children into the Unaccompanied Refugee Minor (URM) program. The Refugee Programs consist of the Division of Refugee Assistance, the Division of Refugee Services, and the Division of Refugee Health. The Refugee Programs collect and maintain data related to the populations served. The Deputy Director reports directly to the Director of ORR.
The Division of Refugee Assistance represents ORR in coordinating services and capacity for refugees in a manner that helps refugees become employed and economically self-sufficient soon after their arrival in the United States. The Division monitors and provides technical assistance to the State-administered domestic assistance programs and Wilson/Fish projects. The Division works closely with each State in designing a resettlement program specific to the needs of incoming populations. The Division develops guidance and procedures for their implementation; manages special initiatives to increase refugee self-sufficiency such as through State funded discretionary grants or pilot programs. The Division also assists public and private agencies on data reporting and the resolution of reporting problems. The Division develops and supports the flow of information on refugee profiles and community resources in support of effective placement at the State and local level. The Division works closely with the Department of State to ensure effective and seamless orientation from overseas to local resettlement community. The Division manages the effective allocation of formula social services and targeted assistance in support of newly arriving populations. The Division tracks all State costs related to refugee assistance.
The Division of Refugee Services manages effective refugee resettlement through the programmatic implementation of grants, contracts and special initiatives, such as the Match Grant Program. The Division oversees and monitors most ORR discretionary grants; recommends grantee allocation; coordinates with the grants management office to review the financial expenditures under discretionary grant programs; provides data in support of apportionment requests; and, provides technical assistance on discretionary grants operations. The Division coordinates and provides liaison with the Department and other Federal agencies on discretionary grant operational issues and other activities as specified by the Director or required by Congressional mandate. The Division responds to unanticipated refugee and entrant arrivals or significant increases in arrivals to communities where adequate or appropriate services do not exist through supplemental initiatives. The Division works to promote economic independence among refugees through social services, educational services, and intensive case management and community development initiatives.
The Division of Refugee Health provides direction for assuring that refugees are provided medical assistance and mental health services through the State-administered programs and alternative programs. The Division ensures the quality of medical screening and initial medical treatment of refugees through its administration of grant programs, technical assistance, and interagency agreements in support of comprehensive medical and mental health services. The Division also supports mental health services to victims of torture. The Division works closely with State Refugee Health Coordinators in the planning and provision of medical and mental health services to meet the individual needs of incoming populations. The Division
C. The Unaccompanied Children Programs are directly responsible for providing services to unaccompanied children who are referred to ORR for care pending immigration status, or identified as victims of trafficking. The Unaccompanied Children Programs consists of the Division of Unaccompanied Children Operations, the Division of Planning and Logistics, and the Division of Unaccompanied Children's Health. Unaccompanied Children Programs staff ensures that services are administered in a manner that supports child welfare standards of care and services and complete regular monitoring of service provision. The Deputy Director reports directly to the Director of ORR.
The Division of Operations implements intake and placement decisions for all unaccompanied alien children. The Division supports specialized care through grants and contracts, and also conducts monitoring and inspections of facilities and placement locations in which unaccompanied children reside. The Division also maintains statistical information and data on each child and any actions concerning the child while the child is under ORR's care. The Division ensures consideration of the child's best interest in care and custody decisions. The Division coordinates all decisions related to sponsor reunification, background checks, home assessments, follow-up services, medical assessment and treatment, and repatriation. The Division administers the pro bono legal services and child advocate program and compiles a State-by-State list of professionals or entities qualified to provide the children with a guardian and attorney representational services. The Division also supports grants for services provided to children after their release from ORR care.
The Division of Planning and Logistics oversees the development of a comprehensive annual plan to ensure that Unaccompanied Children Programs are able to accommodate the number of referrals of children to ORR care. The Division prepares plans for anticipated shelter capacity and staffing needs. The Division leads coordination with other federal agencies and management of grants and contracts. If ORR requires temporary shelters to care for unaccompanied children, the Division leads the operational and logistical support for those shelters.
The Division of Health for Unaccompanied Children oversees the provision of health and medical services to unaccompanied children in ORR care. The Division reviews and approves orders for complex medical procedures and reviews test results for certain medical ailments. The Division also ensures reporting of public health information to the appropriate public health authorities.
III. Continuation of Policy. Except as inconsistent with this reorganization, all statements of policy and interpretations with respect to organizational components affected by this notice within ACF, heretofore issued and in effect on this date of this reorganization are continued in full force and effect.
IV. Delegation of Authority. Pending further delegation, directives or orders by the Director of ORR, all delegations and redelegations of authority made to officials and employees of affected organizational components will continue in them or their successors pending further redelegations, provided they are consistent with this reorganization.
V. Funds, Personnel, and Equipment. Transfer of organizations and functions affected by this reorganization shall be accompanied in each instance by direct and support funds, positions, personnel, records, equipment, supplies, and other resources.
This realignment is effective January 19, 2017.
Substance Abuse and Mental Health Services Administration (SAMHSA), Department of Health and Human Services (HHS).
Request for information.
Substance Abuse and Mental Health Services Administration (SAMHSA), Center for Substance Abuse Treatment, in the Department of Health and Human Services (HHS) announces the opening of a docket to obtain public comment on a report to Congress in response to the Projecting Our Infants Act of 2015 (POIA) (Pub. L. 114-91). The POIA mandated HHS to: Conduct a review of planning and coordination activities related to prenatal opioid exposure and neonatal abstinence syndrome; develop recommendations for the identification, prevention, and treatment of prenatal opioid exposure and neonatal abstinence syndrome; and develop a strategy to address gaps, overlap, and duplication among Federal programs and Federal coordination efforts to address neonatal abstinence syndrome. The POIA further mandates that public comment be sought regarding the proposed strategy and incorporated as appropriate.
You may submit comments identified by Docket No. [SAMHSA-2016-0004] by any of the following methods:
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Melinda Campopiano, MD, Chief Medical Officer, Center for Substance Abuse Treatment, Substance Abuse and Mental Health Services Administration, 5600 Fishers Lane, 13E49, Rockville, MD 20852. Email:
In response to this Act, this report provides background information on prenatal opioid exposure and neonatal abstinence syndrome (Part 1), summarizes HHS activities related to prenatal opioid exposure and neonatal abstinence syndrome (Part 2), presents clinical and programmatic evidence and recommendations for preventing and treating neonatal abstinence syndrome (Part 3), and presents a strategy to address the identified gaps, challenges, and recommendations (Part 4).
Public comment is sought for “Part 4: Strategy to Protect Our Infants” (Section 2(b) of the Act) and comments will be incorporated into the strategy as appropriate. The final strategy will be posted on an HHS Web site by May 25, 2017.
Federal Emergency Management Agency, DHS.
Notice.
This notice amends the notice of a major disaster declaration for the Commonwealth of Virginia (FEMA-4291-DR), dated November 2, 2016, and related determinations.
Effective December 19, 2016.
Dean Webster, Office of Response and Recovery, Federal Emergency Management Agency, 500 C Street SW., Washington, DC 20472, (202) 646-2833.
The notice of a major disaster declaration for the Commonwealth of Virginia is hereby amended to include the following area among those areas determined to have been adversely affected by the event declared a major disaster by the President in his declaration of November 2, 2016.
The independent city of Hampton for Public Assistance.
The following Catalog of Federal Domestic Assistance Numbers (CFDA) are to be used for reporting and drawing funds: 97.030, Community Disaster Loans; 97.031, Cora Brown Fund; 97.032, Crisis Counseling; 97.033, Disaster Legal Services; 97.034, Disaster Unemployment Assistance (DUA); 97.046, Fire Management Assistance Grant; 97.048, Disaster Housing Assistance to Individuals and Households In Presidentially Declared Disaster Areas; 97.049, Presidentially Declared Disaster Assistance—Disaster Housing Operations for Individuals and Households; 97.050 Presidentially Declared Disaster Assistance to Individuals and Households—Other Needs; 97.036, Disaster Grants—Public Assistance (Presidentially Declared Disasters); 97.039, Hazard Mitigation Grant.
Federal Emergency Management Agency, DHS.
Notice.
This notice lists communities where the addition or modification of Base Flood Elevations (BFEs), base flood depths, Special Flood Hazard Area (SFHA) boundaries or zone designations, or the regulatory floodway (hereinafter referred to as flood hazard determinations), as shown on the Flood Insurance Rate Maps (FIRMs), and where applicable, in the supporting Flood Insurance Study (FIS) reports, prepared by the Federal Emergency Management Agency (FEMA) for each community, is appropriate because of new scientific or technical data. The FIRM, and where applicable, portions of the FIS report, have been revised to reflect these flood hazard determinations through issuance of a Letter of Map Revision (LOMR), in accordance with Title 44, Part 65 of the Code of Federal Regulations (44 CFR part 65). The LOMR will be used by insurance agents and others to calculate appropriate flood insurance premium rates for new buildings and the contents of those buildings. For rating purposes, the currently effective community number is shown in the table below and must be used for all new policies and renewals.
These flood hazard determinations will become effective on the dates listed in the table below and revise the FIRM panels and FIS report in effect prior to this determination for the listed communities.
From the date of the second publication of notification of these changes in a newspaper of local circulation, any person has 90 days in which to request through the community that the Deputy Associate Administrator for Insurance and
The affected communities are listed in the table below. Revised flood hazard information for each community is available for inspection at both the online location and the respective community map repository address listed in the table below. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
Submit comments and/or appeals to the Chief Executive Officer of the community as listed in the table below.
Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 400 C Street SW., Washington, DC 20472, (202) 646-7659, or (email)
The specific flood hazard determinations are not described for each community in this notice. However, the online location and local community map repository address where the flood hazard determination information is available for inspection is provided.
Any request for reconsideration of flood hazard determinations must be submitted to the Chief Executive Officer of the community as listed in the table below.
The modifications are made pursuant to section 201 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4105, and are in accordance with the National Flood Insurance Act of 1968, 42 U.S.C. 4001
The FIRM and FIS report are the basis of the floodplain management measures that the community is required either to adopt or to show evidence of having in effect in order to qualify or remain qualified for participation in the National Flood Insurance Program (NFIP).
These flood hazard determinations, together with the floodplain management criteria required by 44 CFR 60.3, are the minimum that are required. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own or pursuant to policies established by other Federal, State, or regional entities. The flood hazard determinations are in accordance with 44 CFR 65.4.
The affected communities are listed in the following table. Flood hazard determination information for each community is available for inspection at both the online location and the respective community map repository address listed in the table below. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
Federal Emergency Management Agency, DHS.
Notice.
The Federal Emergency Management Agency, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to take this opportunity to comment on a revision of a currently approved information collection. In accordance with the Paperwork Reduction Act of 1995, this notice seeks comments concerning enrollment for students and score assessments for FEMA's Independent Study Program.
Comments must be submitted on or before March 20, 2017.
To avoid duplicate submissions to the docket, please use only one of the following means to submit comments:
(1)
(2)
All submissions received must include the agency name and Docket ID. Regardless of the method used for submitting comments or material, all submissions will be posted, without change, to the Federal eRulemaking Portal at
Mark Magers, Instructional Systems Specialist, FEMA, PNP—Emergency Management Institute, at 301-447-1038. You may contact the Information Management Division for copies of the proposed collection of information at email address:
FEMA's Emergency Management Institute (EMI) provides a wide variety of training to emergency management personnel throughout the country. The EMI Independent Study (IS) Program is part of the FEMA training program authorized under section 611(f) of the Robert T. Stafford Disaster Relief and Emergency Act, Public Law 93-288 as amended. These courses are offered online by EMI. The IS Program provides valuable training to Federal, State, local and Tribal emergency management personnel and the general citizenry of the United States without having to attend a resident course at EMI, or at a State-sponsored course. The IS program also includes a course on the National Incident Management System (NIMS). NIMS is our nation's incident management system. Homeland Security Presidential Directive 5, “Management of Domestic Incidents,” requires the adoption of NIMS by all Federal departments and agencies. This directive also requires that Federal preparedness assistance funding for States, Territories, local jurisdictions
Comments may be submitted as indicated in the
Federal Emergency Management Agency, DHS.
Notice.
Comments are requested on proposed flood hazard determinations, which may include additions or modifications of any Base Flood Elevation (BFE), base flood depth, Special Flood Hazard Area (SFHA) boundary or zone designation, or regulatory floodway on the Flood Insurance Rate Maps (FIRMs), and where applicable, in the supporting Flood Insurance Study (FIS) reports for the communities listed in the table below. The purpose of this notice is to seek general information and comment regarding the preliminary FIRM, and where applicable, the FIS report that the Federal Emergency Management Agency (FEMA) has provided to the affected communities. The FIRM and FIS report are the basis of the floodplain management measures that the community is required either to adopt or to show evidence of having in effect in order to qualify or remain qualified for participation in the National Flood Insurance Program (NFIP). In addition, the FIRM and FIS report, once effective, will be used by insurance agents and others to calculate appropriate flood insurance premium rates for new buildings and the contents of those buildings.
Comments are to be submitted on or before April 19, 2017.
The Preliminary FIRM, and where applicable, the FIS report for each community are available for inspection at both the online location and the respective Community Map Repository address listed in the tables below. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
You may submit comments, identified by Docket No. FEMA-B-1663, to Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 400 C Street SW., Washington, DC 20472, (202) 646-7659, or (email)
Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 400 C Street SW., Washington, DC 20472, (202) 646-7659, or (email)
FEMA proposes to make flood hazard determinations for each community listed below, in accordance with section 110 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4104, and 44 CFR 67.4(a).
These proposed flood hazard determinations, together with the floodplain management criteria required by 44 CFR 60.3, are the minimum that are required. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own or pursuant to policies established by other Federal, State, or regional entities. These flood hazard determinations are used to meet the floodplain management requirements of the NFIP and also are used to calculate the appropriate flood insurance premium rates for new buildings built after the FIRM and FIS report become effective.
The communities affected by the flood hazard determinations are provided in the tables below. Any request for reconsideration of the revised flood hazard information shown on the Preliminary FIRM and FIS report that satisfies the data requirements outlined in 44 CFR 67.6(b) is considered an appeal. Comments unrelated to the flood hazard determinations also will be considered before the FIRM and FIS report become effective.
Use of a Scientific Resolution Panel (SRP) is available to communities in support of the appeal resolution process. SRPs are independent panels of experts in hydrology, hydraulics, and other pertinent sciences established to review conflicting scientific and technical data and provide recommendations for resolution. Use of the SRP only may be exercised after FEMA and local communities have been
The watersheds and/or communities affected are listed in the tables below. The Preliminary FIRM, and where applicable, FIS report for each community are available for inspection at both the online location and the respective Community Map Repository address listed in the tables. For communities with multiple ongoing Preliminary studies, the studies can be identified by the unique project number and Preliminary FIRM date listed in the tables. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
February 23, 2017.
I. Watershed-based studies:
Federal Emergency Management Agency, DHS.
Notice.
This notice lists communities where the addition or modification of Base Flood Elevations (BFEs), base flood depths, Special Flood Hazard Area (SFHA) boundaries or zone designations, or the regulatory floodway (hereinafter referred to as flood hazard determinations), as shown on the Flood Insurance Rate Maps (FIRMs), and where applicable, in the supporting Flood Insurance Study (FIS) reports, prepared by the Federal Emergency Management Agency (FEMA) for each community, is appropriate because of new scientific or technical data. The FIRM, and where applicable, portions of the FIS report, have been revised to reflect these flood hazard determinations through issuance of a Letter of Map Revision (LOMR). The LOMR will be used by insurance agents and others to calculate appropriate flood insurance premium rates for new buildings and the contents of those buildings. For rating purposes, the currently effective community number is shown in the table below and must be used for all new policies and renewals.
These flood hazard determinations will become effective on the dates listed in the table below and revise the FIRM panels and FIS report in effect prior to this determination for the listed communities.
From the date of the second publication of notification of these changes in a newspaper of local circulation, any person has 90 days in which to request through the community that the Deputy Associate Administrator for Insurance and Mitigation reconsider the changes. The flood hazard determination information may be changed during the 90-day period.
The affected communities are listed in the table below. Revised flood hazard information for each community is available for inspection at both the online location and the respective community map repository address listed in the table below. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
Submit comments and/or appeals to the Chief Executive Officer of the community as listed in the table below.
Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 400 C Street SW., Washington, DC 20472, (202) 646-7659, or (email)
The specific flood hazard determinations are not described for each community in this notice. However, the online location and local community map repository address where the flood hazard determination information is available for inspection is provided.
Any request for reconsideration of flood hazard determinations must be submitted to the Chief Executive Officer of the community as listed in the table below.
The modifications are made pursuant to section 201 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4105, and are in accordance with the National Flood Insurance Act of 1968, 42 U.S.C. 4001
The FIRM and FIS report are the basis of the floodplain management measures that the community is required either to adopt or to show evidence of having in effect in order to qualify or remain qualified for participation in the National Flood Insurance Program (NFIP).
These flood hazard determinations, together with the floodplain management criteria required by 44 CFR 60.3, are the minimum that are required. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own or pursuant to policies established by other Federal, State, or regional entities. The flood hazard determinations are in accordance with 44 CFR 65.4.
The affected communities are listed in the following table. Flood hazard determination information for each community is available for inspection at both the online location and the respective community map repository address listed in the table below. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
Federal Emergency Management Agency, DHS.
Notice.
Comments are requested on proposed flood hazard determinations, which may include additions or modifications of any Base Flood Elevation (BFE), base flood depth, Special Flood Hazard Area (SFHA) boundary or zone designation, or regulatory floodway on the Flood Insurance Rate Maps (FIRMs), and where applicable, in the supporting Flood Insurance Study (FIS) reports for the communities listed in the table below. The purpose of this notice is to seek general information and comment regarding the preliminary FIRM, and where applicable, the FIS report that the Federal Emergency Management Agency (FEMA) has provided to the affected communities. The FIRM and FIS report are the basis of the floodplain management measures that the community is required either to adopt or to show evidence of having in effect in order to qualify or remain qualified for participation in the National Flood Insurance Program (NFIP). In addition, the FIRM and FIS report, once effective, will be used by insurance agents and others to calculate appropriate flood insurance premium rates for new buildings and the contents of those buildings.
Comments are to be submitted on or before April 19, 2017.
The Preliminary FIRM, and where applicable, the FIS report for each community are available for inspection at both the online location and the respective Community Map Repository address listed in the tables below. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
You may submit comments, identified by Docket No. FEMA-B-1667, to Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 400 C Street SW., Washington, DC 20472, (202) 646-7659, or (email)
Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 400 C Street SW., Washington, DC 20472, (202) 646-7659, or (email)
FEMA proposes to make flood hazard determinations for each community listed below, in accordance with section 110 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4104, and 44 CFR 67.4(a).
These proposed flood hazard determinations, together with the floodplain management criteria required by 44 CFR 60.3, are the minimum that are required. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own or pursuant to policies established by other Federal, State, or regional entities. These flood hazard determinations are used to meet the floodplain management requirements of the NFIP and also are used to calculate the appropriate flood insurance premium rates for new buildings built after the FIRM and FIS report become effective.
The communities affected by the flood hazard determinations are provided in the tables below. Any request for reconsideration of the revised flood hazard information shown on the Preliminary FIRM and FIS report that satisfies the data requirements outlined in 44 CFR 67.6(b) is considered an appeal. Comments unrelated to the flood hazard determinations also will be considered before the FIRM and FIS report become effective.
Use of a Scientific Resolution Panel (SRP) is available to communities in support of the appeal resolution process. SRPs are independent panels of experts in hydrology, hydraulics, and other pertinent sciences established to review conflicting scientific and technical data and provide recommendations for resolution. Use of the SRP only may be exercised after FEMA and local communities have been engaged in a collaborative consultation process for at least 60 days without a mutually acceptable resolution of an appeal. Additional information regarding the SRP process can be found online at
The watersheds and/or communities affected are listed in the tables below. The Preliminary FIRM, and where applicable, FIS report for each community are available for inspection at both the online location and the respective Community Map Repository address listed in the tables. For communities with multiple ongoing Preliminary studies, the studies can be identified by the unique project number and Preliminary FIRM date listed in the tables. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
I. Non-watershed-based studies:
Federal Emergency Management Agency, DHS.
Notice.
This notice amends the notice of a major disaster declaration for the State of North Carolina (FEMA-4285-DR), dated October 10, 2016, and related determinations.
Effective December 23, 2016.
Dean Webster, Office of Response and Recovery, Federal Emergency Management Agency, 500 C Street SW., Washington, DC 20472, (202) 646-2833.
The notice of a major disaster declaration for the State of North Carolina is hereby amended to include the following area among those areas determined to have been adversely affected by the event declared a major disaster by the President in his declaration of October 10, 2016.
Warren County for Public Assistance, including direct federal assistance.
Federal Emergency Management Agency, DHS.
Notice.
This notice lists communities where the addition or modification of Base Flood Elevations (BFEs), base flood depths, Special Flood Hazard Area (SFHA) boundaries or zone
These flood hazard determinations will become effective on the dates listed in the table below and revise the FIRM panels and FIS report in effect prior to this determination for the listed communities.
From the date of the second publication of notification of these changes in a newspaper of local circulation, any person has 90 days in which to request through the community that the Deputy Associate Administrator for Insurance and Mitigation reconsider the changes. The flood hazard determination information may be changed during the 90-day period.
The affected communities are listed in the table below. Revised flood hazard information for each community is available for inspection at both the online location and the respective community map repository address listed in the table below. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
Submit comments and/or appeals to the Chief Executive Officer of the community as listed in the table below.
Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 400 C Street SW., Washington, DC 20472, (202) 646-7659, or (email)
The specific flood hazard determinations are not described for each community in this notice. However, the online location and local community map repository address where the flood hazard determination information is available for inspection is provided.
Any request for reconsideration of flood hazard determinations must be submitted to the Chief Executive Officer of the community as listed in the table below.
The modifications are made pursuant to section 201 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4105, and are in accordance with the National Flood Insurance Act of 1968, 42 U.S.C. 4001
The FIRM and FIS report are the basis of the floodplain management measures that the community is required either to adopt or to show evidence of having in effect in order to qualify or remain qualified for participation in the National Flood Insurance Program (NFIP).
These flood hazard determinations, together with the floodplain management criteria required by 44 CFR 60.3, are the minimum that are required. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own or pursuant to policies established by other Federal, State, or regional entities. The flood hazard determinations are in accordance with 44 CFR 65.4.
The affected communities are listed in the following table. Flood hazard determination information for each community is available for inspection at both the online location and the respective community map repository address listed in the table below. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
Federal Emergency Management Agency, DHS.
Notice.
Comments are requested on proposed flood hazard determinations, which may include additions or modifications of any Base Flood Elevation (BFE), base flood depth, Special Flood Hazard Area (SFHA) boundary or zone designation, or regulatory floodway on the Flood Insurance Rate Maps (FIRMs), and where applicable, in the supporting Flood Insurance Study (FIS) reports for the communities listed in the table below. The purpose of this notice is to seek general information and comment regarding the preliminary FIRM, and where applicable, the FIS report that the Federal Emergency Management Agency (FEMA) has provided to the affected communities. The FIRM and FIS report are the basis of the floodplain management measures that the community is required either to adopt or to show evidence of having in effect in order to qualify or remain qualified for participation in the National Flood Insurance Program (NFIP). In addition, the FIRM and FIS report, once effective, will be used by insurance agents and others to calculate appropriate flood insurance premium rates for new buildings and the contents of those buildings.
Comments are to be submitted on or before January 19, 2017.
The Preliminary FIRM, and where applicable, the FIS report for each community are available for inspection at both the online location and the respective Community Map Repository address listed in the tables below. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
You may submit comments, identified by Docket No. FEMA-B-1666, to Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 400 C Street SW., Washington, DC 20472, (202) 646-7659, or (email)
Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 400 C Street SW., Washington, DC 20472, (202) 646-7659, or (email)
FEMA proposes to make flood hazard determinations for each community listed below, in accordance with section 110 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4104, and 44 CFR 67.4(a).
These proposed flood hazard determinations, together with the floodplain management criteria required by 44 CFR 60.3, are the minimum that are required. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own or pursuant to policies established by other Federal, State, or regional entities. These flood hazard determinations are used to meet the floodplain management requirements of the NFIP and also are used to calculate the appropriate flood insurance premium rates for new buildings built after the FIRM and FIS report become effective.
The communities affected by the flood hazard determinations are provided in the tables below. Any request for reconsideration of the revised flood hazard information shown on the Preliminary FIRM and FIS report that satisfies the data requirements outlined in 44 CFR 67.6(b) is considered an appeal. Comments unrelated to the flood hazard determinations also will be considered before the FIRM and FIS report become effective.
Use of a Scientific Resolution Panel (SRP) is available to communities in support of the appeal resolution process. SRPs are independent panels of experts in hydrology, hydraulics, and other pertinent sciences established to review conflicting scientific and technical data and provide recommendations for resolution. Use of the SRP only may be exercised after FEMA and local communities have been engaged in a collaborative consultation process for at least 60 days without a mutually acceptable resolution of an appeal. Additional information regarding the SRP process can be found online at
The watersheds and/or communities affected are listed in the tables below. The Preliminary FIRM, and where applicable, FIS report for each community are available for inspection at both the online location and the respective Community Map Repository address listed in the tables. For communities with multiple ongoing Preliminary studies, the studies can be identified by the unique project number and Preliminary FIRM date listed in the tables. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
Science and Technology Directorate, DHS.
Committee Management; Notice of Federal Advisory Committee Meeting.
The Homeland Security Science and Technology Advisory Committee (HSSTAC) will meet on February 16-17, 2017 in Washington, DC. The meeting will be an open session with both in-person and webinar participation.
The HSSTAC will meet in-person Thursday, February 16, 2017, from 1:30 p.m.-5:30 p.m. and Friday, February 17, 2017, from 9:00 a.m.-12:00 p.m.
Due to security requirements, screening pre-registration is required for this event. Please see the “REGISTRATION” section below.
The meeting may close early if the committee has completed its business.
Homeland Security, 1120 Vermont Ave. NW., 8th Floor, Washington, DC 20005.
Michel Kareis, HSSTAC Designated Federal Official, S&T IAO STOP 0205, Department of Homeland Security, 245 Murray Lane, Washington, DC 20528-0205, 202-254-8778, (Office), 202-254-6176 (Fax)
Notice of this meeting is given under the Federal Advisory Committee Act (FACA), 5 U.S.C. appendix (Pub. L. 92-463). The committee addresses areas of interest and importance to the Under Secretary for Science and Technology (S&T), such as new developments in systems engineering, cyber-security, knowledge management and how best to leverage related technologies funded by other Federal agencies and by the private sector. It also advises the Under Secretary on policies, management processes, and organizational constructs as needed.
To pre-register for the virtual meeting (webinar) please send an email to:
If you plan to attend the meeting in-person you must RSVP by February 15, 2017. To register, email
At the end of each open session, there will be a period for oral statements. Please note that the oral statement period may end before the time indicated, following the last call for oral statements. To register as a speaker, contact the person listed in the
To facilitate public participation, we invite public comment on the issues to be considered by the committee as listed in the “Agenda” below. Written comments must be received by February 6, 2017. Please include the docket number (DHS-2016-0084) and submit via
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The sessions will focus discussion on the technology development lifecycle to include best practice recommendations on how to create situational awareness of new or emerging trends, technologies, capabilities and research; develop processes to efficiently use networks and partnerships to identify, locate, and evaluate existing or developing technologies, and identify methods that can be used to engage the commercial marketplace to support the development and ultimately the acquisition by homeland security stakeholders of new technologies while prioritizing the need to leverage limited resources and maximize impact. The day will end with questions and comments from the public.
U.S. Citizenship and Immigration Services, Department of Homeland Security.
30-Day notice.
The Department of Homeland Security (DHS), U.S. Citizenship and Immigration Services (USCIS) will be submitting the following information collection request to the Office of Management and Budget (OMB) for review and clearance in accordance with the Paperwork Reduction Act of 1995. The information collection notice was previously published in the
The purpose of this notice is to allow an additional 30 days for public comments. Comments are encouraged and will be accepted until February 21, 2017. This process is conducted in accordance with 5 CFR 1320.10.
Written comments and/or suggestions regarding the item(s) contained in this notice, especially regarding the estimated public burden and associated response time, must be directed to the OMB USCIS Desk Officer via email at
You may wish to consider limiting the amount of personal information that you provide in any voluntary submission you make. For additional information please read the Privacy Act notice that is available via the link in the footer of
USCIS, Office of Policy and Strategy, Regulatory Coordination Division, Samantha Deshommes, Chief, 20 Massachusetts Avenue NW., Washington, DC 20529-2140, Telephone number (202) 272-8377. (This is not a toll-free number; comments are not accepted via telephone message.) Please note contact information provided here is solely for questions regarding this notice. It is not for individual case status inquiries. Applicants seeking information about the status of their individual cases can check Case Status Online, available at the USCIS Web site at
You may access the information collection instrument with instructions, or additional information by visiting the Federal eRulemaking Portal site at:
(1) Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
(2) Evaluate the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
(3) Enhance the quality, utility, and clarity of the information to be collected; and
(4) Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology,
(1)
(2)
(3)
(4)
(5)
(6)
(7)
U.S. Citizenship and Immigration Services, Department of Homeland Security.
30-Day Notice.
The Department of Homeland Security (DHS), U.S. Citizenship and Immigration Services (USCIS) will be submitting the following information collection request to the Office of Management and Budget (OMB) for review and clearance in accordance with the Paperwork Reduction Act of 1995. The information collection notice was previously published in the
The purpose of this notice is to allow an additional 30 days for public comments. Comments are encouraged and will be accepted until February 21, 2017. This process is conducted in accordance with 5 CFR 1320.10.
Written comments and/or suggestions regarding the item(s) contained in this notice, especially regarding the estimated public burden and associated response time, must be directed to the OMB USCIS Desk Officer via email at
You may wish to consider limiting the amount of personal information that you provide in any voluntary submission you make. For additional information please read the Privacy Act notice that is available via the link in the footer of
USCIS, Office of Policy and Strategy, Regulatory Coordination Division, Samantha Deshommes, Chief, 20 Massachusetts Avenue NW., Washington, DC 20529-2140, Telephone number (202) 272-8377 (This is not a toll-free number; comments are not accepted via telephone message.). Please note contact information provided here is solely for questions regarding this notice. It is not for individual case status inquiries. Applicants seeking information about the status of their individual cases can check Case Status Online, available at the USCIS Web site at
You may access the information collection instrument with instructions, or additional information by visiting the Federal eRulemaking Portal site at:
(1) Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
(2) Evaluate the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
(3) Enhance the quality, utility, and clarity of the information to be collected; and
(4) Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology,
(1)
(2)
(3)
(4)
(5)
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Office of the Assistant Secretary for Housing-Federal Housing Commissioner, HUD.
Notice.
This notice establishes the terms and conditions by which HUD will approve a request for the transfer of project-based rental assistance, debt held or insured by the Secretary, and statutorily required income-based use restrictions from one multifamily housing project to another (or between several such projects). The Department of Housing and Urban Development Appropriations Act, 2016 gives the Secretary the authority to approve transfer requests for fiscal years (FY) 2016 and 2017, provided that the Secretary publish a notice in the
Katherine Nzive, Director, Program Adminstration Office, Office of Asset Management and Portfolio Oversight of Multifamily Housing, Office of Housing, Department of Housing and Urban Development, 451 7th Street SW., Room 6110, Washington, DC 20410; telephone number 202-402-3440 (this is not a toll-free number). Persons with hearing or speech impairments may access this number through TTY by calling the toll-free Federal Relay Service at 800-877-8339.
Beginning with section 318 of the Department of Housing and Urban Development Appropriations Act, 2006 (Pub. L. 109-115, 119 Stat. 2396, approved November 30, 2005), HUD appropriations acts have contained a general provision authorizing the Secretary to approve requests from project owners for the transfer of certain rental assistance, debt, and income-based use restrictions between HUD-assisted projects. For fiscal year 2017, this transfer authority is provided under section 212 of of the Consolidated Appropriations Act, 216 (Pub. L. 114-113, 129 Stat. 2889, approved December 18, 2015 (Section 212). Section 212(a) states that “[n]otwithstanding any other provision of law . . . the Secretary of Housing and Urban Development may authorize the transfer of some or all project-based assistance, debt held or insured by the Secretary and statutorily required low-income and very low-income use restrictions if any, associated with one or more multifamily housing project or projects to another multifamily housing project or projects.” Section 212(b) also allows for phased transfers of project-based assistance to accommodate the financing and other requirements related to rehabilitating or constructing the project or projects to which the assistance is transferred.
HUD approval of transfers is subject to the conditions enumerated in the appropriations act for the applicable fiscal year. These statutory terms and conditions have, in general, been consistent from one appropriations act to the next. The statutory criteria for FY 2017 is enumerated in section 212(c), which provides as follows:
(c) The transfer authorized in subsection (a) is subject to the following conditions:
(1) NUMBER AND BEDROOM SIZE OF UNITS.—
(A) For occupied units in the transferring project: the number of low-income and very low-income units and the configuration (i.e. bedroom size) provided by the transferring project shall be no less than when transferred to the receiving project or projects and the net dollar amount of Federal assistance provided to the transferring project shall remain the same in the receiving project or projects.
(B) For unoccupied units in the transferring project: the Secretary may authorize a reduction in the number of dwelling units in the receiving project or projects to allow for a reconfiguration of bedroom sizes to meet current market demands, as determined by the Secretary and provided there is no increase in the project-based assistance budget authority.
(2) The transferring project shall, as determined by the Secretary, be either physically obsolete or economically nonviable.
(3) The receiving project or projects shall meet or exceed applicable physical standards established by the Secretary.
(4) The owner or mortgagor of the transferring project shall notify and consult with the tenants residing in the transferring project and provide a certification of approval by all appropriate local governmental officials.
(5) The tenants of the transferring project who remain eligible for assistance to be provided by the receiving project or projects shall not be required to vacate their units in the transferring project or projects until new units in the receiving project are available for occupancy.
(6) The Secretary determines that this transfer is in the best interest of the tenants.
(7) If either the transferring project or the receiving project or projects meets the condition specified in subsection (d)(2)(A),
(8) If the transferring project meets the requirements of subsection (d)(2),
(9) The transfer does not increase the cost (as defined in section 502 of the Congressional Budget Act of 1974, as amended) of any FHA-insured mortgage, except to the extent that appropriations are provided in advance for the amount of any such increased cost.
Section 212 (e)(1) requires that HUD publish by notice in the
This notice will become effective February 21, 2017. HUD will begin accepting requests for transfers pursuant to this notice on or after the effective date. For questions regarding the submission or status of a transfer request, interested parties should contact their local HUD Multifamily Regional Center or Satellite Office. The list of HUD Multifamily Regional Centers and Satellite Offices is available at:
Office of the Assistant Secretary for Community Planning and Development, HUD.
Notice of Redelegation of Authority to Deputy Assistant Secretaries in Community Planning and Development.
Section 7(d) of the Department of Housing and Urban Development Act, as amended, provides authority to the Secretary to delegate functions, powers, and duties as the Secretary deems necessary. By separate notice published in today's
Cliff Taffet, General Deputy Assistant Secretary, Office of Community Planning and Development, Department of Housing and Urban Development, 451 7th Street SW., Room 7100, Washington, DC 20410-7000; telephone number 202-708-2690. This is not a toll-free number. For those needing assistance, this number may be accessed via TTY by calling the Federal Relay Service at 800-877-8339.
Published elsewhere today in the
Except those authorities specifically excluded, the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development redelegate to the Deputy Assistant Secretary for Grant Programs all powers and authorities necessary to carry out the following Community Planning and Development programs and matters:
a. Comprehensive Housing Affordability Strategies (CHAS), Title I of the Cranston-Gonzalez National Affordable Housing Act, Public Law 101-625, 104 Stat. 4079 (1990) (codified as amended at 42 U.S.C. 12701
b. The HOME Investment Partnerships Act, Title II of the Cranston-Gonzalez National Affordable Housing Act, Public Law 101-625, 104 Stat. 4079 (1990) (codified as amended at 42 U.S.C. 12721
c. Housing Trust Fund (HTF), Section 1338 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, added by Section 1131 of Public Law 110-289, 122 Stat. 2654 (codified at 12 U.S.C. 4568).
d. Tax Credit Assistance Program (TCAP) as authorized under the HOME Investments Partnership Program heading of Division A, Title XII of American Recovery and Reinvestment Act of 2009, Public Law 111-5, 123 Stat. 115, 220-21.
e. Title I of the Housing and Community Development Act of 1974, Public Law 93-383, 88 Stat. 633 (codified as amended at 42 U.S.C. 5301
(1) Community Development Block Grant (CDBG) program;
(2) Section 108 Loan Guarantee program;
(3) Economic development grants pursuant to Section 108(q);
(4) Urban Development Action Grants
(5) Neighborhood Stabilization Programs Under Housing and Economic Recovery Act of 2008, Public Law 110-289, 122 Stat. 2850; Title XII of Division A of the American Recovery and Reinvestment Act of 2009, Public Law 111-5, 123 Stat. 115; and Section 1497 of the Wall Street Reform and Consumer Protection Act of 2010, Public Law 111-203, 124 Stat. 1376 (codified as amended at 42 U.S.C. 5301 note);
(6) CDBG Disaster Recovery Grants as provided for in annual and supplemental HUD appropriations acts; and
(7) Appalachian Regional Commission grants pursuant to section 214 of the Appalachian Regional Development Act of 1965, Public Law 89-4, 79 Stat. 5 (codified as amended at 40 U.S.C. 14507) and consistent with the CDBG program authorized under Title I of the Housing and Community Development Act of 1974, Public Law 93-383, 88 Stat. 633 (codified as amended at 42 U.S.C. 5301
f. Overall Departmental responsibility for policies, standards, procedures, and advisory materials for compliance with the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, Public Law 91-646, 84 Stat. 1894 (1971) (codified as amended at 42 U.S.C. 4601
g. Environment, overall Departmental responsibility for compliance with the National Environmental Policy Act of 1969 (NEPA), Public Law 91-190, 83 Stat. 852 (1970) (codified as amended at 42 U.S.C. 4321-4347), and the related laws and authorities cited in 24 CFR 50.4 and 58.5. The Director of the Office of Environment and Energy, within the Office of the Deputy Assistant Secretary for Grant Programs, is designated to serve as the Departmental Environmental Clearance Officer (DECO). The DECO serves as the Departmental lead in all federal initiatives that address NEPA and other federal environmental laws and authorities cited in 24 CFR 50.4 and 58.5 and as the Departmental signatory for environmental compliance MOUs with other federal agencies addressing compliance at the regional and national level.
h. Slum Clearance and Urban Renewal Program Under Title I of the Housing Act of 1949, Public Law 81-171, 63 Stat. 413 and any program that is superseded or inactive by, or inactive by reason of, Title I of the Housing and Community Development Act of 1974,
i. Rental Rehabilitation Program, United States Housing Act of 1937 § 17, Public Law 98-181, 97 Stat. 1196 (repealed 1990); 24 CFR part 511.
j. Section 312 Rehabilitation Loan Program, Housing Act of 1964 § 312, Public Law 88-560, 78 Stat. 769 (repealed 1990); 24 CFR part 510.
k. Homeownership Zone Initiative (HOZ) grants as provided for in section 205 of the Departments of Veterans Affairs and Housing and Urban Development, and Independent Agencies Appropriations Act, 1997, Public Law 104-204, 110 Stat. 2874 (1996) and funded with recaptured Nehemiah grants authorized under Title VI of the Housing and Community Development Act of 1987, Pub. L. 100-242, 101 Stat. 1815 (1988) (codified at 12 U.S.C. 17151 note).
l. HOPE for Homeownership of Single-family Housing Program (HOPE 3), Title IV, Subtitle C of the Cranston-Gonzalez National Affordable Housing Act, Public Law 101-625, 104 Stat. 4079 (1990) (codified at 42 U.S.C. 12891).
m. New Communities Program, Section 413 of the Housing and Urban Development Act of 1968, Public Law 90-448, 82 Stat. 476 (repealed 1983), Section 726 of the Housing and Urban Development Act of 1970, Public Law 91-609 (repealed 1983), 84 Stat. 1784, Section 474 of the Housing and Urban-Rural Recovery Act of 1983, Public Law 98-181, 97 Stat. 1237 (codified at 12 U.S.C. 1701g-5b), and any other functions, powers and duties which may affect the liquidation of the New Communities program.
n. Technical assistance and capacity building awards authorized under any program or matter listed in Section A.1 and as provided for in annual and supplemental HUD appropriations acts (
Except those authorities specifically excluded, the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development redelegate to the Deputy Assistant Secretary for Special Needs all powers and authorities necessary to carry out the following Community Planning and Development programs and matters:
a. Title IV of the McKinney-Vento Homeless Assistance Act, Public Law 100-77, 101 Stat. 482 (1987) (codified as amended at 42 U.S.C. 11301
b. Base Closure, Base Closure Community Redevelopment and Homeless Assistance Act of 1994, Public Law 103-421, 108 Stat. 4352 (codified as amended at 10 U.S.C. 2687 note); 24 CFR part 586.
c. Homelessness Prevention and Rapid Re-Housing Program (HPRP), as authorized under the Homelessness Prevention Fund heading of Division A, Title XII of the American Recovery and Reinvestment Act of 2009, Public Law 111-5, 123 Stat. 115.
d. Title V of the McKinney-Vento Homeless Assistance Act, Public Law 100-77, 101 Stat. 482 (1987) (codified as amended 42 U.S.C. 11411
e. Veterans Homelessness Prevention Demonstration Program, as provided for in annual HUD appropriations act(s) (
f. AIDS Housing Opportunity Act, Title VIII, Subtitle D of the Cranston-Gonzalez National Affordable Housing Act, Public Law 101-625, 104 Stat. 4079 (1990) (codified as amended at 42 U.S.C. 12901-12912); 24 CFR part 574.
Further, in the absence of the Deputy Assistant Secretary for Special Needs, the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development redelegate to the Director of the Office of Special Needs Programs all powers and authorities of the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development necessary to carry out programs and matters listed in Section A.2. paragraphs a., b., c., d., and e. Further, the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development redelegate to the Director of the Community Assistance Division the authority to sign notices of available properties and subsequent letters regarding the properties under Title V of the McKinney-Vento Homeless Assistance Act (codified as amended 42 U.S.C. 11411
Except those authorities specifically excluded, the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy
a. The Loan Guarantee Recovery Program under Section 4 of the Church Arson Prevention Act of 1996, Public Law 104-155, 110 Stat. 1392; 24 CFR part 573.
b. Neighborhood Initiatives grants specifically designated in annual HUD appropriations acts (
c. Rural Innovation Fund grants as provided for in annual HUD appropriations act(s) (
d. Rural Housing and Economic Development grants specifically designated originally in the Fiscal Year 1998 HUD Appropriations Act, Public Law 105-65, 111 Stat. 1344 1997, and subsequent annual HUD appropriations acts.
e. Self-Help Homeownership Opportunity Program (SHOP) under section 11 of the Housing Opportunity Program Extension Act of 1996, Public Law 104-120, 110 Stat. 834 (codified as amended at 42 U.S.C. 12805 note).
f. Pilot Program to Rehabilitate and Modify Homes of Disabled and Low-Income Veterans, as authorized under section 1079 of the Carl Levin and Howard P. “Buck” McKeon National Defense Authorization Act for Fiscal Year 2015, Public Law 113-291, 128 Stat. 3292, 3521-3524 (2014).
Further, in the absence of the Deputy Assistant Secretary for Economic Development, the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development redelegate to the Director of the Rural Housing and Economic Development Division all powers and authorities of the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development necessary to carry out programs and matters listed in Section A.3.
Except those authorities specifically excluded, the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development redelegate to the Deputy Assistant Secretary for Operations and the Director of Technical Assistance and Management all powers and authorities of the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development necessary to carry out the following Community Planning and Development programs and matters:
a. Technical Assistance and Capacity Building awards authorized under any program or matter delegated to the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development (
b. All programs consolidated in the Revolving Fund (Liquidating Programs) established pursuant to Title II of the Independent Offices Appropriations Act, Public Law 98-45, 97 Stat. 223 (1983) (codified at 12 U.S.C. 1701g-5), including all authority of the Assistant Secretary with respect to functions, administration and management of the Revolving Fund (Liquidating Programs). Only the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development are the responsible officials for allotments in the Revolving Fund (Liquidating Programs).
c. Economic Development Initiative grants, as provided for in annual HUD appropriations acts (
d. Grants for urban Empowerment Zones (EZ) as provided for in annual HUD appropriations acts (
e. Neighborhood Initiatives grants specifically designated in annual HUD appropriations acts (
f. Rural Innovation Fund grants as provided for in annual HUD appropriations act(s) (
g. The Renewal Communities (RC) Initiative as authorized under title 26, subtitle A, chapter 1, subchapter X of the Internal Revenue Code, as amended, 26 U.S.C. 1400E
h. The urban Empowerment Zones (EZ), as authorized under title 26, subtitle A, chapter 1, subchapter U of the Internal Revenue Code (codified as amended at 26 U.S.C. 1391
The authority redelegated under Section A does not include:
1. The authority to issue or waive regulations covered by section 7(q) of the Department of Housing and Urban Development Act;
2. The authority to exercise the Federal Agency waiver authority provided under 49 CFR 24.7;
3. The authority to enter regulations or directives into Departmental clearance; or
4. Any authority not delegated to the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development under the Consolidated Delegation of Authority for Community Planning and Development. The Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, or the General Deputy Assistant Secretary for Community Planning and Development may revoke at any time this redelegation with respect to the programs and matters listed in Section A.
The authority redelegated in Section A may be further redelegated to employees of the Department.
This notice supersedes all prior redelegations of authority to Deputy Assistant Secretaries of Community Planning and Development, including the redelegation of authority published on June 29, 2012 at 77 FR 38853.
The Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development hereby ratify all actions previously taken by the Deputy Assistant Secretaries for Community Planning and Development, with respect to the programs and matters listed in Section A.
Section 7(d), Department of Housing and Urban Development Act, 42 U.S.C. 3535(d).
Office of the Assistant Secretary for Public and Indian Housing and Office of the Assistant Secretary for Housing-Federal Housing Commissioner, HUD.
Notice.
On July 26, 2012, HUD announced through notice in the
The new statutory and regulatory waivers and alternative requirements are effective January 30, 2017.
The items listed as subject to notice and comment will be effective upon February 21, 2017. If HUD receives adverse comment that leads to reconsideration, HUD will notify the public in a new notice immediately upon the expiration of the comment period.
Interested persons are invited to submit comments electronically to
To assure a timely response, please direct requests for further information electronically to the email address
RAD, authorized by the Consolidated and Further Continuing Appropriations Act, 2012 (Pub. L. 122-55, signed November 18, 2011) (2012 Appropriations Act), allows for the conversion of assistance under the public housing, Rent Supplement (Rent Supp), Rental Assistance (RAP), Moderate Rehabilitation (Mod Rehab), and Mod Rehab Single Room Occupancy (SRO) programs (collectively, “covered programs”) to long-term, renewable assistance under Section 8.
The following highlights key changes to the RAD program that are included in the Revised Program Notice:
1. Creating a new way in which public housing agencies (PHAs) can increase their RAD rents by relinquishing existing balances of replacement housing factor (RHF) funds or demolition and disposition transition funding (DDTF) (see section 1.5.A).
2. Eliminating the cap on the number of project-based voucher (PBV) units at a project (see section 1.6.A.2).
3. Improving the quality of information that must be provided to residents of properties undergoing conversion and requiring that PHAs submit responses to resident comments in connection with meetings held following the issuance of the Commitment to enter into a Housing Assistance Payments Contract (CHAP) (see section 1.8).
4. Extending the prohibition on re-screening to current public housing households that will reside in non-RAD PBV or non-RAD project-based rental assistance (PBRA) units placed in a project that contain RAD PBV or RAD PBRA units so as to facilitate the right to return to the assisted property (see sections 1.6.C.1 and 1.7.B.1).
5. Correcting the phase-in of rents for residents who may experience a rent increase as a result of conversion, in order to ensure a more even distribution across years (see sections 1.6.B.3 and 1.7.B.3).
6. Clarifying that a PHA is permitted to receive cash acquisition proceeds in excess of any seller take-back financing and that such proceeds must be used for Affordable Housing Purposes, a newly defined term (see section 1.4.7).
7. Establishing flexibility for requirements related to the Capital Needs Assessments, permitting certain
8. Requiring title reports to be submitted with the Financing Plan to avoid delays in closing (see section 1.15, Attachment 1A).
9. Modifying the maximum allowable developer fee, by excluding from the formula for larger transactions any acquisition payments made to the PHA, developer fee, and reserves (see section 1.14).
10. Establishing greater flexibility to underwrite to new loan products that have emerged in the market (see section 1.15, Attachment 2A).
11. Providing greater detail on the acceptable forms in which a public or non-profit entity can demonstrate ownership or control (see section 1.4.A.11).
12. Providing guidance on owners' responsibilities to treat lead-based paint hazards in the context of a RAD conversion (see section 1.4.A.15).
13. Encouraging PHAs and their partners to grant current workers whose employment positions may be eliminated during conversion the right of first refusal for new employment openings for which they are qualified (see section 1.4.A.16).
1. Eliminating the cap on the number of PBV units at a project (see section 2.5.C).
2. Permitting Mod Rehab conversions to PBRA to convert at comparable market rents, up to 110 percent of fair market rent (FMR) (see sections 2.6.C and D).
3. For Mod Rehab SRO conversions, authorizing the use of the efficiency FMR for SRO units, rather than 75 percent of the efficiency FMR, which is the existing SRO standard (see section 2.7).
4. Allowing all conversions to PBRA to achieve rents between 110 percent and 120 percent of FMR (up to the statutory maximum), if justified by comparable market rents and only in certain circumstances where preservation criteria have been meet (see sections 3.6.C and D).
5. For conversions to PBRA, permitting the use of Small Area FMR (SAFMR) in the calculation of contract rent cap, with HUD approval (see sections 2.5 and 2.6).
The Revised Program Notice makes changes to some of the selection and eligibility criteria for conversions of public housing under the First Component. Pursuant to the RAD Statute, these changes must be made available for public comment before they are effective. Please submit all comments to
The changes subject to notice and comment are:
1. Consolidating the selection priority categories for new applications into two buckets: (1) High investment applications and (2) all other applications (see section 1.11.C).
2. Allowing PHAs to submit a simple letter of interest, rather than an application, when a waiting list has formed. A letter of interest would serve to reserve a project or portfolio's position on the waiting list subject to future submission of a RAD Application (see section 1.9).
3. Making eligible an entire contiguous HOPE VI project that was developed in phases as long as the earliest phase is greater than ten years old (see section 1.3.H).
The RAD Statute provides that waivers and alternative requirements authorized under the First Component must be published by notice in the
HUD has previously published its waivers and alternative requirements for RAD, on July 26, 2012 (77 FR 43850), July 2, 2013 (78 FR 39759), and June 26, 2015 (80 FR 36830). This notice only includes waivers and alternative requirements not previously published or that have changed from previous publications. Although waivers or alternative requirements under the Second Component are not subject to a
The new waivers and alternative requirements are:
1.
2.
3.
The method described below explains the set percentage-based phase-in a Project Owner must follow according to the phase-in period established. For purposes of this section “Calculated Multifamily TTP” refers to the TTP calculated in accordance with regulations at 24 CFR 5.628 (not capped at Gross Rent) and the “most recently paid TTP” refers to the TTP recorded on the family's most recent HUD Form 50059. If a family in a project converting from Public Housing to PBRA was paying a flat rent immediately prior to conversion, the PHA should use the flat rent amount to calculate the phase-in amount for Year 1, as illustrated below.
Three-Year Phase-in:
• Year 1: Any recertification (interim or annual) performed prior to the second annual recertification after conversion—33 percent of difference between most recently paid TTP or flat rent and the Calculated Multifamily TTP
• Year 2: Year 2 Annual Recertification (AR) and any Interim Recertification (IR) in prior to Year 3 AR—50 percent of difference between most recently paid TTP and Calculated Multifamily TTP
• Year 3: Year 3 AR and all subsequent recertifications—Year 3 AR and any IR in Year 3: Full Calculated Multifamily TTP
Five-Year Phase-in
• Year 1: Any recertification (interim or annual) performed prior to the second annual recertification after conversion—20 percent of difference between most recently paid TTP or flat rent and the Calculated Multifamily TTP
• Year 2: Year 2 AR and any IR prior to Year 3 AR—25 percent of difference between most recently paid TTP and Calculated Multifamily TTP
• Year 3: Year 3 AR and any IR prior to Year 4 AR—33 percent of difference between most recently paid TTP and Calculated Multifamily TTP
• Year 4: Year 4 AR and any IR prior to Year 5 AR—50 percent of difference between most recently paid TTP and Calculated Multifamily TTP
• Year 5 AR and all subsequent recertifications—Full Calculated Multifamily TTP
4.
5.
The Revised Program Notice (PIH 2012-32/H 2017-03, REV-3) can be found on RAD's Web site,
A Finding of No Significant Impact with respect to the environment was made in connection with HUD notice PIH 2012-32 issued on March 8, 2012, and in accordance with HUD regulations in 24 CFR part 50 that implement section 102(2)(C) of the National Environmental Policy Act of 1969 (42 U.S.C. 4332(2)(C)). The Finding remains applicable to the Revised Program Notice and is available for public inspection during regular business hours in the Regulations Division, Office of General Counsel; Department of Housing and Urban Development; 451 7th Street SW., Room 10276; Washington, DC 20410-0500. Due to security measures at the HUD Headquarters building, please schedule an appointment to review the finding by calling the Regulations Division at 202-402-3055 (this is not a toll-free number). Individuals with speech or hearing impairments may access this number via TTY by calling the Federal Relay Service at 800-877-8339.
Office of the Assistant Secretary for Community Planning and Development, HUD.
Notice.
This Notice identifies unutilized, underutilized, excess, and surplus Federal property reviewed by HUD for suitability for use to assist the homeless.
Juanita Perry, Department of Housing and Urban Development, 451 Seventh Street SW., Room 7266, Washington, DC 20410; telephone (202) 402-3970; TTY number for the hearing- and speech-impaired (202) 708-2565 (these telephone numbers are not toll-free), call the toll-free Title V information line at 800-927-7588 or send an email to
In accordance with 24 CFR part 581 and section 501 of the Stewart B. McKinney Homeless Assistance Act (42 U.S.C. 11411), as amended, HUD is publishing this Notice to identify Federal buildings and other real property that HUD has reviewed for suitability for use to assist the homeless. The properties were reviewed using information provided to HUD by Federal landholding agencies regarding unutilized and underutilized buildings and real property controlled by such agencies or by GSA regarding its inventory of excess or surplus Federal property. This Notice is also published in order to comply with the December 12, 1988 Court Order in
Properties reviewed are listed in this Notice according to the following categories: Suitable/available, suitable/unavailable, and suitable/to be excess, and unsuitable. The properties listed in the three suitable categories have been reviewed by the landholding agencies, and each agency has transmitted to
Properties listed as suitable/available will be available exclusively for homeless use for a period of 60 days from the date of this Notice. Where property is described as for “off-site use only” recipients of the property will be required to relocate the building to their own site at their own expense. Homeless assistance providers interested in any such property should send a written expression of interest to HHS, addressed to: Ms. Theresa M. Ritta, Chief Real Property Branch, the Department of Health and Human Services, Room 12-07, Parklawn Building, 5600 Fishers Lane, Rockville, MD 20857, (301)-443-2265 (This is not a toll-free number.) HHS will mail to the interested provider an application packet, which will include instructions for completing the application. In order to maximize the opportunity to utilize a suitable property, providers should submit their written expressions of interest as soon as possible. For complete details concerning the processing of applications, the reader is encouraged to refer to the interim rule governing this program, 24 CFR part 581.
For properties listed as suitable/to be excess, that property may, if subsequently accepted as excess by GSA, be made available for use by the homeless in accordance with applicable law, subject to screening for other Federal use. At the appropriate time, HUD will publish the property in a Notice showing it as either suitable/available or suitable/unavailable.
For properties listed as suitable/unavailable, the landholding agency has decided that the property cannot be declared excess or made available for use to assist the homeless, and the property will not be available.
Properties listed as unsuitable will not be made available for any other purpose for 20 days from the date of this Notice. Homeless assistance providers interested in a review by HUD of the determination of unsuitability should call the toll free information line at 1-800-927-7588 or send an email to
For more information regarding particular properties identified in this Notice (
Office of the Assistant Secretary for Community Planning and Development, HUD.
Notice of redelegation of authority to field offices.
Section 7(d) of the Department of Housing and Urban Development Act, as amended, provides authority to the Secretary to delegate functions, powers, and duties as the Secretary deems necessary. By separate notice published in today's
Cliff Taffet, General Deputy Assistant Secretary, Office of Community Planning and Development, Department of Housing and Urban Development, 451 7th Street SW., Room 7100, Washington, DC 20410-7000; telephone number 202-708-2690. This is not a toll-free number. For those needing assistance, this number may be accessed via TTY by calling the Federal Relay Service at 800-877-8339.
Published elsewhere in today's
Except those authorities specifically excluded, the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development redelegates to the Directors and Deputy Directors of Community Planning and Development in HUD Field Offices all powers and authorities of the Assistant Secretary necessary to carry out the following Community Planning and Development programs and matters:
1. Community Development Block Grants (CDBG), Section 108 Loan Guarantees, Neighborhood Stabilization Programs (NSP), CDBG Disaster Recovery Grants, and other programs covered by Title I of the Housing and Community Development Act of 1974, Public Law 93-383, 88 Stat. 633 (codified as amended at 42 U.S.C. 5301
a. Terminate, reduce, or limit the availability of grant payments pursuant to section 111(a), 42 U.S.C. 5311.
b. Adjust entitlement and state grants pursuant to section 104(e), 42 U.S.C. 5304.
c. Determine basic grant amounts for metropolitan cities, urban counties, and States pursuant to section 106, 42 U.S.C. 5306.
d. Reallocate funds pursuant to section 106(c) or (d), 42 U.S.C. 5306.
e. Determine the qualifications of localities for special consideration. This includes, but is not limited to, the determination of qualifications of counties as urban counties pursuant to section 102(a)(6), 42 U.S.C. 5302, the determination of what constitutes a city pursuant to section 102(a)(5), 42 U.S.C. 5302, and the determination of levels of physical and economic distress of cities and urban counties for eligibility for urban development action grants pursuant to section 119(b), 42 U.S.C. 5318.
f. Approve and disapprove applications, or amendments to applications, filed for loan guarantee or grant assistance, issue commitments or grant awards, execute grant agreements, or issue guarantees pursuant to section 108, 42 U.S.C. 5308.
2. Comprehensive Housing Affordability Strategies (CHAS), Title I of the Cranston-Gonzalez National Affordable Housing Act, Public Law 101-625, 104 Stat. 4079 (1990) (codified as amended at 42 U.S.C. 12701
3. Emergency Shelter Grants/Emergency Solutions Grants program, Title IV, Subtitle B of the McKinney-Vento Homeless Assistance Act, Public Law 100-77, 101 Stat. 482 (1987) (codified as amended at 42 U.S.C. 11371
a. Determine allocation amounts.
b. Approve built-in waivers or exceptions authorized under Title IV of the McKinney-Vento Homeless Assistance Act and applicable implementing regulations.
4. The HOME Investment Partnerships Act, Title II of the Cranston-Gonzalez National Affordable Housing Act (NAHA), Public Law 101-625, 104 Stat. 4094 (1990) (codified as amended at 42 U.S.C. 12721
a. Determine allocation and reallocation amounts pursuant to section 217 of NAHA.
b. Revoke a jurisdiction's designation as a participating jurisdiction pursuant to section 216 of NAHA.
c. Effect remedies for noncompliance pursuant to section 223 of NAHA.
d. Approve a change in the number of units designated as HOME-assisted units during the period of affordability pursuant to 24 CFR 92.205(d).
e. Make a determination that a consortium does not have sufficient authority and administrative capability to administer the HOME Program pursuant to 24 CFR 92.101(a)(3).
5. Housing Trust Fund (HTF), Section 1338 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, added by Section 1131 of Public Law 110-289, 122 Stat. 2654 (codified at 12 U.S.C. 4568).
a. Determine allocations, adjustments, and reallocation amounts.
6. Homelessness Prevention and Rapid Re-Housing Program (HPRP) as authorized under the Homelessness Prevention Fund heading of Division A, Title XII of the American Recovery and Reinvestment Act of 2009, Public Law 111-5, 123 Stat. 115.
7. AIDS Housing Opportunity Act, Title VIII, Subtitle D of the Cranston-Gonzalez National Affordable Housing Act, Public Law 101-625, 104 Stat. 4079 (1990) (codified as amended at 42 U.S.C.12901-12912); 24 CFR part 574.
a. Determine allocations, adjustments, and reallocation amounts.
b. Revoke a jurisdiction's designation as an eligible state or eligible metropolitan statistical area for a formula allocation or as an eligible applicant for a nonformula allocation.
c. Suspend or terminate current awards in whole or in part, withhold further awards, and effect other legally available remedies pursuant to 2 CFR 200.338-200.342.
8. Title IV Subtitles C-F of the McKinney-Vento Homeless Assistance Act, Public Law 100-77, 101 Stat. 482 (1987) (codified as amended at 42 U.S.C. 11381
a. Make funding decisions.
b. Approve built-in waivers or exceptions authorized under Title IV of the McKinney-Vento Homeless Assistance Act and applicable implementing regulations.
9. Economic Development Initiative grants, as provided for in annual HUD appropriations acts (
10. Neighborhood Initiatives grants specifically designated in annual HUD appropriations acts (
11. Rural Innovation Fund grants as provided for in annual HUD
12. The urban Empowerment Zones (EZ), as authorized under title 26, subtitle A, chapter 1, subchapter U of the Internal Revenue Code (codified as amended at 26 U.S.C. 1391
a. Approve or amend strategic plans or other state and local commitments, including boundary changes.
b. Revoke a designation, including issuing a warning letter pursuant to 24 CFR parts 597 and 598.
13. Responsibility for compliance with the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, Public Law 91-646, 84 Stat. 1894 (1971) (codified as amended at 42 U.S.C. 4601
a. Exercise the Federal Agency waiver authority provided under 49 CFR 24.7.
14. Technical Assistance and Capacity Building awards authorized under any program or matter delegated under Section A (
15. Certain Community Planning and Development programs that are no longer authorized for funding (or future funding is not anticipated) but administration of the programs must continue until all Department responsibilities are discharged and finally terminated. These programs, as of June 2011, include the following:
a. Any program superseded by, or inactive by reason of, Title I of the Housing and Community Development Act of 1974, Public Law 93-383, 88 Stat. 633 (codified as amended at 42 U.S.C. 5316).
b. Grants for urban Empowerment Zones (EZ) as provided for in annual HUD appropriations acts (
c. HOPE for Homeownership of Single-family Housing Program (HOPE 3), Title IV, Subtitle C of the Cranston-Gonzalez National Affordable Housing Act, Public Law 101-625, 104 Stat. 4079 (1990) (codified at 42 U.S.C. 12891).
d. New Communities Program, Section 413 of the Housing and Urban Development Act of 1968, Public Law 90-448, 82 Stat. 476 (repealed 1983), Section 726 of the Housing and Urban Development Act of 1970, Public Law 91-609 (repealed 1983), 84 Stat. 1784, Section 474 of the Housing and Urban-Rural Recovery Act of 1983, Public Law 98-181, 97 Stat. 1237 (codified at 12 U.S.C. 1701g-5b), and any other functions, powers and duties which may affect the liquidation of the New Communities program.
e. Rural Housing and Economic Development grants specifically designated originally in the Fiscal Year 1998 HUD Appropriations Act, Public Law 105-65, 111 Stat. 1344 (1997), and subsequent annual HUD appropriations acts.
f. Renewal Communities (RC), as authorized under Title 26, Subtitle A, Chapter 1, Subchapter X of the Internal Revenue Code (codified as amended at 26 U.S.C. 1400E
g. All programs consolidated in the Revolving Fund (Liquidating Programs) established pursuant to Title II of the Independent Offices Appropriations Act, Public Law 98-45, 97 Stat. 223 (1983) (codified as amended at 12 U.S.C. 1701g-5) including all authority of the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development with respect to the functions, administration and management of the Revolving Fund (Liquidating Programs). Only the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development are the responsible official for allotments in the Revolving Fund (Liquidating Programs).
Subject to the excepted authority in Section C, the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development redelegate to Directors and Deputy Directors of CPD in HUD Field Offices the authority to order a limited denial of participation sanction pursuant to HUD regulations at 2 CFR part 2424, with respect to the programs and matters listed in Section A; provided that the General Counsel, or such other official as may be designated by the General Counsel, must: (1) Concur in any proposed sanction under 2 CFR part 2424 before it is issued, and (2) concur in any proposed settlement of a sanction under 2 CFR part 2424.
The authority redelegated under Section A does not include:
1. The authority to issue or waive regulations covered by section 7(q) of the Department of Housing and Urban Development Act (42 U.S.C. 3535(q));
2. The authority to sue and be sued;
3. The authority to effect remedies for noncompliance requiring notice and an opportunity for an administrative hearing;
4. The authority for allotments in the Revolving Fund (Liquidating Programs) under paragraph g of Section A; or
5. Any authority not delegated to the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development under the Consolidated Delegation of Authority for Community Planning and Development. The Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development may revoke at any time this redelegation with respect to the programs and matters listed in Section A and orders of limited denial of participation issued in accordance with Section B.
The authority redelegated in Sections A and B may not be further redelegated.
This notice supersedes all prior redelegations of authority to Directors and Deputy Directors of Community Planning and Development in HUD Field Offices, including the redelegation of authority published on June 29, 2012 at 77 FR 38851.
The Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary for Community Planning and Development hereby ratify all actions previously taken by the Directors and Deputy Directors of CPD in HUD Field Offices with respect to the programs and matters listed in Section A and orders of limited denial of
Section 7(d), Department of Housing and Urban Development Act, 42 U.S.C. 3535(d).
Office of the Secretary, HUD.
Notice of delegations of authority.
This notice updates, clarifies, and consolidates delegations of authority from the Secretary of Housing and Urban Development to the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development and the General Deputy Assistant Secretary for Community Planning and Development.
Cliff Taffet, General Deputy Assistant Secretary, Office of Community Planning and Development, Department of Housing and Urban Development, 451 7th Street SW., Room 7100, Washington, DC 20410-7000; telephone number 202-708-2690. This is not a toll-free number. For those needing assistance, this number may be accessed via TTY by calling the Federal Relay Service at 800-877-8339.
This notice updates, clarifies, and consolidates into one notice the authority delegated by the Secretary of Housing and Urban Development to the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development and the General Deputy Assistant Secretary for Community Planning and Development. This notice supersedes all previous delegations to the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development and the General Deputy Assistant Secretary for Community Planning and Development, including the delegation published on April 20, 2015, at 80 FR 21747.
Only the Assistant Secretary for Community Planning and Development is delegated the authority to issue a final regulation or a Notice of Funding Availability (NOFA). The authority delegated herein to the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development, and the General Deputy Assistant Secretary includes the authority to waive regulations and statutes, but for the Principal Deputy Assistant Secretary and the General Deputy Assistant Secretary the authority to waive statutes is limited in Section B below. Except as provided in Section B, the Secretary of HUD delegates to the Assistant Secretary for Community Planning and Development, the Principal Deputy Assistant Secretary for Community Planning and Development and the General Deputy Assistant Secretary for Community Planning and Development the authority of the Secretary with respect to the programs and matters listed below:
1. The AIDS Housing Opportunity Act, Title VIII, Subtitle D of the Cranston-Gonzalez National Affordable Housing Act, Public Law 101-625, 104 Stat. 4079 (1990) (codified as amended at 42 U.S.C. 12901-12912); 24 CFR part 574.
2. The Base Closure Community Redevelopment and Homeless Assistance Act of 1994, Public Law 103-421, 108 Stat. 4346 (codified as amended at 10 U.S.C. 2687 note); 24 CFR part 586.
3. Capacity Building for Community Development and Affordability Housing grants, Section 4 of the HUD Demonstration Act of 1993, Public Law 103-120, 107 Stat. 1148 (codified as amended at 42 U.S.C. 9816 note).
4. Comprehensive Housing Affordability Strategies (CHAS), Title I of the Cranston-Gonzalez National Affordable Housing Act, Public Law 101-625, 104 Stat. 4079 (1990) (codified as amended at 42 U.S.C. 12701
5. Economic Development Initiative grants, as provided for in annual HUD appropriations acts (
6. Urban Empowerment Zones (EZ), as authorized under Title 26, subtitle A, chapter 1, subchapter U of the Internal Revenue Code (codified as amended at 26 U.S.C. 1391
7. The HOME Investment Partnerships Act, Title II of the Cranston-Gonzalez, National Affordable Housing Act, Public Law 101-625, 104 Stat. 4079 (1990) (codified as amended at 42 U.S.C. 12721
8. The Loan Guarantee Recovery Fund under Section 4 of the Church Arson Prevention Act of 1996, Public Law 104-155, 110 Stat. 1392; 24 CFR part 573.
9. Neighborhood Initiatives grants specifically designed in annual HUD appropriations acts (
10. The Homelessness Prevention and Rapid Re-Housing Program (HPRP), as authorized under the Homelessness Prevention Fund heading of Division A, Title XII of the American Recovery and Reinvestment Act of 2009, Public Law 111-5, 123 Stat. 115.
11. The Housing Trust Fund (HTF), Section 1338 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, added by Section 1131 of Public Law 110-289, 112 Stat. 2654 (codified at 12 U.S.C. 4568); 24 CFR part 93.
12. Rural Innovation Fund grants as provided for in annual HUD appropriations acts (
13. The Tax Credit Assistance Program (TCAP), as authorized under the HOME Investments Partnerships Program heading of Division A, Title XII of the American Recovery and Reinvestment Act of 2009, Public Law 111-5, 123 Stat. 115, 220-21.
14. The Self-Help Homeownership Opportunity Program (SHOP) under section 11 of the Housing Opportunity Program Extension Act of 1996, Public Law 104-120, 110 Stat. 834 (codified as amended at 42 U.S.C. 12805 note).
15. Technical Assistance and Capacity Building awards authorized under any program or matter delegated under Section A (
16. Title I of the Housing and Community Development Act of 1974, Public Law 93-383, 88 Stat. 633 (codified as amended at 42 U.S.C. 5301
a. The Community Development Block Grant (CDBG) program;
b. The Section 108 Loan Guarantee program;
c. Economic development grants pursuant to Section 108(q);
d. Neighborhood Stabilization programs under the Housing and Economic Recovery Act of 2008, Public Law 110-289, 122 Stat. 2850; Title XII of Division A of the American Recovery and Reinvestment Act of 2009, Public Law 111-5, 123 Stat. 115; and Section 1497 of the Wall Street Reform and Consumer Protection Act of 2010, Public Law 111-203, 124 Stat. 1376 (codified as amended at 42 U.S.C. 5301 note);
e. CDBG Disaster Recovery Grants as provided for in annual and supplemental HUD appropriations acts; and
f. Appalachian Regional Commission grants pursuant to Section 214 of the Appalachian Regional Development Act of 1965, Public Law 89-4, 79 Stat. 5 (codified as amended at 40 U.S.C. 14507) and consistent with the CDBG program authorized under Title I of the Housing and Community Development Act of 1974, Public Law 93-393, 88 Stat. 633 (codified as amended at 42 U.S.C. 5301
17. Title IV of the McKinney-Vento Homeless Assistance Act, Public Law 100-77, 101 Stat. 482 (1987) (codified as amended at 42 U.S.C. 5301
a. The Emergency Shelter Grants/Emergency Solutions Grants program, 24 CFR 576;
b. The Supportive Housing Program, 24 CFR part 583;
c. The Shelter Plus Care Program, 24 CFR part 582;
d. The Moderate Rehabilitation for Single Room Occupancy program 24 CFR part 882, subpart H;
e. The Continuum of Care program, 24 CFR part 578; and
f. The Rural Housing Stability Assistance program.
18. Title V of the McKinney-Vento Homeless Assistance Act, Public Law 100-77, 101 Stat. 482 (1987) (codified as amended at 42 U.S.C. 1411
19. The Veterans Homelessness Prevention Demonstration program as provided for in annual HUD appropriations acts (
20. Overall departmental responsibility for rulemaking, policies, standards, procedures, and advisory materials for compliance with the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, Public Law 91-646, 84 Stat. 1894 (1971) (codified as amended at 42 U.S.C. 4601
21. Overall departmental responsibility for compliance with the National Environmental Policy Act of 1969, Public Law 91-190, 83 Stat. 852 (1970) (codified as amended at 42 U.S.C. 4321-4347), and the related laws and authorities cited in 24 CFR 50.4 and 58.5, including (with regard to the Assistant Secretary for Community Planning and Development) the authority to issue and to waive, or approve exceptions or establish criteria for exceptions from provisions of 24 CFR parts 50, 51, 55, and 58. The Assistant Secretary for Community Planning and Development's designee serves as the Departmental lead in all federal initiatives that address NEPA and other federal environmental laws and authorities cited in 24 CFR 50.4 and 58.5 and as the Departmental signatory for environmental compliance MOUs with other federal agencies addressing compliance at the regional and national level.
22. Certain Office of Community Planning and Development Programs that are no longer authorized for funding (or future funding is not anticipated), but whose administration must continue until all departmental responsibilities are discharged and finally terminated. These programs include the following:
a. The Slum Clearance and Urban Renewal program under Title I of the Housing Act of 1949, Public Law 81-171, 63 Stat. 413 and any program which is superseded by, or inactive by reason of Title I of the Housing and Community Development Act of 1974, Public Law 93-383, 88 Stat. 633 (codified as amended at 42 U.S.C. 5316);
b. Area-wide grants, inequities grants, disaster grants and the authority to concur in final approval actions regarding innovative grants under Section 107 of Title I of the Housing and Community Development Act of 1974, Public Law 93-383, 88 Stat. 633 (repealed 1981);
c. Urban Development Action grants under Title I of the Housing and Community Development Act of 1974, Public Law 93-383, 88 Stat. 633. (codified as amended at 42 U.S.C. 5318);
d. The Rental Rehabilitation Program, United States Housing Act of 1937, § 17, Public Law 98-181, 97 Stat. 1196;
e. The Section 312 Rehabilitation Loan Program, Housing Act of 1964, § 312 Public Law 88-560, 78 Stat. 769 (repealed 1990); 24 CFR part 510;
f. The Urban Homesteading Program, Housing and Community Development Act of 1974 § 810, Public Law 93-383, 88 Stat. 633 (repealed 1990);
g. Enterprise Zone Program under Title VII of the Housing and Community Development Act of 1987, Public Law 100-242, 100 Stat. 1815 (1988) (codified as amended at 42 U.S.C. 11501
h. Grant for Urban Empowerment Zones (EZ) as provided for in annual HUD appropriations acts (
i. HUD's Homeownership Zone initiative (HOZ) grants as provided for in Section 205 of the Department of Veterans Affairs and Housing and Urban Development, and Independent Agencies Appropriations Act, 1997, Public Law 104-204, 110 Stat. 2874 (1996) and funded with recaptured Nehemiah grants authorized under Title VI of the Housing and Community Development Act of 1987, Public Law 100-242, 101 Stat. 1815 (1988) (codified at 12 U.S.C. 1715l note);
j. The Innovative Homeless Initiatives Demonstration program under the HUD Demonstration Act of 1993, Public Law 103-120, 107 Stat. 1144;
k. The HOPE for Homeownership of Single-family Housing (HOPE 3) program, Title IV, Subtitle C of the Cranston-Gonzalez National Affordable Housing Act, Public Law 101-625, 104 Stat. 4079 (1990) (codified at 42 U.S.C. 12891);
l. New Communities Program, Section 413 of the Housing and Urban Development Act of 1968, Public Law 90-448, 82 Stat. 476 (repealed 1983), Section 726 of the Housing and Urban-Rural Recovery Act of 1983, Public Law 91-609 (repealed 1983), 84 Stat. 1784, Section 474 of the Housing and Urban-Rural Act of 1983, Public Law 98-181,97 Stat. 1237 (codified at 12 U.S.C. 1710g-5b), and any other functions, powers, and duties that may affect the liquidation of the New Communities program;
m. Rural Housing and Economic Development grants specifically designed originally in the Fiscal Year 1998 HUD Appropriations Act, Public Law 105-65, 111 Stat. 1344 and subsequent annual HUD appropriations acts;
n. Renewal Communities (RC), as authorized under Title 26, subtitle A, chapter 1, subchapter X of the Internal Revenue Code (codified as amended at
o. All programs consolidated in the Revolving Fund (Liquidating Programs) established pursuant to Title II of the Independent Offices Appropriations Act, Public Law 98-45, 97 Stat. 223 (1983) (codified as amended at 12 U.S.C. 1701g-5), including all authority of the Secretary with respect to functions, administration, and management of the Revolving Fund (Liquidating Programs).
23. Suspensions, and/or limited denial of participations under 2 CFR part 2424 with the concurrence of the General Counsel, or such other official as may be designed by the General Counsel.
24. Pilot Program to Rehabilitate and Modify Homes of Disabled and Low-Income Veterans, as authorized under section 1079 of the Carl Levin and Howard P. “Buck” McKeon National Defense Authorization Act for Fiscal Year 2015, Public Law 113-291, 128 Stat. 3292, 3521-3524 (2014).
There is excepted from the authority delegated under Section A:
1. The power to sue and be sued;
2. Under Title I of the Housing and Community Development Act of 1974, Public Law 93-383, 88 Stat. 633 (codified as amended at 42 U.S.C. 5301
a. The power to administer the Indian Community Development Block Grant program, for which the authority has been delegated to the Assistant Secretary for Public and Indian Housing;
b. The power to administer section 107 programs delegated to the Assistant Secretary for Policy Development and Research;
c. The power to issue obligations for purchase by the Secretary of the Treasury under section 108(g) of the Housing and Community Development Act (42 U.S.C. 5308); and
d. The power and authority of the Secretary with respect to nondiscrimination under section 109 may be exercised only with the advice of the Assistant Secretary for Fair Housing Equal Opportunity.
3. For programs noted in Section A.22 of this delegation that are no longer authorized for funding;
a. The power to establish interest rates; and
b. The power to issue notes or obligations for purchase by the Secretary of the Treasury.
4. The authority delegated under Section A to the Principal Deputy Assistant Secretary and General Deputy Assistant Secretary does not include the authority to waive the following statutes:
a. The authority under annual and supplemental HUD appropriations acts providing Community Development Block Grant funding for disaster recovery (
b. The authority under section 215(a)(6) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12745) to waive qualifying rents; and
c. The authority under section 858(b) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12907) to waive requirements for short-term supported housing and services.
The Assistant Secretary, the Principal Deputy Assistant Secretary and the General Deputy Assistant Secretary for Community Planning and Development are authorized to redelegate to employees of the Department any authority delegated under Section A. Redelegated authority to CPD Directors, Deputy Assistant Secretaries or other CPD program officials does not supersede the authority of the Assistant Secretary as designee of the Secretary.
This notice supersedes all prior delegations of authority from the Secretary to the Assistant Secretary for Community Planning and Development, including the delegation published on April 20, 2015, at 80 FR 21747.
Section 7(d) of the Department of Housing and Urban Development Act, 42 U.S.C. 3535(d).
Office of the Assistant Secretary for Community Planning and Development, HUD.
Correction.
HUD is republishing this notice to include all information that was inadvertently not included in the notice publish on December 23, 2016 at 81 FR 94405.
Juanita Perry, Department of Housing and Urban Development, 451 Seventh Street SW., Room 7266, Washington, DC 20410; telephone (202) 402-3970; TTY number for the hearing- and speech-impaired (202) 708-2565 (these telephone numbers are not toll-free), call the toll-free Title V information line at 800-927-7588 or send an email to
In accordance with 24 CFR part 581 and section 501 of the Stewart B. McKinney Homeless Assistance Act (42 U.S.C. 11411), as amended, HUD is publishing this Notice to identify Federal buildings and other real property that HUD has reviewed for suitability for use to assist the homeless. The properties were reviewed using information provided to HUD by Federal landholding agencies regarding unutilized and underutilized buildings and real property controlled by such agencies or by GSA regarding its inventory of excess or surplus Federal property. This Notice is also published in order to comply with the December 12, 1988 Court Order in
Properties reviewed are listed in this Notice according to the following categories: Suitable/available, suitable/unavailable, and suitable/to be excess, and unsuitable. The properties listed in the three suitable categories have been reviewed by the landholding agencies, and each agency has transmitted to HUD: (1) Its intention to make the property available for use to assist the homeless, (2) its intention to declare the property excess to the agency's needs, or (3) a statement of the reasons that the property cannot be declared excess or made available for use as facilities to assist the homeless.
Properties listed as suitable/available will be available exclusively for homeless use for a period of 60 days from the date of this Notice. Where property is described as for “off-site use only” recipients of the property will be required to relocate the building to their own site at their own expense. Homeless assistance providers interested in any such property should send a written expression of interest to HHS, addressed to: Ms. Theresa M. Ritta, Chief Real Property Branch, the Department of Health and Human Services, Room 12-07, Parklawn Building, 5600 Fishers Lane, Rockville, MD 20857, (301) 443-2265 (This is not a toll-free number.) HHS will mail to the interested provider an application packet, which will include instructions
For properties listed as suitable/to be excess, that property may, if subsequently accepted as excess by GSA, be made available for use by the homeless in accordance with applicable law, subject to screening for other Federal use. At the appropriate time, HUD will publish the property in a Notice showing it as either suitable/available or suitable/unavailable.
For properties listed as suitable/unavailable, the landholding agency has decided that the property cannot be declared excess or made available for use to assist the homeless, and the property will not be available.
Properties listed as unsuitable will not be made available for any other purpose for 20 days from the date of this Notice. Homeless assistance providers interested in a review by HUD of the determination of unsuitability should call the toll free information line at 1-800-927-7588 or send an email to
For more information regarding particular properties identified in this Notice (
Office of the Assistant Secretary for Housing—Federal Housing Commissioner, Department of Housing and Urban Development (HUD).
Notice of Housing Counseling Federal Advisory Committee (HCFAC) public meeting.
This gives notice of a Housing Counseling Federal Advisory Committee (HCFAC) meeting on Wednesday, February 8, 2017, via conference phone, and the proposed agenda. The meeting is open to the public and is accessible to individuals with disabilities.
The meeting will be held on Wednesday, February 8, 2017 from 12:00 p.m. to 2:00 p.m. Eastern Daylight Time (EDT) via conference phone.
Marjorie George, Housing Program Technical Specialist, Office of Housing Counseling, U.S. Department of Housing and Urban Development, 200 Jefferson Avenue, Suite 300, Memphis, TN 38103; telephone number (901) 544-4228 (this is not a toll-free number). Persons who have difficulty hearing or speaking may access this number via TTY by calling the toll-free Federal Relay Service at (800) 877-8339. Individuals may also email
HUD is convening the meeting of the HCFAC on Wednesday, February 8, 2017 from 12:00 p.m. to 2:00 p.m. The meeting will be held via conference phone. This meeting notice is provided in accordance with the Federal Advisory Committee Act, 5. U.S.C. App. 10(a)(2).
With advance registration, the public is invited to attend this meeting via teleconference. To register for this meeting please access the below link:
The toll-free call-in number will be provided once registration is confirmed. Persons with hearing impairments may also follow the discussion by first calling the Federal Relay Service (FRS): (800) 977-8339 and providing the FRS operator with the conference call toll-free number, which will be provided upon registration.
Records and documents discussed during the meeting, as well as other information about the work of this Committee, will be available for public viewing as they become available at:
Fish and Wildlife Service, Interior.
Notice of intent; announcement of meetings; request for comments.
We, the U.S. Fish and Wildlife Service (Service), are notifying the public that we intend to prepare a draft environmental impact statement (EIS) to evaluate the impacts of alternatives relating to the proposed issuance of an Endangered Species Act (ESA) Incidental Take Permit (ITP) in response to the American Electric Power
In order to be included in the analysis, all comments must be received or postmarked by February 21, 2017. See
Please provide comments in writing, by one of the following methods:
Email:
Please specify that your information request or comments concern the AEP draft EIS/HCP (TE01909C).
See
Jonna Polk, by U.S. mail at the U.S. Fish and Wildlife Service, Oklahoma Ecological Services Field Office, 9014 E. 21st St., Tulsa, OK 74129, or by phone at 918-581-7458. If you use a telecommunications device for the deaf (TDD), please call the Federal Information Relay Service at 800-877-8339.
We publish this notice in compliance with the National Environmental Policy Act of 1969 (NEPA), as amended (42 U.S.C. 4321
We will conduct four public scoping meetings within the 62-county proposed covered area, which includes the ABB range: Tulsa, OK; McAlester, OK; Fort Smith, AR; and Texarkana, TX. Exact meeting locations and times will be announced in local newspapers and on Service Web sites at least 2 weeks prior to each event (Oklahoma Ecological Services Office Web site,
Persons needing reasonable accommodations in order to attend and participate in a public meeting should contact us at the address listed in
We will accept written comments at each meeting. You may also submit written comments to the Field Supervisor at the email or U.S. mail addresses in
Section 9 of the ESA prohibits “take” of fish and wildlife species listed as endangered or threatened (16 U.S.C. 1531-1544). Under section 3 of the ESA, the term “take” means to harass, harm, pursue, hunt, shoot, wound, kill, trap, capture, or collect, or to attempt to engage in any such conduct (16 U.S.C. 1532(19)). The term “harm” is further defined by regulation as an act that actually kills or injures wildlife. Such act may include significant habitat modification or degradation where it actually kills or injures wildlife by significantly impairing essential behavioral patterns, including breeding, feeding, or sheltering (50 CFR 17.3). The term “harass” is also further defined in the regulations as an intentional or negligent act or omission that creates the likelihood of injury to wildlife by annoying it to such an extent as to significantly disrupt normal behavioral patterns, which include, but are not limited to, breeding, feeding, or sheltering (50 CFR 17.3).
Under section 10(a)(1)(B) of the Act, the Secretary of the Interior may authorize the taking of federally listed species if such taking occurs incidental to otherwise legal activities and where a conservation plan has been developed under section 10(a)(2)(A) that describes: (1) The impact that will likely result from such taking; (2) the steps an applicant will take to minimize and mitigate that take to the maximum extent practicable and the funding that will be available to implement such steps; (3) the alternative actions to such taking that an applicant considered and the reasons why such alternatives are not being utilized; and (4) other measures that the Service may require as being necessary or appropriate for the purposes of the plan. Issuance criteria under section 10(a)(2)(B) for an incidental take permit require the Service to find that: (1) The taking will be incidental to otherwise lawful activities; (2) an applicant will, to the maximum extent practicable, minimize and mitigate the impacts of such taking; (3) an applicant has ensured that adequate funding for the plan will be provided; (4) the taking will not appreciably reduce the likelihood of the survival and recovery of the species in the wild; and (5) the measures, if any, we require as necessary or appropriate for the purposes of the plan will be met. Regulations governing permits for endangered and threatened species are at 50 CFR 17.22 and 17.32, respectively.
A primary purpose of the scoping process is to receive suggestions and information on the scope of issues and alternatives to consider when drafting the EIS, and to identify significant issues and reasonable alternatives related to the Service's proposed action (issuance of the ITP under the AEP HCP). In order to ensure that we identify a range of issues and alternatives related to the proposed action, we invite comments and suggestions from all interested parties. We will conduct a review of this project according to the requirements of NEPA and its regulations, other relevant Federal laws, regulations, policies, and guidance, and our procedures for compliance with applicable regulations.
Once the draft EIS and draft HCP are completed, we will offer further opportunities for public comment on the content of these documents through additional public meetings and a 90-day public comment period.
Under the no-action alternative, AEP would comply with the Act by avoiding impacts to (take of) the ABB where practicable. If take cannot be avoided and there is Federal involvement in the project (for example, a Federal permit, such as a Corps of Engineers section 404
The proposed action is issuance of an incidental take permit for the covered species during construction, operation, and/or maintenance of electric transmission and distribution lines or other associated infrastructure. The proposed HCP, which must meet the requirements in section 10(a)(2)(A) of the Act, would be developed in coordination with the Service and implemented by AEP. This alternative will allow for a comprehensive mitigation approach for authorized impacts and result in a more efficient and timely permit processing effort for the Service and AEP. Actions covered under the requested incidental take permit may include possible take of covered species associated with activities including, but not limited to, construction, operation, and/or maintenance of electric transmission and distribution lines or other associated infrastructure. The proposed permit submitted by American Energy Power provides coverage for a period of 30 years.
Sixty-two counties are in the proposed permit area, including Adair, Atoka, Bryan, Carter, Cherokee, Choctaw, Cleveland, Coal, Craig, Creek, Delaware, Garvin, Haskell, Hughes, Johnston, Kay, Latimer, Le Flore, Lincoln, Logan, Love, Marshall, Mayes, McClain, McCurtain, McIntosh, Murray, Muskogee, Noble, Nowata, Okfuskee, Oklahoma, Okmulgee, Osage, Ottawa, Pawnee, Payne, Pittsburg, Pontotoc, Pottawatomie, Pushmataha, Rogers, Seminole, Sequoyah, Tulsa, Wagoner, and Washington Counties in Oklahoma; Clark, Crawford, Franklin, Hempstead, Johnson, Little River, Logan, Miller, Sebastian, Scott, and Yell Counties in Arkansas; and Bowie, Fannin, Lamar, and Red River Counties in Texas. The species covered under the requested incidental take permit is the ABB. We will be evaluating whether the covered activities will impact other species and whether they should be included on the permit or if management practices can be implemented that are sufficient to avoid take. These species and their legal status include:
• American alligator (
• Arkansas fatmucket (
• Arkansas River shiner (
• Gray bat (
• Harperella (
• Indiana bat (
• Least tern (
• Leopard darter (
• Neosho madtom (
• Neosho mucket (
• Northern long-eared bat (
• Ouachita Rock pocketbook (
• Ozark big-eared bat (
• Ozark cavefish (
• Pink mucket (
• Piping plover (
• Rabbitsfoot (
• Red-cockaded woodpecker (
• Scaleshell mussel (
• Spectaclecase (
• Whooping crane (
• Winged mapleleaf (
We do not anticipate that covered activities will result in take of all these species, but we seek comments to help inform our evaluation.
We also will evaluate whether covered activities are likely to impact the bald eagle (
We seek information regarding other reasonable alternatives during this scoping period and will evaluate the impacts associated with such alternatives in the draft EIS.
Written comments we receive become part of the public record associated with this action. Before including your address, phone number, email address, or other personal identifying information in your comment, you should be aware that the entire comment—including your personal identifying information—may be made publicly available at any time. While you can ask us in your comment to withhold your personal identifying information from public review, we cannot guarantee that we will be able to do so.
Comments and materials we receive, as well as supporting documentation we use in preparing the EIS, will be available for public inspection, by appointment, during normal business hours at the Service's Oklahoma Ecological Services Field Office in Tulsa, Oklahoma, (see
Fish and Wildlife Service, Interior.
Notice of receipt of application and proposed incidental harassment authorization; request for comments.
We, the U.S. Fish and Wildlife Service (Service), have received an application from the California Department of Fish and Wildlife, Central Region, for authorization to take small numbers of marine mammals by harassment incidental to construction activities as part of a tidal marsh restoration project within the Minhoto-Hester Marsh in Elkhorn Slough, Monterey County, California. In accordance with provisions of the Marine Mammal Protection Act of 1972,
Comments and information must be received by February 21, 2017.
1.
2.
3.
Lilian Carswell, Southern Sea Otter Recovery & Marine Conservation Coordinator, (805) 612-2793, or by email at
Sections 101(a)(5)(A) and (D) of the Marine Mammal Protection Act of 1972, as amended, (MMPA; 16 U.S.C. 1371 (a)(5)(A) and (D)), authorize the Secretary of the Interior to allow, upon request, the incidental, but not intentional, taking of small numbers of marine mammals by U.S. citizens who engage in a specified activity (other than commercial fishing) within a specified geographical region, provided that we make certain findings and either issue regulations or, if the taking is limited to harassment, provide a notice of a proposed authorization to the public for review and comment.
We may grant authorization to incidentally take marine mammals if we find that the taking will have a negligible impact on the species or stock(s) and will not have an unmitigable adverse impact on the availability of the species or stock(s) for subsistence uses. As part of the authorization process, we prescribe permissible methods of taking and other means of effecting the least practicable impact on the species or stock and its habitat, and requirements pertaining to the monitoring and reporting of such takings.
The term “take,” as defined by the MMPA, means to harass, hunt, capture, or kill, or to attempt to harass, hunt, capture, or kill, any marine mammal. Harassment, as defined by the MMPA, means “any act of pursuit, torment, or annoyance which (i) has the potential to injure a marine mammal or marine mammal stock in the wild [the MMPA calls this Level A harassment], or (ii) has the potential to disturb a marine mammal or marine mammal stock in the wild by causing disruption of behavioral patterns, including, but not limited to, migration, breathing, nursing, breeding, feeding, or sheltering [the MMPA calls this Level B harassment].”
The terms “negligible impact,” “small numbers,” and “unmitigable adverse impact” are defined in title 50 of the Code of Federal Regulations at 50 CFR 18.27, the Service's regulations governing take of small numbers of marine mammals incidental to specified activities. “Negligible impact” is defined as “an impact resulting from the specified activity that cannot be reasonably expected to, and is not reasonably likely to, adversely affect the species or stock through effects on annual rates of recruitment or survival.” The term “small numbers” is also defined in the regulations as “a portion of a marine mammal species or stock whose taking would have a negligible impact on that species or stock.” However, we do not rely on that definition here, as it conflates the terms “small numbers” and “negligible impact,” which we recognize as two separate and distinct requirements. Instead, in our small numbers determination, we evaluate whether the number of marine mammals likely to be taken is small relative to the size of the overall population. “Unmitigable adverse impact” is defined as “an impact resulting from the specified activity (1) that is likely to reduce the availability of the species to a level insufficient for a harvest to meet subsistence needs by (i) causing the marine mammals to abandon or avoid hunting areas, (ii) directly displacing subsistence users, or (iii) placing physical barriers between the marine mammals and the subsistence hunters; and (2) that cannot be sufficiently mitigated by other measures to increase the availability of marine mammals to allow subsistence needs to be met.” The subsistence provision applies to northern sea otters (
On May 23, 2016, we received an application from the California Department of Fish and Wildlife, Central Region (CDFW), for authorization to take southern sea otters incidental to construction activities associated with a 47-acre tidal marsh restoration project within the Minhoto-Hester Marsh in Elkhorn Slough, Monterey County, California. The project would reduce tidal prism in Elkhorn Slough, reducing the potential for ongoing tidal scour and associated marsh loss. It would also improve marsh sustainability with sea level rise, as the restored marsh would be higher in the tidal frame and further from the drowning threshold, and marsh vegetation in the restored areas would accrete organic material that would help the restored marsh plain rise with sea level. The full Elkhorn Slough Tidal Marsh Restoration Project includes the anticipated restoration of 147 acres, but future phases are not part of this application because they would not likely occur for several years. If any future phase of the project would result in harassment of southern sea otters, another IHA would have to be requested and received prior to its implementation.
A detailed description of the proposed project is contained in the incidental harassment authorization request submitted to us by CDFW (ESA/ESNERR 2016). CDFW submitted revised versions of the application on July 26, 2016, August 24, 2016, August 29, 2016, and September 6, 2016. A final version, submitted on September 15, 2016, was determined to be adequate and complete. Work would begin between January 2017 and June 2017 and require approximately 11 months to complete. This period includes buffers for adverse weather and other conditions when work is not possible. Construction activities are expected to produce noise and visual disturbance that have the potential to result in behavioral harassment of southern sea otters. We are proposing to authorize take, by Level B harassment only, of southern sea otters as a result of the specified activity.
The proposed project would restore approximately 47 acres of tidal marsh within the Minhoto-Hester Marsh area and additional tidal marsh, upland ecotone, and native grassland in a buffer area, intended to absorb upland sediment and contaminants, between the remnant marsh and agricultural fields. Approximately 170,000 cubic yards of fill would be required to raise the marsh plain an average height of 2.4 feet, or 1.9 feet after 1 year of soil consolidation. The entire remnant marsh plain would be raised to an elevation that would allow emergent wetland vegetation to reestablish naturally and persist.
The buffer area would be graded to increase marsh area and to create a gently sloping ecotone band along the edge of the restored marsh. Excavation would widen the existing marsh by up to 150 feet and create a band of gentle slope on the hillside, fostering creation of a wider ecotone habitat. A 35-acre portion of the buffer area would be restored to native-dominated perennial grassland. A weed-resistant border of rhizomatous perennial plants would be planted between the grassland and ecotone. The remaining 6-acre portion of the buffer area would be used as a stockpile location for future restoration phases and would be revegetated with annual barley until future phases were complete, at which time it would be restored to native-dominated perennial grassland.
Remnant historic channels onsite would generally be left in place or filled and re-excavated in the same place. Smaller channels would be filled as needed for marsh access. As much of the existing tidal channel network would be maintained as feasible, and the post-project channel alignments would be similar to those under existing conditions. The density of channels (length of channel per acre of marsh) after restoration would be comparable to the density in natural reference marshes.
Low levees (less than 0.5 feet above the marsh plain) composed of fill material would be constructed along the larger channels to simulate natural channel levees. The project would re-create natural levee features along the sides of the main channel into the Minhoto-Hester area. Fill would be placed as close to the edge of the channel as possible to simulate the form and function of a natural channel bank. Borrow ditches that date from the times of historical wetland reclamation in these areas would be blocked or filled completely if fill is available after raising the marsh plain. Blocking borrow ditches would route more flow through the natural channels and slightly increase hydraulic resistance, which may achieve benefits from reducing tidal prism and associated scour in the Elkhorn Slough system.
Construction sequencing would begin with water management and/or turbidity control measures constructed around the work areas prior to placing material on the marsh. Work areas on the remnant marsh plain would for the most part be isolated from the tides and dewatered to allow construction to occur in non-tidal conditions. Water control structures such as temporary berms would be utilized to isolate the fill placement area during the construction period. Existing berms would be used where possible. It is likely that the mouth of the restoration area could be closed with an earthen dam or an inflatable dam; however, a sheet pile wall at the mouth of the restoration area could be installed using vibratory hammering if the earthen and inflatable dam options proved to be infeasible. Tidal channels into work areas would be blocked. The isolated work areas would be drained using a combination of gravity and pumps. Water levels within the blocked areas would be managed to keep them mostly free of water (with some ponded areas remaining) to allow fill placement at all stages of the tides. Blocking of tidal channels would occur at low tide. Upon completion of sediment placement, the berms would be lowered to the target marsh elevation, reintroducing tidal inundation. Any blocked tidal channels would be re-excavated. After fill placement on the marsh, any temporary features, such as water management berms, sheet piles, and culverts, would be removed.
All material needed for the current phase of the project is onsite. Additional material may be delivered to the restoration areas by trucks if it becomes available. Construction crews and equipment would access the existing stockpile area and Minhoto Marsh from Dolan Road via existing roadways that were used for delivery of the existing sediment stockpile, located alongside existing agricultural fields. The Hester Marsh staging area may be accessed from Via Tanques Road.
Construction equipment would include haul trucks, heavy earthmoving equipment (such as bulldozers, backhoes, and loaders), and excavators to transport dry material out onto the marsh. A conveyor system could be used to transport material from a stockpile out to the marsh in lieu of bulldozers. In such cases, timber matting would be temporarily placed on the marsh to provide a stable footing for the conveyors. A mobile radial stacker at the end of the conveyor belt would be rotated to spread the material.
Construction is anticipated to require approximately 11 months. The 11-month window would include 132 days of construction activity and (if needed) 4 days of vibratory pile driving, totaling 136 days of project activity. The 11-month window includes the time required for ecotone and grassland restoration work. Most work on the marsh plane would likely be completed within 6 to 8 months. The length of the construction period is based on the assumption that construction contractors would work between the hours of 5:00 a.m. to 6:00 p.m., Monday through Friday. However, some construction activity could also be required during these times on Saturdays. The proposed IHA would be valid for 1 year from the date of issuance, with project activities beginning between January 2017 and June 2017.
The proposed project is located in the Elkhorn Slough estuary, a network of intertidal marshes, mudflats, and subtidal channels 90 miles south of San Francisco and 20 miles north of Monterey (see Figure 1-1 of ESA/ESNERR 2016). The Minhoto-Hester Marsh, where the proposed restoration work would occur, is a low-lying area within Elkhorn Slough consisting of subsided pickleweed (
Southern sea otters and Pacific harbor seals (
Southern sea otters are listed as threatened under the Endangered Species Act of 1973, as amended (ESA) (42 FR 2965; January 14, 1977), and, because of their threatened status, are considered “depleted” under the MMPA. The State of California also recognizes the sea otter as a fully protected mammal (Fish and Game Code section 4700) and as a protected marine mammal (Fish and Game Code section 4500). All members of the sea otter population in California are descendants of a small group that survived the fur trade and persisted near Big Sur, California. Historically ranging from at least as far north as Oregon (Valentine et al. 2008) to Punta Abreojos, Baja California, Mexico, in the south, sea otters currently occur in only two areas of California. The mainland population ranges from San Mateo County to Santa Barbara County, and a translocated population exists at San Nicolas Island, Ventura County. The most recent (2016) California-wide index of abundance is 3,272 individuals (
Sea otters occur in Elkhorn Slough year round. As many as 150 sea otters (mostly male) raft together in the harbor at the mouth of Elkhorn Slough, and more than 50 females and pups, and a few territorial males, utilize protected tidal creeks and adjacent waters further up the slough (Scoles et al. 2012). Sea otters occur in the harbor, in tidal channels, and where eelgrass (
Sea otters use areas within the project footprint minimally (ESA/ESNERR 2016; USGS, Monterey Bay Aquarium, and ESNERR unpublished data). A maximum of two sea otters at any one time were observed within the project footprint during pre-project monitoring conducted in 2013 (Beck 2014). These animals were observed resting in water in area M3 of Minhoto Marsh (see Figure 4-2 of ESA/ESNERR 2016) when tidal heights were approximately 4 feet or higher. The maximum length of time a sea otter was observed in M3 during any monitoring session was 1.5 hours (Beck 2014).
Up to 50 southern sea otters may be present in the area in and around Minhoto Marsh, Parsons Slough, Yampah Marsh, and the portion of Elkhorn Slough Channel that could be exposed to construction-related noise or disturbance (ESA/ESNERR 2016). Three main sea otter resting locations occur in these areas: One in the Parsons Slough Complex near the Avila Property and two near Yampah Island, southwest of the Union Pacific Railroad Bridge (see Figure 4-3 of ESA/ESNERR 2016; note that one marker is used to represent the two Yampah Island resting areas, which are located immediately to the west and east of its location on the map). Each of these areas consists of a territorial male and females with or without pups. Up to 35 sea otters were observed within the Parsons Slough Complex and Yampah Marsh during monitoring for an earlier project (ESNERR 2011). The closest area of concentrated sea otter activity to the project footprint is in Yampah Marsh, approximately 800 feet to the northeast (ESA/ESNERR 2016). The Yampah Marsh area is used heavily by females with and without pups for resting, hauling out, grooming, and (for females with pups) nursing (ESA 2016; USGS, Monterey Bay Aquarium, and ESNERR unpublished data).
In this section we provide a qualitative discussion of the potential impacts of the proposed project. The “Estimated Take by Incidental Harassment” section later in this document includes a quantitative analysis of the number of individuals that may be taken by Level B harassment as a result of this activity. Sea otters that have been observed to use Minhoto Marsh would be prevented from accessing the area and would be displaced to other areas of Elkhorn Slough for the duration of the project. Sea otters using the marsh areas adjacent to the project site for resting and foraging would be exposed to construction noise and activity, which could deter them from using these areas and displace them to adjacent areas of Elkhorn Slough. If sheet pile (rather than an earthen dam or inflatable dam) is required to isolate the construction area from tidal waters, vibratory hammering would increase ambient noise levels at the site for 4 days. Noise generated by vibratory pile driving could cause sea otters that forage or rest in the portion of the main channel adjacent to the restoration area to relocate temporarily to nearby areas. Behavioral changes resulting from disturbance could include startle responses, the interruption of resting behaviors (while in water or hauled out on pickleweed), and changes in foraging patterns. Impacts of the proposed project are limited to behavioral disturbance that may reach the threshold of Level B harassment. These impacts could result from airborne noise and visual disturbance caused by the presence of construction equipment and workers over a period of 11 months and (if sheet pile installation is required) from underwater noise caused by vibratory pile driving over a 4-day period.
Relatively little is known regarding the effects of noise on sea otters, but they have not been reported to be particularly sensitive to noise disturbance, especially in comparison to other marine mammals (Riedman 1983, 1984). Many marine mammals depend on acoustic cues for vital biological functions, such as orientation, communication, locating prey, and avoiding predators. However, sea otters are not known to use acoustic information to orient or to locate prey, nor are they known to communicate underwater. Ghoul and Reichmuth (2014) obtained aerial and underwater audiograms for a captive adult male sea otter and evaluated his hearing in the presence of noise. In air, the sea otter's hearing was similar to that of a sea lion (
Observed responses of wild sea otters to disturbance are highly variable, probably reflecting the level of noise and activity to which they have been exposed and become acclimated over time and the particular location and social or behavioral state of that individual (G. Bentall pers. comm. 2010). Sea otters appeared to be relatively undisturbed by pile driving activities in Elkhorn Slough during the construction of the Parsons Slough Sill (adjacent to the Minoto-Hester Marsh), with many showing no response to pile driving and generally reacting more strongly to passing vessels associated
The proposed construction activity may generate airborne noise above ambient levels or create a visual disturbance (during typical construction hours/workdays) for a period of 11 months. However, only work in the northern and eastern portions of Minhoto Marsh would be expected to disturb sea otters due to their proximity to the adjacent areas used by sea otters. Work in these portions of the marsh would likely be accomplished within approximately 6 months (132 construction days). Airborne noise produced by heavy earth-moving equipment such as backhoes and front-end loaders may produce sound levels of 80-90 dB re 20μPa at 50 feet (Federal Highway Administration 2015). Vibratory driving of steel sheet piles, which may occur during 4 of the 136 total days of construction, is expected to produce maximum airborne sound levels of 97 dBA re 20μPa at 33 feet and 90 dBA re 20μPa at 98 feet (where dBA refers to dB with A-weighting designed to match the average frequency response of human hearing, which enables comparison of the intensity of noises with different frequency characteristics) (ESNERR 2011). Vibratory driving of sheet piles would generate underwater noise to which sea otters in the vicinity would be exposed while diving or performing other behaviors that cause immersion of the ears. However, because of acoustic shadowing due to the winding configuration of Elkhorn Slough, underwater sound transmission would be relatively limited. The likely extent of transmission of sound exceeding 120 dB re 1 µPa is pictured in Figure 6-4 of ESA/ESNERR (2016).
NMFS employs acoustic exposure criteria to define Level A harassment (injury) and Level B harassment (disturbance) resulting from sound for the marine mammal species under its jurisdiction. For underwater non-impulsive noise (which includes vibratory pile driving and removal), NMFS uses 219 dB re 1 µPa (cumulative 24-hour sound exposure level) as the threshold for Level A harassment of otariid pinnipeds (
In the absence of sufficient data on which to base noise exposure thresholds specific to sea otters, but in light of experimental evidence suggesting that the hearing sensitivities of sea lions and sea otters are generally comparable (although, as noted above, sea otter hearing appears to be less sensitive than sea lion hearing underwater), we use the thresholds, guidelines, and criteria applicable to sea lions as proxies. With regard to underwater noise, we use the thresholds adopted by NMFS for sea lions to evaluate whether noise exposure levels would constitute Level A or Level B harassment of sea otters. With regard to airborne noise, we use the guideline that NMFS uses for pinnipeds other than harbor seals to evaluate whether anticipated exposure levels resulting from this project would constitute Level B harassment of sea otters and the injury criterion proposed in Southall et al. (2007) for sea lions to evaluate whether the anticipated airborne noise exposures would constitute Level A harassment. Specifically, we use 219 dB re 1 µPa as the threshold for Level A harassment underwater and 120 dB re 1 µPa (for non-impulse sources) as the threshold for Level B harassment underwater. Similarly, we adopt for sea otters the 100 dB re 20 µPa guideline that NMFS uses for in-air Level B harassment of pinnipeds other than harbor seals. We use the Southall et al. (2007) criterion of 172.5 dB re 20 µPa for sea lions to approximate the airborne noise levels that may cause injury to sea otters. Given that sea otters are not known to use sound to communicate underwater, to orient, or to locate prey, and given sea otters' decreased sensitivity to underwater noise relative to that of sea lions, we acknowledge that these thresholds are likely highly conservative. As additional behavioral or other data on sea otter responses to sound become available, we may determine that one or more of these thresholds are not applicable to sea otters.
Habitat within the project footprint would be inaccessible to sea otters for the duration of construction. However, these impacts would be minimal, as past surveys documented a maximum of two sea otters using this area. Construction activity would result in a slight increased risk of accidental water contamination from equipment refueling, fluid leakage, or maintenance activities within or near water bodies. Leaks or spills of petroleum hydrocarbon products found in construction equipment could have adverse effects on sea otters by contaminating their fur (interfering with thermoregulation) and through ingestion during grooming. Vibratory pile driving (if required by the project) would not be expected to alter the availability of prey species to sea otters in the waters or marshlands adjacent to the project site because these species are largely sessile benthic invertebrates. The proposed action would permanently alter habitat within the footprint of the construction area, but the restoration of salt marsh would benefit sea otters over the longer term by providing additional high-quality habitat within Elkhorn Slough for hauling out and foraging.
The subsistence provision of the MMPA does not apply.
CDFW has proposed the following measures to prevent Level A harassment (injury) and to reduce the extent of potential effects from Level B harassment (disturbance) to marine mammals.
1. A Service- and NMFS-approved biologist would conduct mandatory biological resources awareness training for construction personnel. The awareness training would be provided to all construction personnel to brief them on the need to avoid effects on marine mammals. If new construction personnel are added to the project, the contractor would ensure that the personnel receive the mandatory training before starting work.
2. A biological monitor approved by the Service and NMFS would monitor for marine mammal disturbance. Monitoring would occur at all times when work is occurring: (a) In water, (b) north of a line starting at 36°48′38.91 N. 121°45′08.03 W. and ending 36°48′38.91 N. 121°45′27.11 W., or (c) within 100
3. To reduce the risk of potentially startling marine mammals with a sudden intensive sound, the construction contractor would begin construction activities gradually each day by moving around the project area and starting tractors one at a time.
4. Biological monitors would have authority to stop construction at any time for the safety of any marine mammals.
5. In-water construction work would occur only during daylight hours when visual monitoring of marine mammals can be implemented. No in-water work would be conducted at night.
6. If sheet piles are used to isolate construction activities from tidal action, all piles would be installed using a vibratory pile driver, and an exclusion zone would be implemented. Because the area within which underwater sound pressure levels are expected to reach or exceed 190 dB re 1 μPa is less than a foot, the radius of the exclusion zone would be set at a minimum of 49 feet to prevent the injury of marine mammals from machinery. Pile extraction or driving would not commence (or re-commence following a shutdown) until marine mammals are not sighted within the exclusion zone for a 15-minute period. If a marine mammal enters the exclusion zone during sheet pile work, work would stop until the animal leaves the exclusion zone.
7. If marine mammals are present within the work area, they would be allowed to leave on their own volition. If they are not leaving the work area on their own, coordination with NMFS or the Service (as appropriate) would occur to ensure a government official be present should an animal require flushing from within the footprint of the construction area.
8. Fuel storage and all fueling and equipment maintenance activities would be conducted at least 100 feet from subtidal and intertidal habitat.
CDFW would follow a detailed monitoring plan developed in consultation with the Service and NMFS. A Service- and NMFS-approved biological monitor would monitor for marine mammal disturbance. Monitoring would occur as described in Mitigation Measure #2 above. Throughout construction activities that require a monitor, the biological monitor would maintain a log that documents numbers of marine mammals present before, during, and at the conclusion of daily activities. The monitor would record basic weather conditions and marine mammal behavior. A final report would be submitted to the Service and NMFS within 90 days of the conclusion of monitoring efforts. The report would detail the monitoring protocol, summarize the data recorded during monitoring, and contain an estimate of the number of marine mammals, by species, that may have been harassed.
Based on the proposed construction methodology and mitigation, including use of an exclusion zone, no Level A harassment of southern sea otters is anticipated as a result of the proposed project. Anticipated received noise levels would remain well below the thresholds established for Level A harassment. Behavioral harassment (Level B) could result from visual disturbance and in-air noise of 100 dB re 20 μPa or greater for a period of 132 days and (if pile driving is required by the project) visual disturbance, in-air noise of 100 dB re 20 μPa or greater, and underwater continuous noise of 120 dB re 1 μPa or greater for a period of 4 days.
In order to quantify take that may occur incidental to the specified activity, we determine the area that may be subject to project-related disturbance, estimate the number of sea otters likely to be present in that area, and multiply the number of sea otters by the number of days they could be disturbed during the project. Because airborne noise attenuates rapidly, and because of the distance of the project site from areas of concentrated sea otter activity (the closest such area, Yampah Marsh, is approximately 800 feet away), it is likely that few sea otters will be exposed to noise levels exceeding the 100 dB re 20 μPa threshold. The area potentially subject to visual disturbance from construction activity is larger than and inclusive of the area potentially exposed to airborne sound exceeding the threshold for Level B harassment. Accordingly, we do not evaluate the number of sea otters exposed to airborne noise separately from the number of sea otters exposed to visual disturbance.
Vibratory pile driving (if required) would generate visual disturbance and in-air and underwater noise for a period of 4 days. The portion of Elkhorn Slough Channel that could be exposed to underwater noise of 120 dB re 1 μPa or greater during pile driving is pictured in Figure 6-4 of ESA/ESNERR (2016). An estimated 15 sea otters may use this portion of the channel for foraging or traveling from one location to another. The area that could potentially be affected by visual disturbance and in-air noise of 100 dB re 20 μPa or greater during pile driving includes Minhoto Marsh, Parsons Slough, and Yampah Marsh, which are utilized by an average of 35 sea otters (ESA/ESNERR 2016). Up to 50 sea otters may be present on land or in water and potentially affected by vibratory pile driving for 4 days, resulting in an estimated 200 instances of take.
After sheet piles are installed (or if an earthen dam or an inflatable dam is used instead), the project site would be isolated from aquatic areas, and sea otters would no longer be able to access the work area. At that time, sea otters outside of the work area would be subject to reduced levels of disturbance. An average of 10 sea otters per day (a subset of the 50 that may be affected by vibratory pile driving) could be affected by visual disturbance and in-air noise of 100 dB re 20 μPa or greater during the subsequent 132 days of construction work in the northern and eastern portions of the Minhoto Marsh, resulting in approximately 1,320 takes.
We propose the following findings regarding this action:
We find that any incidental take by harassment that is reasonably likely to result from the proposed project would not adversely affect the southern sea otter by means of effects on rates of recruitment or survival, and would, therefore, have no more than a negligible impact on the species or stock
The estimated 200 potential takes (affecting up to 50 sea otters per day) during a total of 4 days of vibratory pile driving, if required by the project, and 1,320 potential takes (affecting up to 10 sea otters per day over a period of 132 days) during subsequent construction activity are expected to result in negligible impact for the following reasons: Received noise levels would remain well below the thresholds established for Level A harassment; sea otters do not appear to be particularly sensitive to noise (and often do not react visibly to it); and any behavioral reactions to noise or visual disturbance are expected to be temporary and of short duration. In particular, the estimate of the number of sea otters that could be harassed by exposure to project-related underwater sound based on the 120 dB threshold may overstate impacts because this threshold is sometimes at or even below the ambient noise level in certain locations. Additionally, disturbance resulting from project activities would affect only a small portion of the sea otter habitat available to and used by sea otters in Elkhorn Slough.
The mitigation measures outlined above are intended to minimize the number of sea otters that could be disturbed by the proposed activity. Any impacts to individuals are expected to be limited to Level B harassment of short duration. Responses of sea otters to disturbance would most likely be common behaviors such as diving and/or swimming away from the source of the disturbance. No take by injury or death is anticipated. Because any Level B harassment that occurs would be of short duration, and because no take by injury or death is anticipated, we find that the anticipated harassment caused by the proposed activities is not expected to adversely affect the species or stock through effects on annual rates of recruitment or survival.
Our finding of negligible impact applies to incidental take associated with the proposed activity as mitigated through this authorization process. This authorization establishes monitoring and reporting requirements to evaluate the potential impacts of the authorized activities, as well as mitigation measures designed to minimize interactions with, and impacts to, sea otters.
For small numbers take analysis, the statute and legislative history do not expressly require a specific type of numbers analysis, leaving the determination of “small” to the agency's discretion. The sea otter population in California consists of approximately 3,272 animals. The number of sea otters that could potentially be taken by harassment in association with the proposed project, approximately 50 animals, is 1.5 percent of the population size. We find that the number of sea otters utilizing the affected area is small relative to the size of the population.
The subsistence provision of the MMPA does not apply to southern sea otters.
The proposed activity will occur within the range of the southern sea otter, which is listed as threatened under the ESA. CDFW has requested a Pre-Construction Notification (PCN) under U.S. Army Corps of Engineers' (Corps') Nationwide Permit (NWP) 27 (USACE 2012). The Corps has initiated interagency consultation under section 7 of the ESA with the Service's Ventura Fish and Wildlife Office. We will also complete intra-Service section 7 consultation on our proposed issuance of the IHA.
The types of impacts associated with aquatic habitat restoration, establishment, and enhancement activities are described in NWP 27. The analyses in the NWP and the coordination undertaken prior to its issuance fulfill the requirements of NEPA (42 U.S.C. 4321
In accordance with the President's memorandum of April 29, 1994, “Government-to-Government Relations with Native American Tribal Governments” (59 FR 22951), Executive Order 13175, Secretarial Order 3206, Department of the Interior Secretarial Order 3317 of December 1, 2011 (Tribal Consultation and Policy), the Department of the Interior's manual at 512 DM 2, and the Native American Policy of the Service, January 20, 2016, we readily acknowledge our responsibility to communicate meaningfully with federally recognized Tribes on a Government-to-Government basis. We have evaluated possible effects on federally recognized Indian Tribes and have determined that there are no effects.
The Service proposes to issue CDFW an IHA for the nonlethal, incidental, unintentional take by level B harassment of small numbers of southern sea otters while the applicant is completing the Minhoto-Hester Marsh Restoration Project in Elkhorn Slough, Monterey County, California. The 1-year authorization would begin on the date of issuance, with an anticipated project start date between January 2017 and June 2017. Authorization for incidental take beyond the 1-year period would require a request for renewal.
The final IHA would incorporate the mitigation, monitoring, and reporting requirements discussed in this proposal. The applicant would be responsible for following those requirements. This authorization would not allow the intentional taking of sea otters, nor take by injury or death.
If the level of activity exceeded that described by the applicant, or the level or nature of take exceeded those projected here, the Service would reevaluate its findings. The Secretary may modify, suspend, or revoke an authorization if the findings are not accurate or the mitigation, monitoring, and reporting requirements described in this notice are not being met.
The Service requests that interested persons submit comments and information concerning this proposed IHA. For information on the references cited in this notice, see
Consistent with section 101(a)(5)(D)(iii) of the MMPA, we are opening the comment period on this proposed authorization for 30 days (see
We particularly seek comments concerning:
• Whether the proposed authorization, including the proposed activities, will have a negligible impact on the species or stock of the southern sea otter.
• Whether there are any additional provisions we may wish to consider for ensuring the conservation of the southern sea otter.
You may submit your comments and materials concerning this proposed authorization by one of the methods listed in
We issue this notice under the authority of the MMPA (16 U.S.C. 1371
Bureau of Land Management, Interior.
Notice.
This notice contains the Director of the Bureau of Land Management's (BLM) response to the Alaska Governor's appeal of the BLM Alaska State Director's response to the State of Alaska's Governor's consistency review letter for the Eastern Interior Proposed Resource Management Plan (PRMP) and Final Environmental Impact Statement (FEIS). The BLM Director determined not to accept the recommendations of the Alaska Governor's consistency review letter.
Leah Baker, Division Chief for Decision Support, Planning and NEPA, at 202-912-7282. Persons who use a telecommunications device for the deaf (TDD) may call the Federal Relay Service (FRS) at 1-800-877-8339 to contact the above individual during normal business hours. FRS is available 24 hours a day, 7 days a week, to leave a message or question with the above individual. You will receive a reply during normal business hours.
On July 29, 2016, the BLM released the PRMP and FEIS for the Eastern Interior Resource Management Plan in Alaska. In accordance with the regulations at 43 CFR 1610.3-2(e), the BLM submitted the PRMP and FEIS for a 60-day Governor's Consistency Review. On September 28, 2016, the Governor of Alaska submitted a Governor's Consistency Review letter to the BLM Alaska State Director asserting inconsistencies between the PRMP and State land use plans, programs, and policies.
After careful consideration of the concerns raised in the Governor's Consistency Review letter, the State Director decided not to adopt the recommendations made by the Governor. On October 12, 2016, the State Director sent a written response to the Governor describing the reasons for which the State Director believes that the PRMP is consistent with State land use plans, policies, and programs.
On November 8, 2016, the Governor appealed the BLM Alaska State Director's decision to not accept his recommendations to the BLM Director. In the Governor's appeal letter, the State of Alaska requested the BLM Director to reconsider the issues and recommendations raised in the Governor's Consistency Review letter. The BLM Director issued a final response to the Governor that declined to accept the recommendations of the Governor and affirmed the BLM State Director's decision. Pursuant to 43 CFR 1610.3-2(e), the basis for the BLM Director's determination on the Governor's appeal is published verbatim below.
“This letter addresses your appeal of the response provided by the Bureau of Land Management (BLM) Alaska State Director regarding your consistency review of the Eastern Interior Proposed Resource Management Plan and Final Environmental Impact Statement (referred to hereafter as the PRMP or plan). The Governor's consistency review is an important part of the BLM land use planning process, and we appreciate the significant time and attention that you and your staff have committed to this effort.
The BLM developed the Eastern Interior PRMP with extensive local involvement. As a result of more than 15 months of public comment periods, we received 590 comments, including those from the State of Alaska, Chalkyitsik Village Council, Gwichyaa Zhee Gwich'in Tribal Government, miners from the Fortymile area, and industry groups. Of the total comments, 171 submissions were from rural Alaska residents who qualify as Federal subsistence users. All of these stakeholder groups provided important information about their current and anticipated future uses of the lands in the planning area.
I believe that this effort has led to the creation of a strong resource management plan that properly balances responsible development with the protection and conservation of subsistence use, important habitats for fish and wildlife, and other special values in the planning area. For example, the plan recommends opening more than one million acres of currently-withdrawn lands to mineral location, entry, and leasing, while also providing protection of priority habitats for caribou, Dall sheep, and other wildlife critical for subsistence use.
The applicable regulations at 43 CFR 1610.3-2(e) provide you with the opportunity to appeal the State Director's decision to not accept the recommendations you made in your consistency review letter. These regulations also guide my review of your appeal. In reviewing your appeal, I must first consider whether you have identified inconsistencies with State or local plans, policies, or programs. If such inconsistencies are identified, I then must consider whether your recommendations both address the inconsistencies and provide for a reasonable balance between the national interest and the State's interest.
In your consistency review letter, you identified three key issues that the Alaska State Director determined to be outside the scope of the Governor's consistency review: The PRMP is inconsistent with Federal statutes implementing the goals of the Alaska Statehood Act that protect the State's resource management responsibilities; the PRMP is inconsistent with previous BLM plans and the BLM's multiple use mandate; and the PRMP frustrates the
Your letter also stated that the PRMP is inconsistent with State land use plans, programs, and policies, which the State Director responded to in greater depth. While you raised multiple issues in both your consistency review and appeal letters, your overarching recommendation to address these issues was to revoke all Alaska Native Claims Settlement Act (ANCSA) 17(d)(1) withdrawals. Further, in your consistency review letter, you requested that recommendations for new mineral withdrawals be removed.
As described in this letter and supported by the State Director's response to your consistency letter, there is a strong national interest in protecting subsistence use and conserving important habitats for fish and wildlife. I find that the recommendations in your letter do not meet the standard for granting your appeal. I agree with the State Director that the issues dismissed in the response to your consistency review do not identify inconsistencies with State resource related plans, policies, or programs. Nevertheless, I have fully considered these issues as well as your responses to the State Director's findings. Below is my review of the issues and recommendations presented in your appeal letter.
Upon review, I have determined that the PRMP is consistent with the provisions of ANILCA. As you are aware, ANILCA § 101(d) states that the designation and disposition of the public lands pursuant to this Act represent a proper balance between the reservation of national conservation system units and those public lands necessary and appropriate for more intensive use and designation, further stating that Congress believes the need for future legislation designating new conservation system units, new national conservation areas, or new national recreation areas, to be “obviated.” The PRMP does not recommend designating any new conservation system units, national conservation areas, or national recreation areas, but rather recommends revoking ANCSA 17(d)(1) withdrawals on a total of approximately 1.7 million acres in order to open these lands to mineral location entry and leasing, including 1.1 million acres of the Fortymile Subunit. While the PRMP does recommend new withdrawals under the Federal Land Policy and Management Act (FLPMA), this action is not precluded by ANILCA. Specifically, ANILCA (§ 1326(a)) outlines a process for withdrawing lands in Alaska, which indicates that Congress did envision the possibility of future withdrawals. Such withdrawals are consistent with ANILCA and Secretarial withdrawal authorities. The PRMP recommends only temporarily retaining the ANCSA 17(d)(1) withdrawals until new withdrawals under FLPMA can be enacted in these areas.
The BLM recognizes that Federal and State laws and regulations provide for the protection of resource values. FLPMA and its implementing regulations are included among these Federal laws. FLPMA mandates that the BLM manage on the basis of multiple use and sustained yield, and makes clear that the term “multiple use” does not mean that every use is appropriate for every acre of public land. Rather, the Secretary can “make the most judicious use of the land for some or all of these resources or related services over areas large enough to provide sufficient latitude for periodic adjustments inuse . . .” (FLPMA § 103(c)).
In your appeal letter, you reference Article 8, Section 2 of the Alaska State Constitution, which states, “[t]he legislature shall provide for the utilization, development, and conservation of all natural resources belonging to the State, including land and waters, for the maximum benefit to the people.” You also highlight similarities between State statutes and FLPMA, both of which provide for the balance of resource development and conservation. While section 102 of FLPMA expresses Congressional policy that public lands be managed in a manner which recognizes the Nation's need for domestic sources of minerals, that same section also references protection of the quality of scientific, scenic, historical, ecological, environmental, air and atmospheric, water resource, and archeological values, and FLPMA section 103(c) expressly includes similar values in its definition of multiple use (including values such as “recreation . . . . wildlife and fish, and natural scenic, scientific, and historical values”).
The BLM also recognizes that all of the ANCSA 17(d)(1) withdrawals should not remain in place. As previously mentioned, the PRMP recommends revoking ANCSA 17(d)(1) withdrawals on approximately 1.7 million acres to open these lands for mineral entry. The PRMP recommends retaining certain portions of these withdrawals, but only until recommended withdrawals under FLPMA can be put in place. The PRMP also recommends eventual revocation of all ANCSA 17(d)(1) withdrawals to clean up the land record and remove duplicate withdrawals.
Your appeal states that the plan provides no explanation as to why existing laws and regulations provide insufficient protection for resource values. However, I find that the effects of the proposed alternative, including the rationale for these actions, are adequately analyzed and disclosed in the PRMP/FEIS. I concur with the determination in the PRMP that additional protections, such as FLPMA withdrawals to protect water quality and river values, are warranted.
While I have fully considered your concerns, I concur with the State Director's response that these statements do not identify inconsistencies with State plans, policies, or programs. In your appeal, you state that the PRMP impedes the State's ability to prioritize land selections. Based on analysis completed by BLM Alaska in June 2016, only an estimated 197,100 acres of the State's top three priorities of top-filed lands are encumbered solely by 17(d)(1) withdrawals on a statewide basis. Affected lands within the planning area would be even less. The State is currently over-selected on their land entitlement by 242 percent.
Further, in regards to the assertion that retaining 17(d)(1) withdrawals interferes with the State's ability to explore, locate, and define the mineral resource on large tracts of lands identified for selection, all State and Native-selected lands are segregated from mineral entry. Should 17(d)(1) withdrawals be revoked, the lands are not open to the staking of mining claims until the selections are relinquished, including State selections. Once a 17(d)(1) withdrawal is revoked and the State's top-filing attaches to a selection, the State's selection itself segregates the
In your consistency review and appeal letters, you assert that the PRMP preempts mineral exploration and development, and by doing so, the PRMP is inconsistent with State plans, policies, and programs. However, I concur with the State Director's finding that the PRMP is consistent with the State's plans, policies, and programs, including the State's policy to make mineral resources available for development. As noted in the State Director's response, the PRMP recommends revoking ANCSA 17(d)(1) withdrawals on 1.7 million acres to open lands to mineral location, entry, and leasing, including 1.1 million acres in the Fortymile Subunit, 4,000 acres in the White Mountains Subunit, 547,000 acres in the Draanjik (Upper Black River) Subunit adjacent to State and State-selected land, and 30,000 acres in the Steese Subunit adjacent to State land. These recommendations are consistent with making mineral resources available for mineral development.
Moreover, revoking the ANCSA 17(d)(1) withdrawals would not allow for new mining claims in the White Mountains NRA, as that area would remain withdrawn from the mining law by ANILCA. As noted in the response to comments on FEIS pp. 1520-1521, the PRMP recommends maintaining the ANILCA withdrawals for the Steese NCA and White Mountains NRA. It also recommends to the Secretary that the ANCSA 17(d)(1) withdrawals (Public Land Orders 5180 and 5179) be revoked as applied to these areas since they are duplicative of the ANILCA withdrawals and thus not necessary. Additionally, Public Land Order 5180 does not close the national conservation area to location of metalliferous mining claims (such as gold), so its protective effect is limited. Removing the 17(d)(1) withdrawals would clean up the public land record by removing duplicative withdrawals, but it would not result in opening the lands to the mining law.
Your overarching recommendation is to revoke all ANCSA 17(d)(1) withdrawals, unconditionally. However, based on the foregoing, I find that the recommendations provided in your appeal letter do not meet the standard identified above for granting an appeal in accordance with 43 CFR 1610.3-2(e). Therefore, I affirm the Alaska State Director's response to your finding of inconsistency and respectfully deny your appeal. The reasons outlined above for my decision on your appeal will also be published in the
Further, please note that the BLM gave due consideration to the State's concerns raised in the protest letter dated August 29, 2016. For a detailed response to these issues, many of which were raised in your consistency review letter, I refer you to the Director's Protest Resolution Report.
The BLM and the State of Alaska have a long history of working cooperatively on the development of resource management plans. I appreciate the resources and input that you and your staff have put into the process of developing the PRMP for the Eastern Interior planning area. As mentioned, I believe this plan balances responsible development with the protection and conservation of subsistence use, important habitats for fish and wildlife, and other special values. I look forward to our continued coordination as our teams work together to implement this plan.”
43 CFR 1610.3-2(e).
Bureau of Land Management, Interior.
Notice.
The Bureau of Land Management (BLM) is processing an application under section 209 of the Federal Land Policy and Management Act of 1976 (FLPMA) to convey the federally owned mineral interests in a 799.57-acre parcel of land, located in Maricopa County, Arizona, to the surface owner, REO Funding Solution IV, LLC. Publication of this notice temporarily segregates the federally owned mineral interests in the land covered by the application from all forms of appropriation under the public land laws, including the mining laws, for up to 2 years while the BLM processes the application.
Interested persons may submit written comments to the BLM at the address listed below on or before March 6, 2017.
Bureau of Land Management, Phoenix District Office, 21605 North 7th Avenue, Phoenix, AZ 85027. Detailed information concerning this action is available for review at this address.
Benedict Parsons, Realty Specialist, at the address above, or by telephone at 623-580-5637, or email at
The BLM is processing an application under section 209 of the Federal Land Policy and Management Act (FLPMA), 43 U.S.C. 1719(b), to convey the federally owned mineral interests that aggregate 799.57 acres, situated in Maricopa County, Arizona. The location of the federally owned mineral interest proposed for conveyance is intended to be identical in location as the privately owned surface interest of the applicant, and is described as follows.
A parcel of land situated in the southwest quarter of section 12, being more particularly described as follows:
COMMENCING at the southwest section corner of said section 12, which bears North 89°14′17″ West, a distance of 2644.37 feet from the south
THENCE South 89°14′17″ East, along the south section line of said southwest
THENCE North 0°12′34″ West, leaving said south section line, a distance of 1330.92 feet;
THENCE South 88°54′41″ East, a distance of 1198.47 feet;
THENCE South 0°08′53″ East, a distance of 1324.06 feet to a point on said south section line of the southwest
THENCE North 89°14′17″ West, along said south section line of the southwest
A parcel of land situated in the south half of section 12, being more particularly described as follows:
COMMENCING at the southwest section corner of said section 12, which bears North 89°14′17″ West, a distance of 2644.37 feet from the south
THENCE South 89°14′17″ East, along the south section line of said southwest
THENCE North 0°08′53″ West, leaving said south section line, a distance of 1324.06 feet;
THENCE South 88°54′41″ East, a distance of 1208.47 feet;
THENCE South 0°05′10″ East, a distance of 1316.56 feet to a point on the south section line of the southeast
THENCE North 89°36′43″ West, along said south section line of the southeast
THENCE North 89°14′17″ West, along the south section line of the southwest
A parcel of land situated in the southeast
COMMENCING at the south
THENCE South 89°36′43″ East, along the south section line of the southeast
THENCE North 00°05′10″ West, leaving said south section line, a distance of 1316.56 feet;
THENCE South 88°54′51″ East, a distance of 1232.04 feet to a point on the north and south center line of the southeast
THENCE South 0°07′39″ West, along said north and south center line of the southeast
THENCE North 89°36′43″ West, along said south section line, a distance of 1226.97 feet to the point of beginning.
Excluding that portion within the Gift Lode Mining Claim, M.S. 4503, conveyed in U.S. Patent No. 1220768 dated June 23, 1961, and recorded in the records of Maricopa County, Arizona, at Docket 3753, Page 360, containing 35.35 acres of land.
A parcel of land situated in the southwest
COMMENCING at the southwest section corner of said section 12, which bears North 89°14′17″ West, a distance of 2644.37 feet from the south
THENCE South 89°14′17″ East, along the south line of said southwest
THENCE North 00°12′34″ West, leaving said south section line, a distance of 1330.92 feet to the point of beginning;
THENCE North 00°12′34″ West, a distance of 1330.92 feet to a point on the east and west center line of Section 12;
THENCE South 88°27′04″ East, along said east and west center line, a distance of 1200.14 feet;
THENCE South 00°08′53″ East, leaving said North line, a distance of 1321.24 feet;
THENCE North 88°54′41″ West, a distance of 1198.47 feet to the point of beginning, containing 36.50 acres of land.
A parcel of land situated in the south
COMMENCING at the southwest section corner of said section 12, which bears North 89°14′17″ West, a distance of 2644.37 feet from the south
THENCE South 89°14′17″ East, along the south section line of said southwest
THENCE North 0°08′53″ West, leaving said south section line, a distance of 1324.06 feet to the point of beginning;
THENCE North 00°08′53″ West, a distance of 1321.24 feet to a point on the east and west center line of said Section 12;
THENCE South 88°27′04″ East, along said east and west center line, a distance of 1120.10 feet to the center
THENCE South 88°27′04″ East, along the east and west center line of said Section 12, a distance of 90.04 feet;
THENCE South 00°05′10″ East, a distance of 1311.49 feet;
THENCE North 88°54′41″ West, a distance of 1208.47 feet to the point of beginning;
Excluding that portion within the Gift Lode Mining Claim, M.S. 4503, conveyed in U.S. Patent No. 1220768 dated June 23, 1961, and recorded in the records of Maricopa County, Arizona, at Docket 3753, Page 360, containing 35.46 acres of land.
A parcel of land situated in the southeast
COMMENCING at the south
THENCE South 89°36′43″ East, along the south section line of the southeast
THENCE North 00°05′10″ West, leaving said south section line, a distance of 1316.56 feet to the point of beginning;
THENCE North 00°05′10″ West, a distance of 1311.49 feet to a point on the east and west center line of said Section 12;
THENCE South 88°27′04″ East, along the said east and west center line, a distance of 1237.13 feet to a point on the north and south center line of the southeast
THENCE South 00°07′39″ West, along said north and south center line, a distance of 1301.46 feet;
THENCE North 88°54′41″ West, leaving said north and south center line, a distance of 1232.04 feet to the point of beginning;
Excluding that portion within the Gift Lode Mining Claim, M.S. 4503, conveyed by U.S. Patent No. 1220768 dated June 23, 1961, and recorded in the records of Maricopa County, Arizona, at Docket 3753, Page 360, containing 20.42 acres of land.
A parcel of land situated in the northeast
COMMENCING at the north
THENCE South 00°05′11″ East, along the north and south center line of said section 12, a distance of 1150.23 feet to the point of beginning;
THENCE South 88°27′04″ East, leaving said north and south center line, a distance of 1101.27 feet;
THENCE South 00°02′17″ East, a distance of 1451.57 feet, to a point on the east and west center line of said section 12;
THENCE North 88°27′04″ West, along said east and west center line, a distance of 1100.04 feet to the center
THENCE North 00°05′11″ West, along the north and south center line of said section 12, a distance of 1451.60 feet to the point of beginning;
Excluding that portion within the Gift Lode Mining Claim, M.S. 4503, conveyed by U.S. Patent No. 1220768 dated June 23, 1961, and recorded in the records of Maricopa County, Arizona, at Docket 3753, Page 360, containing 35.47 acres of land.
A parcel of land situated in the northeast
BEGINNING at the north
THENCE South 89°57′16″ East, along the north section line of the northeast
THENCE South 00°02′17″ East, leaving said north section line, a distance of 1522.73 feet;
THENCE North 88°27′04″ West, a distance of 513.91 feet to a point on the east line of Parcel No. 7, hereinbefore described;
THENCE North 00°02′17″ West, a distance of 330.13 feet to the northeast corner of said Parcel No. 7;
THENCE North 88°27′04″ West, a distance of 1101.27 feet to a point on the north and south center line of said Section 12;
THENCE North 00°05′11″ West, along said north and south center line of said Section 12, a distance of 1150.23 feet to the point of beginning, containing 47.32 acres of land.
A parcel of land situated in the northeast
COMMENCING at the north
THENCE South 89°57′16″ East, along the north section line of said northeast
THENCE South 89°57′16″ East, continuing along said north section line, a distance of 1040.00 feet to the northeast section corner of said Section 12;
THENCE South 00°02′17″ East, along the east section line of said section 12, a distance of 1550.02 feet;
THENCE North 88°27′04″ West, leaving said east section line, a distance of 1040.40 feet;
THENCE North 00°02′17″ West, a distance of 1522.73 feet to the point of beginning, containing 36.68 acres of land.
Sec. 1, NE
A parcel of land situated in the southeast
BEGINNING at the southeast section corner of section 11, which bears North 89°14′17″ West, a distance of 2644.37 feet from the south
THENCE South 89°59′10″ West, along the south section line of the southeast
THENCE North 00°11′08″ West, leaving said south section line, a distance of 314.67 feet;
THENCE North 90°00′00″ East, a distance of 620.58 feet, to the east section line of said section 11;
THENCE South 00°13′36″ East, along the east section line of said section 11, a distance of 315.48 feet to the point of beginning, containing 4.48 acres of land.
A parcel of land situated in the southeast
COMMENCING at the southeast section corner of said section 11, which bears North 89°14′17″ West, a distance of 2644.37 feet from the south
THENCE South 89°59′10″ West, along the south section line of the southeast
THENCE North 00°11′13″ West, a distance of 315.69 feet to the point of beginning;
THENCE North 00°11′13″ West, a distance of 502.94 feet;
THENCE North 89°44′33″ East, a distance of 454.34 feet;
THENCE South 00°11′13″ East, a distance of 504.98 feet, to a point on the north line of Parcel No. 15, hereinafter described;
THENCE North 90°00′00″ West, a distance of 454.34 feet to the point of beginning, containing 5.53 acres of land.
A parcel of land situated in the southeast
COMMENCING at the southeast section corner of said section 11, which bears North 89°14′17″ West, a distance of 2644.37 feet from the south
THENCE South 89°59′10″ West, along the south section line of the southeast
THENCE North 00°11′13″ West, a distance of 315.69 feet;
THENCE South 90°00′00″ East, a distance of 454.34 feet to the point of beginning;
THENCE North 00°11′13″ West, a distance of 504.98 feet;
THENCE North 89°44′33″ East, a distance of 345.66 feet;
THENCE North 00°11′08″ West, a distance of 549.02 feet;
THENCE North 89°48′47″ East, a distance of 9.99 feet;
THENCE 182.67 feet along an arc of a curve to the right having a radius distance of 135.00 feet, having a central angle of 77°31′39″ and the long chord of which measures South 51°25′14″ East, a distance of 169.05 feet;
THENCE South 12°39′24″ East, a distance of 164.66 feet;
THENCE North 89°44′33″ East, a distance of 332.78 feet, to the east section line of section 11;
THENCE South 00°13′44″ East, along the east section line of said section 11, a distance of 262.91 feet;
THENCE South 00°13′36″ East, a distance of 527.01 feet;
THENCE North 90°00′00″ West, a distance of 620.56 feet, to the northeast corner of Parcel No. 15, hereinafter described;
THENCE North 00°11′08″ West, a distance of 0.85 feet, to the northwest corner of Parcel No. 12, hereinbefore described;
THENCE North 90°00′00″ West, a distance of 235.76 feet to the point of beginning;
EXCEPT that portion located within the NE
A parcel of land situated in the southeast
COMMENCING at the southeast section corner of said Section 11, which bears North 89°14′17″ West, a distance of 2644.37 feet from the south
THENCE South 89°59′10″ West, along the south section line of the southeast
THENCE South 89°59′10″ West, along the south section line of the southeast
THENCE North 00°11′13″ West, a distance of 315.69 feet;
THENCE North 90°00′00″ East, a distance of 690.10 feet;
THENCE South 00°11′08″ East, a distance of 315.52 feet to the point of beginning, containing 5.00 acres of land.
A parcel of land situated in the southwest
BEGINNING at the southwest section corner of said section 12, which bears North 89°14′17″ West, a distance of 2644.37 feet from the south
THENCE South 89°14′17″ East, along the south line of the southwest
THENCE North 00°13′36″ West, leaving said south line, a distance of 838.92 feet;
THENCE North 88°27′04″ West, a distance of 330.91 feet, to the west section line of said section 12;
THENCE South 00°13′36″ East, along the west section line of said Section 12, a distance of 842.49 feet to the point of beginning, containing 6.38 acres of land.
The areas described for Parcels Nos. 1 through 16 aggregate 435.21 acres.
EXCEPT those portions lying within the following described lands:
EXCEPTION PARCEL NO. 1
BEGINNING at the north
THENCE South 00°10′19″ West, a distance of 1980.03 feet;
THENCE North 89°38′30″ West, a distance of 400.00 feet;
THENCE North 00°10′19″ East, a distance of 1360.76 feet;
THENCE North 89°38′30″ West, a distance of 810.00 feet;
THENCE North 00°10′19″ East, a distance of 619.28 feet to a point on the north line of the northwest
THENCE South 89°38′29″ East, along said north line, a distance of 1210.00 feet to the point of beginning;
EXCEPTION PARCEL NO. 2
COMMENCING at the north
THENCE North 89°42′22″ West, a distance of 1210.00 feet to the point of intersection with the west line of the east 1210.00 feet of the west
THENCE South 00°06′00″ West along said west line, a distance of 2502.98 feet to the point of beginning;
THENCE South 89°07′50″ East, a distance of 805.67 feet;
THENCE South 15°34′27″ West, a distance of 1473.72 feet to the point of intersection with the east and west center line of the southwest
THENCE North 88°24′21″ West, along said east and west center line, a distance of 415.55 feet to the point of intersection with the aforementioned west line of the east 1210.00 feet of the west
THENCE North 00°06′00″ East along said west line, a distance of 1420.32 feet to the point of beginning.
Containing 59.80 acres of land.
Containing 224.56 acres of land.
Containing 80.00 acres of land.
The areas described for Parcels Nos. 1 through 3 aggregate 364.36 acres.
Section 209(b) of the FLPMA authorizes the conveyance of the federally owned mineral interests in land to the surface owner when the surface interest is not federally owned, upon payment of administrative costs. The objective is to allow consolidation of the surface and mineral interests when either one of the following conditions exist: (1) There are no known mineral values in the land; or (2) Where continued Federal ownership of the mineral interests interferes with or precludes appropriate non-mineral development and such development is a more beneficial use of the land than mineral development.
The applicant has deposited, a sum of funding sufficient to cover administrative costs, but not limited to, the cost for the mineral potential report.
Subject to valid existing rights, on January 19, 2017 the federally owned mineral interests in the land described above are hereby segregated from all forms of appropriation under the public lands laws, including the mining laws, while the application is being processed to determine if either one of the two specified conditions exists and, if so, to otherwise comply with the procedural requirements of 43 CFR part 2720. The segregative effect shall terminate upon: (1) Issuance of a patent or other document of conveyance as to such mineral interests; (2) Final rejection of the application; or (3) January 22, 2019, whichever occurs first.
Please submit all comments in writing to Benedict Parsons at the address listed above. Before including your address, phone number, email address, or other personal identifying information in your comment, you should be aware that your entire comment, including your personal identifying information, may be made available to the public at any time. While you can ask in your comment to withhold your personal identifying information from public review, we cannot guarantee that we will be able to do so.
43 CFR 2720.1-1.
Bureau of Land Management, Interior.
Notice.
The United States Forest Service (USFS) has filed an application with the Bureau of Land Management (BLM) requesting that the Secretary of the Interior withdraw, for a 20-year term, approximately 234,328 acres of National Forest System lands within the Rainy River Watershed on the Superior National Forest from disposition under the United States mineral and geothermal leasing laws, subject to valid existing rights. Publication of this notice temporarily segregates the lands for up to 2 years from the United States mineral and geothermal leasing laws while the withdrawal application is being processed.
Comments regarding this withdrawal proposal must be received by April 19, 2017. The BLM and the USFS will hold a public meeting in connection with the proposed withdrawal on March 16, 2017, from 5 p.m. to 7:30 p.m. Central Time (CT) at the Duluth Entertainment and Convention Center, 350 Harbor Drive, Duluth, MN 55802. During this 90-day comment period, the BLM and USFS will hold additional meetings in other areas of the State, notices of which will be provided in local newspapers or on agency Web sites. The USFS' 90-day scoping period associated with preparing an environmental impact statement (EIS) was announced on January 13, 2017 in the
Comments regarding this withdrawal proposal should be sent to the Deputy State Director of Geospatial Services, Bureau of Land Management, Eastern States Office, 20 M Street SE., Suite 950, Washington, DC 20003; or by facsimile at 202-912-7710. Comments sent by email will not be accepted. The March 16, 2017, BLM and USFS public meeting location is the Duluth Entertainment and Convention Center, 350 Harbor Drive, Duluth, MN 55802.
Dominica VanKoten, BLM Eastern States Office, 202-912-7756 during regular business hours, 8 a.m. to 4:30 p.m. Monday through Friday, except holidays. Persons who use a telecommunications device for the deaf (TDD) may call the Federal Relay Service at 1-800-877-8339 to contact the above individual. The Service is available 24 hours a day, 7 days a week, to leave a message or question. You will receive a reply during normal business hours.
The applicant is the USFS. The application requests the Secretary of the Interior to withdraw National Forest System lands in the Superior National Forest from disposition under the United States mineral and geothermal leasing laws for a period of 20 years to protect and preserve the natural resources and waters located within the Rainy River Watershed that flow into the Boundary Waters Canoe Area Wilderness (BWCAW) and the Boundary Waters Canoe Area Wilderness Mining Protection Area (MPA) in northeastern Minnesota. The lands will remain open to other forms of use and disposition as may be allowed by law on National Forest System lands, including the disposition of mineral materials.
All the National Forest System Lands identified in the townships below and any lands acquired by the Federal government within the exterior boundaries described below are included in the withdrawal application. This area excludes the BWCAW and the Boundary Waters Canoe Area Wilderness MPA, as depicted on the map entitled Appendix B: Superior National Forest, dated December 5, 2016. This map is available from the BLM Eastern States Office at the address listed above, and from the USFS Superior National Forest office, 8901
The areas described contain approximately 234,328 acres of National Forest System lands in Cook, Lake, and Saint Louis Counties, Minnesota, located adjacent to the BWCAW and the MPA.
Non-Federal lands within the area proposed for withdrawal total approximately 190,321 acres in Cook, Lake and Saint Louis Counties. As non-Federal lands, these parcels would not be affected by the temporary segregation or proposed withdrawal unless they are subsequently acquired by the Federal Government. The temporary segregation and proposed withdrawal are subject to valid existing rights, which would be unaffected by these actions.
As stated in the application, the purpose of the requested withdrawal is to protect and preserve the natural resources and waters within the Rainy River Watershed that flow into the BWCAW and the MPA from the effects of mining and mineral exploration. Congress designated the BWCAW and established the MPA to protect and preserve the ecological richness of the lakes, waterways, and forested wilderness along the Canadian border. The protection of the Rainy River Watershed would extend the preservation of the BWCAW and MPA as well as Voyageurs National Park and Canada's Quetico Provincial Park, which are all interconnected through the unique hydrology of this region.
The application further states that the use of a right-of-way, interagency agreement, or cooperative agreement would not adequately constrain mineral and geothermal leasing to provide adequate protection throughout this pristine natural area.
According to the application, no alternative sites are feasible because the lands subject to the withdrawal application are the lands for which protection is sought from the impacts of exploration and development under the United States mineral and geothermal leasing laws. No water will be needed to fulfill the purpose of the requested withdrawal.
The USFS will serve as the lead agency for the EIS analyzing the impacts of the proposed withdrawal. The USFS will designate the BLM as a cooperating agency. The BLM will independently evaluate and review the draft and final EISs and any other documents needed for the Secretary of the Interior to make a decision on the proposed withdrawal.
Records related to the application may be examined by contacting the individual listed in the
For a period until April 19, 2017, all persons who wish to submit comments, suggestions, or objections in connection with the withdrawal application may present their views in writing to the BLM Deputy State Director of Geospatial Services at the BLM Eastern States Office address noted in the
Before including your address, phone number, email address, or other personal identifying information in your comment, you should be aware that your entire comment—including your personal identifying information—may be made publicly available at any time. While you can ask us to withhold your personal identifying information from public review, we cannot guarantee that we will be able to do so.
Notice is hereby given that a public meeting in connection with the application for withdrawal will be held at Duluth Entertainment and Convention Center, 350 Harbor Drive, Duluth, Minnesota 55802 on March 16, 2017, from 5 p.m. to 7:30 p.m. CT. The USFS will publish a notice of the time and place in a local newspaper at least 30 days before the scheduled date of the meeting. During this 90-day comment period, the BLM and USFS will hold additional meetings in other areas of the State, notices of which will be provided in local newspapers or on agency Web sites.
For a period until January 21, 2017, subject to valid existing rights, the National Forest System lands described in this notice will be temporarily segregated from the United States mineral and geothermal leasing laws, unless the application is denied or canceled or the withdrawal is approved prior to that date. All other activities currently consistent with the Superior National Forest Land and Resource Management Plan could continue, including public recreation, mineral materials disposition and other activities compatible with preservation of the character of the area, subject to USFS discretionary approval, during the segregation period.
The application will be processed in accordance with the regulations set forth in 43 CFR 2300.
Bureau of Land Management, Interior.
Notice.
The Bureau of Land Management (BLM) received an application for a Recordable Disclaimer of Interest (Disclaimer of Interest) from Gringita, Ltd. pursuant to the Federal Land Policy and Management Act of 1976 (FLPMA), as amended, and the regulations in 43 CFR subpart 1864, for certain mineral estate in Dimmit County, Texas. This notice is intended to inform the public of the pending application, give notice of BLM's intention to grant the requested Disclaimer of Interest, and provide a public comment period for the proposed Disclaimer of Interest.
Comments on this action should be received by April 19, 2017.
Written comments must be sent to the Deputy State Director, Lands and Resources, BLM, New Mexico State Office, P.O. Box 27115, Santa Fe, NM 87502-0115.
John Ledbetter, Realty Specialist, BLM Oklahoma Field Office, (405) 579-7172. Additional information pertaining to this application can be reviewed in case file TXNM114510 located in the Oklahoma Field Office, 201 Stephenson Parkway, Room 1200, Norman, Oklahoma 73072-2037. Persons who use a telecommunications device for the deaf (TDD) may call the Federal Relay Service (FRS) at 1-800-877-8339 to contact the above individual during normal business hours. The Service is available 24 hours a day, 7 days a week, to leave a message or question with the
The purpose of this Disclaimer is to remove a cloud on the title of a mineral interest in Dimmit County, Texas.
In 1938, the Banking Commissioner of Texas, as receiver for the Commonwealth Bank and Trust Company (in liquidation), reported to have conveyed a one-half, non-participating royalty interest in the property described below to the Reconstruction Finance Corporation (RFC), an independent agency of the United States Government. However, the real property records of Dimmit County, and the records of the United States, do not indicate that the Commonwealth Bank and Trust Company ever obtained this one-half, non-participating royalty interest in the property prior to the 1938 Banking Commissioner's action. The BLM therefore believes that the United States does not own this interest in the property described below. However, the conveyance from the Banking Commissioner of Texas to the RFC creates a cloud on the title. Therefore, pursuant to Section 315 of FLPMA, the BLM proposes to disclaim any claim by the United States to this one-half, non-participating royalty interest in the property described below.
The lands are described as:
Dimmit County, Texas
393.5 acres, being 50.94 acres, H.R. Trammel Survey No. 487
621.26 acres, M. Devereaux Survey No. 488, Abstract No. 52.
The area described contains 1,014.76 acres, more or less.
This proposed Disclaimer of Interest does not address any surface interest that may still be vested with the United States of America.
The public is hereby notified that comments may be submitted to the Deputy State Director, Lands and Resources at the address shown above within the comment period identified in the notice. Any adverse comments will be evaluated by the State Director who may modify or vacate this action and issue a final determination.
In the absence of any valid objection, this notice will become the final determination of the Department of the Interior and a Disclaimer of Interest may be issued 90 days from publication of this notice.
All persons who wish to present comments, suggestions, or objections in connection with the proposed Disclaimer of Interest may do so by writing to the Deputy State Director at the above address. Comments, including names and street addresses of commenters, will be available for public review at the BLM New Mexico State Office (see address above), during regular business hours, Monday through Friday, except Federal holidays. Before including your address, phone number, email address, or other personal identifying information in your comment, you should be aware that your entire comment—including your personal identifying information—may be made publicly available at any time. While you can ask us in your comment to withhold your personal identifying information from public review, we cannot guarantee that we will be able to do so.
43 CFR 1864.2(a).
National Park Service, Interior.
Notice of establishment.
As authorized by the National Defense Authorization Act for Fiscal Year 2015, the National Park Service announces that the Secretary of the Interior (Secretary) has established, in the State of New York, Harriet Tubman National Historical Park as a unit of the National Park System.
Rose Fennell, Deputy Regional Director, National Park Service, Northeast Regional Office at (617) 223-5137.
Section 3036 of the National Defense Authorization Act for Fiscal Year 2015, Public Law 113-291 includes a specific provision relating to establishment of this unit of the National Park System. To establish the national historical park, the Secretary must determine that a sufficient quantity of land, or interests in land, has been acquired to constitute a manageable park unit and must publish notice of the establishment of the historical park in the
The National Park Service acquired by Bargain and Sale Deed the fee simple interests in the 0.5 acres at 47-49 Parker Street in Auburn, New York, on December 30, 2016. This property contains the historic Thompson Memorial AME Zion Church and the adjacent, two-story rectory.
On January 10, 2017, the Secretary of the Interior signed a Decision Memorandum determining that a sufficient quantity of land, or interests in land, had been acquired to constitute a manageable park unit. With the signing of this Decision Memorandum by the Secretary, the site to be known as the “Harriet Tubman National Historical Park” was established as a unit of the National Park System, effective January 10, 2017, and is subject to all laws, regulations, and policies pertaining to such units.
National Park Service, Interior.
Meeting notice.
The National Park Service is hereby giving notice of the 2017 meeting schedule for the Gettysburg National Military Park Advisory Commission.
The Gettysburg National Military Park Advisory Commission will host two meetings, one on Thursday, April 13, 2017, and one on Thursday, September 14, 2017. Both scheduled meetings will begin at 7:00 p.m. and end at 9:00 p.m. (Eastern). Efforts have been made locally to ensure that the interested public is aware of the meeting dates.
Both meetings will be held at the Gettysburg National Military Park Museum and Visitor Center in the Ford Education Center, 1195 Baltimore Pike, Suite 100, Gettysburg, Pennsylvania 17325.
Ed Clark, Superintendent and Designated Federal Official, Gettysburg National
The Gettysburg National Military Park Advisory Commission was established by Public Law 101-377. The scheduled meetings will be open to the public. Each scheduled meeting will include presentations on the Gettysburg National Military Park Operational Update, and subcommittee reports. The April 13, 2017, meeting will also include the nomination of new officers. Any member of the public may file with the Commission a written statement with issues or concerns. The statement should be addressed to Gettysburg National Military Park Advisory Commission, 1195 Baltimore Pike, Gettysburg, Pennsylvania 17325 or email
Before including your address, telephone number, email address, or other personal identifying information in your comments—you should be aware that your entire comment—including your personal identifying information may be made publicly available at any time. While you may ask us in your comment to withhold your personal identifying information from public view, we cannot guarantee that we will be able to do so.
National Park Service, Interior.
Meeting notice.
The National Park Service (NPS) is hereby giving notice that the Lake Clark National Park Subsistence Resource Commission (SRC) will hold a public meeting to develop and continue work on NPS subsistence program recommendations, and other related regulatory proposals and resource management issues.
The Lake Clark National Park SRC will meet from 1:00 p.m. to 4:00 p.m. or until business is completed on Wednesday, February 15, 2017, at the Pedro Bay Community Building, 2516 Mountain Circle, Pedro Bay, AK 99647. There will be a community luncheon prior to the meeting at 12:00 p.m. Teleconference participants must call the National Park Service office at (907) 644-3648, prior to the meeting to receive teleconference passcode information. For more detailed information regarding this meeting, or if you are interested in applying for SRC membership, contact Megan Richotte, Designated Federal Official and Acting Superintendent, at (907) 644-3639, or via email at
The SRC will meet in the Pedro Bay Community Building, 2516 Mountain Circle, Pedro Bay, AK 99647.
The NPS is holding the meeting pursuant to the Federal Advisory Committee Act (5 U.S.C. Appendix 1-16). The NPS SRC program is authorized until Section 808 of the Alaska National Interest Lands Conservation Act, (16 U.S.C. 3118), title VII. SRC meetings are open to the public and will have time allocated for public testimony. The public is welcome to present written or oral comments to the SRC. SRC meetings will be recorded and meeting minutes will be available upon request from the Superintendent for public inspection approximately six weeks after the meeting. Before including your address, telephone number, email address, or other personal identifying information in your comment, you should be aware that your entire comment—including your personal identifying information—may be made publicly available at any time. While you may ask us in your comment to withhold your personal identifying information from public review, we cannot guarantee that we will be able to do so.
The SRC meeting location and date may change based on inclement weather or exceptional circumstances. If the meeting date and location are changed, the Superintendent will issue a press release and use local newspapers and radio stations to announce the rescheduled meeting.
National Park Service, Interior.
Meeting notice.
The National Park Service is hereby giving notice of the 306th meeting of the Cape Cod National Seashore Advisory Commission.
The public meeting of the Cape Cod National Seashore Advisory Commission will be held on Monday, March 13, 2017, at 1:00 p.m. (EASTERN).
The Commission members will meet in the conference room at park headquarters, 99 Marconi Site Road, Wellfleet, Massachusetts 02667.
Further information concerning the meeting may be obtained from George E. Price, Jr., Superintendent, Cape Cod National Seashore, 99 Marconi Site, Wellfleet, Massachusetts 02667, at (508) 771-2144 or via email at
The 306th meeting of the Cape Cod National Seashore Advisory Commission will take place on Monday, March 13, 2017, at 1:00 p.m., in the conference room at Headquarters, 99 Marconi Station Road, in Wellfleet, Massachusetts to discuss the following:
The Commission was reestablished pursuant to Public Law 87-126, as amended by Public Law 105-280. The purpose of the Commission is to consult with the Secretary of the Interior, or her designee, with respect to matters relating to the development of Cape Cod National Seashore, and with respect to carrying out the provisions of sections 4 and 5 of the Act establishing the Seashore.
The meeting is open to the public. It is expected that 15 persons will be able to attend the meeting in addition to Commission members. Interested persons may make oral/written presentations to the Commission during the business meeting or file written statements. Such requests should be made to the park superintendent prior to the meeting. Before including your address, telephone number, email address, or other personal identifying information in your comment, you should be aware that your entire comment—including your personal identifying information—may be made publicly available at any time. While you may ask us in your comment to withhold your personal identifying information from public review, we cannot guarantee that we will be able to do so.
National Park Service, Interior.
Meeting notice.
The National Park Service (NPS) is hereby giving notice of the 2017 meeting schedule of the Cedar Creek and Belle Grove National Historical Park Advisory Commission.
March 16, 2017.
Strasburg Town Hall, 174 East King Street, Strasburg, VA 22657.
June 15, 2017.
Warren County Government Center, 220 North Commerce Avenue, Front Royal, VA 22630.
September 21, 2017.
Middletown Town Hall Council Chambers, 7875 Church Street, Middletown, VA 22645.
December 21, 2017.
Strasburg Town Hall Council Chambers, 174 East King Street, Strasburg, VA 22657.
Further information concerning the meetings may be obtained from Karen Beck-Herzog, Site Manager, Cedar Creek and Belle Grove National Historical Park, P.O. Box 700, Middletown, Virginia 22645, telephone (540) 868-9176, or visit the park Web site:
The NPS is holding the meetings pursuant to the Federal Advisory Committee Act (5 U.S.C. Appendix 1-16). The Commission was designated by Congress to provide advice to the Secretary of the Interior on the preparation and implementation of the park's general management plan and to advise on land protection (16 U.S.C. 410iii-7). Individuals who are interested in the park, the implementation of the plan, or the business of the Commission are encouraged to attend the meetings. Interested members of the public may present, either orally or through written comments, information for the Commission to consider during the public meeting. Attendees and those wishing to provide comment are strongly encouraged to preregister through the contact information provided. Scheduling of public comments during the Commission meeting will be determined by the chairperson of the Commission.
Before including your address, telephone number, email address, or other personal identifying information in your comment, you should be aware that your entire comment—including your personal identifying information—may be made publicly available at any time. While you may ask us in your comment to withhold your personal identifying information from public view, we cannot guarantee that we will be able to do so.
Agenda: All meetings are open to the public and begin at 9:00 a.m. (EASTERN). Topics to be discussed include: Visitor services and interpretation—including directional and interpretive signage and visitor facilities, land protection planning, historic preservation, and natural resource protection.
Commission meetings will consist of the following:
Bureau of Ocean Energy Management, Interior.
Notice of availability.
The Bureau of Ocean Energy Management (BOEM) announces the availability of the 2017-2022 Outer Continental Shelf (OCS) Oil and Gas Leasing Program Final Programmatic EIS (Final Programmatic EIS) Record of
Jill Lewandowski, Ph.D., Bureau of Ocean Energy Management, 45600 Woodland Road VAM-OEP, Sterling, VA 20166. Dr. Lewandowski may also be reached by telephone at (703) 787-1703.
In accordance with 40 CFR 1505.2, the Bureau of Ocean Energy Management (BOEM) announces the availability of the 2017-2022 Outer Continental Shelf (OCS) Oil and Gas Leasing Program Final Programmatic EIS (Final Programmatic EIS) Record of Decision (ROD). The ROD is available at
The Final Programmatic EIS was published on November 25, 2016 (81 FR 85221). BOEM considered comments submitted on the Final Programmatic EIS before a final decision was made.
This Notice of Availability of a ROD is issued in accordance with the National Environmental Policy Act of 1969, as amended (Pub. L. 91-190, 42 U.S.C. 4231
U.S. International Trade Commission.
Notice.
Notice is hereby given that the U.S. International Trade Commission has determined to review in-part the presiding Administrative Law Judge's (“ALJ”) final initial determination on remand (“RID”) for the limited purpose of modifying pages 20-21 and 24 of the RID. The Commission has also determined to vacate the issued remedial orders, which are currently suspended.
Panyin A. Hughes, Office of the General Counsel, U.S. International Trade Commission, 500 E Street SW., Washington, DC 20436, telephone (202) 205-3042. Copies of non-confidential documents filed in connection with this investigation are or will be available for inspection during official business hours (8:45 a.m. to 5:15 p.m.) in the Office of the Secretary, U.S. International Trade Commission, 500 E Street SW., Washington, DC 20436, telephone (202) 205-2000. General information concerning the Commission may also be obtained by accessing its Internet server (
The Commission instituted this investigation on August 23, 2013, based on a complaint filed by ResMed Corporation of San Diego, California; ResMed Incorporated of San Diego, California; and ResMed Limited of New South Wales, Australia (collectively, “ResMed”). 78
On January 9, 2014, the ALJ issued an initial determination (“ID”) granting a motion by ResMed to amend the complaint and notice of investigation to substitute U.S. Patent No. RE 44,453 (“the '453 patent”) for the '398 patent and to terminate the investigation as to the '398 patent.
On February 24, 2014, the ALJ issued an ID granting a motion by ResMed to withdraw its allegations with respect to the '116 patent.
On August 21, 2014, the ALJ issued a final ID, finding a violation of section 337 by BMC with respect to certain asserted claims of the '392, '267, '060, '883, '527, and '453 patents. The ALJ found no violation of section 337 with respect to the asserted claims of the '487 patent.
On September 3, 2014, the parties filed petitions for review of the ID. On September 11, 2014, the parties filed responses to the petitions for review.
On October 16, 2014, the Commission determined to review the final ID in part. 79
On February 18, 2015, ResMed filed a notice of appeal in the U.S. Court of Appeals for the Federal Circuit, seeking review of the Commission's determination as to the '453 patent (Appeal No. 2015-1360). On April 14, 2015, BMC filed a notice of appeal in the Federal Circuit, seeking review of the Commission's domestic industry determination as well as the Commission's finding that prior art does not render the asserted claims of the '267 patent invalid for obviousness (Appeal No. 2015-1576). The Court consolidated the two appeals on April 23, 2015.
On March 16, 2016, the parties jointly moved to dismiss ResMed's appeal as to the '453 patent. On March 17, 2016, the Commission moved to remand BMC's appeal in light of intervening domestic industry precedent in
On May 12, 2016, the Commission issued a notice suspending the remedial orders in place during the pendency of the remand proceedings. 81
On November 10, 2016, the ALJ issued the RID finding that ResMed failed to establish the existence of a domestic industry that practices the mask patents. RID at 1. No petitions for review were received.
Having examined the record of this investigation, the Commission has determined to review in-part the RID for the limited purpose of modifying pages 20-21 and 24 of the RID. The Commission does not adopt the RID's statements that “the amount a complainant spends to purchase components manufactured in the United States is immaterial to the economic prong analysis” (RID at 20-21) or that evidence of payments to domestic suppliers is “
The authority for the Commission's determination is contained in section 337 of the Tariff Act of 1930, as amended (19 U.S.C. 1337), and in Part 210 of the Commission's Rules of Practice and Procedure (19 CFR part 210).
By order of the Commission.
Notice of application.
Registered bulk manufacturers of the affected basic classes, and applicants therefore, may file written comments on or objections to the issuance of the proposed registration in accordance with 21 CFR 1301.33(a) on or before March 20, 2017.
Written comments should be sent to: Drug Enforcement Administration, Attention: DEA Federal Register Representative/DRW, 8701 Morrissette Drive, Springfield, Virginia 22152.
The Attorney General has delegated her authority under the Controlled Substances Act to the Administrator of the Drug Enforcement Administration (DEA), 28 CFR 0.100(b). Authority to exercise all necessary functions with respect to the promulgation and implementation of 21 CFR part 1301, incident to the registration of manufacturers, distributors, dispensers, importers, and exporters of controlled substances (other than final orders in connection with suspension, denial, or revocation of registration) has been redelegated to the Assistant Administrator of the DEA Diversion Control Division (“Assistant Administrator”) pursuant to section 7 of 28 CFR part 0, appendix to subpart R.
In accordance with 21 CFR 1301.33(a), this is notice that on July 12, 2016, Noramco, Inc., 500 Swedes Landing Road, Wilmington, Delaware 19801-4417 applied to be registered as a bulk manufacturer of the following basic classes of controlled substances:
The company plans to manufacture the above-listed controlled substances in bulk for distribution to its customers. In reference to drug code 7360, the company plans to manufacture a synthetic version of cannabidiol in bulk for sale to its customers, who are final dosage form manufacturers. No other activity for this drug code is authorized for this registration.
In accordance with Departmental Policy, 28 CFR 50.7, notice is hereby given that a proposed Consent Decree in
This proposed Consent Decree concerns a complaint filed by the United States and the State of West Virginia against Greer Industries, Inc., Deckers Creek Limestone Company, and Pikewood, Inc., pursuant to 33 U.S.C. Sections 1319(b) and (d) of the Clean Water Act and W. Va. Code Section 22-11-22, to obtain injunctive relief from and impose civil penalties against the Defendants for violating the Clean Water Act by discharging pollutants without a permit into waters of the United States and waters of the State of West Virginia. The proposed Consent Decree resolves these allegations by requiring the Defendants to restore the impacted areas and/or perform mitigation and to pay a civil penalty.
The Department of Justice will accept written comments relating to this proposed Consent Decree for thirty (30) days from the date of publication of this Notice. Please address comments to Austin Saylor, Trial Attorney, United States Department of Justice, Environment and Natural Resources Division, Environmental Defense Section, Post Office Box 7611, Washington, DC 20044, and refer to
The proposed Consent Decree may be examined at the Clerk's Office, United States District Court for the Northern District of West Virginia, 1125 Chapline Street, Suite 1000, Wheeling, West Virginia 26003. In addition, the proposed Consent Decree may be examined electronically at
In accordance with Section 223 of the Trade Act of 1974, as amended (“Act”), 19 U.S.C. 2273, the Department of Labor issued a Certification of Eligibility to Apply for Worker Adjustment Assistance on May 23, 2016, applicable to workers of Kraft Heinz Foods Company, a subsidiary of The Kraft Heinz Company, including on-site leased workers from Kelly Services, Allentown, Pennsylvania (TA-W-91,755). The Department's notice of determination was published in the
At the request of the Pennsylvania Department's Workforce Partnership & Operations, the Department reviewed the certification for workers of the subject firm. The workers firm is engaged in activities related to the production of Tassimo Coffee Pods, K-cups, and condiments.
The company reports that workers leased from U.S. Securities, West Side Hammer Electric, and Goodwill Keystone Area were employed on-site at the Allentown, Pennsylvania location of Kraft Heinz Company. The Department has determined that these workers were sufficiently under the operational control of the subject firm to be considered leased workers.
The intent of the Department's certification is to include all workers of the subject firm who were adversely affected by a shift in production of Tassimo Coffee Pods, K-cups, and condiments to a foreign country.
Based on these findings, the Department is amending this certification to include workers leased from U.S. Securities, West Side Hammer Electric, and Goodwill Keystone Area working on-site at the Allentown, Pennsylvania location of the subject firm.
The amended notice applicable to TA-W-91,755 is hereby issued as follows:
All workers from Kraft Heinz Foods Company, a subsidiary of The Kraft Heinz Company, including on-site leased workers from Kelly Services, U.S. Securities, West Side Hammer Electric, and Goodwill Keystone Area, Allentown, Pennsylvania who became totally or partially separated from employment on or after April 28, 2015 through May 23, 2018 and all workers in the group threatened with total or partial separation from employment on date of certification through two years from the date of certification, are eligible to apply for adjustment assistance under Chapter 2 of Title II of the Trade Act of 1974, as amended.
By application dated October 3, 2016, State Workforce Official requested administrative reconsideration of the negative determination regarding workers' eligibility to apply for worker adjustment assistance applicable to workers and former workers of Northern Industrial Erectors, Inc., Grand Rapids, Minnesota. The determination was issued on September 9, 2016.
Pursuant to 29 CFR 90.18(c) reconsideration may be granted under the following circumstances:
(1) If it appears on the basis of facts not previously considered that the determination complained of was erroneous;
(2) If it appears that the determination complained of was based on a mistake in the determination of facts not previously considered; or
(3) If in the opinion of the Certifying Officer, a misinterpretation of facts or of the law justified reconsideration of the decision.
The initial investigation resulted in a negative determination based on the findings that there was no increase in imports by the workers' firm or its customers, nor was there a foreign shift or acquisition by the workers' or its customers. In addition, neither the workers' firm nor its customers reported imports of steel erection services like or directly competitive with steel erection services provided by the workers' firm. Furthermore, the workers' firm was not
The request for reconsideration asserts that the workers' firm should be considered a Downstream Producer.
The Department of Labor has carefully reviewed the request for reconsideration and the existing record, and has determined that the Department will conduct further investigation to determine if the workers meet the eligibility requirements of the Trade Act of 1974.
After careful review of the application, I conclude that the claim is of sufficient weight to justify reconsideration of the U.S. Department of Labor's prior decision. The application is, therefore, granted.
On May 16, 2016, the Department of Labor issued an Affirmative Determination Regarding Application for Reconsideration for the workers and former workers of REC Silicon LLC, a wholly owned subsidiary of Renewable Energy Corporation ASA, Moses Lake, Washington (TA-W-91,121), and REC Silicon ASA, a wholly owned subsidiary of REC Solar Grade Silicon LLC, Silver Bow, Montana (TA-W-91,121A) (herein referred to as “REC Silicon”). The firm is engaged in activities related to the production of Silane Gas and Polysilicon. The worker group was previously certified eligible to apply for Trade Adjustment Assistance under petition number TA-W-82,458 and TA-W-82,458A which expired on March 22, 2015. The subject worker group includes on-site leased workers from Express Employment Professionals (TA-W-91,121), Nemo IT Solutions (TA-W-91,121B), and Spherion Staffing, LLC (TA-W-91,121C). Nemo IT Solutions and Spherion Staffing, LLC were not included in the certification for TA-W-82,458. The subject worker group also includes workers whose wages were reported under REC Solar Grade Silicon (TA-W-91,121) and REC Advanced Silicon Materials (TA-W-91,121A).
To support the request for reconsideration, the petitioner supplied additional information regarding the firms' previous certification to supplement that which was gathered during the initial investigation.
Based on the new information supplied by the firm and provided by the petitioner during the reconsideration investigation, the Department of Labor determines that a shift in production of silane gas and polysilicon has contributed importantly to the worker separations at the subject firm.
After careful review of the additional facts obtained on reconsideration, I determine that workers of REC Silicon LLC, a wholly owned subsidiary of Renewable Energy Corporation ASA, including workers whose wages were reported under REC Solar Grade Silicon LLC, including on-site leased workers from Express Employment Professionals, Moses Lake, Washington (TA-W-91,121), REC Silicon ASA, a wholly owned subsidiary of REC Solar Grade Silicon LLC, including workers whose wages were reported under REC Advanced Silicon Materials, Silver Bow, Montana (TA-W-91,121A), NEMO IT Solutions, working on-site at REC Silicon LLC, a wholly owned subsidiary of Renewable Energy Corporation ASA, Moses Lake, Washington (TA-W-91,121B), and Spherion Staffing LLC, working on-site at REC Silicon ASA, a wholly owned subsidiary of REC Solar Grade Silicon LLC, Silver Bow, Montana (TA-W-91,121C) who were engaged in employment related to production of saline gas and polysilicon, meet the worker group certification criteria under Section 222(a) of the Act, 19 U.S.C. 2272(a). In accordance with Section 223 of the Act, 19 U.S.C. 2273, I make the following certification:
All workers of REC Silicon LLC, a wholly owned subsidiary of Renewable Energy Corporation ASA, including workers whose wages were reported under REC Solar Grade Silicon LLC, including on-site leased workers from Express Employment Professionals, Moses Lake, Washington (TA-W-91,121), REC Silicon ASA, a wholly owned subsidiary of REC Solar Grade Silicon LLC, including workers whose wages were reported under REC Advanced Silicon Materials, Silver Bow, Montana (TA-W-91,121A), who became totally or partially separated from employment on or after March 23, 2015, through two years from the date of this certification, and all workers in the group threatened with total or partial separation from employment on date of certification through two years from the date of certification, are eligible to apply for adjustment assistance under Chapter 2 of Title II of the Trade Act of 1974, as amended;
All workers of NEMO IT Solutions, working on-site at REC Silicon LLC, a wholly owned subsidiary of Renewable Energy Corporation ASA, Moses Lake, Washington (TA-W-91,121B) and Spherion Staffing LLC, working on-site at REC Silicon ASA, a wholly owned subsidiary of REC Solar Grade Silicon LLC, Silver Bow, Montana (TA-W-91,121C) who became totally or partially separated from employment on or after November 4, 2014, through two years from the date of this certification, and all workers in the group threatened with total or partial separation from employment on date of certification through two years from the date of certification, are eligible to apply for adjustment assistance under Chapter 2 of Title II of the Trade Act of 1974, as amended.
In accordance with Section 223 of the Trade Act of 1974, as amended (“Act”), 19 U.S.C. 2273, the Department of Labor issued a Certification of Eligibility to Apply for Worker Adjustment Assistance on January 19, 2016, applicable to workers of Huntington Alloys Corporation, Special Metals Division, a subsidiary of Special Metals Corporation, including on-site leased workers from Kelly Services, Huntington, West Virginia (TA-W-86,089). The Department's notice of determination was published in the
At the request of a state workforce office, the Department reviewed the certification for workers of the subject firm. The workers are engaged in activities related to the production of nickel based alloys in a variety of forms including but not limited to ingot, billet, bar, wire rod, tube, plate, and sheet products.
The company reports that workers from Huntington Alloys Corporation, Special Metals Division, a subsidiary of Special Metals Corporation, Burnaugh, Kentucky are engaged in activities related to the production of nickel based alloys in a variety of forms including but not limited to ingot, billet, bar, wire rod, tube, plate, and sheet products.
The intent of the Department's certification is to include all workers of the subject firm who were adversely affected by increased imports of nickel based alloys in a variety of forms including but not limited to ingot, billet, bar, wire rod, tube, plate, and sheet products.
Based on these findings, the Department is amending this certification to include workers from Huntington Alloys Corporation, Special Metals Division, a subsidiary of Special Metals Corporation, Burnaugh, Kentucky.
The amended notice applicable to TA-W-86,089 and TA-W-86,089A is hereby issued as follows:
All workers of Huntington Alloys Corporation, Special Metals Division, a subsidiary of Special Metals Corporation, including on-site leased workers from Kelly Services, Huntington, West Virginia (TA-W-86,089) and Huntington Alloys Corporation, Special Metals Division, a subsidiary of Special Metals Corporation, Burnaugh, Kentucky (TA-W-86,089A) who became totally or partially separated from employment on or after June 10, 2014, through January 19, 2018, and all workers in the group threatened with total or partial separation from employment on date of certification through two years from the date of certification, are eligible to apply for adjustment assistance under Chapter 2 of Title II of the Trade Act of 1974, as amended.
In accordance with Section 223 of the Trade Act of 1974, as amended (19 U.S.C. 2273) the Department of Labor herein presents summaries of determinations regarding eligibility to apply for trade adjustment assistance for workers by (TA-W) number issued during the period of
In order for an affirmative determination to be made for workers of a primary firm and a certification issued regarding eligibility to apply for worker adjustment assistance, each of the group eligibility requirements of Section 222(a) of the Act must be met.
I. Under Section 222(a)(2)(A), the following must be satisfied:
(1) A significant number or proportion of the workers in such workers' firm have become totally or partially separated, or are threatened to become totally or partially separated;
(2) the sales or production, or both, of such firm have decreased absolutely; and
(3) One of the following must be satisfied:
(A) Imports of articles or services like or directly competitive with articles produced or services supplied by such firm have increased;
(B) imports of articles like or directly competitive with articles into which one or more component parts produced by such firm are directly incorporated, have increased;
(C) imports of articles directly incorporating one or more component parts produced outside the United States that are like or directly competitive with imports of articles incorporating one or more component parts produced by such firm have increased;
(D) imports of articles like or directly competitive with articles which are produced directly using services supplied by such firm, have increased; and
(4) the increase in imports contributed importantly to such workers' separation or threat of separation and to the decline in the sales or production of such firm; or
II. Section 222(a)(2)(B) all of the following must be satisfied:
(1) A significant number or proportion of the workers in such workers' firm have become totally or partially separated, or are threatened to become totally or partially separated;
(2) One of the following must be satisfied:
(A) There has been a shift by the workers' firm to a foreign country in the production of articles or supply of services like or directly competitive with those produced/supplied by the workers' firm;
(B) there has been an acquisition from a foreign country by the workers' firm of articles/services that are like or directly competitive with those produced/supplied by the workers' firm; and
(3) the shift/acquisition contributed importantly to the workers' separation or threat of separation.
In order for an affirmative determination to be made for adversely affected secondary workers of a firm and a certification issued regarding eligibility to apply for worker adjustment assistance, each of the group eligibility requirements of Section 222(b) of the Act must be met.
(1) A significant number or proportion of the workers in the workers' firm have become totally or partially separated, or are threatened to become totally or partially separated;
(2) the workers' firm is a Supplier or Downstream Producer to a firm that employed a group of workers who received a certification of eligibility under Section 222(a) of the Act, and such supply or production is related to the article or service that was the basis for such certification; and
(3) either—
(A) the workers' firm is a supplier and the component parts it supplied to the firm described in paragraph (2) accounted for at least 20 percent of the production or sales of the workers' firm; or
(B) a loss of business by the workers' firm with the firm described in paragraph (2) contributed importantly to the workers' separation or threat of separation.
In order for an affirmative determination to be made for adversely affected workers in firms identified by the International Trade Commission and a certification issued regarding eligibility to apply for worker adjustment assistance, each of the group eligibility requirements of Section 222(e) of the Act must be met.
(1) the workers' firm is publicly identified by name by the International Trade Commission as a member of a domestic industry in an investigation resulting in—
(A) an affirmative determination of serious injury or threat thereof under section 202(b)(1);
(B) an affirmative determination of market disruption or threat thereof under section 421(b)(1); or
(C) an affirmative final determination of material injury or threat thereof under section 705(b)(1)(A) or 735(b)(1)(A) of the Tariff Act of 1930 (19 U.S.C. 1671d(b)(1)(A) and 1673d(b)(1)(A));
(2) the petition is filed during the 1-year period beginning on the date on which—
(A) a summary of the report submitted to the President by the International Trade Commission under section 202(f)(1) with respect to the affirmative determination described in paragraph (1)(A) is published in the
(B) notice of an affirmative determination described in subparagraph (1) is published in the
(3) the workers have become totally or partially separated from the workers' firm within—
(A) the 1-year period described in paragraph (2); or
(B) not withstanding section 223(b)(1), the 1-year period preceding the 1-year period described in paragraph (2).
The following certifications have been issued. The date following the company name and location of each determination references the impact date for all workers of such determination.
The following certifications have been issued. The requirements of Section 222(a)(2)(A) (increased imports) of the Trade Act have been met.
The following certifications have been issued. The requirements of Section 222(a)(2)(B) (shift in production or services) of the Trade Act have been met.
The following certifications have been issued. The requirements of Section 222(b) (downstream producer for a firm whose workers are certified eligible to apply for TAA) of the Trade Act have been met.
In the following cases, the investigation revealed that the eligibility criteria for worker adjustment assistance have not been met for the reasons specified.
The investigation revealed that the criterion under paragraph (a)(1), or (b)(1) (employment decline or threat of separation) of section 222 has not been met.
The investigation revealed that the criteria under paragraphs (a)(2)(A)(i) (decline in sales or production, or both) and (a)(2)(B) (shift in production or services to a foreign country) of section 222 have not been met.
The investigation revealed that the criteria under paragraphs (a)(2)(A) (increased imports) and (a)(2)(B) (shift in production or services to a foreign country) of section 222 have not been met.
After notice of the petitions was published in the
The following determinations terminating investigations were issued because the petitioner has requested that the petition be withdrawn.
I hereby certify that the aforementioned determinations were issued during the period of December 19, 2016 through December 30, 2016. These determinations are available on the Department's Web site
Notice.
The Department of Labor (DOL), Employment and Training Administration (ETA) and the Department of Education (ED) (jointly referred to as “the Departments”) are soliciting comments concerning a proposed extension for the authority to conduct the information collection request (ICR) titled, “Workforce Innovation and Opportunity Act (WIOA) Common Performance Reporting.” This comment request is part of continuing Departmental efforts to reduce paperwork and respondent burden in accordance with the Paperwork Reduction Act of 1995 (PRA), 44 U.S.C. 3501
Consideration will be given to all written comments received by March 20, 2017.
Comments submitted in response to this notice should be submitted electronically through the Federal eRulemaking Portal at
Comments submitted in response to this comment request will become a matter of public record and will be summarized and included in the request for Office of Management and Budget (OMB) approval of the final ICR. In addition, comments regardless of the delivery method, will be posted without change on the
Contact Karen Staha by telephone at 202-693-2917 (this is not a toll-free number) or by email at
44 U.S.C. 3506(c)(2)(A).
The DOL, as part of continuing efforts to reduce paperwork and respondent burden, conducts a pre-clearance consultation program to provide the general public and Federal agencies an opportunity to comment on proposed and/or continuing collections of information before submitting them to the OMB for final approval. This program helps to ensure requested data can be provided in the desired format, reporting burden (time and financial resources) is minimized, collection instruments are clearly understood, and the impact of collection requirements can be properly assessed.
The data collections in this ICR fulfill requirements in WIOA sec.116(d)(1) for the development of report templates for the State Performance Report for WIOA core programs, the Local Area Performance Report, and the Eligible Training Provider (ETP) Report. The Departments propose to amend the information collection by adding new information collection requirements for WIOA Statewide performance reporting. In particular, the Departments propose to add: (1) Data elements related to training program information to the ETP Performance Report, and (2) a new information collection requirement,
Section 116 of WIOA (29 U.S.C. 3141) requires States and Local Areas that operate the six core programs of the public workforce development system to comply with common performance accountability requirements for those programs, which are: The Adult, Dislocated Worker, and Youth programs (authorized under WIOA title I, administered by DOL); the Employment Service program authorized under the Wagner-Peyser Act, as amended by WIOA title III (administered by DOL); the Adult Education and Family Literacy Act (AEFLA) program (authorized under WIOA title II, administered by ED); and the Vocational Rehabilitation (VR) program authorized under title I of the Rehabilitation Act of 1973, as amended by WIOA title IV (administered by ED). As such, States and Local Areas that operate core programs must submit common performance data to demonstrate that specified performance levels are achieved. States and Local Areas report the common performance data through the “Workforce Innovation and Opportunity Act (WIOA) Common Performance Reporting” ICR (OMB Control No. 1205-0526).
In addition, and in accordance with WIOA sec. 122(b)(2), training providers
Section 116(d)(1) of WIOA mandates that the Secretaries of Labor and Education develop a template for performance reports to be used by States, Local Boards, and ETPs for reporting on outcomes achieved by participants in the six core programs. Corresponding regulations for these data collection requirements, including which primary performance indicators apply for each core program, have been issued jointly by the Departments. See 81 FR 55792 (Aug. 19, 2016). The WIOA regulations became effective on October 18, 2016. These joint performance regulations can be found at: (1) 20 CFR part 677 (which covers the Adult and Dislocated Worker programs (20 CFR part 680), the Youth program (20 CFR part 681), and the Wagner-Peyser Act Employment Service program (20 CFR part 652)); (2) 34 CFR part 463, subpart I (which covers the AEFLA program); and (3) 34 CFR part 361, subpart E (which covers the VR program).
The data collection instruments covered in this ICR are necessary to meet the requirements of sec. 116 of WIOA. These information collection instruments were developed jointly by the Departments, and include: (1) The Joint Participant Individual Record Layout (PIRL), which provides a standardized set of data elements, definitions, and reporting instructions for use by States and local entities administering WIOA core programs; (2) the Statewide Performance Report Template, to be used for the reporting of data by State entities that administer WIOA core programs; (3) the Local Area Performance Report Template, to be used for the reporting of data by local entities that administer WIOA core programs; (4) the ETP Performance Report specifications and definitions, to be used for the reporting of data by eligible providers of training services under WIOA title I Adult and Dislocated Worker programs; and (5) the Annual Statewide Performance Report Narrative, a new information collection requirement to be used for providing information on the status and progress of workforce development program performance.
This information collection is subject to the PRA. A Federal agency generally cannot conduct or sponsor a collection of information, and the public is generally not required to respond to an information collection, unless it is approved by the OMB under the PRA and displays a currently valid OMB Control Number. In addition, notwithstanding any other provisions of law, no person shall generally be subject to penalty for failing to comply with a collection of information that does not display a valid Control Number.
Interested parties are encouraged to provide comments to the contact shown in the
The DOL is particularly interested in comments that:
• Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
• Evaluate the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
• Enhance the quality, utility, and clarity of the information to be collected; and
• Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology,
Petitions have been filed with the Secretary of Labor under Section 221 (a) of the Trade Act of 1974 (“the Act”) and are identified in the Appendix to this notice. Upon receipt of these petitions, the Director of the Office of Trade Adjustment Assistance, Employment and Training Administration, has instituted investigations pursuant to Section 221 (a) of the Act.
The purpose of each of the investigations is to determine whether the workers are eligible to apply for adjustment assistance under Title II, Chapter 2, of the Act. The investigations will further relate, as appropriate, to the determination of the date on which total or partial separations began or threatened to begin and the subdivision of the firm involved.
The petitioners or any other persons showing a substantial interest in the subject matter of the investigations may request a public hearing, provided such request is filed in writing with the Director, Office of Trade Adjustment Assistance, at the address shown below, no later than January 30, 2017.
Interested persons are invited to submit written comments regarding the subject matter of the investigations to the Director, Office of Trade Adjustment Assistance, at the address shown below, not later than January 30, 2017.
The petitions filed in this case are available for inspection at the Office of the Director, Office of Trade Adjustment Assistance, Employment and Training Administration, U.S. Department of Labor, Room N-5428, 200 Constitution Avenue NW., Washington, DC 20210.
1.
2.
A. This Order is issued pursuant to Executive Order 13755 (replacing Executive Order (E.O.) 13245, December 18, 2001); the Federal Vacancies Reform Act of 1998 (the FVRA) (codified generally at 5 U.S.C. 3345, et seq.); 29 U.S.C. 551 et seq.; Reorganization Plan No. 6 of 1950; Reorganization Plan No. 1 of 1958; Reorganization Plan No. 1 of 1973; Federal Civil Defense Act of 1950 as amended; Robert T. Stafford Disaster Relief and Emergency Assistance Act, 42 U.S.C. 5121 et seq., as amended; 5 USC 301; 31 U.S.C. 1531 and 1533; Executive Order 12656, as amended; and Executive Order 12148, as amended.
National Security Presidential Directive 51/Homeland Security Presidential Directive 20 (NSPD-51/HSPD-20)
B. Secretary's Order 4-2008 (August 4, 2008) is hereby superseded and canceled, and all agency delegations in conflict with this Order and/or its Attachment are hereby superseded.
3.
The Department's plan for continuity of operations in the event of a need for relocation involves movement of Emergency Response Group to a Continuity Site. The Department's plan for devolution was established by Secretarial Memorandum dated December 20, 2006, wherein the Secretary selected Dallas, Texas as the National Office, Department of Labor devolution site (the “Devolution Site”).
4.
Sequence for identifying the Acting Secretary of Labor, who shall have all of
(1) Deputy Secretary of Labor;
(2) Solicitor of Labor;
(3) Assistant Secretary for Administration and Management [Not subject to Senate Confirmation, Pub. L. 112-166];
(4) Assistant Secretary for Policy;
(5) Assistant Secretary for Congressional and Intergovernmental Affairs;
(6) Assistant Secretary for Employment and Training;
(7) Assistant Secretary for Employee Benefits Security;
(8) Assistant Secretary for Occupational Safety and Health;
(9) Assistant Secretary for Mine Safety and Health;
(10) Assistant Secretary for Public Affairs [Not subject to Senate confirmation, Pub. L. 112-166];
(11) Chief Financial Officer
(12) Administrator, Wage and Hour Division
(13) Assistant Secretary for Veterans' Employment and Training;
(14) Assistant Secretary for Disability Employment Policy;
(15) First assistants, as defined in the FVRA, to the officials in the order listed in (2), and (4)-(9);
(16) Regional Solicitor—Dallas; and
(17) Regional Administrator for the Office of the Assistant Secretary for Administration and Management—Region VI/Dallas—(who, upon becoming Delegated Secretarial Designee (DSD) by order of operation of this Succession Order, the Secretary hereby authorizes and pre-approves for an immediate, noncompetitive appointment to the Senior Executive Service (SES) under a limited-term appointment using a DOL SES allocation).
In the event and for such time(s) that none of the incumbents in the succession sequence set forth in Paragraph 4.A., above, are available to serve as Acting Secretary, the Delegated Secretarial Designee (DSD) shall fulfill, on an interim basis, the operational management of the Department except the Secretary's “functions and duties.” The “functions and duties” of the Secretary are those non-delegable responsibilities (a) established by law (statute or regulation); and (b) required to be performed by, and only by, the Secretary. Except as determined otherwise by the President, whoever from time to time is highest in the following sequence and is available to serve shall be the Delegated Secretarial Designee:
(1) The following:
(a) Director, Office of Federal Contract Compliance Programs;
(b) Director of the Women's Bureau; and
(c) Director, Office of Labor Management Standards;
(2) Specified DOL officials as follows:
(a) Regional Administrator for ETA located in Dallas;
(b) OSHA Regional Administrator—Dallas.
(1) There are offices and agencies within the Department of Labor headed by officers whose appointment to office is required to be made by the President, by and with the advice and consent of the Senate (PAS). In the event of a vacancy in any of these PAS positions, the FVRA provides that, except in certain narrow circumstances, the “first assistant [to the PAS position] shall perform the functions and duties of the [PAS position] temporarily in an acting capacity” (subject to certain time limitations), unless and until the President makes an alternative designation under the FVRA. The functions and duties of the PAS officers of the Department and the operational management of the respective agency will be performed by the incumbent first assistant to the PAS position, as designated in the Secretarial Memorandum to Department of Labor Executive Staff (see, “Memorandum,” attached to this Order).
(2) In the event that (a) there is a vacancy in the position of the first assistant, or (b) the first assistant position is occupied by a person who is statutorily barred from serving as an acting officer, the operational management of the agency headed by the PAS shall be performed by the person whose designation closest follows that of the first assistant, unless and until the President makes an alternative designation under the FVRA. However, the “functions and duties” of the PAS may not be performed by any person other than the person serving in an acting capacity (or, in the absence of an acting officer, by the Secretary pursuant to the FVRA). The “functions and duties” are those non-delegable responsibilities (a) established by law (statute or regulation); and (b) required to be performed by, and only by, the PAS.
(3) The Memorandum described in Paragraph 4.C. (1) above shall include succession to the heads of other Departmental organizational units that report to the Secretary.
(4) Nothing in this Order or the Memorandum shall: (1) Be construed to override the provisions in the FVRA with respect to the Inspector General or the Chief Financial Officer (5 U.S.C. 3348(e)); or (2) limit the Secretary's authority to reassign functions or duties of officers unless otherwise precluded by law or regulation.
(5) The Memorandum shall be published in the
5.
A. Secretary (or Acting Secretary) of Labor. Unless otherwise directed by the President (or designee), upon the occurrence of a national emergency entailing a wholesale disruption of the operations, structure, and leadership of the Department of Labor, the Secretary or Acting Secretary (as designated by the President or as provided in the order of succession set forth in Paragraph 4.A. above) shall activate the governing Continuity Plans and determine whether the National Office of the Department of Labor will remain in the then existing location, be repositioned organizationally to the Continuity Site, or be repositioned at the Devolution Site.
B. Except as otherwise directed by the President (or designee), if (1) a catastrophic event occurs in the Washington, DC metropolitan area; (2) the incumbents identified in Paragraph 4.A. are unavailable or unlikely to be available promptly for succession; and (3) the incumbent(s) higher-situated to fill the role of Delegated Secretarial Designee (DSD) as provided in Paragraph 4.B. are unavailable or unlikely to be available promptly to assume the position of DSD, then consistent with the guidelines and operational plans of the Department and upon a review of the circumstances and Executive branch guidance, the incumbent in the next highest DSD-eligible position shall activate the governing Continuity Plans described in Paragraph 5.A. and, based upon those
6.
A.
B.
C.
(1) The standards under a variety of scenarios for activation of the Continuity Plans;
(2) the determination of each agency head that the succession plans, delegations of authority and assignments of responsibility, emergency agency directives, standard operating procedures, and position descriptions needed to fulfill its mission, if devolved to or reconstituted in Dallas, are established, approved by the ASAM, and presented to the Dallas Regional Administrator (OASAM) for contingency activation by Secretary, Acting Secretary, or the Delegated Secretarial Designee; and
(3) plans prepared by the DOL component Agencies, to include OASAM, Dallas Regional Administrator (OASAM) for devolving essential operations for the component Agency and for reconstituting the Department or component Agency in the event of activation of the DOL Continuity Plans.
D.
E.
F.
G.
H.
I.
J.
In addition, the Solicitor of Labor shall assume responsibilities from the Assistant Secretary for Policy for performing the role of Departmental liaison with the Office of the Federal
K.
(1) Establishing appropriate succession plans, delegations of authority and assignments of responsibility, emergency agency directives, vital record identification and protection, standard operating procedures, and position descriptions to assure for the continuity of agency operations relocated to the Continuity Site or the Devolution Site, as appropriate;
(2) Engaging in specific transitional planning with the ASAM, including provisions for appropriate transfer of staff and programs as appropriate, in order to create devolution plans for DOL Agencies whose Offices do not currently have staff and space available at the Devolution Site; and
(3) In consultation with the Office of the Solicitor, identifying, compiling, and reporting to the ASAM regarding those emergency authorities and responsibilities that may not be suspended, or are activated, during national emergencies of any type.
L. All employees, including contactors, of the Department shall be responsible for knowing their individual responsibilities in any continuity situation, for contacting DOL as soon as possible after a major incident consistent with applicable guidance and for being available to work during emergencies to the extent deemed necessary and appropriate and consistent with OPM guidance. All employees shall also comply with such further directions as may be published from time to time in the Department's internal regulations or otherwise distributed relating to their duties and responsibilities during emergency circumstances.
7.
A. Except to the extent stated in this Order, this Secretary's Order does not affect the authorities and responsibilities of the Inspector General under the Inspector General Act of 1978, as amended, or Secretary's Order 04-2006 (February 21, 2006).
B. This Order does not affect any authorities and responsibilities of the Chief Financial Officer under the Chief Financial Officers Act of 1990, any other Federal law or regulation, or any Office of Management and Budget, Government Accountability Office, or U.S. Department of the Treasury policies and publications governing the fiscal responsibilities of Federal departments and agencies.
8.
This memorandum is issued pursuant to Secretary's Order 1-2017 and the authorities cited therein, in order to provide lines of succession in periods of vacancy in case of absence, sickness, resignation, or death of agency heads and during periods of national emergency declared by the President and to provide for ongoing operational management of agency programs and personnel. This memorandum addresses succession in the Department for (1) appointments made by the President, by and with the advice and consent of the Senate (PAS), (2) appointments made by the President not subject to the Senate's advice and consent role (PA), and (3) appointments made by the Secretary.
Functions and duties and ongoing operational management responsibilities of the officers of the Department whose appointment to office is required to be made by the President, by and with the advice and consent of the Senate (PAS), will be performed in an acting capacity by the below designated “first assistants,” unless and until the President makes an alternative designation under the Federal Vacancies Reform Act of 1998 (FVRA). Functions and duties are those non-delegable responsibilities established by law (statute or regulation) and required to be performed by, and only by, the PAS.
In the event that the first assistant does not serve or is barred from serving, unless and until the President makes an alternative designation under the FVRA, the person whose designation closest follows that of the first assistant shall perform the operational management of the agency. However, the functions and duties of the PAS may not be performed by any person other than the person serving in an acting capacity, in accord with FVRA (or, in the absence of an acting officer, by the Secretary pursuant to the FVRA).
In addition, certain DOL offices are not covered by the FVRA because they are not subject to Senate confirmation. Nevertheless, they are included in this Memorandum in order to consolidate the presentation of the Department's program for establishing orderly internal succession in the event of vacancies. These agencies are: Office of the Assistant Secretary for Administration and Management, Office of the Assistant Secretary for Public Affairs, Office of Federal Contract Compliance Programs, Women's Bureau, Office of Labor-Management Standards, Office of Workers' Compensation Programs, Bureau of International Labor Affairs.
This memorandum supersedes all prior inconsistent agency delegations. Agency Heads shall assure that agency delegations, position descriptions, and other pertinent documents are maintained consistently with the designations provided below. Any modifications to the Order of Succession specified in this memorandum are solely reserved to the Secretary. This memorandum shall be published in the
Occupational Safety and Health Review Commission.
Annual Notice.
Notice is given of the appointment of members to the Performance Review Board (PRB) of the Occupational Safety and Health Review Commission.
Membership is effective on January 19, 2017.
Linda M. Beard, Human Resources Specialist, U.S. Occupational Safety and Health Review Commission, 1120 20th Street NW., Washington, DC 20036, (202) 606-5393.
The Review Commission, as required by 5 U.S.C. 4314(c)(1) through (5), has established a Senior Executive Service PRB. The PRB reviews and evaluates the initial appraisal of a senior executive's performance by the supervisor, and makes recommendations to the Chairman of the Review Commission regarding performance ratings, performance awards, and pay-for-performance adjustments. Members of the PRB serve for a period of 24 months. In the case of an appraisal of a career appointee, more than half of the members shall consist of career appointees, pursuant to 5 U.S.C. 4314(c)(5). The names and titles of the PRB members are as follows:
• Nancy P. Bray, Director, Spaceport Integration and Services, National Aeronautics and Space Administration;
• Christine M. Condon, Principal Director, Deputy Chief Information Officer for Resources and Analysis, Office of the Secretary of Defense, DOD;
• Monica R. Shephard, Vice Director, Joint Force Development, DOD; and
• Rebecca A. Fenneman, Director, Office of Consumer Affairs and Dispute Resolution Services, Federal Maritime Commission.
National Aeronautics and Space Administration.
Notice of intent To grant partially exclusive license.
NASA hereby gives notice of its intent to grant a partially exclusive patent license in the United States to practice the inventions described and claimed in U.S. Patent Number 7,075,295 B2 titled “Magnetic Field Response Sensor for Conductive Media,” NASA Case Number LAR-16571-1; U.S. Patent Number 7,589,525 B2 titled “Magnetic Field Response Sensor for Conductive Media,” NASA Case Number LAR-16571-2; U.S. Patent No. 7,759,932 B2 titled “Magnetic Field Response for Conductive Media,” NASA Case Number LAR-16571-3; U.S. Patent No. 7,086,593 B2 titled “Magnetic Field Response Measurement Acquisition System,” NASA Case Number LAR-16908-1; U.S. Patent No. 7,047,807 B2 titled “Flexible Framework for Capacitive Sensing,” NASA Case No. LAR-16974-1; U.S. Patent No. 7,506,541 B2 titled “System and Method for Wirelessly Determining Fluid Volume,” NASA Case No. LAR-17116-1; U.S. Patent No. 7,255,004 B2 titled “Wireless Fluid Level Measuring System,” NASA Case Number LAR-17155-1; U.S. Patent No. 7,159,774 B2 titled “Magnetic Field Response Measurement Acquisition System,” NASA Case No. LAR-17280-1; U.S. Patent No. 8,430,327 B2 titled “Wireless Sensing System Using Open-Circuit, Electrically-Conductive Spiral-Trace Sensor,” NASA Case No. LAR-17294-1;
The prospective partially exclusive license may be granted unless, within fifteen (15) days from the date of this published notice, NASA receives written objections including evidence and argument that establish that the grant of the license would not be consistent with the requirements regarding the licensing of federally owned inventions as set forth in the Bayh-Dole Act and implementing regulations. Competing applications completed and received by NASA within fifteen (15) days of the date of this published notice will also be treated as objections to the grant of the contemplated partially exclusive license. Objections submitted in response to this notice will not be made available to the public for inspection and, to the extent permitted by law, will not be released under the Freedom of Information Act.
Objections relating to the prospective license may be submitted to Patent Counsel, Office of Chief Counsel, NASA Langley Research Center, MS 30, Hampton, Virginia 23681. Phone (757) 864-3221. Facsimile (757) 864-9190.
Robin W. Edwards, Patent Counsel, Office of Chief Counsel, NASA Langley Research Center, MS 30, Hampton, Virginia 23681. Phone (757) 864-3221. Facsimile (757) 864-9190.
This notice is issued in accordance with 35 U.S.C. 209(e) and 37 CFR 404.7(a)(a)(i). This notice of intent to grant a partially exclusive patent license is issued in accordance with 35 U.S.C. 209(c)(1) and 37 CFR 404.7(a)(1)(i). The patent rights in these inventions have been assigned to the United States of America as represented by the Administrator of the National Aeronautics and Space Administration. The prospective exclusive license will comply with the requirements of 35 U.S.C. 209 and 37 CFR 404.7.
Information about other NASA inventions available for licensing can be found online at
National Archives and Records Administration (NARA).
Notice of Federal Advisory Committee Meeting Change.
In accordance with the Federal Advisory Committee Act, as amended (5 U.S.C. appendix 2), the National Archives and Records Administration announces an upcoming Advisory Committee on Presidential Library-Foundation Partnerships meeting.
The meeting will be Thursday, February 23, 2017, from 9:00 a.m. to 12:00 noon.
Denise LeBeck, by telephone at 301-837-3250, or by email at
The original notice about this meeting stated it was scheduled for February 29, 2017, at 10:00 a.m. (see 81 FR 94426, December 23, 2016). However, that was an incorrect date. This notice changes the meeting date to February 23, 2017, to reflect the actual meeting date.
The meeting's purpose is to discuss the Presidential Library program and topics related to public-private partnerships between Presidential Libraries and Presidential Foundations. The meeting is open to the public. Meeting attendees may enter from the Pennsylvania Avenue entrance, and must show photo identification to enter. No visitor parking is available at the Archives building; however, there are commercial parking lots and metered curb parking nearby.
National Archives and Records Administration (NARA).
Notice of availability of proposed records schedules; request for comments
The National Archives and Records Administration (NARA) publishes notice at least once monthly of certain Federal agency requests for records disposition authority (records schedules). Once approved by NARA, records schedules provide mandatory instructions on what happens to records when agencies no longer need them for current Government business. The records schedules authorize agencies to preserve records of continuing value in the National Archives of the United States and to destroy, after a specified period, records lacking administrative, legal, research, or other value. NARA publishes notice in the
NARA must receive requests for copies in writing by February 21, 2017. Once NARA finishes appraising the records, we will send you a copy of the schedule you requested. We usually prepare appraisal memoranda that contain additional information concerning the records covered by a proposed schedule. You may also request these. If you do, we will also provide them once we have completed the appraisal. You have 30 days after we send to you these requested documents in which to submit comments.
You may request a copy of any records schedule identified in this notice by contacting Records Appraisal and Agency Assistance (ACRA) using one of the following means:
You must cite the control number, which appears in parentheses after the name of the agency that submitted the schedule, and a mailing address. If you would like an appraisal report, please include that in your request.
Margaret Hawkins, Director, by mail at Records Appraisal and Agency Assistance (ACRA); National Archives and Records Administration; 8601 Adelphi Road; College Park, MD 20740-6001, by phone at 301-837-1799, or by email at
Each year, Federal agencies create billions of records on paper, film, magnetic tape, and other media. To control this accumulation, agency records managers prepare schedules proposing records retention periods and submit these schedules for NARA's approval. These schedules provide for timely transfer into the National Archives of historically valuable records and authorize the agency to dispose of all other records after the agency no longer needs them to conduct its business. Some schedules are comprehensive and cover all the records of an agency or one of its major subdivisions. Most schedules, however, cover records of only one office or program or a few series of records. Many of these update previously approved schedules, and some include records proposed as permanent.
The schedules listed in this notice are media neutral unless otherwise specified. An item in a schedule is media neutral when an agency may apply the disposition instructions to records regardless of the medium in which it creates or maintains the records. Items included in schedules submitted to NARA on or after December 17, 2007, are media neutral unless the item is expressly limited to a specific medium. (See 36 CFR 1225.12(e).)
Agencies may not destroy Federal records without Archivist of the United States' approval. The Archivist approves destruction only after thoroughly considering the records' administrative use by the agency of origin, the rights of the Government and of private people directly affected by the Government's activities, and whether or not the records have historical or other value.
In addition to identifying the Federal agencies and any subdivisions requesting disposition authority, this notice lists the organizational unit(s) accumulating the records (or notes that the schedule has agency-wide applicability when schedules cover records that may be accumulated throughout an agency); provides the control number assigned to each schedule, the total number of schedule items, and the number of temporary items (the records proposed for destruction); and includes a brief description of the temporary records. The records schedule itself contains a full description of the records at the file unit level as well as their disposition. If NARA staff has prepared an appraisal memorandum for the schedule, it also includes information about the records. You may request additional information about the disposition process at the addresses above.
1. Department of the Army, Agency-wide (DAA-AU-2016-0045, 1 item, 1 temporary item). Master files of an electronic information system used to track parts and asset shortages in support of depot-level maintenance operations.
2. Department of Defense, Defense Logistics Agency (DAA-0361-2017-0001, 1 item, 1 temporary item). Records relating to personally owned property abandoned at Department of Defense activities.
3. Department of Defense, Defense Logistics Agency (DAA-0361-2017-0002, 1 item, 1 temporary item). Master files of an electronic information system used to report food inspections at installations.
4. Department of Energy, Naval Nuclear Propulsion Program (DAA-0434-2015-0008, 11 items, 10 temporary items). Records relating to finance and procurement including accounting, purchasing, contract administration, asset valuation, and preparation and maintenance of the budget and payroll and related material. Proposed for permanent retention are records relating to first prime contracts.
5. Department of Health and Human Services, National Institutes of Health (DAA-0443-2016-0002, 4 items, 4 temporary items). Administrative technology transfer records including agreements, application files, letters, and progress and sales reports.
6. Department of Justice, Agency-wide (DAA-0060-2016-0006, 4 items, 4 temporary items). Records related to the coordination of agency rulemaking actions.
7. Department of Justice, Agency-wide (DAA-0060-2017-0004, 1 item, 1 temporary item). Records documenting office and program level annual work plans.
8. Department of the Navy, Agency-wide (DAA-NU-2015-0006, 36 items, 33 temporary items). Records relating to medicine and dentistry including routine correspondence, tissue exam results, diving and hyperbaric medical treatment, dental reports, training, obesity case files and associated records. Proposed for permanent retention are records relating to policy and planning, individual health care files, and reports of medical research.
9. Department of the Navy, Agency-wide (DAA-NU-2015-0008, 35 items, 28 temporary items). Records relating to ordnance management including routine correspondence, deperming and degaussing, ordnance equipment, device calibration, occupational vision tests, and related matters. Proposed for permanent retention are records relating to policy and planning, ordnance technical instructions, logistics programs, ordnance design, technical reports and manuals, harbor defense, and special weapons records.
10. Commodity Futures Trading Commission, Agency-wide (DAA-0180-2017-0001, 1 item, 1 temporary item). Registered entity applications, and related amendments and supplements.
11. Peace Corps, Office of Global Operations (DAA-0490-2016-0004, 1 item, 1 temporary item). Records of the Office of Staging and Pre-Departure, related to facilitating the orientation and departure of volunteers to overseas posts.
National Archives and Records Administration (NARA).
Notice of Federal Advisory Committee meeting change.
In accordance with the Federal Advisory Committee Act, as amended (5 U.S.C. appendix 2), the National Archives and Records Administration announces an upcoming Advisory Committee on Presidential Library-Foundation Partnerships meeting.
The meeting will be Thursday, February 23, 2017, from 9:00 a.m. to 12:00 noon.
Denise LeBeck, by telephone at 301-837-3250, or by email at
The original notice about this meeting stated it was scheduled for February 29, 2017, at 10:00 a.m. (see 81 FR 94426, December 23, 2016). However, that was an incorrect date. This notice changes the meeting date to February 23, 2017, to reflect the actual meeting date.
The meeting's purpose is to discuss the Presidential Library program and topics related to public-private partnerships between Presidential Libraries and Presidential Foundations. The meeting is open to the public. Meeting attendees may enter from the Pennsylvania Avenue entrance, and must show photo identification to enter. No visitor parking is available at the Archives building; however, there are commercial parking lots and metered curb parking nearby.
Nuclear Regulatory Commission.
Environmental assessment and finding of no significant impact; issuance.
The U.S. Nuclear Regulatory Commission (NRC) is considering the issuance of a license amendment to Facility Operating License No. R-23, held by the Texas A&M University (TAMU or the licensee) for the Aerojet General Nucleonics Model 201-Modified (AGN-201M) reactor facility located in the Zachry Engineering Center on the TAMU College Station Campus, Brazos County, Texas. The amendment would delete from the technical specifications (TSs) the Zachry Engineering Center location that constituted the reactor facility for the AGN-201M reactor and associated components. The reactor, associated components, and its special nuclear material (SNM) have been removed from the Zachry Engineering Center and temporarily stored at the Texas Engineering Experiment Station, in Brazos County, Texas, where TAMU operates another reactor. The license amendment would also delete the license conditions requiring a physical security plan (PSP) and TSs requiring procedures that implement the security plan and audits of the PSP and its implementing procedures as the SNM possession limit in the license is below the quantity of material that requires a security plan.
If approved, removal of the Zachry Engineering Center from the TSs would allow the unrestricted use of the rooms where the AGN-201M reactor, its associated components and its byproduct and SNM were formerly located. The NRC is issuing an environmental assessment (EA) and finding of no significant impact (FONSI) associated with the proposed license amendment.
The EA and FONSI are available as of January 19, 2017.
Please refer to Docket ID NRC-2017-0007 when contacting the NRC about the availability of information regarding this document. You may obtain publicly available information related to this document using any of the following methods:
•
•
•
Patrick G. Boyle, Office of Nuclear Reactor Regulation, U.S. Nuclear Regulatory Commission, Rockville, MD 20852; telephone: 301-415-3936; email:
The NRC is considering the issuance of a license amendment to Facility Operating License No. R-23, held by TAMU, which would delete (1) part of TS 5.3, removing the Reactor Room, Control Room and Accelerator Room in the Zachry Engineering Center as a storage location for the AGN-201M reactor and associated components and allowing the unrestricted use of the Zachry Engineering Center that was the former location of the AGN-201M reactor; (2) license conditions 2.C.(3) and 2.D, removing the requirement that the licensee maintain a PSP; and (3) TS 6.4.3.c and parts of TS 6.6.f, removing requirements for procedures that implement the PSP and audits of the PSP and implementing procedures. The facility is located in the Zachry Engineering Center on the TAMU campus, Brazos County, Texas.
The licensee submitted its license amendment request by letter dated November 21, 2016 (ADAMS Accession No. ML16326A447), as supplemented by letters dated December 16 and 20, 2016 (ADAMS Accession Nos. ML16352A000, ML16351A502, and ML17011A079); and January 9 and 11, 2017 (ADAMS Accession Nos. ML17010A057 and ML17012A069). The NRC staff prepared an EA to document its environmental findings related to the proposed license amendment in accordance with section 51.21 of title 10 of the
The Zachry Engineering Center, located on the TAMU College Station Campus, in Brazos County, Texas housed the AGN-201M reactor as well as offices and laboratories in which radiological materials were used in support of reactor operations. The AGN-201M has a power rating of 5 watts, thermal and uses a polyethylene and uranium dioxide plate type fuel with a uranium-235 enrichment of less than 20%. The reactor core is cooled by natural convection and therefore, the reactor does not have an external cooling loop. Texas A&M University purchased the AGN reactor in 1957 and moved it to the Zachry Engineering Center in 1972. The AGN-201M reactor was located on the ground floor in the
TAMU operates a second reactor at the Nuclear Science Center, within the Texas Engineering Experiment Station, also located on the TAMU College Station Campus, in Brazos County, Texas.
The NRC staff approved the SNM transfer and relocation of the AGN-201M reactor and associated components in license amendments dated August 31, 2016 (ADAMS Accession No. ML16109A153), and November 11, 2015 (ADAMS Accession No. ML15315A027), respectively. TAMU completed the transfer of SNM in the form of AGN-201M reactor fuel, control rods, and a plutonium beryllium start up source to the TAMU System, Nuclear Science Center Reactor Facility License No. R-83 and the remaining AGN-201M reactor components containing byproduct material and trace quantities of SNM were relocated to the Texas Engineering Experiment Station on October 15, 2016.
TAMU requested that the NRC amend the AGN-201M license to allow the unrestricted use of the Zachry Engineering Center, proposed changes to conditions and TSs in the license, and provided radiation survey results to support its amendment application.
The proposed action would delete the Reactor Room, Control Room and Accelerator Room in the Zachry Engineering Center as a location for the storage of the AGN-201 reactor and associated components, allowing the unrestricted use of the Zachry Engineering Center that was the former location of the AGN-201M reactor. The proposed action would also delete license conditions that require a PSP, and delete TS 6.6.f. and 6.4.3.c, which require PSP implementing procedures and audits of the PSP and its implementing procedures because SNM for the AGN-201M has been transferred to another NRC license and, hence, the license no longer authorizes possession of a quantity of SNM that requires a PSP under the regulations in 10 CFR 73.67. In order to remove the Zachry Engineering Center rooms constituting the reactor facility from the TSs and allow unrestricted use of those locations in accordance with 10 CFR 20.1402, residual radioactivity that is distinguishable from background radiation at the reactor facility may not exceed 25 mrem (0.25 mSv) per year total effective dose equivalent (TEDE) to a member of the public and the residual radioactivity must be reduced to levels that are as low as reasonably achievable (ALARA).
The proposed action is needed (1) to remove from Facility Operating License No. R-23 and release the rooms that constitute the AGN-201M reactor facility at the Zachry Engineering Center, which would enable the rooms to be used for other purposes without radiological restrictions, and (2) to delete license conditions requiring the licensee to maintain a PSP and delete associated PSP procedural and audit requirements in the TSs.
The NRC staff has completed its environmental review of the proposed action and concludes that the proposed action will not present any undue risk to public health and safety. After removal of the AGN-201M reactor, associated components, and SNM, and their relocation to the Texas Engineering Experiment Station, TAMU conducted clean-up activities at the Zachry Engineering Center. TAMU developed a final status survey plan (ADAMS Accession No. ML16316A002), completed the final status survey of the Zachry Engineering Center rooms where the AGN-201M reactor, associated components, and SNM were previously located (ADAMS Accession No. ML17010A057) and found that the facility met the requirements for unrestricted use in 10 CFR part 20, subpart E. An NRC staff confirmatory survey was conducted during the week of November 14, 2016 (ADAMS Accession No. ML16355A083).
The NRC staff is preparing a safety evaluation in connection with its review of the proposed action. Based on the clean-up activities carried out by the licensee, the NRC staff's review of TAMU's final status survey report and the results of the NRC staff confirmatory survey, the NRC staff has concluded, pursuant to 10 CFR 20.1402, that residual radioactivity at the site does not exceed 25 mrem (0.25 mSv) TEDE. In addition, since no residual radioactivity distinguishable from background was found at the site, ALARA has been met. Therefore, the Zachry Engineering Center rooms which constituted the reactor facility (as designated in TS 5.3) are suitable to be released for unrestricted use and can be removed from the TSs. TAMU also requests that the NRC delete license conditions requiring a PSP and associated PSP TSs because physical possession of the SNM for the AGN-201M reactor has been transferred to, and is being stored under, another NRC license and therefore a PSP is not required for the AGN-201M under 10 CFR 73.67. Further details of the NRC's safety review will be provided in the safety evaluation related to the license amendment that, if issued by the NRC, would authorize the proposed action.
The proposed action does not authorize any effluent or material releases, does not change any release criteria set forth in the present regulations, and the results of the NRC confirmatory survey confirmed that any residual radioactivity at the Zachry Engineering Center facility comply with criteria for unrestricted release of a site set forth in 10 CFR 20.1402. No changes would occur in the types of any effluents that may be released offsite, and there would be no significant increase in the amount of any effluent released offsite. Thus there would be no significant increase in occupational or public radiation exposure. In addition, because all of the SNM has been removed from the Zachry Engineering Center, deletion of license conditions requiring a PSP and deletion of associated TSs is appropriate. Therefore, the proposed action would result in no significant radiological environmental impacts.
With regard to potential non-radiological impacts, the proposed action does not authorize of involve any reactor facility construction activities and would not result in visual resource impacts, increases in noise or air emissions, or have any foreseeable impacts to historic properties, water resources, and aquatic or terrestrial resources. Similarly, the proposed action would result in no socioeconomic or environmental justice impacts. Therefore, there would be no significant non-radiological environmental impacts associated with the proposed action.
Accordingly, the NRC staff concludes that there would be no significant environmental impacts associated with the proposed action.
As an alternative to the proposed action, the NRC staff considered the denial of the proposed action (
The proposed action would not involve the use of any different
The NRC staff did not enter into consultation with any other Federal agency or with the State of Texas regarding the environmental impact of the proposed action. However, on December 22, 2016, the NRC notified the Texas State official, Mrs. DeAnn Walker, Director, Office of the Governor Office of Budget and Policy, of the proposed action. The State official had no comments.
The NRC is considering the issuance of a license amendment to Facility Operating License No. R-23, held by TAMU, which would delete (1) part of TS 5.3, removing the Reactor Room, Control Room and Accelerator Room in the Zachry Engineering Center as a storage location for the AGN-201M reactor and associated components and allowing the unrestricted use of the Zachry Engineering Center that was the former location of the AGN-201M reactor; (2) license conditions 2.C.(3) and 2.D, removing the requirement that the licensee maintain a PSP; and (3) TS 6.4.3.c and parts of TS 6.6.f, removing requirements for procedures that implement the PSP and audits of the PSP and implementing procedures. The facility is located in the Zachry Engineering Center on the TAMU campus, Brazos County, Texas.
On the basis of the EA included in Section II of this notice and incorporated by reference, the NRC staff finds that the proposed action will not have a significant effect on the quality of the human environment. The NRC staff's evaluation considered information provided in the licensee's application, as supplemented, and the NRC staff's review of related environmental documents. Section II above identifies the documents related to the proposed action and includes information on the availability of these documents. Accordingly, the NRC has determined not to prepare an environmental impact statement for the proposed action.
For the Nuclear Regulatory Commission.
Postal Regulatory Commission.
Notice.
The Commission is noticing a recent Postal Service filing concerning the calculation of the assumed Federal income tax on competitive products income for Fiscal Year 2016. This notice informs the public of the filing, invites public comment, and takes other administrative steps.
Submit comments electronically via the Commission's Filing Online system at
David A. Trissell, General Counsel, at 202-789-6820.
In accordance with 39 U.S.C. 3634 and 39 CFR 3060.40
In accordance with 39 CFR 3060.42, the Commission establishes Docket No. T2017-1 to review the calculation of the assumed Federal income tax and supporting documentation.
The Commission invites comments on whether the Postal Service's filing in this docket is consistent with the policies of 39 U.S.C. 3634 and 39 CFR 3060.40
The Commission appoints Jennaca D. Upperman to serve as Public Representative in this docket.
1. The Commission establishes Docket No. T2017-1 to consider the calculation of the assumed Federal income tax on competitive products for FY 2016.
2. Pursuant to 39 U.S.C. 505, Jennaca D. Upperman is appointed to serve as an officer of the Commission to represent the interests of the general public in this proceeding (Public Representative).
3. Comments are due no later than February 3, 2017.
4. The Secretary shall arrange for publication of this order in the
By the Commission.
Pursuant to the provisions of Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
The Exchange is filing a proposal to amend Rule 510, Interpretations and Policies .01 to extend the pilot program for the quoting and trading of certain options in pennies (the “Penny Pilot Program”).
The text of the proposed rule change is available on the Exchange's Web site at
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
MIAX PEARL plans to commence operations as a national securities exchange registered under Section 6 of the Act
In addition to the extension of the Penny Pilot Program through June 30, 2017, the Exchange proposes to extend one other date in the Rule. Currently, Interpretations and Policies .01 states that the Exchange will replace any Penny Pilot issues that have been delisted with the next most actively traded multiply listed option classes that are not yet included in the Penny Pilot Program, and that the replacement issues will be selected based on trading activity in the previous six months. Such option classes will be added to the Penny Pilot Program on the second trading day following December 31, 2016.
The purpose of this provision is to reflect the new date on which replacement issues may be added to the Penny Pilot Program. The Exchange notes that this filing is based upon and, in all material respects, substantially similar to a recent filing of Miami International Securities Exchange, Inc. (“MIAX Options”) regarding the extension of the Penny Pilot Program.
MIAX PEARL believes that its proposed rule change is consistent with Section 6(b) of the Act
In particular, the proposed rule change, which extends the Penny Pilot Program for six months, allows the Exchange to participate in a program that has been viewed as beneficial to traders, investors and public customers and viewed as successful by the other options exchanges participating in it.
The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. Specifically, the Exchange believes that, by extending the expiration of the Pilot Program, the proposed rule change will enable the Exchange to participate in the Pilot Program and provide additional data for further analysis of the Penny Pilot Program and allow for a determination of how the Program should be structured in the future. In doing so, the proposed rule change will also serve to promote regulatory clarity and consistency, thereby reducing burdens on the marketplace, facilitating investor protection, and fostering a competitive environment.
Written comments were neither solicited nor received.
Because the foregoing proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days after the date of the filing, or such shorter time as the Commission may designate, it has become effective pursuant to 19(b)(3)(A) of the Act
A proposed rule change filed under Rule 19b-4(f)(6)
At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings under Section 19(b)(2)(B) of the Act
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On September 30, 2016, The NASDAQ Stock Market LLC (“Exchange” or “Nasdaq”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
The Exchange proposes to amend the Rule 5700 Series to specify continued listing requirements for products listed under those rules, which include products listed pursuant to Rule 19b-4(e) under the Act (“generically-listed products”) and products listed pursuant to proposed rule changes filed with the Commission (“non-generically-listed products”).
The Exchange also proposes to amend the Rule 5700 Series to specify issuer notification requirements related to failures to comply with continued listing requirements. Specifically, the Exchange proposes to add Rule 5701(d) to require an issuer with securities listed under the Rule 5700 Series to promptly notify the Exchange of any non-compliance with the requirements of the Rule 5700 Series. In addition, with respect to non-generically-listed products, the Exchange proposes to require an issuer to notify the Exchange of its failure to comply with any continued listing requirements that were specified in the proposals to list those products. As proposed, the Exchange would initiate delisting proceedings for a product listed under the Rule 5700 Series if any of its continued listing requirements (including those set forth in a Nasdaq Rule and those set forth in an applicable proposed rule change) are not continuously maintained.
The Exchange also proposes to amend Rule 5810 to specify the delisting procedures for products listed under the Rule 5700 Series. Under proposed Rule 5810(c)(2)(A), unless the issuer is currently under review by an Adjudicatory Body for a Staff Delisting Determination, the Listing Qualifications Department may accept and review a plan to regain compliance when an issuer fails to meet a continued listing requirement contained in the Rule 5700 Series. The issuer would be required to submit its compliance plan within 45 calendar days of the Exchange staff's notification of deficiencies, and certain issuers would be required to pay a compliance plan review fee.
Finally, the Exchange proposes to make conforming and technical changes throughout the Rule 5700 Series to maintain consistency in its rules. For example, the Exchange proposes to consistently use the language “initiate delisting proceedings under the Rule 5800 Series” when describing the delisting process for a product that fails to meet continued listing requirements;
The Exchange proposes to implement the rule changes by August 1, 2017.
The Commission finds that the proposed rule change, as modified by Amendment No. 2, is consistent with the requirements of the Act and the rules and regulations thereunder applicable to a national securities exchange.
The Commission does not believe that the proposal raises unique or novel regulatory issues. As the Commission previously stated, the development, implementation, and enforcement of standards governing the initial and continued listing of securities on an exchange are activities of critical importance to financial markets and the investing public. Once a security has been approved for initial listing, continued listing criteria allow an exchange to monitor the status and trading characteristics of that issue to ensure that it continues to meet the exchange's standards for market depth and liquidity so that fair and orderly markets can be maintained.
Currently, certain rules within the Rule 5700 Series impose specific listing requirements on an initial basis, without
Because the proposal specifies continued listing requirements for products listed pursuant to the Rule 5700 Series, the Commission believes the proposal is designed to achieve on a continuing basis the goals of the listing requirements, including ensuring that the Exchange lists products that are not susceptible to manipulation and maintaining fair and orderly markets for the listed products. In particular, the Commission believes that the proposal is designed to ensure that stocks with a substantial market capitalization and trading volume account for a substantial portion of the weight of an index or portfolio underlying a listed product;
The Commission also believes that the proposal to delete the threshold of “30 or more consecutive trading days” in the requirements for the number of beneficial or record holders is consistent with the goal of ensuring that there is adequate liquidity in the listed product on an ongoing basis. As proposed, the Exchange would initiate delisting proceedings for a product if it fails to comply with the minimum number of beneficial holders requirement, even if the non-compliance does not continue for 30 consecutive trading days.
As noted above, the proposal specifies the delisting procedures for products listed pursuant to the Rule 5700 Series. The Commission believes that the proposed amendments to Rule 5810 provide transparency regarding the process that the Exchange will follow if a listed product fails to meet its continued listing requirements. The Commission also notes that the process surrounding compliance plans already exists in Rule 5810. As a result, the proposed delisting procedures are not novel.
Finally, the Commission believes that the conforming and technical proposed changes do not raise novel issues, are designed to further the goals of the listing standards, and provide clarity and consistency in the Exchange's rules.
For the reasons discussed above, the Commission finds that the proposed rule change, as modified by Amendment No. 2, is consistent with the Act.
As noted above, in Amendment No. 2, the Exchange: (i) Amended proposed Rule 5701(d) to require a Company with securities listed under the Rule 5700 Series to provide the Exchange with prompt notification if the Company (rather than an Executive Officer of the Company) becomes aware of its non-compliance with the requirements of the Rule 5700 Series; (ii) further amended rules within the Rule 5700 Series to reflect that certain listing requirements (including certain statements or representations in rule filings for the listing and trading of specific products) apply on an initial and ongoing basis; (iii) further amended rules within the Rule 5700 Series to consistently state that the Exchange will initiate delisting proceedings if continued listing requirements are not maintained; (iv) amended rules within the Rule 5700 Series to provide that the Exchange will initiate delisting proceedings due to an interruption to the dissemination of index, reference asset, or intraday indicative values (as applicable to the product) only if the interruption persists past the trading day in which it occurred; (v) specified an implementation date for the proposed changes; and (vi) made conforming and non-substantive changes throughout the
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether Amendment No. 2 is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Brent J. Fields, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Exchange proposes to extend the pilot program in Phlx Rule 1059, Accommodation Transactions, to allow cabinet trading to take place below $1 per option contract under specified circumstances (the “pilot program”).
The text of the proposed rule change is set forth below. Proposed new language is underlined; proposed deletions are in brackets.
(a)-(b) No change.
.01 No change.
.02 Limit Orders Priced Below $1: Limit orders with a price of at least $0 but less than $1 per option contract may trade under the terms and conditions in Rule 1059 above in each series of option contracts open for trading on the Exchange, except that:
(a)-(c) No change.
(d) Unless otherwise extended, the effectiveness of the Commentary .02 terminates January 5, [2017]
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The Exchange proposes to extend the pilot program in Commentary .02 of Exchange Rule 1059, Accommodation Transactions, which sets forth specific procedures for engaging in cabinet trades, to allow the Commission adequate time to consider permanently allowing transactions to take place on the Exchange in open outcry at a price of at least $0 but less than $1 per option
On December 30, 2010, the Exchange filed an immediately effective proposal that established the pilot program being extended by this filing. The pilot program allowed transactions to take place in open outcry at a price of at least $0 but less than $1 per option contract until June 1, 2011.
The Exchange believes that allowing a price of at least $0 but less than $1 will continue to better accommodate the closing of options positions in series that are worthless or not actively traded, particularly due to recent market conditions which have resulted in a significant number of series being out-of-the-money. For example, a market participant might have a long position in a call series with a strike price of $100 and the underlying stock might now be trading at $30. In such an instance, there might not otherwise be a market for that person to close-out its position even at the $1 cabinet price (
The Exchange hereby seeks to extend the pilot period for such $1 cabinet trading until January 5, 2018. The Exchange seeks this extension to allow the procedures to continue without interruption.
The Exchange believes that the proposed rule change is consistent with the provisions of Section 6 of the Act,
The Exchange does not believe that the proposed rule change will result in
No written comments were either solicited or received.
Because the foregoing proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A)(iii) of the Act
A proposed rule change filed under Rule 19b-4(f)(6)
At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is: (i) Necessary or appropriate in the public interest; (ii) for the protection of investors; or (iii) otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or disapproved.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On December 2, 2016, the Chicago Stock Exchange, Inc. (“CHX” or “Exchange”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
The Exchange is a wholly-owned subsidiary of CHX Holdings. According to the Exchange, CHX Holdings is currently beneficially owned by 193 firms or individuals, including Exchange Participants or affiliates of Exchange Participants.
Upon the closing of the Transaction, the Exchange represents that all of the outstanding and issued shares of N.A. Casin Holdings would be held by the following firms and individuals (the “upstream owners”) in the following percentages:
•
•
Following the closing of the Transaction, CHX would remain registered as a national securities exchange under Section 6 of the Act
In order to facilitate the Transaction, the Exchange is proposing to amend its certificate of incorporation and bylaws,
The Exchange proposes several substantive and technical amendments to its corporate governance documents, rules, and the governing documents of CHX Holdings. The amendments include revised provisions addressing, among other items, board and committee composition and procedures, procedures regarding stockholder meetings, consent to U.S. and Commission jurisdiction, and Commission access to corporate books and records.
The proposed amendments also would revise provisions in the certificate of incorporation of CHX Holdings relating to ownership and voting limitations. Additionally, the proposed certificate of incorporation of N.A. Casin Holdings would contain identical ownership concentration and voting limitations and other provisions substantially similar to those contained in the CHX Holdings documents, which would apply directly to the upstream owners.
Additionally, both the certificates of incorporation of CHX Holdings and N.A. Casin Holdings would preclude any stockholder, either alone or with its Related Persons, from voting more than 20% of the then outstanding shares entitled to be cast on any matter unless specific procedures are followed prior to voting in excess of the limitation.
The Commission received four comments regarding the proposed rule change.
In general, three of the commenters express concern over the proposed upstream ownership of CHX.
Another commenter argues that due to jurisdiction limitations and transparency concerns, the Commission cannot exercise proper regulatory oversight under the current proposal.
This commenter also questions the identity of the proposed upstream owners and the validity of CHX's representation that there are no Related Persons among the proposed upstream owners other than Castle YAC and N.A. Casin Group.
This commenter also asserts that there are few or no controls in place at the upstream corporate ownership level that would prevent the upstream owners from transferring their voting power in CHX to what the commenter opines could be more opaque owners, including those that involve the Chinese government.
Two commenters assert that the proposed acquisition may present financial security risks to investors and the U.S. marketplace.
Finally, three commenters express concern regarding the length of the comment period and the timing of the filing over the holiday season.
The Commission is instituting proceedings pursuant to Section 19(b)(2)(B) of the Exchange Act
Pursuant to Section 19(b)(2)(B) of the Exchange Act,
The Commission requests that interested persons provide written submissions of their views, data, and arguments with respect to the issues identified above, as well as any other concerns they may have with the proposal. In particular, the Commission invites the written views of interested persons concerning whether the proposal is consistent with Sections 6(b)(1), 6(b)(5), or any other provision of the Exchange Act, or the rules and regulations thereunder. Although there do not appear to be any issues relevant to approval or disapproval that would be facilitated by an oral presentation of
Interested persons are invited to submit written data, views, and arguments regarding whether the proposal should be approved or disapproved by February 21, 2017. Any person who wishes to file a rebuttal to any other person's submission must file that rebuttal by March 6, 2017. The Commission asks that commenters address the sufficiency of the Exchange's statements in support of the proposal, in addition to any other comments they may wish to submit about the proposed rule change.
Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On November 17, 2016, Chicago Board Options Exchange, Incorporated (“CBOE” or “Exchange”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
Section 19(b)(2) of the Act
The Commission is extending the 45-day time period for Commission action on the proposed rule change. The Commission finds that it is appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider and take action on the proposed rule change, as modified by Amendment No. 1. Accordingly, pursuant to Section 19(b)(2)(A)(ii)(I) of the Act,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 17(d) of the Securities Exchange Act of 1934 (“Act”),
Section 19(g)(1) of the Act,
Section 17(d)(1) of the Act
To implement Section 17(d)(1), the Commission adopted two rules: Rule 17d-1 and Rule 17d-2 under the Act.
To address regulatory duplication in these and other areas, the Commission adopted Rule 17d-2 under the Act.
On November 19, 2014, the Commission declared effective the Plan entered into between FINRA and MIAX for allocating regulatory responsibility pursuant to Rule 17d-2.
On January 12, 2017, the parties submitted a proposed amendment to the Plan. The primary purpose of the amendment is to add MIAX PEARL as a Participant to the Plan. The text of the proposed amended 17d-2 plan is as follows (additions are
This Agreement, by and [between]
1.
(a) “
(b) “
(c) “[Dual]
(d) “
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(a) Surveillance, examination, investigation and enforcement with respect to trading activities or practices involving MIAX's
(b) registration pursuant to [its]
(c) discharge of [its]
(d) any MIAX Rules
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(a) FINRA shall make available to MIAX
(b) The parties agree that documents or information shared shall be held in confidence, and used only for the purposes of carrying out their respective regulatory obligations. [Neither]
(c) The sharing of documents or information [between]
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Miami International Securities Exchange, LLC (“MIAX”)
Pursuant to Section 17(d)(1) of the Act
In order to assist the Commission in determining whether to approve the proposed 17d-2 Plan and to relieve MIAX and MIAX PEARL of the responsibilities which would be assigned to FINRA, interested persons are invited to submit written data, views, and arguments concerning the foregoing. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Brent J. Fields, Secretary, Securities and Exchange Commission, Station Place, 100 F Street NE., Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”),
The Exchange filed a proposal to amend the fee schedule applicable to Members
The text of the proposed rule change is available at the Exchange's Web site at
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in Sections A, B, and C below, of the most significant parts of such statements.
The Exchange proposes to amend its fee schedule for its equity options platform (“BZX Options”) to: (i) Add definitions of terms “OCC Customer Volume” or “OCV” and “Options Step-Up Add TCV” to the Definitions section; and (ii) modify the criteria for tiers under footnotes 1 through 13 to reflect the new definition of OCV. The Exchange also proposes to (i) increase the rebate provided in the Customer
The Exchange proposes to replace current tier qualifications which refer to TCV with a reference to OCV in the tiers under footnotes 1 through 13. Because OCV generally makes up a smaller range than the prior TCV, the Exchange also proposes to amend the percentage of OCV necessary to achieve the tier so that it is substantially identical to the previously required percentage of TCV. Doing so will keep each tier's criteria relatively unchanged from its current requirements. The rates for each tier are unchanged. Changes to each tier are described below.
• Tier 1 currently requires that a Member has an ADV
• Tier 2 currently requires that a Member has an ADV equal to or greater than 0.30% of average TCV. As amended, a Member must have an ADV equal to or greater than 0.40% of average OCV.
• Tier 3 currently requires that a Member has an ADV equal to or greater than 1.00% of average TCV. As amended, a Member must have an ADV equal to or greater than 1.30% of average OCV.
• Tier 4 currently requires that a Member has an ADAV in Customer orders equal to or greater than 1.00% of average TCV. As amended, a Member must have an ADAV in Customer orders equal to or greater than 1.30% of average OCV.
• Tier 5 currently requires that a Member has an: (i) ADAV in Customer orders equal to or greater than 0.60% of average TCV; (ii) ADAV in Market Maker
• Tier 6 currently requires that a Member has an ADAV in Customer orders equal to or greater than 1.30% of average TCV. As amended, a Member must have an ADAV in Customer orders equal to or greater than 1.70% of average OCV.
• The Customer Step-Up Volume Tier currently requires that a Member has an Options Step-Up Add TCV in Customer orders from September 2015 baseline equal to or greater than 0.40%. As amended, a Member must have an Options Step-Up Add OCV in Customer orders from September 2015 baseline equal to or greater than 0.45%.
• The Customer Cross-Asset Add Tier currently requires that a Member has an: (i) ADV equal to or greater than 0.80% of average TCV; and (ii) ADAV on BZX Equities equal to or greater than 0.50% of average TCV. As amended, a Member must have an: (i) ADAV in Customer orders equal to or greater than 0.50% of average OCV; and (ii) ADAV on BZX Equities greater than or equal to 0.50% of average TCV. As a result of the change from requiring a Member to meet a certain threshold of ADV to a certain threshold of ADAV, the Exchange proposes to increase the rebate provided by this tier from $0.50 to $0.52 per contract. The Exchange believes an increased rebate more appropriately corresponds with the tier's more stringent criteria.
• Tier 1 currently requires that a Member has an: (i) ADAV in Away Market Maker,
• Tier 2 currently requires that a Member has an: (i) ADV greater than or equal to 0.40% of average TCV; and (ii) ADAV in Away Market Maker, Firm, Broker Dealer and Joint Back Office greater than or equal to 0.30% of average TCV. As amended, a Member must have an: (i) ADV greater than or equal to 0.50% of average OCV; and (ii) ADAV in Away Market Maker, Firm, Broker Dealer and Joint Back Office greater than or equal to 0.40% of average OCV.
• Tier 1 currently requires that a Member has an: (i) ADAV in Customer orders greater than or equal to 0.60% of average TCV; (ii) ADAV in Market Maker orders greater than or equal to 0.25% of average TCV and (iii) ADAV on BZX Equities greater than or equal to 0.30% of average TCV. As amended, a Member must have an: (i) ADAV in Customer orders greater than or equal to 0.80% of average OCV; (ii) ADAV in Market Maker orders greater than or equal to 0.35% of average OCV; and (iii) ADAV on BZX Equities greater than or equal to 0.30% of average TCV.
• Tier 2 currently requires that a Member has an ADAV in Customer orders greater than or equal to 1.00% of average TCV. As amended, a Member must have an ADAV in Customer orders greater than or equal to 1.30% of average OCV.
• Tier 3 currently requires that a Member has an ADAV in Customer orders greater than or equal to 1.30% of average TCV. As amended, a Member must have an ADAV in Customer orders greater than or equal to 1.70% of average OCV.
• Tier 1 currently requires that a Member has an ADV greater than or equal to 0.30% of average TCV. As amended, a Member must have an ADV greater than or equal to 0.40% of average OCV.
• Tier 2 currently requires that a Member has an ADV greater than or equal to 1.00% of average TCV. As amended, a Member must have an ADV greater than or equal to 1.30% of average OCV.
• Tier 3 currently requires that a Member has an: (i) ADV greater than or equal to 0.40% of average TCV; and (ii) ADAV in Away Market Maker, Firm, Broker Dealer and Joint Back Office orders greater than or equal to 0.30% of average TCV. As amended, a Member must have an: (i) ADV greater than or equal to 0.50% of average OCV; and (ii) ADAV in Away Market Maker, Firm, Broker Dealer and Joint Back Office orders greater than or equal to 0.40% of average OCV.
• Tier 4 currently requires that a Member has an ADAV in Market Maker
• Tier 5 currently requires that a Member has an ADAV in Non-Customer orders greater than or equal to 2.30% of average TCV. As amended a Member must have an ADAV in Non-Customer orders greater than or equal to 3.00% of average OCV.
• Tier 1 currently requires that a Member has an ADV greater than or equal to 0.30% of average TCV. As amended, a Member must have an ADV greater than or equal to 0.40% of average OCV.
• Tier 2 currently requires that a Member has an ADV greater than or equal to 1.00% of average TCV. As amended, a Member must have an ADV greater than or equal to 1.30% of average OCV.
• Tier 3 currently requires that a Member has an ADV greater than or equal to 2.50% of average TCV. As amended, a Member must have an ADV greater than or equal to 3.25% of average OCV.
• Tier 4 currently requires that a Member has an ADV [sic] in Market Maker orders greater than or equal to 0.40% of average TCV. As amended, a Member must have an ADV [sic] in Market Maker orders greater than or equal to 0.50% of average OCV.
• Tier 1 currently requires that a Member has an ADV greater than or equal to 0.30% of average TCV. As amended, a Member must have an ADV greater than or equal to 0.40% of average OCV.
• Tier 2 currently requires that a Member has an: (i) ADAV in Market Maker and/or Away Market Maker orders greater than or equal to 1.00% of average TCV; and (ii) ADV greater than or equal to 2.00% of average TCV. As amended, a Member must have an: (i) ADAV in Market Maker and/or Away Market Maker orders greater than or equal to 1.30% of average OCV; and (ii) ADV greater than or equal to 2.60% of average OCV.
• Tier 1 currently requires that a Member has an ADV greater than or equal to 0.30% of average TCV. As amended, a Member must have an ADV greater than or equal to 0.40% of average OCV.
• Tier 2 currently requires that a Member has an ADV greater than or equal to 1.00% of average TCV. As amended, a Member must have an ADV greater than or equal to 1.30% of average OCV.
• Tier 1 currently requires that a Member has an ADV greater than or equal to 0.15% of average TCV. As amended, a Member must have an ADV greater than or equal to 0.20% of average OCV.
• Tier 2 currently requires that a Member has an ADV greater than or equal to 0.25% of average TCV. As amended, a Member must have an ADV greater than or equal to 0.35% of average OCV.
• Tier 3 currently requires that a Member has an: (i) ADV greater than or equal to 1.75% of average TCV; and (ii) ADAV in Away Market Maker, Firm, Broker Dealer, and Joint Back Office orders greater than or equal to 1.25% of average TCV. As amended, a Member must have an: (i) ADV greater than or equal to 2.30% of average OCV; and (ii) ADAV in Away Market Maker, Firm, Broker Dealer, and Joint Back Office orders greater than or equal to 1.65% of average OCV.
• Tier 1 currently requires that a Member has an ADAV in Customer and Professional orders greater than or equal to 0.10% of average TCV. As amended, a Member must have an ADAV in Customer and Professional orders greater than or equal to 0.15% of average OCV.
• Tier 2 currently requires that a Member has an ADAV in Customer and Professional orders greater than or equal to 0.20% of average TCV. As amended, a Member must have an ADAV in Customer and Professional orders greater than or equal to 0.25% of average OCV.
• Tier 3 currently requires that a Member has an ADAV in Customer and Professional orders greater than or equal to 0.30% of average TCV. As amended, a Member must have an ADAV in Customer and Professional orders greater than or equal to 0.40% of average OCV.
• Tier 4 currently requires that a Member has an ADAV in Customer and Professional orders greater than or equal to 0.50% of average TCV. As amended a Member must have an ADAV in Customer and Professional orders greater than or equal to 0.65% of average OCV.
• Tier 1 currently requires that a Member has an ADV greater than or equal to 0.30% of average TCV. As amended, a Member must have an ADV greater than or equal to 0.40% of average OCV.
• Tier 2 currently requires that a Member has an: (i) ADAV in Away Market Maker, Firm, Broker Dealer and Joint Back Office orders greater than or equal to 0.80% of average TCV; and (ii) ADV greater than or equal to 1.50% of average TCV. As amended, a Member must have an: (i) ADAV in Away Market Maker, Firm, Broker Dealer and Joint Back Office orders greater than or equal to 1.05% of average OCV; and (ii) ADV greater than or equal to 1.95% of average OCV.
• Tier 3 currently requires that a Member has an: (i) ADV greater than or equal to 0.40% of average TCV: and (ii) ADAV in Away Market Maker, Firm, Broker Dealer and Joint Back Office orders greater than or equal to 0.30% of average TCV. As amended, a Member must have an: (i) ADV greater than or equal to 0.50% of average OCV; and (ii) ADAV in Away Market Maker, Firm, Broker Dealer and Joint Back Office orders greater than or equal to 0.40% of average OCV.
• Tier 1 currently requires that a Member has an ADV greater than or equal to 0.30% of average TCV. As amended, a Member must have an ADV greater than or equal to 0.40% of average OCV.
• Tier 2 currently requires that a Member has an ADV greater than or equal to 1.00% of average TCV. As amended, a Member must have an ADV greater than or equal to 1.30% of average OCV.
• Tier 1 currently requires that a Member has an ADAV in Customer orders greater than or equal to 0.70% of average TCV. As amended a Member must have an ADAV in Customer orders greater than or equal to 0.90% of average OCV.
• Tier 1 currently requires that a Member has an: (i) ADAV in Customer orders greater than or equal to 0.60% of average TCV; (ii) ADAV in Market Maker orders greater than or equal to 0.25% of average TCV; and (iii) ADAV on BZX Equities greater than or equal to 0.30% of average TCV. As amended, a Member must have an: (i) ADAV in Customer orders greater than or equal to 0.80% of average OCV; (ii) ADAV in Market Maker orders greater than or equal to 0.35% of average OCV; and (iii) ADAV on BZX Equities greater than or equal to 0.30% of average TCV.
• Tier 2 currently requires that a Member has an ADAV in Customer
• Tier 3 currently requires that a Member has an ADAV in Customer orders greater than or equal to 1.30% of average TCV. As amended, a Member must have an ADAV in Customer orders greater than or equal to 1.70% of average OCV.
As described above, the Exchange currently offers eight Customer Penny Pilot Add Volume Tiers under footnote 1 which provide enhanced rebates ranging from $0.40 to $0.53 per contract for orders which yield fee code PY and meet the required criteria. The Exchange now proposes to add a Step-Up Tier which would provide an additional rebate of $0.02 to orders appended with fee code PY, including those orders that satisfy the required criteria under the tiers listed under footnote 1. To qualify for the additional rebate, a Member must have an Options Step-Up Add OCV in Customer orders from October 2016 baseline equal to or greater than 0.45%.
As described above, the Exchange currently offers three Non-Customer Penny Pilot Take Volume Tiers under footnote 3 which provide reduced fees of $0.44 and $0.47 per contract for orders which yield fee code PP and meet the required criteria. Additionally, footnote 3 provides a Step-Up Tier under which Members may receive an additional discount of $0.01 per contract for orders appended with fee code PP, including those orders that satisfy the required criteria under the tiers listed under footnote 3. To receive the additional $0.01 per contract discount, the Member must have an Options Step-Up Add TCV in Customer orders from September 2016 baseline greater than or equal to 0.30%. The Exchange now proposes to delete and replace this Step-Up Tier under footnote 3 with a new Step-Up Tier which would provide a reduced fee of $0.47 per contract for orders which yield fee code PP and where the Member has an Options Step-Up Add OCV in Customer orders from October 2016 baseline greater than or equal to 0.45%.
As described above, the Exchange currently offers two Market Maker Non-Penny Pilot Add Volume Tiers under footnote 7 which provide enhanced rebates of $0.45 and $0.52 per contract for orders which yield fee code NM and meet the required criteria. The Exchange now proposes to add Tier 3 under which a Member would receive an enhanced rebate of $0.65 per contract where that Member has an: (i) ADAV in Market Maker orders in Non-Penny Pilot Securities greater than or equal to 0.20% of average OCV; and (ii) ADAV in Non-Customer orders greater than or equal to 3.00% of average OCV. The Exchange also notes that changes are required to the Standard Rates table of the fee schedule applicable to fee code NM in connection with this change.
As described above, the Exchange currently offers one Customer Non-Penny Pilot Add Volume Tier under footnote 12 which provides an enhanced rebate of $1.00 per contract for orders which yield fee code NY and meet the required criteria. The Exchange now proposes to add two new tiers under footnote 12. First, proposed Tier 2 would provide an enhanced rebate of $1.05 per contract where that Member has an ADAV in Customer orders greater than or equal to 2.10% of average OCV. Second, the proposed Step-Up Tier will provide an enhanced rebate of $1.00 per contract where that Member has an Options Step-Up Add OCV in Customer orders from October 2016 baseline greater than or equal to 0.45%. The Exchange also notes that changes are required to the Standard Rates table of the fee schedule applicable to fee code NY in connection with these changes.
The Exchange proposes to add new footnote 14 entitled, “Customer Penny Pilot Take Volume Tier”. Under the proposed Cross-Asset Tier, a Member's orders that yield fee code PC
The Exchange proposes to implement this amendment to its fee schedule on January 3, 2017.
The Exchange believes that the proposed rule change is consistent with the objectives of Section 6 of the Act,
The Exchange believes adopting a definition of OCV, utilizing OCV in lieu of TCV, and changing the definition of Options Step-Up Add TCV to Options Step-Up Add OCV are reasonable, fair and equitable, and non-discriminatory because the Exchange also proposed to modify the tier's related criteria in order to maintain substantially identical requirements to qualify for the tier without changing the rate provided for by the tiers. In addition, the amount of OCV historically tends to remain reasonably consistent from month to month, as opposed to TCV which is less consistent. OCV is also more consistent than options volume that clears in the Market Maker or Firm range at the OCC, as Market Maker and Firm volume may vary drastically from month to month based on market events, as opposed to Customer options volume which remains relatively consistent. Therefore, the Exchange believes utilizing OCV would result in consistent tier criteria as OCV is a relatively static monthly number which would enable market participants to better predict whether they may achieve a tier criteria each month and qualify for that tier's preferred pricing.
The Exchange also believes that the use of OCV provides a calculation that is identical to that which was implemented in December 2016 on the EDGX Options fee schedule.
The Exchange believes that the proposed modifications to the tiered pricing structure are reasonable, fair and equitable, and non-discriminatory. The Exchange operates in a highly competitive market in which market participants may readily send order flow to many competing venues if they deem fees at the Exchange to be excessive. The proposed fee structure remains intended to attract order flow to the Exchange by offering market participants a competitive pricing structure. The Exchange believes it is reasonable to offer and incrementally modify incentives intended to help to contribute to the growth of the Exchange.
Volume-based rebates such as that proposed herein have been widely adopted by exchanges, including the Exchange, and are equitable because they are open to all Members on an equal basis and provide additional benefits or discounts that are reasonably related to: (i) The value to an exchange's market quality; (ii) associated higher levels of market activity, such as higher levels of liquidity provisions and/or growth patterns; and (iii) introduction of higher volumes of orders into the price and volume discovery processes.
The proposed modifications and additions proposed herein are also intended to incentivize additional Members to send orders to the Exchange in an effort to qualify for the enhanced rebate made available by the tiers. The Exchange believes the proposed change to each tier's criteria is consistent with the Act.
Additionally, the Exchange believes the elimination and replacement of the Step-Up tier under footnote 3 is reasonable, fair, and equitable because the current tier was not providing the desired result of incentivizing Members to increase their participation over time. Therefore, eliminating the current Step-Up Tier under footnote 3 will have a negligible effect on order flow and market behavior. The Exchange believes the proposed new Step-Up Tier under footnote 3 should incentives Members to increase their participation in Customer and Non-Customer orders. Likewise, the proposed tiers under footnotes 1, 7 and 12 are also designed to incentivize Members to increase their participation on the Exchange. The Exchange believes it is reasonable to continue to modify the volume based incentives to help to contribute to the growth of the Exchange. The Exchange also believes the proposed change is not unfairly discriminatory because it will apply equally to all participants.
The Exchange does not believe its proposed amendment to its fee schedule would impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange does not believe that the proposed changes represents a significant departure from previous pricing offered by the Exchange or pricing offered by the Exchange's competitors. The Exchange believes that its proposal to amend the qualification criteria and to incorporate OCV as proposed would not impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act because the Exchange also proposed to modify the tier's related criteria in order to maintain substantially identical requirements to qualify for each tier. Additionally, Members may opt to disfavor the Exchange's pricing if they believe that alternatives offer them better value. Accordingly, the Exchange does not believe that the proposed changes to the volume discount and rebate structure will impair the ability of Members or competing venues to maintain their competitive standing in the financial markets. The Exchange believes that its proposal would not burden intramarket competition because the proposed rate changes would continue to apply uniformly to all Members. As stated above, the Exchange notes that it operates in a highly competitive market in which market participants can readily direct order flow to competing venues if they deem fee structure s to be unreasonable or excessive. The Exchange does not believe the proposed tiers would burden intramarket competition as they would apply to all Members uniformly.
The Exchange has not solicited, and does not intend to solicit, comments on this proposed rule change. The Exchange has not received any unsolicited written comments from Members or other interested parties.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send paper comments in triplicate to Brent J. Fields, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Notice of request for public comment.
The Department of State is seeking Office of Management and Budget (OMB) approval for the information collection described below. In accordance with the Paperwork Reduction Act of 1995, we are requesting comments on this collection from all interested individuals and organizations. The purpose of this notice is to allow 60 days for public comment preceding submission of the collection to OMB.
The Department will accept comments from the public up to March 20, 2017.
You may submit comments by any of the following methods:
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You must include the DS form number (if applicable), information collection title, and the OMB control number in any correspondence.
Direct requests for additional information regarding the collection listed in this notice, including requests for copies of the proposed collection instrument and supporting documents, to the Office of Passport Services, who may be reached at
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We are soliciting public comments to permit the Department to:
• Evaluate whether the proposed information collection is necessary for the proper functions of the Department.
• Evaluate the accuracy of our estimate of the time and cost burden for this proposed collection, including the validity of the methodology and assumptions used.
• Enhance the quality, utility, and clarity of the information to be collected.
• Minimize the reporting burden on those who are to respond, including the use of automated collection techniques or other forms of information technology.
Please note that comments submitted in response to this Notice are public record. Before including any detailed personal information, you should be aware that your comments as submitted, including your personal information, will be available for public review.
The Secretary of State is authorized to issue U.S. passports under 22 U.S.C. 211a. The Department of State, Passport Services administers the U.S. passport issuance program and operates passport agencies and application adjudication centers throughout the United States. As part of the Intelligence Reform and Terrorism Prevention Act of 2004, the Western Hemisphere Travel Initiative required the Secretary of Homeland Security and the Secretary of State to implement a plan to require all U.S. citizen and non-citizen nationals to present a passport and/or other sufficient documentation when entering the U.S. from abroad. This resulted in an increase in demand for U.S. passports.
The Passport Demand Forecasting Survey requests information from the general public about the demand for U.S. passports, anticipated travel, and the demographic profile of the respondent. This voluntary survey is conducted on a monthly basis using responses from a randomly selected but nationally representative sample of U.S. nationals ages 18 and older. The information obtained from the survey is used to monitor and project the demand for U.S. passport books and U.S. passport cards. The Passport Demand Forecasting Survey aids the Department of State, Passport Services in making decisions about staffing, resource allocation, and budget planning.
The Passport Demand Forecasting Study uses monthly surveys that will gather data from a national representative sample of U.S. nationals. Survey delivery methodologies can include mail, internet/web, telephone, and mix-mode surveys to ensure the CA/PPT reaches the appropriate audience and leverages the best research method to obtain valid responses. The survey data will cover an estimated 48,000 respondents annually.
Notice of request for public comment.
The Department of State is seeking Office of Management and Budget (OMB) approval for the information collection described below. In accordance with the Paperwork Reduction Act of 1995, we are requesting comments on this collection from all interested individuals and organizations. The purpose of this notice is to allow 60 days for public comment preceding submission of the collection to OMB.
The Department will accept comments from the public up to
You may submit comments by any of the following methods:
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You must include the DS form number (if applicable), information collection title, and the OMB control number in any correspondence.
Direct requests for additional information regarding the collection listed in this notice, including requests for copies of the proposed collection instrument and supporting documents, to Derek A. Rivers, Bureau of Consular Affairs, Overseas Citizens Services (CA/OCS/PMO), U.S. Department of State, SA-17, 10th Floor, Washington, DC 20522-1707, who may be reached at
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We are soliciting public comments to permit the Department to:
• Evaluate whether the proposed information collection is necessary for the proper functions of the Department.
• Evaluate the accuracy of our estimate of the time and cost burden for this proposed collection, including the validity of the methodology and assumptions used.
• Enhance the quality, utility, and clarity of the information to be collected.
• Minimize the reporting burden on those who are to respond, including the use of automated collection techniques or other forms of information technology.
Please note that comments submitted in response to this Notice are public record. Before including any detailed personal information, you should be aware that your comments as submitted, including your personal information, will be available for public review.
The purpose of the DS-5528 is to document the evacuation of persons from abroad when their lives are endangered by war, civil unrest, or natural disaster; document issuance of a crisis evacuation loan; obtain a Privacy Act Waiver to share information about the welfare of a U.S. citizen or U.S. lawful permanent resident consistent with the Privacy Act of 1974; and, to facilitate debt collection.
An electronic version of the Evacuee Manifest and Promissory Note was created, allowing applicants to type their information into the form, print it, and present it to a consular officer at the evacuation point. Continued software development will provide the capability to electronically submit signed loan applications for adjudication. The final stage of software development will not only allow the applicant to enter his/her information and submit the form, but will also make the information available for all stages of financial processing including the Department of State's debt collection process. Due to the potential for serious conditions during crisis events that often affect electronic and internet infrastructure systems, the electronic form will not replace the paper form. Rather, the paper form will still be maintained and used in the event that applicants are unable to submit forms electronically.
Designation of the Organization for Technological Industries (OTI) Pursuant to E.O. 13382.
Pursuant to the authority in section 1(ii) of E.O. 13382, “Blocking Property of Weapons of Mass Destruction Proliferators and Their Supporters”, the Under Secretary of State for Arms Control and International Security, in consultation with the Secretary of the Treasury and the Attorney General, has determined that the Syrian entity Organization for Technological Industries (OTI) has engaged, or attempted to engage, in activities or transactions that have materially contributed to, or pose a risk of materially contributing to, the proliferation of weapons of mass destruction or their means of delivery (including missiles capable of delivering such weapons), including any efforts to manufacture, acquire, possess, develop, transport, transfer or use such items, by any person or foreign country of proliferation concern.
Director, Office of Counterproliferation Initiatives, Bureau of International Security and Nonproliferation, Department of State, Washington, DC 20520, tel.: 202-647-5193.
On June 28, 2005, the President, invoking the authority,
Section 1 of the Order blocks, with certain exceptions, all property and interests in property that are in the United States, or that hereafter come within the United States or that are or hereafter come within the possession or control of United States persons, of: (1) The persons listed in the Annex to the Order; (2) any foreign person determined by the Secretary of State, in consultation with the Secretary of the Treasury, the Attorney General, and other relevant agencies, to have engaged, or attempted to engage, in activities or transactions that have materially contributed to, or pose a risk of materially contributing to, the proliferation of weapons of mass destruction or their means of delivery (including missiles capable of delivering such weapons), including any efforts to manufacture, acquire, possess, develop, transport, transfer or use such items, by any person or foreign country of proliferation concern; (3) any person determined by the Secretary of the Treasury, in consultation with the Secretary of State, the Attorney General, and other relevant agencies, to have provided, or attempted to provide, financial, material, technological or other support for, or goods or services in support of, any activity or transaction described in clause (2) above or any person whose property and interests in property are blocked pursuant to the Order; and (4) any person determined by the Secretary of the Treasury, in consultation with the Secretary of State, the Attorney General, and other relevant agencies, to be owned or controlled by, or acting or purporting to act for or on behalf of, directly or indirectly, any person whose property and interests in property are blocked pursuant to the Order.
Information on the additional designee is as follows:
Surface Transportation Board.
Correction to notice of exemption.
On June 27, 2016, Chesapeake Western Railway (CW) filed a verified notice of exemption under 49 CFR 1152 subpart F—
On September 23, 2016, CW filed a letter stating that the starting point of the Line at milepost CW 84.4 was inadvertently incorrect and should have been CW 84.0. As a result, CW states that the total length of the Line is approximately 15.5 miles as opposed to 15.1 miles. This notice corrects the description of the milepost and total length of the Line. All other information in the July 15, 2016 notice is correct.
Board decisions and notices are available on our Web site at “
By the Board, Rachel D. Campbell, Director, Office of Proceedings.
SMS Rail Lines of New York, LLC (SMS), a Class III rail carrier, has filed a verified notice of exemption under 49 CFR 1150.41 to acquire by lease from WCC, LLC, and operate approximately 3.5 miles of rail line in Hudson Falls, Washington County, NY (the Line). According to SMS, there are no milepost designations on the Line.
SMS certifies that its projected annual revenues as a result of this transaction will not result in the creation of a Class II or Class I rail carrier and will not exceed $5 million.
SMS further certifies that the transaction does not include a provision or agreement that may limit future interchange commitments.
The transaction may be consummated on February 4, 2017, the effective date of the exemption (30 days after the exemption was filed).
If the notice contains false or misleading information, the exemption is void ab initio. Petitions to revoke the exemption under 49 U.S.C. 10502(d) may be filed at any time. The filing of a petition to revoke will not automatically stay the transaction. Petitions for stay must be filed no later than January 27, 2017 (at least 7 days before the exemption becomes effective).
An original and 10 copies of all pleadings, referring to Docket No. FD 36088, must be filed with the Surface Transportation Board, 395 E Street SW., Washington, DC 20423-0001. In addition, one copy of each pleading must be served on Robert A. Klein, 629 B Swedesford Rd., Malvern, PA 19355.
According to SMS, this action is categorically excluded from environmental review under 49 CFR 1105.6(c).
Board decisions and notices are available on our Web site at
By the Board, Rachel D. Campbell, Director, Office of Proceedings.
Susquehanna River Basin Commission.
Notice.
This notice lists the projects approved by rule by the Susquehanna River Basin Commission during the period set forth in
December 1-30, 2016.
Susquehanna River Basin Commission, 4423 North Front Street, Harrisburg, PA 17110-1788.
Jason E. Oyler, General Counsel, telephone: (717) 238-0423, ext. 1312; fax: (717) 238-2436; email:
This notice lists the projects, described below, receiving approval for the consumptive use of water pursuant to the Commission's approval by rule process set forth in 18 CFR 806.22(f) for the time period specified above:
1. Chesapeake Appalachia, LLC, Pad ID: WGC, ABR-201205014.R1, Albany Township, Bradford County, Pa.; Consumptive Use of Up to 7.5000 mgd; Approval Date: December 2, 2016.
2. Chesapeake Appalachia, LLC, Pad ID: Iceman, ABR-201205016.R1, Wilmot Township, Bradford County, Pa.; Consumptive Use of Up to 7.5000 mgd; Approval Date: December 2, 2016.
3. SWEPI LP, Pad ID: Cotton Hanlon 595, ABR-201612001, Sullivan Township, Tioga County, Pa.; Consumptive Use of Up to 4.0000 mgd; Approval Date: December 2, 2016.
4. Anadarko E&P Onshore, LLC, Pad ID: COP Tract 356 Pad E, ABR-201112029.R1, Cummings Township, Lycoming County, Pa.; Consumptive Use of Up to 4.0000 mgd; Approval Date: December 5, 2016.
5. Anadarko E&P Onshore, LLC, Pad ID: Larrys Creek F&G Pad E, ABR-201112030.R1, Cummings Township, Lycoming County, Pa.; Consumptive Use of Up to 4.0000 mgd; Approval Date: December 5, 2016.
6. SWN Production Company, LLC, Pad ID: TONYA WEST, ABR-201201026.R1, New Milford Township, Susquehanna County, Pa.; Consumptive Use of Up to 4.9990 mgd; Approval Date: December 5, 2016.
7. SWN Production Company, LLC, Pad ID: WATTS, ABR-201202028.R1, New Milford Township, Susquehanna County, Pa.; Consumptive Use of Up to 4.9990 mgd; Approval Date: December 6, 2016.
8. Cabot Oil & Gas Corporation, Pad ID: KielarD P1, ABR-201112002.R1, Lathrop Township, Susquehanna County, Pa.; Consumptive Use of Up to 3.5750 mgd; Approval Date: December 12, 2016.
9. Cabot Oil & Gas Corporation, Pad ID: CareyR P1, ABR-201112023.R1, Harford Township, Susquehanna
10. Chesapeake Appalachia, LLC, Pad ID: Maris, ABR-201205010.R1, Auburn Township, Susquehanna County, Pa.; Consumptive Use of Up to 7.5000 mgd; Approval Date: December 12, 2016.
11. Carrizo (Marcellus), LLC, Pad ID: Trecoske North Pad, ABR-201201023.R1, Silver Lake Township, Susquehanna County, Pa.; Consumptive Use of Up to 2.1000 mgd; Approval Date: December 16, 2016.
12. Carrizo (Marcellus), LLC, Pad ID: Trecoske South Pad, ABR-201201024.R1, Silver Lake Township, Susquehanna County, Pa.; Consumptive Use of Up to 2.1000 mgd; Approval Date: December 16, 2016.
13. Talisman Energy USA Inc., Pad ID: Hemlock Valley, ABR-201201035.R1, Pike Township, Bradford County, Pa.; Consumptive Use of Up to 7.5000 mgd; Approval Date: December 16, 2016.
Pub. L. 91-575, 84 Stat. 1509
Federal Motor Carrier Safety Administration (FMCSA), DOT.
Notice of application for exemption; request for comments.
FMCSA announces that it has received an application from J.B. Hunt Transport, Inc. (J.B. Hunt), Schneider National Carriers, Inc. (Schneider), Werner Enterprises, Inc. (Werner), Knight Transportation, Inc. (Knight), Dupre Logistics, Inc. (Dupree), and Maveric Transportation, LLC (Maverick) (the Applicants) to allow hair analysis in lieu of urine testing for pre-employment controlled substances testing of commercial driver's license (CDL) holders. The Applicants currently conduct pre-employment urine testing that satisfies the Department of Transportation's (the Department) requirements under 49 CFR part 40 and hair analysis, separate from the Department's controlled substances and alcohol testing program. The Applicants' believe their data “. . . demonstrates that hair analysis is a more reliable and comprehensive basis for ensuring detection of controlled substance use” and the exemption would enable these fleets to discontinue pre-employment urine testing. FMCSA requests public comment on the exemption application.
Comments must be received on or before February 21, 2017.
You may submit comments identified by Federal Docket Management System Number FMCSA-2017-0002 by any of the following methods:
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Each submission must include the Agency name and the docket number for this notice. Note that DOT posts all comments received, without change, to
For information concerning this notice, contact Mr. Thomas Yager, Chief, FMCSA Driver and Carrier Operations Division; Office of Carrier, Driver and Vehicle Safety Standards; Telephone: (614) 942-6477. Email:
FMCSA encourages you to participate by submitting comments and related materials.
If you submit a comment, please include the docket number for this notice (FMCSA-2017-0002), indicate the specific section of this document to which the comment applies, and provide a reason for suggestions or recommendations. You may submit your comments and material online or by fax, mail, or hand delivery, but please use only one of these means. FMCSA recommends that you include your name and a mailing address, an email address, or a phone number in the body of your document so the Agency can contact you if it has questions regarding your submission.
To submit your comment online, go to
FMCSA has authority under 49 U.S.C. 31136(e) and 31315 to grant exemptions from certain Federal Motor Carrier Safety Regulations (FMCSRs). FMCSA must publish a notice of each exemption request in the
The Agency reviews safety analyses and public comments submitted, and determines whether granting the exemption would likely achieve a level of safety equivalent to, or greater than, the level that would be achieved by the current regulation (49 CFR 381.305). The decision of the Agency must be published in the
Currently, 49 CFR 382.105, concerning FMCSA's controlled substances and alcohol testing regulations, requires that each employer ensure all alcohol or controlled substances testing conducted on CDL holders complies with the procedures under 49 CFR part 40. All parties who conduct controlled substances and alcohol tests required by the Department must follow the Part 40 requirements on how to conduct the test and what procedures to use. Currently, Part 40 only allows urine testing for controlled substances. Congress, through the Omnibus Transportation Employee Testing Act (OTETA) of 1991 (Pub. L. 102-143, Title V, 105 Stat. 952). OTETA requires the Department to follow the HHS Mandatory Guidelines for scientific testing issues. While DOT has discretion concerning many aspects of the regulations governing testing in the transportation industries' regulated programs, we must follow the HHS Mandatory Guidelines for the laboratory standards and procedures the Department will use for regulated testing.
Section 382.301 provides requirements concerning pre-employment testing of commercial driver's license (CDL) holders for controlled substances, while 49 CFR part 383 prescribes requirements for individuals who must obtain a CDL. With limited exceptions, an employer must conduct pre-employment testing for controlled substances prior to the first time a driver performs “safety-sensitive functions,” as defined in 49 CFR 382.107. Employers must not allow a driver whom the employer intends to hire or use to perform safety-sensitive functions unless the employer has received a controlled substances test result from the medical review officer (MRO) or consortium/third-party administrator (C/TPA), as those terms are defined in 49 CFR 40.3, indicating a verified negative test result for that driver.
The Applicants have requested an exemption from 49 CFR 382.105 and 382.301 with specific authorization for release of and obtaining hair test results to comply with 49 CFR 391.23,
The carriers that would be covered by the exemption already use hair analysis as a method for pre-employment controlled substances testing of drivers on a voluntary basis. However, they also conduct urine testing for drugs because it is the only screening method accepted under the Department's regulations. The Applicant's view their use of multiple screening methods as an unnecessary and redundant financial burden. Also, the Applicants consider urine testing to be less effective in pre-employment screening for drugs than hair analysis.
A copy of the exemption application and all supporting documents submitted by the Applicant is available for review in the docket referenced at the beginning of this notice.
In accordance with 49 U.S.C. 31315(b)(4) and 31136(e), FMCSA requests public comment on the application for an exemption from 49 CFR 382.105 and 382.301.
The Agency will consider all comments received by close of business on February 21, 2017. Comments will be available for examination in the docket at the location listed under the
Federal Motor Carrier Safety Administration (FMCSA), DOT.
Notice of application for exemption; request for comments.
The Federal Motor Carrier Safety Administration (FMCSA) requests public comment on an application for exemption from Hino Motors Manufacturing U.S.A., Inc. (Hino) to allow an Automated Emergency Braking (AEB) system and a Lane Departure Warning (LDW) system camera to be mounted lower in the windshield than is currently permitted. Mounting the camera in this location does not meet the prohibition on obstructions to the driver's field of view requirements for windshields in the Federal Motor Carrier Safety Regulations (FMCSR) which requires devices meeting the definition of “vehicle safety technology” to be mounted not more than 4 inches below the upper edge of the area swept by the windshield wipers, or not more than 7 inches above the lower edge of the area swept by the windshield wipers, and outside the driver's sight lines to the road and highway signs and signals. Because the camera will be mounted outside of the driver's normal sight lines to all mirrors, Hino believes that they will maintain a level of safety that is equivalent to, or greater than, the level of safety achieved without the exemption.
Comments must be received on or before February 21, 2017.
You may submit comments bearing the Federal Docket Management System (FDMS) Docket ID FMCSA-2016-0450 using any of the following methods:
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Mrs. Amina Fisher, Vehicle and Roadside Operations Division, Office of Carrier, Driver, and Vehicle Safety, MC-PSV, (202) 366-2782, Federal Motor Carrier Safety Administration, 1200 New Jersey Avenue SE., Washington, DC 20590-0001.
Section 4007 of the Transportation Equity Act for the 21st Century (TEA- 21) [Pub. L. 105-178, June 9, 1998, 112 Stat. 401] amended 49 U.S.C. 31315 and 31136(e) to provide authority to grant exemptions from the Federal Motor Carrier Safety Regulations (FMCSRs). On August 20, 2004, FMCSA published a final rule (69 FR 51589) implementing section 4007. Under this rule, FMCSA must publish a notice of each exemption request in the
The Agency reviews the safety analyses and the public comments and determines whether granting the exemption would likely achieve a level of safety equivalent to or greater than the level that would be achieved by the current regulation (49 CFR 381.305).
The decision of the Agency must be published in the
Hino has applied for an exemption from 49 CFR 393.60(e) to allow an Automated Emergency Braking (AEB) system and a Lane Departure Warning (LDW) system camera to be mounted lower in the windshield than is currently permitted. A copy of the application is included in the docket referenced at the beginning of this notice.
Section 393.60(e)(1)(i) of the FMCSRs prohibits the obstruction of the driver's field of view by devices mounted at the top of the windshield. Antennas and similar devices must not be mounted more than 152 mm (6 inches) below the upper edge of the windshield, and outside the driver's sight lines to the road and highway signs and signals. Section 393.60(e)(1)(i) does not apply to vehicle safety technologies, as defined in § 390.5 as including “a fleet-related incident management system, performance or behavior management system, speed management system, lane departure warning system, forward collision warning or mitigation system, active cruise control system, and transponder.” Section 393.60(e)(1)(ii) requires devices with vehicle safety technologies to be mounted (1) not more than 100 mm (4 inches) below the upper edge of the area swept by the windshield wipers, or (2) not more than 175 mm (7 inches) above the lower edge of the area swept by the windshield wipers, and outside the driver's sight lines to the road and highway signs and signals.
In its application, Hino states:
Hino is making this request so that it becomes possible to introduce an Automated Emergency Braking (AEB) system and a Lane Departure Warning (LDW) system as optional equipment on some Hino commercial motor vehicles. This system, like many other similar systems which FMCSA has granted exemptions for, requires that a camera be mounted to the upper center area of the windshield in an area where the windshield in an area where the windshield is swept by the windshield wipers to provide a clear view to the lane markings on the road.
In the Hino installation, the camera housing supplied by Meritor Wabco is approximately 4.67 inches wide by 4.30 inches tall. We propose to mount the camera such that is in the approximate center of the windshield and such that the bottom edge of the camera is approximately 7 inches below the upper edge of the windshield, outside of the driver's and passenger's normal sight lines to all mirrors, highway signs, signals and view of the road ahead. This location will allow for the optimal functionality of the advanced safety systems supported by the camera.
Hino has created a CAD layout of a typical Hino conventional type truck to verify that we do not significantly obstruct the FMVSS 104 specified zones A, B or C for passenger cars of 1730 or more mm overall width [Figure 1 of application]. In fact, we obstruct 0.0% of zone C, 0.1% of zone B and 1.4% of zone A.
Hino has installed one prototype camera housing in a Hino conventional type model 258LP (low profile) test vehicle with the lowest cab height we offer to assess, through a jury evaluation, the impact of the camera on driver and passenger visibility [Figure 2 of application].
All drivers and passengers agreed that there was no noticeable obstruction to the normal sight lines to the road ahead, highway signs, signals or any mirrors. Also, one driver noted that the camera did not interfere with the normal range of motion of the sun visor and that the sun visor lower edge extended lower than the camera housing [Figure 3 of application].
The exemption would apply to all CMV operators driving Hino vehicles with the AEB/LDW system camera installed. Hino believes that mounting the system as described will maintain a
In accordance with 49 U.S.C. 31315 and 31136(e), FMCSA requests public comment from all interested persons on Hino's application for an exemption from 49 CFR 393.60. All comments received before the close of business on the comment closing date indicated at the beginning of this notice will be considered and will be available for examination in the docket at the location listed under the
Federal Transit Administration (FTA), DOT.
Notice.
By this notice, the Federal Transit Administration (FTA) is establishing an Emergency Relief Docket for calendar year 2017 so grantees and subgrantees affected by national or regional emergencies may request temporary relief from FTA administrative and statutory requirements.
Bonnie L. Graves, Attorney-Advisor, Office of Chief Counsel, Federal Transit Administration, 90 Seventh Street, Ste. 15-300, San Francisco, CA 94103; phone: (202) 366-0944, fax: (415) 734-9489, or email,
Pursuant to title 49 CFR part 601, subpart D, FTA is establishing the Emergency Relief Docket for calendar year 2017. Subsequent to an emergency or major disaster, the docket may be opened at the request of a grantee or subgrantee, or on the FTA Administrator's own initiative.
In the event a grantee or subgrantee believes the Emergency Relief Docket should be opened and it has not been opened, that grantee or subgrantee may submit a petition to
All petitions for relief from a provision of chapter 53 of title 49, U.S.C. or FTA administrative requirements must be posted in the docket in order to receive consideration by FTA. The docket is publicly available and can be accessed 24 hours a day, seven days a week, via the Internet at
In the event a grantee or subgrantee needs to request immediate relief and does not have access to electronic means to request that relief, the grantee or subgrantee may contact any FTA regional office or FTA headquarters and request that FTA staff submit the petition on its behalf.
Federal public transportation law at 49 U.S.C. 5324(d) provides that a grant awarded under Section 5324 or under 49 U.S.C. 5307 or 49 U.S.C. 5311 that is made to address an emergency shall be subject to the terms and conditions the Secretary determines are necessary. This language allows FTA to waive statutory, as well as administrative, requirements. Therefore, grantees affected by an emergency or major disaster may request waivers of provisions of chapter 53 of title 49, U.S.C. when a grantee or subgrantee demonstrates the requirement(s) will limit a grantee's or subgrantee's ability to respond to an emergency. Grantees must follow the procedures set forth below when requesting a waiver of statutory or administrative requirements.
A petition for relief shall:
(a) Identify the grantee or subgrantee and its geographic location;
(b) Identify the section of chapter 53 of title 49, U.S.C., or the FTA policy statement, circular, guidance document and/or rule from which the grantee or subgrantee seeks relief;
(c) Specifically address how a requirement in chapter 53 of title 49 U.S.C., or an FTA requirement in a policy statement, circular, agency guidance or rule will limit a grantee's or subgrantee's ability to respond to an emergency or disaster; and
(d) Specify if the petition for relief is one-time or ongoing, and if ongoing identify the time period for which the relief is requested. The time period may not exceed three months; however, additional time may be requested through a second petition for relief.
A petition for relief from administrative requirements will be conditionally granted for a period of three (3) business days from the date it is submitted to the Emergency Relief Docket. FTA will review the petition after the expiration of the three business days and review any comments submitted thereto. FTA may contact the grantee or subgrantee that submitted the request for relief, or any party that submits comments to the docket, to obtain more information prior to making a decision. FTA shall then post a decision to the Emergency Relief Docket. FTA's decision will be based on whether the petition meets the criteria for use of these emergency procedures, the substance of the request, and the comments submitted regarding the petition. If FTA does not respond to the request for relief to the docket within three business days, the grantee or subgrantee may assume its petition is granted for a period not to exceed three months until and unless FTA states otherwise.
A petition for relief from statutory requirements will not be conditionally granted and requires a written decision from the FTA Administrator.
Pursuant to 49 CFR 604.2(f) of FTA's Charter Rule, grantees and subgrantees may assist with evacuations or other movement of people that might otherwise be considered charter transportation when that transportation is in response to an emergency declared by the President, governor, or mayor, or in an emergency requiring immediate action prior to a formal declaration,
FTA reserves the right to reopen any docket and reconsider any decision made pursuant to these emergency procedures based upon its own initiative, based upon information or comments received subsequent to the three business day comment period, or at the request of a grantee or subgrantee upon denial of a request for relief. FTA shall notify the grantee or subgrantee if it plans to reconsider a decision. FTA decision letters, either granting or denying a petition, shall be posted in the Emergency Relief Docket and shall reference the document number of the petition to which it relates.
Federal Transit Administration (FTA), DOT.
Notice.
This notice provides interim guidance for programs in FY 2017, announces the apportionments and allocations for programs authorized and funded by the Further Continuing and Security Assistance Appropriations Act, 2017 (Pub. L. 114-254) and provides contract authority, and describes future plans for several competitive programs. The notice also includes locations of FY 2017 apportionment tables and unobligated (or carryover) funds allocated under the competitive programs from prior years.
For general information about this notice contact Kimberly Sledge, Director, Office of Transit Programs, at (202) 366-2053. Please contact the appropriate FTA Regional Office for any specific requests for information or technical assistance. FTA Regional Office contact information is available on FTA's Web site:
An FTA headquarters contact for each major program area is included in the discussion of that program in the text of this notice. FTA recommends that stakeholders subscribe on FTA's Web site
This document contains important information and interim guidance about existing FTA program statutes (49 U.S.C. 5301,
In addition, this document provides notice of funding availability through April 28, 2017 by the Further Continuing and Security Assistance Appropriations Act, 2017 (Pub. L. 114-254) contract authority for FTA formula and competitive programs pursuant to the Further Continuing and Security Assistance Appropriations Act, 2017 (Pub. L. 114-254) (“Continuing Appropriations Act”).
For each FTA program, FTA has provided information on the FY 2017 authorized funding levels, the basis for apportionment or allocation of funds, requirements specific to the program, the period of availability of funds, and other program information. A separate section provides information on pre-award authority as well as other requirements and guidance applicable to FTA programs and grant administration. Finally, the notice includes referred to tables on FTA's Web site that show $5,323,087,320 in new contract authority apportioned through April 28, 2017 and approximately $1.04 billion in unobligated or carryover contract authority that is available in FY 2017 from prior years.
Information in this document includes references to the existing FTA program guidance and circulars. Some information may have been superseded by new provisions in the FAST Act, but these guidance documents and circulars remain a resource for program management in most areas. FTA intends to revise the guidance and circulars, as appropriate, with an opportunity for public comment where necessary.
The Further Continuing and Security Assistance Appropriations Act, 2017 (Pub. L. 114-254) makes new funding available for FY 2017 available through April 28, 2017. At approximately seven twelfths of the FY 2016 level.
Current funding availability for each program is identified in section IV of this notice and in Table 1 located on FTA's FY 2017 Apportionment Web page:
The FAST Act modified section 5338(f) to provide for the following oversight takedowns of FTA programs: 0.5 percent of Metropolitan and Statewide Planning funds, 0.75 percent of Urbanized Area Formula funds, 1 percent of Fixed Guideway Capital Investment funds, 0.5 percent of Formula Grants for the Enhanced Mobility of Seniors and Individuals with Disabilities, 0.5 percent of Formula Grants for Rural Areas, 1 percent of State of Good Repair Formula funds, 0.75 percent for Grants for Buses and Bus Facilities, and 1 percent of Capital and Preventive Maintenance Projects for Washington Metropolitan Area Transit Authority funds. The funds are used to provide necessary oversight activities, such as oversight of the construction of any major capital project receiving Federal transit assistance; to conduct State Safety Oversight, drug and alcohol, civil rights, procurement systems, management, planning certification, and financial reviews and audits, as well as evaluations and analyses of grantee-specific problems and issues; and to generally provide technical assistance and correct deficiencies identified in compliance reviews and audits.
FTA is publishing apportionment tables on its Web site for each program that reflects the funding level in the continuing resolution appropriations less oversight take-downs, as applicable. Tables displaying the funds available to eligible states, tribes, and urbanized areas have been posted to
Consistent with past practices, the calculations for sections 5307, 5311, including 5311(j) (Tribal Transit), 5329, 5337, and 5339 programs rely on the most-recent transit service data reported to the (NTD), which for FY 2017 is the 2015 report year. In some cases where an apportionment is based on the age of the system, the age is calculated as of September 30, 2016, the last day before FY 2017 began. Any recipient or beneficiary of either section 5307 or Rural Areas Formula Program program funds is required to report to the NTD. Additionally, a number of transit operators report to the FTA's NTD on a voluntary basis. For the 2015 report year, the NTD includes data from 866 reporters in urbanized areas, 836 of which reported operating transit service. The NTD also includes data from 1,551 providers of rural transit service, which includes 134 Indian Tribes providing transit service.
The 2010 Census data is used to determine population and population density for sections 5303, 5305, 5307 and 5339 as well as rural population and rural land area for Rural Areas Formula Program. The formulas for sections 5307, 5311, and 5311(j) include tiers where funding is allocated on the basis of the number of persons living in poverty, and the section 5310 formula program allocates funding on the basis of the population of older adults and people with disabilities. The Census Bureau no longer publishes decennial census data on persons living in poverty and persons with disabilities. As a result, since FY 2013, FTA used the data for these populations available via the Census' American Community Survey (ACS). The NTD and census data that FTA used to calculate the apportionments associated with this notice can be found on FTA's Web site:
The FY 2017 apportionments use data on low-income persons, persons with disabilities, and older adults from the 2010-2014 ACS five-year data set, which was published in December 2015. This data represent the most recent five-year ACS estimates that are available as of October 1st for the year being apportioned. As was the case in prior years, data on low-income persons comes from ACS Table B17024, “Age by Ratio of Income to Poverty in the Last Twelve Months,” and data on people with disabilities under 65 years old comes from ACS Table S1810, “Disability Characteristics.” Data on older adults (over 65 years old) comes from ACS Table B01001, “Sex by Age.”
Section 207 of title 23, United States Code establishes a Tribal Transportation Self-Governance Program (Self Governance Program). The Self-Governance Program establishes specific criteria for determining eligibility for a tribe to participate in the program. DOT will implement this program in consultation with tribal representatives and other interested stakeholders. A Negotiated Proposed Rulemaking to implement this program is under development.
FTA's research mission is to advance public transportation innovation by leading multi-dimensional research, development, demonstration, deployment, and technical assistance projects for the transit industry that improves riders' experiences and enhances public transit's effectiveness, efficiency, quality, and safety. FTA's Office of Research, Demonstration, and Innovation sought industry input on a five year research strategic plan. The result was an affirmation of FTA's research strategic goals to improve safety, enhance mobility, promote asset management, and expand asset innovation. These goals directly address and support the six primary purposes of U.S. DOT's transportation research and development program as defined in Section 6503 of the FAST Act as follows:
• Improving mobility of people and goods;
• Reducing congestion;
• Promoting safety;
• Improving the durability and extending the life of transportation infrastructure;
• Preserving the environment; and
• Preserving the existing transportation system.
Going forward, FTA will continue to prioritize research investments based upon these goals. FTA expects to publish its Research Strategic Plan in FY 2017.
Shared Mobility continues to remain a key focus area within FTA's Public Transportation Innovation program. The definition of personal mobility is changing due to social and cultural trends combined with the powerful tools in handheld smartphones and related transportation technology innovations. New mobility concepts and solutions like bike-sharing, car-sharing, car-hailing, and innovative demand-response bus services are now possible and more convenient because of these developments. This gives travelers new, flexible and personally tailored transportation options. Many of these services are emerging in proximity to high-capacity transit corridors with land uses and activities that create the market
To support personal mobility innovation, (FTA) recently allocated $8 million for 11 projects through the innovative Mobility on Demand (MOD) Sandbox Demonstration program using FTA research funds (Public Transportation Innovation/Public Transportation Innovation). The projects carried out by transit agencies will test new ideas in personal mobility and integrated multimodal transportation networks. From that MOD program solicitation process, and from dialogue with other stakeholders, FTA has identified questions about funding eligibility under Federal public transportation law for FTA grant programs, like the Urbanized Area and Rural formula programs, as well as compliance with federal requirements, such as the Americans with Disabilities Act (ADA), related to mobility on demand generally and, particularly, to electronic hailing of vehicles such as taxis or other transportation network company (TNC) vehicles.
FTA has prepared answers to Frequently Asked Questions (FAQs) to address the eligibility and Federal requirement questions. This information is posted on the FTA Web site at
On August 1, 2016, FTA issued its final rule to implement minimum performance standards, a scoring system, and a pass/fail threshold for new model transit buses procured with FTA financial assistance authorized under 49 U.S.C. Chapter 53. Consistent with 49 U.S.C. 5318(e), FTA recipients are prohibited from using FTA financial assistance to procure new bus models, that were not previously tested, that have not met the minimum performance standards established by this rule. The standards and scoring system address the following categories: Structural integrity, safety, maintainability, reliability, fuel economy, emissions, noise, and performance. Buses must meet a minimum performance standard in each of these categories in order to receive an overall passing score and be eligible for purchase using FTA financial assistance. Buses can achieve higher scores with higher performance in each category, and the final rule establishes a numerical scoring system based on a 100-point scale so that buyers can more effectively compare vehicles.
The final rule was effective on October 31, 2016. FTA's Web site has additional information, resources, and a link to sign up for email notices about the Bus Testing Program at:
FTA will issue Notices of Funding Opportunities (NOFO) in FY 2017 for the programs listed in the following chart. Additional information about each competitive program is in section III of this notice.
Section 5305(d) authorizes Federal funding to support a cooperative, continuous, and comprehensive planning program for transportation investment decision-making at the metropolitan area level. The specific requirements of metropolitan transportation planning are set forth in 49 U.S.C. 5303 and further explained in 23 CFR part 450, as incorporated by reference in 49 CFR part 613, Planning Assistance and Standards. State Departments of Transportation (DOTs) are direct recipients of funds allocated by FTA, which are then sub-allocated to Metropolitan Planning Organizations (MPOs), for planning activities that support the economic vitality of the metropolitan area.
The MPO process must establish a performance-based approach in which the MPO will develop specific performance targets that address transportation system performance measures (to be issued by U.S. DOT), where applicable, to use in tracking progress towards attaining critical outcomes. These performance targets will be established by MPOs in coordination with States and transit providers. MPOs will provide a system performance report that evaluates the progress of the MPO in meeting the performance targets in comparison with the system performance identified in prior reports. This funding must support work elements and activities resulting in balanced and comprehensive intermodal transportation planning for the movement of people and goods in the metropolitan area. Comprehensive transportation planning is not limited to transit planning or surface transportation planning, but also encompasses the relationships among land use and all transportation modes, without regard to the programmatic source of Federal assistance. Eligible work elements or activities include, but are not limited to studies relating to management, mobility management, planning, operations, capital requirements, economic feasibility, performance-based planning; evaluation of previously funded projects; peer reviews and exchanges of technical data, information, assistance, and related activities in support of planning and environmental analysis among MPOs and other transportation planners; work elements and related activities preliminary to and in
Federal transit law authorizes $110,347,597 in FY 2017 to provide financial assistance for metropolitan planning needs under section 5305. Under the Further Continuing Appropriations Act, $62,042,888 is available through April 28, 2017.
In FY 2017, $62,042,888 is available for the period October 1, 2016 through April 28, 2017 to the Metropolitan Planning Program (section 5305(d)) to support metropolitan transportation planning activities set forth in section 5303. The total amount apportioned for the Metropolitan Planning Program to States for use by MPOs in urbanized areas (UZAs) is $61,732,673 as shown in the table below, after the deduction for oversight (authorized by section 5338).
Of the amounts authorized in section 5305, 82.72 percent is made available to the Metropolitan Planning Program. Eighty percent of the funds are apportioned on a statutory basis to the States based on the most recent decennial Census for each State's UZA population. The remaining 20 percent is provided to the States based on an FTA administrative formula to address planning needs in larger, more complex UZAs. The amount published for each State includes the supplemental allocation.
The State allocates Metropolitan Planning funds to MPOs in UZAs or portions thereof to provide funds for planning projects included in a one or two-year program of planning work activities (the Unified Planning Work Program, or UPWP) that includes multimodal systems planning activities spanning both highway and transit planning topics. Each State has either reaffirmed or developed, in consultation with its MPOs, an allocation formula among MPOs within the State, based on the 2010 Census. The allocation formula among MPOs in each State may be changed annually, but any change requires approval by the FTA Regional Office before grant approval. Program guidance for the Metropolitan Planning Program is found in FTA Circular 8100.1C,
The Metropolitan Planning program funds apportioned in this notice are available for obligation during FY 2017 plus three additional fiscal years. Accordingly, funds apportioned in FY 2017 must be obligated in grants by September 30, 2020. Any FY 2017 apportioned funds that remain unobligated at the close of business on September 30, 2020, will revert to FTA for reapportionment under the Metropolitan Planning Program.
The planning programs provide funding and procedural requirements to metropolitan areas and States for multimodal transportation planning that is cooperative, continuous, and comprehensive, resulting in long-range plans and short-range programs of projects that reflect transportation investment priorities. The planning programs are jointly administered by FTA and the Federal Highway Administration (FHWA), which provides additional funding. The FAST Act sections 5303 and 5304 as noted below:
• New emphasis is placed on intercity transportation, including intercity buses and intermodal facilities that support intercity transportation, and commuter vanpool providers.
• The scope of the planning process adds two new planning factors, in addition to the eight pre-existing factors established under prior law. The two new factors are: (1) Improve the resiliency and reliability of the transportation system, and reduce the vulnerability of the existing transportation infrastructure to natural disasters, and (2) enhance travel and tourism.
• MPOs and State DOTs should provide public ports, intercity bus operators and employer-based commuting programs with a reasonable opportunity to comment on transportation plans.
• Plans must place greater emphasis on the congestion management process. MPOs that serve transportation management areas must develop a congestion management plan with input from employers, private and public transit providers, transportation management associations, and organizations that provide low-income individuals transportation access to jobs and job related services.
• The long-range statewide transportation plan and metropolitan transportation plan must include a description of the performance measures and performance targets. State DOTs and MPOs are also required to provide a system performance report evaluating the condition and performance of the transportation system.
In the Final Rule on Statewide and Nonmetropolitan Transportation Planning and Metropolitan Transportation Planning, FHWA and FTA make the statewide, metropolitan, and nonmetropolitan transportation planning regulations consistent with current statutory requirements. The final rule establishes the following: (1) A new mandate for States and MPOs to take a performance-based approach to planning and programming; (2) a new emphasis on the nonmetropolitan transportation planning process, by requiring States to have a higher level of involvement with nonmetropolitan local officials and providing a process for the creation of RTPOs; (3) implementation of the afore mentioned statutory requirement for a structural change to the membership of the larger MPOs; (4) a new framework for voluntary scenario
Among the most significant charges is the new mandate for a performance-based planning process: MPOs and State DOTs must establish performance targets that address forthcoming U.S. DOT-issued national performance measures that are based on the goals outlined in the legislation-safety, infrastructure condition, congestion reduction, system reliability, economic vitality, environmental sustainability, reduced project delivery delays, transit safety, and transit asset management. MPOs also must coordinate their performance targets, to the maximum extent practicable, with performance targets set by FTA grantees under the new performance measure requirements for safety and state of good repair. Transportation Improvement Programs (TIPs) must include a description of the anticipated progress toward achieving the performance targets resulting from implementation of the TIP. By October 1, 2017, DOT will provide Congress with a report evaluating the effectiveness of performance-based planning and assessing the technical capacity of MPOs in smaller areas to undertake performance-based planning. After May 27, 2018, a State's and MPO's long-range plans, STIPs, and TIPs must reflect performance targets and plans according to the provisions of the final rule.
This program provides financial assistance to States for statewide transportation planning and other technical assistance activities, including supplementing the technical assistance program provided through the Metropolitan Planning program. The specific requirements of Statewide transportation planning are set forth in 49 U.S.C. 5304 and further explained in 23 CFR part 450 as referenced in 49 CFR part 613, Planning Assistance and Standards. State DOTs are required to reference performance measures and performance targets within the Statewide Planning process. This funding must support work elements and activities resulting in balanced and comprehensive intermodal transportation planning for the movement of people and goods. Comprehensive transportation planning is not limited to transit planning or surface transportation planning, but also encompasses the relationships among land use and all transportation modes, without regard to the programmatic source of Federal assistance.
Federal transit law authorizes $23,051,336 in FY 2017, to provide financial assistance for statewide planning and other technical assistance activities under section 5305. Under the Continuing Appropriations Act of 2017, $12,960,603 is available through April 28, 2017. As specified in law, this represents the 17.28 percent of the amounts available for section 5305 that are allocated to the Statewide Planning and Research program.
In FY 2017, $12,960,603 is available for the period October 1, 2016 through April 28, 2017 to the State Planning and Research Program (section 5305(e)). The total amount apportioned for the State Planning and Research Program (SPRP) is $12,895,800 as shown in the table below, after the deduction for oversight (authorized by section 5338).
States' apportionments for this program are displayed in Table 2.
Of the amount authorized for section 5305, 17.28 percent is allocated to the State Planning and Research program. FTA apportions funds to States by a statutory formula that is based on the most recent decennial Census data available, and the State's UZA population as compared to the UZA population of all States.
Funds are provided to States for Statewide transportation planning programs. These funds may be used for a variety of purposes such as planning, technical studies and assistance, performance-based planning, demonstrations, and management training. In addition, a State may authorize a portion of these funds to be used to supplement Metropolitan Planning funds allocated by the State to its UZAs, as the State deems appropriate. Program guidance for the State Planning and Research program is found in FTA Circular 8100.1C,
The State Planning and Research program funds apportioned in this notice are available for obligation during FY 2017 plus three additional fiscal years. Accordingly, funds apportioned in FY 2017 must be obligated in grants by September 30, 2020. Any FY 2017 apportioned funds that remain unobligated at the close of business on September 30, 2020 will revert to FTA for reapportionment under the State Planning and Research program.
The Urbanized Area Formula Program provides financial assistance to designated recipients in urbanized areas (UZAs) for capital investments in public transportation systems, planning, job access and reverse commute projects, and, in some cases, operating assistance. FTA apportions funds for this program through a statutory formula. Of the amount authorized for Section 5307 each year, $30 million is set aside for the competitive Passenger Ferry Grant Program (Ferry program), as authorized under 49 U.S.C., 5307(h). The Ferry program offers financial assistance to public ferry systems in urbanized areas for capital projects. Projects are selected annually through a funding competition. Additionally 0.5 percent will be apportioned to eligible States for State Safety Oversight (SSO) Program grants, and 0.75 percent will be set aside for program oversight. Further information on the 0.5 percent apportionment to States for the State Safety Oversight Program is provided in section IV.M. of this notice.
For more information or questions on the
Federal transit law authorizes $4,629,683,814 in FY 2017 to provide financial assistance for urbanized areas under section 5307. Under the Continuing Appropriations Act of 2017, $2,604,058,475 is available through April 28, 2017.
Under the Further Continuing and Security Assistance Appropriations Act, 2017, only $2,604,058,475 is available for the Urbanized Area Formula program for the period of October 1, 2016 through April 28, 2017. The total amount apportioned to urbanized areas is $2,817,580,866, which includes the addition of amounts apportioned to UZAs pursuant to the Section 5340 Growing States and High Density States Formula factors. This amount excludes the set-aside for the Ferry program, apportionments under the State Safety Oversight Program, and oversight (authorized by section 5338), as shown in the table below:
FTA apportions Urbanized Area Formula Program funds based on statutory formulas. Congress established four separate formulas to apportion portions of the available funding: The Section 5307 Urbanized Area Formula Program formula, the Small Transit Intensive Cities (STIC) formula, the Growing States and High Density States formula, and a formula based on low-income population.
Consistent with prior apportionment notices, Table 3 shows a total section 5307 apportionment for each UZA, which includes amounts apportioned under each of these formulas. Detailed information about the formulas is provided in Table 4. For technical assistance purposes, the UZAs that receive STIC funds are listed in Table 6. FTA will provide breakouts of the funding allocated to each UZA under these formulas upon request to the FTA Regional Office.
FTA has calculated dollar unit values for the formula factors used in the Urbanized Area Formula Program apportionment calculations. These values represent the amount of money each unit of a factor is worth in this year's apportionment. The unit values change each year, based on all of the data used to calculate the apportionments, as well as the amount appropriated by Congress for the apportionment. The dollar unit values for FY 2017 are displayed in Table 5. To replicate the basic formula component of a UZA's apportionment, multiply the dollar unit value by the appropriate formula factor (
For UZAs between 50,000 and 199,999 in population, the Urbanized Area Formula is based on population and population density. For UZAs with populations of 200,000 or more, the formula is based on a combination of bus revenue vehicle miles, bus passenger miles, bus operating costs, fixed guideway vehicle revenue miles, and fixed guideway route miles, as well as population and population density. The Urbanized Area Formula is defined in 49 U.S.C. 5336. Consistent with section 5336(b), FTA has included 27 percent of the fixed guideway directional route miles and vehicle revenue miles from eligible urbanized area transit systems, but which were attributable to rural areas outside of the urbanized areas from which the system receives funds.
Under the STIC formula, FTA apportions 1.5% of the funds made available for section 5307 to UZAs that are under 200,000 in population and have public transportation service that operates at a level equal to or above the industry average for UZAs with a population of at least 200,000, but not more than 999,999. STIC funds are apportioned on the basis of six performance categories: Passenger miles traveled per vehicle revenue mile, passenger miles traveled per vehicle revenue hour, vehicle revenue miles per capita, vehicle revenue hours per capita, passenger miles traveled per capita, and passengers per capita. In FY 2019, the STIC set aside will increase from 1.5% to 2%.
The data used to determine a UZA's eligibility under the STIC formula and to calculate the STIC apportionments was obtained from the NTD for the 2015 reporting year. Because performance data change with each year's NTD reports, the UZAs eligible for STIC funds and the amount each receives may vary each year. UZAs that received funding through the STIC formula for FY 2017 are listed in Table 6.
FTA also apportions funds to qualifying UZAs and States according to the section 5340 Growing States and High Density States formula, as shown in Table 3. More information on this program and its formula is found in section IV.P. of this notice.
Of the amount authorized and appropriated for the Urbanized Area Formula Program in each year, 3.07 percent is apportioned on the basis of low income population. As specified in statute, FTA apportions 75 percent of the available funds to UZAs with a population of 200,000 or more. Funds are apportioned based on the ratio of the number of low income individuals in each UZA to the total number of low income individuals in all urbanized areas of that size. FTA apportions the remainder of the funds (25 percent) to UZAs with populations of less than 200,000, according to an equivalent formula. The low income populations used for this calculation were based on the American Community Survey (ACS) data set for 2010-2014. This information is updated by the Census Bureau annually.
The maximum Federal share for the Urbanized Area Formula Program, including the Ferry Program, is 80 percent, or 85 percent for the net project cost of acquiring vehicles (including clean-fuel or alternative fuel) for the purpose of complying with or maintaining compliance with the Clean Air Act (CAA) or the Americans with Disabilities Act (ADA) of 1990. The maximum Federal share is 90 percent of the net project cost for acquiring vehicle-related equipment or facilities (including clean-fuel or alternative-fuel vehicle-related equipment or facilities) for the purpose of complying with or maintaining compliance with the CAA or ADA.
Program guidance for the Urbanized Area Formula Program is found in FTA Circular 9030.1E, Urbanized Area Formula Program: Program Guidance and Application Instructions, dated January 16, 2014, and is supplemented by additional information and changes provided in this notice and that may be posted to the Urbanized Area Formula Grants program Web page. FTA is in the process of updating the program circular
Funds made available under the Urbanized Area Formula Program are available for obligation during the year of apportionment plus five additional years. Accordingly, funds apportioned in FY 2017 must be obligated by September 30, 2022. Any FY 2017 apportioned funds that remain unobligated at the close of business on September 30, 2022 will revert to FTA for reapportionment under the Urbanized Area Formula Program.
Funds allocated under the Ferry program follow the same period of availability as section 5307. Accordingly, funds allocated in FY 2017 must be obligated by September 30, 2022. Any of the funds allocated in FY 2017 that remain unobligated at the close of business on September 30, 2022 will revert to FTA for reallocation under the Ferry program.
The special rule at 49 U.S.C. 5307(a)(2) makes recipients in urbanized areas with populations of 200,000 or above that operate 100 or fewer buses in fixed route service or general public demand response service during peak hours, excluding ADA complementary paratransit service, eligible for operating assistance subject to a maximum amount per system as explained below:
In accordance with section 5307(a)(2), FTA has calculated a fixed annual cap on operating assistance for each eligible agency that provides service in a large UZA. The cap is determined by dividing the UZA's apportionment by the total number of vehicle revenue hours reported from all public transportation operators and from all transit modes in the UZA, and then by multiplying this quotient by the number of bus vehicle revenue hours operated in the UZA by the eligible system. The result is the proportional share of the apportionment that is attributable to the qualifying system, as measured by vehicle revenue hours. This cap is calculated based on the FY 2017 apportionment for an eligible provider's UZA. Eligible systems operating in more than one UZA over 200,000 in population will receive separate operating caps from each UZA in which the system operates. The FY 2017 Apportionment Table 3A includes all eligible general public demand response operators. Systems that operate more than 100 buses in general public demand response service, and which do not operate any fixed-route service are not eligible for operating assistance under this provision. Systems that only operate ADA complimentary paratransit are not eligible for operating assistance under this provision.
Systems that operate more than 100 buses in fixed route service are not eligible for operating assistance under this provision. Systems that operate 100 or fewer fixed route buses are eligible, regardless of the number of demand response vehicles they operate.
In determining the amount of operating assistance available for specific systems in urbanized areas under the Special Rule, public transportation systems may execute a written agreement with one or more other public transportation systems within the urbanized area to allocate funds by a method other than by measuring vehicle revenue hours. Systems within the urbanized area may combine their individual operating assistance caps and allocate the combined funds using a method that is agreed upon by all of the systems. The operating assistance cap for the urbanized area does not change as a result of any agreement between two or more systems. The method used to allocate the funds must be documented in a written agreement, signed by the participating parties, and transmitted to FTA as part of the split letter.
The cost of operating substitute service (
While formerly eligible for Urbanized Area Formula Program funds as a “Transit Enhancement” (the precursor to Associated Transit Improvement), at 49 U.S.C. 5323 (h) now prohibits the use of FTA funds for the “incremental costs of incorporating art or non-functional landscaping into facilities, including the costs of an artist on the design team.” This prohibition applies to the creation, production, or installation of artworks, defined as objects intended for a primarily aesthetic purpose, or the involvement of artists in the development of a capital project. However, FTA does not interpret the law to exclude or generally prohibit the functional and aesthetic design of transit stations or related facilities, including designs intended to minimize adverse visual effects on the surrounding community. Transit facilities and surrounding landscape designs should incorporate aesthetic considerations, including but not limited to decisions regarding the use of light, shape, color, materials, the use of space, and the historic setting to achieve a functional and welcoming public transit facility.
FTA will not require grantees to assess the often indeterminate incremental costs associated with functional design elements, including, but not limited to, the use of different types or colors of paint or tile, wayfinding elements intended to direct passengers or staff, or different or alternate construction materials in the design of a transit facility.
Recipients may continue to use local funds for art in association with transit capital projects, but such expenditures may not be counted towards the local
With regard to landscaping, FTA recognizes that landscaping is a functional element of many transit facilities. For example, landscaping can be used to aid in the absorption or drainage of rainwater, prevention of erosion, support of structures on a steep grade, minimization of noise impacts, protection of habitat, provision of shade in hot climates, channeling of pedestrian or vehicle traffic, definition of useable or unsafe spaces, and many other purposes. In interpreting the term “functional landscaping” under this provision of law, FTA draws a similar distinction, as with art, between functionally appropriate landscape design and landscape elements installed primarily for visual or aesthetic appeal.
For additional information see the Art and Non-Functional Landscaping frequently asked questions posted on the Urbanized Area Formula Grants Web page.
Costs associated with employee training may be eligible for Urbanized Area Formula Program funding as operating expenses, as preventive maintenance expenses, or as provided for under the following provisions. A recipient may fund training expenses as an operating expense under Section 5307, where allowed, at a 50 percent Federal share.
• Various public transportation training programs;
• Outreach programs for targeted groups to increase public transportation employment for veterans, women, individuals with disabilities, and minorities;
• Development of training partnerships with key stakeholders including community colleges, workforce development boards, and other industry groups;
• Development of apprenticeships, on-the-job-training, and instructional training for public transportation; maintenance and operations occupations;
• Improve safety, security, and emergency preparedness in local public transportation system through improved safety culture and workforce communication with first responders and the riding public. And other activities approved by FTA that address human resource needs as they apply to public transportation activities.
The Capital Investment Grant (CIG) Program includes four types of eligible projects—New Starts projects, Small Starts projects, Core Capacity Improvement projects, and Programs of Inter-related Projects. Funding is provided for construction of: (1) New fixed guideway systems or extensions to existing fixed guideway systems such as rapid rail (heavy rail), commuter rail, light rail, trolleybus (using overhead catenary), cable car, passenger ferries, and bus rapid transit operating on an exclusive transit lane for the majority of the corridor length that also includes features that emulate the services provided by rail fixed guideway including defined stations, traffic signal priority for public transit vehicles, and short headway bi-directional service for a substantial part of weekdays and weekends; (2) corridor-based bus rapid transit service that does not operate on an exclusive transit lane but includes features that emulate the services provided by rail fixed guideway including defined stations, traffic signal priority for public transit vehicles, and short headway bi-directional services for a substantial part of weekdays; (3) projects that expand the capacity by at least 10 percent in an existing fixed guideway corridor that is at capacity today or will be in five years; and (4) programs of two or more interrelated projects as described above that have logical connectivity with one another and will all begin construction in a reasonable timeframe.
Federal transit law authorizes $2,301,785,760 in FY 2017, to provide financial assistance under section 5309. Under the Continuing Appropriations Act of 2017, $1,241,314,889 is available through April 28, 2017.
In FY 2017, $1,241,314,889 is available for the period October 1, 2016 through April 28, 2017 to the Fixed Guideway Capital Investment Grant Program. The total amount available for projects is $1,228,901,740 as shown in the table below, after the deduction for oversight (authorized by section 5338).
Funds are allocated on a competitive basis and subject to program evaluation.
Projects become candidates for funding under the Capital Investment Grant Program by successfully completing steps in the process defined in section 5309 and obtaining a satisfactory rating under the statutorily-defined criteria. For New Starts and Core Capacity Improvement projects, the steps in the process include project development, engineering, and construction. For Small Starts projects, the steps in the process include project development and construction. For programs of interrelated projects, the steps in the process depend on the combination of project types included. New Starts and Core Capacity Improvement projects receive construction funds from the program through a full funding grant agreement (FFGA) that defines the scope of the project and specifies the total multi-year Federal commitment to the project. Small Starts projects receive construction funds through a single year grant or a Small Starts grant agreement (SSGA) that defines the scope of the project and specifies the Federal commitment to the project.
Funds for the Fixed Guideway Capital Investment Grant Program remain
The Section 5310 Enhanced Mobility of Seniors and Individuals with Disabilities Program provides formula funding to states for the purpose of meeting the transportation needs of older adults and people with disabilities when the transportation service provided is unavailable, insufficient, or inappropriate to meet these needs. The program aims to improve mobility for seniors and individuals with disabilities by removing barriers to transportation service and expanding transportation mobility options.
The Pilot Program for Innovative Coordinated Access and Mobility Program (Pilot Program) open to Section 5310 recipients—was established by Section 3006(b) of the
For more information or questions on the Enhanced Mobility of Seniors and Individuals with Disabilities program, please contact Kelly Tyler at (202) 366-3120 or
Federal transit law authorizes $268,208,388 in FY 2017 to provide formula funding to states for the purpose of meeting the transportation needs of older adults and people with disabilities. The law also authorizes $3 million for the competitive Pilot Program. Under the Further Continuing and Security Assistance Appropriations Act, 2017, $150,859,185 is available through April 28, 2017 for the formula program.
The total available funding for projects under the Section 5310 formula program for FY 2017 is $150,104,889 after the oversight deduction as shown in the table below.
Sixty percent of the funds are apportioned among designated recipients for urbanized areas with a population of 200,000 or more individuals. Twenty percent of the funds are apportioned among the States for urbanized areas with a population of at least 50,000 but less than 200,000. Twenty percent of the funds are apportioned among the States for rural areas, defined as areas with a population less than 50,000. Census Data on Older Adults and People with Disabilities is used for the Section 5310 Enhanced Mobility of Older Adults and People with Disabilities Apportionments. FY 2017 Apportionments Table 8 displays the amounts apportioned under the Enhanced Mobility of Seniors and Individuals with Disabilities Program.
Under the section 5310 formula, funds are allocated using Census data on older adults (
At least 55 percent of program funds must be used on capital projects such as buses and vans; wheelchair lifts, ramps, and securement devices or transit-related information technology systems including scheduling/routing/one-call systems. Mobility management programs are also defined as capital projects for purposes of this provision. The acquisition of transportation services under a contract, lease, or other arrangement is also eligible; both the capital and operating costs associated with contracted service are eligible capital expenses for purposes of this provision. The capital eligibility of acquisition of services is limited to the section 5310 program. The remaining 45 percent of a recipient's 5310 funds can be used for capital or operating.
Eligible recipients include States for rural and small urban areas and designated recipients chosen by the Governor of the State for large urban areas; or a State or local governmental entity that operates a public transportation service. For urbanized areas less than 200,000 in population and in the rural areas, the State is the designated recipient for section 5310. Current section 5310 designations remain in effect until changed by the Governor of a State by officially notifying the appropriate FTA Regional Administrator of re-designation. A State or local governmental entity that operates a public transportation service may be a direct recipient for Section 5310 funds.
In urbanized areas over 200,000 in population, the recipient charged with administering the section 5310 Program must be officially designated in accordance with the planning process, by the Governor of a State, responsible local officials, and publicly owned operators of public transportation prior to grant award (See the definition of designated recipient, 49 U.S.C. 5302(4)). Designated recipients are responsible for administering the program. Eligible subrecipients include private nonprofit agencies, public bodies approved by the state to coordinate services for seniors and people with disabilities, or public bodies which certify to the Governor that no nonprofit organizations or associations are readily available in an area to provide the service.
Capital assistance is provided at 80 percent Federal share; 20 percent local share. Operating assistance requires a 50 percent local match. Funds provided under other Federal programs (other than those of the DOT, with the exception of the Federal Lands Transportation Program may be used for local match for funds provided under section 5310, and revenue from service contracts may be used as local match.
The coordinated planning provision requires that all projects be included in the local coordinated human service-public transportation plan. The plan must be developed and adopted with representation from seniors, individuals
States, designated recipients, and State or local governmental entities that operate a public transportation service that are responsible for implementing the section 5310 program are required to document their approach to managing the program. The Management Plans serve as the basis for FTA management reviews of the program, and provide public information on the administration of the programs.
Designated recipients are required to develop a Program of Projects (POP) with the grant application and submit it to the FTA Regional Office. The POP should be developed with respect to the coordinated plan, long range plan, and the transportation improvement plan. For additional guidance in developing the required POP, see Chapter IV of the FTA Circular 9070.1G,
For Enhanced Mobility of Seniors and Individuals with Disabilities Program funds apportioned under this notice, the period of availability is three years, which includes the year of apportionment plus two additional years. Accordingly, funds apportioned in FY 2017 must be obligated in grants by September 30, 2019. Any FY 2017 apportioned funds that remain unobligated at the close of business on September 30, 2019 will revert to FTA for reapportionment among the States and urbanized areas.
A State may transfer apportioned funds between small urbanized areas and rural areas if it can certify that the needs are being met in the area to which the funds were originally apportioned. The State can transfer the funds (rural and small urbanized area) to any area within the state if a statewide program for section 5310 is established. Section 5310 funds may not be transferred to other FTA programs. Section 5310 funds apportioned to large urbanized areas may not be transferred to other areas. Section 5310 program recipients may partner with meal delivery programs such as the OAA-funded meal programs (to find local programs, visit:
Program Guidance is found in FTA Circular 9070.1G, Enhanced Mobility of Seniors and Individuals with Disabilities Program Guidance and Application Instructions, dated July 7, 2014. Section 3006(b) of the FAST Act creates a new competitive pilot program for innovative coordinated access and mobility that is discussed in section III of this notice. The Federal share is 80% for capital projects. Local Match can come from other Federal (non-DOT) funds.
The Rural Areas program provides formula funding to States and Indian tribes for the purpose of supporting public transportation in areas with a population of less than 50,000. Funding may be used for capital, operating, planning, job access and reverse commute projects, and State administration expenses. Eligible sub-recipients include State and local governmental authorities, Indian Tribes, private non-profit organizations, and private operators of public transportation services, including intercity bus companies. Indian Tribes are also eligible direct recipients under Rural Areas Formula Program, both for funds apportioned to the States and for projects apportioned or selected to be funded with funds set aside for a separate Tribal Transit Program.
Federal transit law authorizes $632,355,120 in FY 2017 to provide financial assistance for rural areas under Rural Areas Formula Program.
Under the Further Continuing Security Assistance Appropriations Act, 2017, $317,012,628 is available through April 28, 2017 to the Rural Area Programs which includes $44,378,969 for Growing States. The total amount apportioned to the program is $359,613,193 as shown in the table below, after the deduction for oversight (authorized by section 5338).
FTA apportions Rural Areas Formula Program funds to the states by a statutory formula using the latest available U.S. decennial census data. The majority of Rural Formula Program funds (83.15 percent) are apportioned based on land area and population factors. In this first tier, no state may receive more than 5 percent of the amount apportioned on the basis of land area. The remaining Rural Formula Program funds (16.85 percent) are apportioned based on land area, vehicle revenue miles, and low-income individual factors. In this second tier, no state may receive more than 5 percent of the amount apportioned on the basis of land area, or more than 5 percent of the amounts apportioned for vehicle revenue miles. In addition to funds made available under section 5311, FTA adds amounts apportioned based on rural population according to the growing states formula factors of 49 U.S.C. 5340 to the amounts apportioned to the states under the section 5311 formula. Before FTA apportions section 5311 funds to the states, FTA subtracts funding from the total available amounts for the Appalachian Development Transportation Assistance Program, the Tribal Transit Program, the Rural Transportation Assistance Program (RTAP), and FTA oversight activities.
Data from the National Transit Database (NTD) 2015 Report Year was used for this apportionment, including data from directly-reporting Indian tribes. Data from public transportation systems that reported as urbanized area systems, but that was not attributable to an urbanized area, was also included. The Rural Areas Formula Program program includes three takedowns: The Appalachian Development Public Transportation Assistance Program; the Rural Transit Assistance Program (RTAP); and the Tribal Transit Program. These separate programs are described in the sections that follow.
The Rural Areas Formula Program provides funding for capital, operating, planning, job access and reverse commute projects, and administration expenses for public transit service in
Each State must spend no less than 15 percent of its annual Rural Areas Formula Program apportionment for the development and support of intercity bus transportation, unless it can certify, after consultation with affected intercity bus service providers, that the intercity bus service needs of the State are adequately met. FTA encourages consultation with other stakeholders, such as communities affected by loss of intercity service. The cost of an unsubsidized portion of privately provided intercity bus service that connects feeder service, including all operating and capital costs of such service whether or not offset by revenue from such service may be used as in-kind local match for the intercity bus projects. FTA is updating the Rural Areas Formula Program program circular to include this change.
States may elect to use up to 10 percent of their apportionment at 100 percent Federal share to administer the Rural Areas Formula Program program and provide technical assistance to subrecipients. Technical assistance includes project planning, program and management development, public transportation coordination activities, and research the State considers appropriate to promote effective delivery of public transportation to rural areas.
The Federal share for capital assistance is 80 percent and for operating assistance is 50 percent, except that States eligible for the sliding scale match under FHWA programs may use that match ratio for Rural Areas Formula Program capital projects and 62.5 percent of the sliding scale capital match ratio for operating projects. No longer exists
Each State prepares an annual program of projects, which must provide for fair and equitable distribution of funds within the States, including Indian reservations, and must provide for maximum feasible coordination with transportation services assisted by other Federal sources.
Additional program guidance for the Rural Areas Formula Program is found in FTA Circular 9040.1G,
Rural Areas Formula Program funds remain available to states for obligation for three Federal fiscal years, beginning with the year of apportionment plus two additional years. The Rural Areas Formula Program funds apportioned in this notice are available for obligation during FY 2017 plus two additional years. Any FY 2017 apportioned funds that remain unobligated at the close of business on September 30, 2019 will revert to FTA for reapportionment under the Rural Areas program.
Revenue from the sale of advertising and concessions may be used as local match.
This program provides funding to assist in the design and implementation of training and technical assistance projects, research, and other support services tailored to meet the needs of transit operators in rural areas.
There is a two percent takedown from the funds made available for RTAP. Of the remaining amount, 15 percent is reserved for the National RTAP program. The remainder is available for allocation to the States.
Federal Transit Law authorizes $12,647,102 in FY 2017 to provide technical assistance.
Under the Further Continuing and Security Assistance Appropriations Act, 2017 $7,113,616 is available through April 28, 2017 to the RTAP Program. The total amount apportioned for RTAP is $6,046,574 as shown in the table below, after the deduction for National RTAP.
FTA allocates funds to the States by an administrative formula. First, FTA allocates $65,000 to each State ($10,000 to territories), and then allocates the balance based on rural population in the 2010 census.
Eligible expenses include the design and implementation of training and technical assistance projects, research, and other support services tailored to meet the needs of transit operators in rural areas.
States may use the funds to undertake research, training, technical assistance, and other support services to meet the needs of transit operators in rural areas. These funds are to be used in conjunction with a State's administration of the Rural Areas Formula Program, but also may support the rural components of the section 5310 program.
The RTAP funds apportioned in this notice are available for obligation in FY 2017 plus two additional years, consistent with that established for the Rural Areas Formula Program Rural Program.
The National RTAP project is administered by cooperative agreement and re-competed at five-year intervals. In July of 2014, FTA awarded a cooperative agreement to the Neponset Valley Transportation Management Association to administer the National RTAP Program. The National RTAP projects are guided by a project review board that consists of managers of rural transit systems and State DOT RTAP programs. National RTAP resources also support the biennial Transportation Research Board National Conference on Rural Public and Intercity Bus Transportation and other research and technical assistance projects of a national scope.
This program is a take-down under the Rural Areas Formula Program to provide additional funding to support public transportation in the Appalachian region. There are sixteen eligible States that receive an allocation under this provision. The State allocations are shown in the Rural Areas Formula program table posted on FTA's Web site on the FY 2017 Apportionments page. For more information about the Appalachian
Federal transit law authorizes $20 million in each of FY 2016 through FY 2020 as a take-down under the Rural Areas Formula Program to support public transportation in the Appalachian region.
Under the Further Continuing and Security Assistance Appropriations Act, 2017 $11,474,389 is available through April 28, 2017.
FTA apportions the funds using percentages established under section 9.5(b) of the Appalachian Regional Commission Code (subtitle IV of title 40). Allocations are based in general on each State's remaining estimated need to complete eligible sections of the Appalachian Development Highway System as determined from the latest percentages of available cost estimates for completion of the System. Such cost estimates are produced at approximate five year intervals. Allocations contain upper and lower limits in amounts determined by the Commission and are made in accordance with legislative instructions.
Funds apportioned under this program can be used for purposes consistent with the Rural Areas Formula Program to support public transportation in the Appalachian region. Funds can be applied for in the State's annual Rural Areas Formula Program grant.
Appalachian program funds that cannot be used for operating may be used for a highway project under certain circumstances. States should contact their regional office if they intend to request a transfer. Additional information about the requirements for this section can be found in Chapter VII of FTA Circular 9040.1G,
Appalachian Program funds are available for three years, which includes the year of apportionment plus two additional years, consistent with that established for the Rural Areas Formula Program.
The Public Transportation on Indian Reservations Program, or Tribal Transit Program (TTP), totals $35 million, of which $30 million is for a formula program and $5 million is for a competitive grant program. It is funded as a takedown from funds made available for the section Rural Areas Formula Program. Formula factors include vehicle revenue miles and the number of low-income individuals residing on tribal lands (defined as American Indian Areas, Alaska Native Areas, and Hawaiian Home Lands). Eligible direct recipients are Federally recognized Indian tribes and Alaskan Native Villages providing public transportation in rural areas. The TTP funds are allocated for grants to eligible recipients for any purpose eligible under Rural Areas Formula Program, which includes capital, operating, planning, and job access and reverse commute projects.
Federal transit law authorizes $35 million in FY 2017 ($30 million for formula and $5 million for the competitive program).
Under the Further Continuing and Security Assistance Appropriations Act, 2017 $15,080,181 is available for the formula program and $5 million for the competitive program through April 28, 2017 as shown below.
Funding is allocated by formula and distributed to eligible Indian tribes providing public transportation on tribal lands. The formula apportionment shown in Table 10 is based on a statutory formula which includes three tiers. Tiers 1 and 2 are based on data reported to NTD by Indian tribes; Tier 3 is based on 2010-2014 American Community Survey data. The three tiers for the formula are: Tier 1—50 percent based on vehicle revenue miles reported to the NTD; Tier 2—25 percent provided in equal shares to Indian tribes reporting at least 200,000 vehicle revenue miles to the NTD; Tier 3—25 percent based on Indian tribes providing public transportation on tribal lands (American Indian Areas, Alaska Native Areas, and Hawaiian Home Lands) on which more than 1,000 low income individuals reside. If more than one eligible tribe provides public transportation services on tribal lands in a single Tribal Statistical Area, and the tribes cannot determine how to allocate Tier 3 funds, FTA will allocate the funds based on the relative portion of transit (as defined by unlinked passenger trips) operated by each tribe, as reported to the National Transit Database.
Formula funds apportioned under this program can be used for purposes consistent with Rural Areas Formula Program to support public transportation on Indian Reservations in rural areas. Funds allocated under the competitive program must be used consistent with the tribe's proposal and the allocation notice published in the
Section 5335 requires NTD reporting for all recipients or beneficiaries all section 5311 funds. This reporting requirement continues to apply to the Tribal Transit Program. Tribes that provide public transportation in rural areas are reminded to report annually so they are included in the TTP formula apportionments. To be considered in the FY 2017 formula apportionments, tribes should have submitted their reports to the NTD no later than April 30, 2016; voluntary reporting to the NTD is also encouraged. Additionally, to be considered for the FY 2018 formula apportionment funds, tribes need to submit their reports to the NTD no later than April 30, 2017. Tribes needing assistance with reporting to the NTD
Funding for the TTP is available for three years, which includes the year of apportionment plus two additional years, consistent with that established for the Rural Areas Formula Program. Any FY 2017 formula funds that remain unobligated at the close of business on September 30, 2019 will revert to FTA for reapportionment under the TTP.
Section 207 of title 23, United States Code establishes a Tribal Transportation Self-Governance Program (Self Governance Program). The Self Governance Program will establish specific criteria for determining eligibility for a tribe to participate in the program. A Negotiated Rulemaking to implement this program in consultation with tribal representatives and other interested stakeholders is under development.
The funds set aside for the TTP are not meant to replace or reduce funds that Indian tribes receive from States through the Rural Areas Formula Program but are to be used to enhance public transportation on Indian reservations and transit serving tribal communities. Funds allocated to Indian tribes by the States may be included in the State's Rural Areas Formula Program application or maybe awarded by FTA in a grant directly to the Indian tribe. FTA encourages Indian tribes intending to apply to FTA as direct recipients to contact the appropriate FTA Regional Office at the earliest opportunity.
TTP grantees must comply with all applicable Federal statutes, regulations, executive orders, FTA circulars, and other Federal requirements in carrying out the project supported by the FTA grant. To assist tribes with understanding these requirements, FTA regularly conducts Tribal Transit Technical Assistance Workshops. FTA has also expanded its technical assistance to tribes receiving funds under this program. In FY 2015, FTA implemented the Tribal Transit Technical Assistance Assessments initiative. Through these assessments, FTA collaborates with tribal transit leaders to review processes and identify areas in need of improvement and then assist with solutions to address these needs—all in a supportive and mutually beneficial manner. These assessments include discussions of compliance areas pursuant to the Master Agreement, a site visit, promising practices reviews, and technical assistance from FTA and its contractors. FTA will post information about upcoming workshops to its Web site and will disseminate information about the reviews through its Regional offices. FTA has regional tribal transit liaisons in each of the FTA Regional Offices that are available to assist tribes with applying for and managing FTA grants. Tribes are encouraged to work directly with their regional tribal transit liaison.
Public Transportation Innovation is FTA's research program. Within this section, are several different activities that comprise three distinct programs: (a) A Research, Development, Demonstration, Deployment, & Evaluation program (49 U.S.C. 5312(b-e)); (b) a Low or No Emission Vehicle Component Assessment Program (LoNo-CAP) (49 U.S.C. 5312(h)); and (c) a Transit Cooperative Research Program (49 U.S.C. 5312(i)).
Federal transit law authorizes $48 million for FY 2017 for the Public Transportation Innovation program.
Under the Further Continuing and Security Assistance Appropriations Act, 2017 $16,064,145 is available through April 28, 2017 shown in the table below.
Public Transportation Innovation funds are allocated according to the authorized purposes and amounts described above, and then remaining amounts are subject to competitive allocations where not specifically authorized. For FY 2017, FTA intends to fund projects and activities consistent with its Research Strategic Plan and in support of three major areas: Asset Innovation and Management, Mobility, and Safety. Projects may be selected through Notices of Funding Opporunity (NOFO) or Requests for Proposals (RFPs), or sole-sourced. Potential recipients can register to receive notification of funding availability under this program on
FTA awards an annual cooperative agreement to the National Academies of Science to administer the TCRP. For the LoNo-CAP, proposals were due November 28, 2016 and FTA expects to announce the selected testing facility or facilities in January 2017.
Eligible expenses include activities involving (a) Research, Innovation, Development, Demonstration, Deployment, Evaluation; (b) Low or No Emission Vehicle Component Testing; and (c) Transit Cooperative Research.
The Government share of the cost of a project carried out under FTA's Research, Development, Deployment, and Demonstration program shall not exceed 80 percent; the remaining 20 percent of the costs can be met with in-kind resources. In some cases, FTA may require a higher non-Federal share if FTA determines a recipient would obtain a clear and direct financial benefit from the project, or if the non-Federal share is an evaluation factor under a competitive selection process.
However, for the LoNo-CAP, the Government share is 50 percent; the remaining 50 percent of the costs will be paid by amounts recovered through the fees established by the testing facilities. There is no match requirement for the TCRP.
Application instructions and program management guidelines are set forth in FTA Circular C 6100.1E, Technology Development and Deployment, “Research, Technical Assistance and Training Program: Application Instructions and Program Management Guidelines” dated May 11, 2015.
All research recipients are required to work with FTA to develop approved Statements of Work. FTA will be updating the Circular for the Research Program during FY 2017.
FTA establishes the period in which the funds must be obligated to the project. If the funds are not obligated within that period of time, they revert to FTA for reallocation under the program.
FTA publishes an annual Research Report on projects, evaluations, and benefits of its research portfolio. The FY2015 Report is posted on FTA's Web
For the new LoNo-CAP (5312(h)), FTA solicited proposals for the LoNo-CAP in the Fall of 2016, with selection(s) expected in January 2017. Per the statute, FTA only considered proposals from “institutions of higher education” as defined in section 1002 of title 20, U.S.C., the Higher Education Act of 1965. Eligible institution(s) of higher education must have capacity to carry out transportation-related advanced component testing and evaluation, with laboratories capable of testing and evaluation, and direct access to or a partnership with a testing facility capable of emulating real-world circumstances in order to test low or no emission components.
LoNo-CAP differs from the Bus Testing Program (Section 5318) in that LoNo-CAP testing is voluntary; it will only test components, and it will not assign passing or failing scores. The LoNo component testing performed under LoNo-CAP complements the Section 5318 Bus Testing Program, under which FTA will continue to test complete buses as a condition of eligibility for FTA grant funding. Eligible activities under LoNo-CAP include testing and assessing voluntarily submitted Lo-No components for transit buses, publishing the results of these LoNo component assessments, and preparing an annual report to Congress summarizing the results of the component assessments.
TCRP is a cooperative effort of three organizations: FTA; the National Academies, acting through the Transportation Research Board (TRB); and the Transit Development Corporation, Inc. (TDC), a nonprofit educational and research organization established by the American Public Transportation Association (APTA). FTA funds the TCRP through a cooperative agreement and it is governed by an independent board—the TCRP Oversight and Project Selection (TOPS) Committee. The TOPS Committee sets priorities to decide what research studies will be undertaken and annually selects projects. The FY 2017 selected projects can be found at
Pursuant to the Small Business Innovation Development Act, a portion of the 5312 funds must be set aside for the Department's SBIR program to address high priority research that will demonstrate innovative, economic, accurate, and durable technologies, devices, applications, or solutions to significantly improve current transit-related service including transit vehicle operation, safety, infrastructure and environmental sustainability, mobility, rider experience, or broadband communication. Information on current and past SBIR projects can be found on the DOT SBIR Web site.
The Technical Assistance and Workforce Development program, 49 U.S.C. 5314, provides assistance to: (1) Carry out technical assistance activities that enable more effective and efficient delivery of transportation services, foster compliance with Federal laws, and improve public transportation service; (2) develop standards and best practices for the transit industry; and (3) address public transportation workforce needs through research, outreach, training and the implementation of a frontline workforce grant program, and conduct training and educational programs in support of the public transportation industry.
The Technical Assistance and Workforce Development Program is at $14 million in FY 2017. Under the Further Continuing and Security Assistance Appropriations Act, 2017 $5,163,475 is authorized through April 28, 2017 as shown in the table below.
Under the Technical Assistance and Workforce Development Program, $2,868,597 is available for the NTI. The remaining $2,294,878 will be allocated in support of FTA and USDOT strategic goals for technical assistance, standards development, and workforce development. Projects may be selected through sole source, Notices of Funding Opportunity (NOFO) or Requests for Proposals (RFPs). Potential recipients can register to receive notification of funding availability under this program on
Eligible expenses include activities involving: (a) Technical assistance; (b) standards development; and (c) human resources and training, including workforce development programs and activities. Eligible technical assistance activities may include activities to support: (a) Compliance with the ADA; (b) compliance with coordinating planning and human services transportation; (c) meeting the transportation needs of elderly individuals; (d) increasing transit ridership in coordination with MPOs and other entities, particularly around transit-oriented development; (e) addressing transportation equity with regard to the effect that transportation planning, investment, and operations have for low-income and minority individuals; (f) facilitating best practices to promote bus driver safety; (g): compliance with Buy America requirements and pre- and post-award audits; (h) assisting with the development and deployment of low and no emission vehicles or components for vehicles; (i) and other technical assistance activities that are necessary to advance the interests of public transportation.
Eligible standards development activities include the development of voluntary and consensus-based standards and best practices by the industry including those needed for safety, fare collection, intelligent transportation systems, accessibility, procurement, security, asset management, operations, maintenance, vehicle propulsion, communications, and vehicle electronics.
Eligible human resources and training activities include (a) employment training programs; (b) outreach programs to increase employment for veterans, females, individuals with
The Government's share of the cost of a project carried out using a grant under this section shall not exceed 80 percent. However, for the human resources and training, including the Innovative Public Transportation Frontline Workforce Development Program, the Government's share cannot exceed 50 percent. The Federal share for other types of awards will be stated in the agreement. In some cases, FTA may require a higher non-Federal share if FTA determines a recipient would obtain a clear and direct financial benefit from the project, or if the non-Federal share is an evaluation factor under a competitive selection process.
The non-Government share of the cost of a project carried out under these sections (Technical Assistance and Standards and Technical Assistance and Training) may be derived from in-kind contributions as defined in the most current version of FTA Circular 5010, “Award Management Guidelines” found on FTA's Circular Web page at
All research recipients are required to work with FTA to develop approved statements of work. There is no match requirement for the National Transit Institute.
FTA establishes the period in which the funds must be obligated to the project. If the funds are not obligated within that period of time, they revert to FTA for reallocation under the program.
FTA publishes an annual report to Congress on the technical assistance and standards activities that receive assistance under this section. Additionally, FTA must report annually on the Frontline Workforce Development Program. These reports can be found on FTA's Web site.
FTA's Emergency Relief (ER) Program is authorized to provide funding for public transportation expenses incurred as a result of an emergency or major disaster. No funding was provided in the Further Continuing and Security Assistance Appropriations Act, 2017 for this program.
In the event funds are appropriated to this program to assist in responding to a publicly declared emergency or disaster, eligible expenses will include emergency operating expenses, such as evacuations, rescue operations, and expenses incurred to protect assets in advance of a disaster, as well as capital projects to protect, repair, reconstruct, or replace equipment and facilities of a public transportation system that the Secretary determines is in danger of suffering serious damage or has suffered serious damage as a result of an emergency. Additionally, transit agencies in the affected areas may request relief from certain FTA administrative and regulatory requirements for costs incurred in support of evacuations, rescue efforts, and the efficient shut down and resumption of transit services during and after the storm. Requests for relief from these requirements may be submitted to FTA's Emergency Relief Docket at
FTA also encourages transit agencies in affected areas to become familiar with FTA's Emergency Relief Program Manual, available at
While Congress has not provided funding for this program in FY 2017, so far recipients of FTA funding affected by a declared emergency or disaster are authorized to use funds apportioned under sections 5307 and 5311 for emergency purposes under the provisions of FTA's Emergency Relief Program. Recipients are advised that formula funds disbursed to a grantee for emergency purposes will not be replaced or restored in the event that funding is subsequently made available through FTA under the ER Program or by the Federal Emergency Management Agency (FEMA).
In the event of a disaster affecting a public transportation system, the affected recipient should contact its FTA Regional Office as soon as practicable to determine whether Emergency Relief Program funds are available, and to notify FTA that it plans to seek reimbursement for emergency operations and/or repairs that have already taken place or are in process. If Emergency Relief funds are unavailable the recipient may seek reimbursement from FEMA. Properly documented costs for which the grantee has not received reimbursement from FEMA may later be reimbursed by grants made either from Emergency Relief Program funding (if appropriated) or from sections 5307 and 5311 program funding, once the eligible recipient formally applies to FTA for reimbursement and FTA determines that the expenses are eligible for emergency relief.
More information on the Emergency Relief Program and FTA's response to Hurricane Sandy is available on the FTA Web site at
For more information or questions on this program, please contact Adam Schildge
The State Safety Oversight Formula Program provides funding to support States with rail fixed guideway public transportation systems (rail transit systems) to develop and carry out State Safety Oversight (SSO) Programs consistent with the requirements of 49 U.S.C. 5329.
Federal transit law authorizes $23,148,419 in FY 2017 to provide funding to support States in developing and carrying out the SSO Program.
Under the Further Continuing and Security Assistance Appropriations Act, 2017 $13,020,292 is available through April 28, 2017 for the period October 1, 2016 through April 28, 2017 for the State Safety Oversight (SSO) program as shown in the table below.
FTA will continue to allocate funds to the States by an administrative formula, which is detailed in the
FTA requires each applicant to demonstrate in its grant application that its proposed grant activities will develop, lead to, or carry out a State Safety Oversight program that meets the requirements under 49 U.S.C. 5329(e). Grant funds may be used for program operational and administrative expenses, including employee training activities. Please see the
SSO Formula Grant Program funds are available for the year of apportionment plus two additional years. Any FY 2017 funds that remain unobligated at the close of business on September 30, 2019 will revert to FTA for reapportionment under the SSO Formula Grant Program.
Section 5329 authorizes FTA to temporarily assume oversight of a rail transit safety system, under certain circumstances. FTA also has the authority to issue restrictions and prohibitions to address unsafe conditions or practices. On August 11, 2016, FTA published a final rule to set procedures for FTA's administration of the Public Transportation Safety Program. The final rule provides procedures whereby FTA may: (1) Require a recipient to use Chapter 53 funds to correct safety violations identified by the Administrator or a State Safety Oversight Agency before such funds are used for any other purpose, or (2) withhold up to than 25 percent of funds apportioned under 49 U.S.C. 5307 from a recipient when the Administrator has evidence that the recipient has engaged in a pattern or practice of serious safety violations, or has otherwise refused to comply with the Public Transportation Safety Program, or any regulation or directive issued under those laws for which the Administrator exercises enforcement authority for safety.
The State of Good Repair Program provides financial assistance to designated recipients in Urbanized Areas (UZAs) with fixed guideway and high intensity motorbus systems for capital investments that maintain, rehabilitate, and replace aging transit assets and bring fixed guideway and high intensity motorbus systems into a state of good repair. FTA apportions funds for this program through a statutory formula using data reported to the National Transit Database (NTD).
Federal transit law authorizes $2,549,670,000 in FY 2017 for the State of Good Repair Program.
Under the Further Continuing and Security Assistance Appropriations Act, 2017 $1,438,314,657 is available through April 28, 2017. The total amount apportioned is $1,423,931,511 after the deduction for oversight as shown in the table below, after the deduction for oversight (authorized by section 5338).
FTA apportions State of Good Repair Program funds according to a statutory formula. Funds are apportioned to urbanized areas with high intensity fixed guideway and high intensity motorbus systems that have been in operation for at least seven years. This means that only segments of high intensity fixed guideway and high intensity motorbus systems that entered into revenue service on or before September 30, 2009 are included in the formula, as identified in the NTD. Funds apportioned to urbanized areas with high intensity fixed guideway and motorbus systems are determined by two equal elements: (1) The proportion of the amount an urbanized area would have received in FY 2011 to the total amount apportioned to all urbanized areas in the FY 2011 Fixed Guideway Modernization program using the fixed guideway definition defined in prior law; and (2) the proportion of vehicle revenue miles of an urbanized area to the total vehicle revenue miles of all urbanized areas and the proportion of directional route miles of an urbanized area to the total directional miles of all urbanized areas. 97.15 percent of the total appropriation is apportioned to the fixed guideway tier, the remaining 2.85 percent is apportioned to the high-intensity motorbus tier.
In addition to the program guidance found in the FTA Circular 5300.1, “State of Good Repair Grants Program: Guidance and application Instructions” all recipients will need to comply with the rule issued under section 5326 for the Transit Asset Management plan (TAM).
The State of Good Repair Program funds apportioned in this notice are available for obligation during FY 2017 plus three additional years. Accordingly, funds apportioned in FY 2017 must be obligated in grants by September 30, 2020. Any FY 2017 apportioned funds that remain unobligated at the close of business on September 30, 2020 will revert to FTA for reappointment under the State of Good Repair Program.
In July 2016, FTA published a Final Rule for Transit Asset Management (81 FR 48890, July 26, 2016). Grantees must have a TAM plan in place by October 1, 2018. Beginning in FY 2019 all projects funded under the State of Good Repair Program must appear in the investment prioritization of the grantees TAM plan.
The Grants for Buses and Bus Facilities Program provides financial assistance to states and designated recipients for capital investments in public transportation systems to replace, rehabilitate and purchase buses and related equipment and to construct bus-related facilities, including technological changes or innovations to modify low or no emission vehicles or facilities. Funding is provided through formula allocations and competitive grants. A sub-program, the Low- or No-Emission Vehicle Program, provides competitive grants for bus and bus facility projects that support low and zero-emission vehicles.
Federal transit law authorizes $719,960,000 in FY 2017, to provide financial assistance for the Grants for Buses and Bus Facilities Program.
Under the Continuing Appropriations Act of 2017, $399,193,992 is available through April 28, 2017. After the 0.75 percent take-down for oversight, $396,200,037 is available after the deduction for oversight, as shown in the table below.
Buses and Bus Facilities Program formula funds are apportioned to States, territories, and designated recipients based on a statutory formula. Under the National Distribution, each State is allocated $1.0 million and each territory is allocated $286,860 for use anywhere in the State or territory for each of fiscal years 2016 through 2020. The remainder of the available funding is then apportioned to UZAs based on population, vehicle revenue miles, and passenger miles using the same apportionment formula and allocation process as the Urbanized Area Formula Program. Funds for UZAs under 200,000 in population are apportioned to the State for allocation to eligible recipients within such areas of the State at the Governor's discretion. Funds for UZAs with populations of 200,000 or more are apportioned directly to one or more designated recipient(s) within each UZA for allocation to eligible projects and recipients within the UZA.
FTA allocates funds under the competitive section 5339(b) and 5339(c) programs on an annual basis based on a notice of funding opportunity, which contains detailed guidance on applicant eligibility, project eligibility, evaluation criteria, and application requirements.
Eligible recipients for section 5339(a) formula grants include: (1) Designated recipients that allocate funds to fixed route bus operators, and (2) States local governmental entities that operate fixed route bus service. Eligible subrecipients to include public agencies or private nonprofit organizations engaged in public transportation, including those providing services open to a segment of the general public, as defined by age, disability, or low income. The definition of eligible recipients applies to funding apportioned in previous fiscal years that remain available for obligation. The requirements of the Urbanized Area Formula Program apply to recipients of section 5339 funds within an urbanized area. The requirements of Rural Areas Formula Program apply to recipients of section 5339 funds within rural areas.
Under prior law, only designated recipients were eligible direct recipients of section 5339(a) funds. Given that State and local government entities that operate fixed route service are now eligible direct recipients of section 5339(a) funds. FTA does not require designated recipients to maintain program management plans (PMPs) if they do not manage any sub-awards of section 5339 funds.
For additional program requirements, refer to FTA Circular 5100, “Bus and Bus Facilities Formula Program: Guidance and Application Instructions.”
The Bus and Bus Facilities Program formula funds apportioned in this notice are available for obligation during FY 2017 plus three additional years. Accordingly, funds apportioned in FY 2017 must be obligated in grants by September 30, 2020. Any FY 2017 apportioned funds that remain unobligated at the close of business on September 30, 2020 will revert to FTA for reapportionment under the Bus and Bus Facilities Formula Program. Competitive program funds authorized under sections 5339(b) and 5339(c) follow the same period of availability.
Although it does not provide additional funding, as authorized under section 5339(a)(9), FTA has established a pilot program to allow designated recipients in urbanized areas between 200,000 and 1 million in population to elect to pool their Bus and Bus Facilities Program formula allocations with other designated recipients within their respective states. The purpose of this provision is to allow for the transfer of formula funding within a State in a manner that supports the transit asset management plans of the participating designated recipients. A State that intends to participate in this pilot program beginning in FY 2018 must submit a request to establish a State Pool to its FTA Regional Office by August 31, 2017. The request must identify the urbanized areas that will participate in the pool for FY 2018, and must include a letter from each participating designated recipient, and from any affected eligible recipients of section 5339(a) funds within the urbanized area, indicating their intention to participate in this pooling provision for FY 2017. An urbanized area that participates in a State Pool must contribute its entire section 5339(a) apportionment for the fiscal years in which it participates in the pool. A designated recipient for a multistate area may participate in only one State Pool. A State that does not establish a State Pool in FY 2018 may
Federal transit law authorizes the use of formula factors to distribute additional funds to the section 5307 and Rural Areas Formula Program programs for growing states and high density states. FTA will continue to publish single urbanized and rural apportionments that show the total amount for section 5307 and 5311 programs that includes section 5340 apportionments for these programs.
For more information or questions on this program, please contact Tara Clark at (202) 366-2623 or
Federal transit law authorizes $544,433,788 for apportionment in FY 2017 for the Growing States and High Density States Formula factors.
Under the Further Continuing and Security Assistance Appropriations Act, 2017 $307,663,675 is available through April 28, 2017.
Under the Growing States portion of the section 5340 formula, FTA projects each State's 2025 population by comparing each State's apportionment year population (as determined by the Census Bureau) to the State's 2010 Census population and extrapolating to 2025 based on each State's rate of population growth between 2010 and the apportionment year. Each State receives a share of Growing States funds on the basis of its projected 2025 population relative to the nationwide projected 2025 population.
Once each State's share is calculated, funds attributable to that State are divided into an urbanized area allocation and a non-urbanized area allocation on the basis of the percentage of each State's 2010 Census population that resides in urbanized and non-urbanized areas. Urbanized Areas receive portions of their State's urbanized area allocation on the basis of the 2010 Census population in that urbanized area relative to the total 2010 Census population in all urbanized areas in the State. These amounts are added to the Urbanized Area's section 5307 apportionment.
The States' rural area allocation is added to the allocation that each State receives under the Rural Areas Formula Program Formula Grants for Rural Areas program.
The High Density States portion of the section 5340 formula are allocated to urbanized areas in States with a population density equal to or greater than 370 persons per square mile. Based on this threshold and 2010 Census data, the States that qualify are Maryland, Delaware, Massachusetts, Connecticut, Rhode Island, New York and New Jersey. The amount of funds provided to each of these seven States is allocated on the basis of the population density of the individual State relative to the population density of all seven States. Once funds are allocated to each State, funds are then allocated to urbanized areas within the States on the basis of an individual urbanized area's population relative to the population of all urbanized areas in that State.
Section 601 of the Passenger Rail Investment and Improvement Act of 2008 (PRIIA) authorized an aggregate amount of $150,000,000 to be available in increments over 10 fiscal years beginning in fiscal year 2009 to assist Washington Metropolitan Transit Authority (WMATA) in implementing Capital Improvement Program and preventive maintenance projects.
For more information or questions on the Washington Metropolitan Area Transit Authority Grants program, please contact Eric Hu at (202) 366-0870 or
Section 601 of PRIIA authorizes $150,000,000 in FY 2017.
Under the Continuing Appropriations Act of 2017, $86,057,917 is available through April 28, 2017. The total amount available is $85,197,338 after the deduction for oversight as shown in the table below.
The funding is authorized under Section 601, Authorization for Capital and Preventive Maintenance Projects for Washington Metropolitan Area Transit Authority, of the Passenger Rail Investment and Improvement Act of 2008, (Pub. L. 110-432) Division B, Title VI.
Grants may be provided for capital and preventive maintenance expenditures for WMATA after it has been determined that WMATA has placed the highest priority on investments that will improve the safety of the system, including but not limited to fixing the track signal system, replacing 1000 series railcars, installing guarded turnouts, buying equipment for wayside worker protection, and installing rollback protection on cars that are not equipped with the safety feature. FTA will communicate further program requirements directly to WMATA. The maximum Federal share for each project shall be for 50 percent of the net project cost of the project, and matching funds shall be provided in cash from sources other than Federal funds or revenues from the operation of public transportation systems.
Funds appropriated for WMATA under Section 601 PRIIA shall remain available until expended.
The Paul S. Sarbanes Transit in Parks Program (Transit in Parks) at former 49 U.S.C. 5320, has provided grants for alternative transportation in and around America's national parks and Federal lands since 2006. FTA is establishing a deadline of September 30, 2017 to obligate funds allocated to recipients under the Transit in Parks program. Any competitive allocations that remain unobligated after September 30, 2017 will revert back to FTA.
Alternative transportation projects formerly eligible under Transit in Parks are now eligible under the Federal Highway Administration's Federal Lands Transportation Program and the Federal Lands Access Program.
While FTA provides pre-award authority to incur expenses before grant award for formula programs, it recommends that first-time grant recipients NOT utilize this automatic pre-award authority without verifying with the appropriate FTA Regional Office that all pre-requisite requirements have been met. As a new grantee, it is easy to misunderstand pre-award authority conditions and be unaware of all of the applicable FTA requirements that must be met in order to be reimbursed for project expenditures incurred in advance of grant award. FTA programs have specific statutory requirements that are often different from those for other Federal grant programs with which new grantees may be familiar. If funds are expended for an ineligible project or activity, or for an eligible activity but at an inappropriate time (
FTA provides pre-award authority to incur expenses before grant award for certain program areas described below. This pre-award authority allows grantees to incur certain project costs before grant approval and retain the eligibility of those costs for subsequent reimbursement after grant approval. The grantee assumes all risk and is responsible for ensuring that all conditions are met to retain eligibility. This pre-award spending authority permits an eligible grantee to incur costs on an eligible transit capital, operating, planning, or administrative project without prejudice to possible future Federal participation in the cost of the project. In this notice, FTA provides pre-award authority through the authorization period of the FAST Act (October 1, 2015 through September 30, 2020) for capital assistance under all formula programs, so long as the conditions described below are met. FTA provides pre-award authority for planning and operating assistance under the formula programs without regard to the period of the authorization. All pre-award authority is subject to conditions and triggers stated below:
FTA does not impose additional conditions on pre-award authority for operating, planning, or administrative assistance under the formula grant programs. Grantees may be reimbursed for expenses incurred before grant award so long as funds have been expended in accordance with all Federal requirements, would have been allowable if incurred after the date of award, and the grantee is otherwise eligible to receive the funding. In addition to cross-cutting Federal grant requirements, program specific requirements must be met. For example, a planning project must have been included in a Unified Planning Work Program (UPWP); a section 5310 project must have been included in a coordinated public transit-human services transportation plan (coordinated plan) and selected by the designated recipient before incurring expenses; expenditures on State Administration expenses under State Administered programs must be consistent with the State Management Plan (as defined in FTA Circular 9040.1G, Chapter 6). Designated recipients for section 5310 have pre-award authority for the ten percent of the apportionment they may use for program administration.
For transit capital projects, the date that costs may be incurred varies depending on the type of activity and its potential to have a significant impact on the human and natural environment as described under conditions in section 3 below. Before an applicant may incur costs when pre-award authority has not been granted, it must first obtain a written Letter of No Prejudice (LONP) from FTA. To obtain an LONP, a grantee must submit a written request accompanied by adequate information and justification to the appropriate FTA regional office, as described in section 4 below.
Unless provided for in an announcement of project selections, pre-award authority does not apply to Public Transportation Innovation Public Transportation Innovation projects or section 5314 Technical Assistance and Workforce Development. Before an applicant may incur costs for activities under these programs, it must first obtain a written Letter of No Prejudice (LONP) from FTA. To obtain an LONP,
The conditions under which pre-award authority may be utilized are specified below:
All Federal environmental grant requirements must be met at the appropriate time for the project to remain eligible for Federal funding. Designated recipients may incur costs for design and environmental review activities for all projects from the date of the authorization of formula funds or the date of the announcement of the competitive allocations of funds for the project. For projects that qualify for a categorical exclusion pursuant to 23 CFR 771.118(c), designated recipients may start activities and incur costs for property acquisition, demolition, construction, and acquisition of vehicles, equipment, or construction materials from the date of the authorization of formula funds or the date of the announcement of the competitive allocation of funds for the project. FTA recommends that a grant applicant considering a categorical exclusion pursuant to 23 CFR 771.118(c) contact FTA's Regional Office for assistance in determining the appropriate environmental review process and level of documentation necessary before incurring costs for property acquisition, demolition, construction, and acquisition of vehicles, equipment, or construction materials. If FTA subsequently finds that a project does not to qualify for this CE, it will be ineligible for FTA assistance. In particular, FTA encourages grant applicants to contact FTA's Regional Office before exercising pre-award authority for projects to which it believes a CE at 23 CFR 771.118(c)(8), (9), (10), (12), or (13) applies.
For all other projects that do not qualify for a categorical exclusion under 23 CFR 771.118(c), grant applicants may take action and incur costs for property acquisition, demolition, construction, and acquisition of vehicles, equipment, or construction materials from the date that FTA completes the environmental review process required by NEPA and its implementing regulations, 23 U.S.C. 139, and other environmental laws by its issuance of a section 771.118(d) categorical exclusion determination, a Finding of No Significant Impact (FONSI), or a Record of Decision (ROD).
Formula funds must be authorized or appropriated and earmarked project allocations published or announced before pre-award authority can be considered.
The requirement that a project be included in a locally-adopted Metropolitan Transportation Plan, the metropolitan transportation improvement program and federally-approved statewide transportation improvement program (23 CFR part 450) must be satisfied before the grantee may advance the project beyond planning and preliminary design with non-federal funds under pre-award authority. If the project is located within an EPA-designated non-attainment or maintenance area for air quality, the conformity requirements of the Clean Air Act, 40 CFR part 93, must also be met before the project may be advanced into implementation-related activities under pre-award authority triggered by the completion of the NEPA process.
For a planning project to have pre-award authority, the planning project must be included in a MPO-approved Unified Planning Work Program (UPWP) that has been coordinated with the State.
k. All program specific requirements must be met. For example, projects under section 5310 must comply with specific program requirements, including coordinated planning. Before incurring costs, grantees are strongly encouraged to consult with the appropriate FTA Regional office regarding the eligibility of the project for future FTA funds and for questions on environmental requirements, or any other Federal requirements that must be met.
Projects proposed for section 5309 Capital Investment Grant (CIG) program funds are required to follow a multi-step, multi-year process defined in law. For New Starts and Core Capacity projects, this process includes three phases: Project development (PD), engineering, and construction. For Small Starts projects, this process includes two phases: PD and construction. After receiving a letter from the project sponsor requesting entry into the PD phase, FTA must respond in writing within 45 days whether the information was sufficient for entry. If FTA's correspondence indicates the information was sufficient and the New Starts, Small Starts or Core Capacity project enters PD, FTA extends pre-award authority to the project sponsor to incur costs for PD activities. PD activities include the work necessary to complete the environmental review process and as much engineering and
For Small Starts projects, upon completion of the environmental review process and confirmation from FTA that the overall project rating is at least a Medium, FTA extends pre-award authority for vehicle purchases. Upon receipt of a letter notifying a New Starts or Core Capacity project sponsor of the project's approval into the engineering phase, FTA extends pre-award authority for vehicle purchases as well as any remaining engineering and design, demolition, and procurement of long lead items for which market conditions play a significant role in the acquisition price. The long lead items include, but are not limited to, procurement of rails, ties, and other specialized equipment, and commodities.
Please contact the FTA Regional Office for a determination of activities not listed here, but which meet the intent described above. FTA provides this pre-award authority in recognition of the long-lead time and complexity involved with purchasing vehicles as well as their relationship to the “critical path” project schedule. FTA cautions grantees that do not currently operate the type of vehicle proposed in the project about exercising this pre-award authority. FTA encourages these sponsors to wait until later in the process when project plans are more fully developed. FTA reminds project sponsors that the procurement of vehicles must comply with all Federal requirements including, but not limited to, competitive procurement practices, the Americans with Disabilities Act, Disadvantaged Business Enterprise program requirements and Buy America. FTA encourages project sponsors to discuss the procurement of vehicles with FTA in regards to Federal requirements before exercising pre-award authority. Because there is not a formal engineering phase for Small Starts projects, FTA does not extend pre-award authority for demolition and procurement of long lead items. Instead, this work must await receipt of a construction grant award or an expedited grant agreement.
As noticed above, FTA extends pre-award authority for the acquisition of real property and real property rights for fixed Guideway Capital Investment Grant projects (New or Small Starts or Core Capacity) upon completion of the environmental review process for that project. The environmental review process is completed when FTA signs an environmental Record of Decision (ROD) or Finding of No Significant Impact (FONSI), or makes a Categorical Exclusion (CE) determination. With the limitations and caveats described below, real estate acquisition may commence, at the project sponsor's risk. For FTA-assisted projects, any acquisition of real property or real property rights must be conducted in accordance with the requirements of the Uniform Relocation Assistance and Real Property Acquisition Policies Act (URA) and its implementing regulations, 49 CFR part 24. This pre-award authority is strictly limited to costs incurred: (i) To acquire real property and real property rights in accordance with the URA regulation; and (ii) to provide relocation assistance in accordance with the URA regulation. This pre-award authority is limited to the acquisition of real property and real property rights that are explicitly identified in the final environmental impact statement (FEIS), environmental assessment (EA), or CE document, as needed for the selected alternative that is the subject of the FTA-signed ROD or FONSI, or CE determination. This pre-award authority regarding property acquisition that is granted at the completion of the environmental review process does not cover site preparation, demolition, or any other activity that is not strictly necessary to comply with the URA, with one exception—namely when a building that has been acquired, has been emptied of its occupants, and awaits demolition poses a potential fire safety hazard or other hazard to the community in which it is located, or is susceptible to reoccupation by vagrants. Demolition of the building is also covered by this pre-award authority upon FTA's written agreement that the adverse condition exists. Pre-award authority for property acquisition is also provided when FTA makes a CE determination for a protective buy or hardship acquisition in accordance with 23 CFR 771.117(d)(12). Pre-award authority for property acquisition is also provided when FTA completes the environmental review process for the acquisition of right-of-way as a separate project in accordance with 49 U.S.C. 5323(q). When a tiered environmental review in accordance with 23 CFR 771.111(g) is used, pre-award authority is NOT provided upon completion of the first tier environmental document except when the Tier-1 ROD or FONSI signed by FTA explicitly provides such pre-award authority for a particular identified acquisition. Project sponsors should use pre-award authority for real property acquisition relocation assistance with a clear understanding that it does not constitute a funding commitment by FTA. FTA provides pre-award authority upon completion of the environmental review process for real property acquisition and relocation assistance to maximize the time available to project sponsors to move people out of their homes and places of business, in accordance with the requirements of the URA, but also with maximum sensitivity to the circumstances of the people so affected.
Although FTA provides pre-award authority for property acquisition, long lead items, and vehicle purchases upon completion of the environmental review process, FTA will not make a grant to reimburse the sponsor for real estate activities, vehicle purchases or purchases of long lead items conducted under pre-award authority until the project receives its construction grant. This is to ensure that Federal funds are not risked on a project whose advancement into construction is not yet assured.
NEPA requires that major projects proposed for FTA funding assistance be subjected to a public and interagency review of the need for the project, its environmental and community impacts, and alternatives to avoid and reduce adverse impacts. Projects of more limited scope also need a level of environmental review, either to support an FTA finding of no significant impact (FONSI) or to demonstrate that the action is categorically excluded (
Except as discussed in paragraphs i through iii above, a CIG project sponsor must obtain a written LONP from FTA before incurring costs for any activity not covered by pre-award authority. To obtain an LONP, an applicant must submit a written request accompanied by adequate information and justification to the appropriate FTA Regional Office, as described in B below.
LONP authority allows an applicant to incur costs on a project utilizing non-Federal resources, with the understanding that the costs incurred subsequent to the issuance of the LONP may be reimbursable as eligible expenses or eligible for credit toward the local match should FTA approve the project at a later date. LONPs are applicable to projects and project activities not covered by automatic pre-award authority. The majority of LONPs will be for section 5309 Capital Investment Grant program projects (New or Small Starts or Core Capacity) undertaking activities not covered under automatic pre-award authority. LONPs may be issued for formula and competitive funds beyond the life of the current authorization or FTA's extension of automatic pre-award authority; however, the LONP is limited to a five-year period, unless otherwise authorized in the LONP. Receipt of Federal funding under any program is not implied or guaranteed by an LONP.
The conditions and requirements for pre-award authority specified in section V.4.ii and V.4.iii above apply to all LONPs. Because project implementation activities may not be initiated before completion of the environmental review process, FTA will not issue an LONP for such activities until the environmental review process has been completed with a ROD, FONSI, or CE determination.
Before incurring costs for project activities not covered by automatic pre-award authority, the project sponsor must first submit a written request for an LONP, accompanied by adequate information and justification, to the appropriate regional office and obtain written approval from FTA. FTA approval of an LONP is determined on a case-by-case basis. Federal funding under the Fixed Guideway Capital Investment Grant program for a New Starts, Small Starts, or Core Capacity project is not implied or guaranteed by an LONP. Specifically, when requesting an LONP, the applicant shall provide the following items:
The FY 2017 Certifications and Assurances and Master Agreement are currently available in TrAMS and must be used for all grants and cooperative agreements awarded in FY 2017. All recipients with active projects are required to sign the FY 2017 Certifications and Assurances within 90 days of publication. The FY 2017 Certifications and Assurances publication date of December 20, 2016.
The FTA Office of Civil Rights released an updated EEO Circular, FTA Circular 4704.1A, effective October 31, 2016. The Circular provides guidance to FTA grant recipients to carry out EEO requirements and prepare EEO Program Plans. The updated FTA EEO Circular is posted at
First, State DOTs are subject to the same threshold requirements for FTA EEO Program submissions, located in Circular Section 1.4, Applicability, as other recipients. A State DOT must only submit a transit-related EEO Program if: (1) It employs 100 or more transit-related employees;
Second, we wish to clarify the threshold requirements for preparing and maintaining an abbreviated EEO Program, which is discussed in Circular Section 1.4. In the paragraph discussing
Third, only direct recipients who cross the EEO Program threshold requirements in Circular Section 1.4, and State DOTs are required to prepare and/or submit an EEO Program to FTA. All subrecipients and contractors who cross the EEO Program threshold must submit EEO Programs to the entity from which they receive funds, generally the transit agency or the State DOT, as appropriate. This will allow State DOTs and transit agencies to determine and document that subrecipients and contractors comply with EEO statutes and regulations, in accordance with their monitoring responsibilities. FTA applicants, recipients, subrecipients, and contractors that do not meet the EEO Program threshold are not required to submit an EEO Program to FTA or to the entity from which they receive funds.
FTA will amend the pages of the Circular affected by the above clarifications and will post the updated Circular on FTA's Web site.
The U.S. DOT's Title VI implementing regulations are found in 49 CFR part 21. FTA's Title VI Circular (4702.1B) provides guidance for carrying out the regulatory requirements. Recipients in urbanized areas of 200,000 or more in population and with 50 or more fixed-route vehicles in peak service must conduct a service or fare equity analysis for all service changes that meet the recipient's definition of “major service change” prior to implementing the service change. A service equity analysis is also required for all New Start, Small Start, or other new fixed guideway capital projects, and must be completed six months prior to implementing revenue service. Recipients also must conduct a fare equity analysis for all fare increases or decreases prior to implementing a fare change. Recipients that do not meet the abovementioned threshold of 200,000 or more in population and 50 fixed route vehicles in peak service (
FTA would also like to stress the importance of public participation. Recipients must facilitate effective public engagement throughout all stages of the consultation, planning, and the decision-making process. Particular emphasis should be given to affected, and potentially affected, communities. FTA recommends that recipients anticipating service and fare changes review FTA Circular 4703.1, Environmental Justice Policy Guidance, Chapter III, Achieving Meaningful Public Engagement with Environmental Justice Populations, available at
FTA and FHWA planning funds under both the Metropolitan Planning and State Planning and Research Programs can be consolidated into a single consolidated planning grant, awarded by either FTA or FHWA. The CPG eliminates the need to monitor individual fund sources, if several have been used, and ensures that the oldest funds will always be used first.
Under the CPG, States can report metropolitan planning program expenditures (to comply with the Single Audit Act) for both FTA and FHWA under the Catalogue of Federal Domestic Assistance number for FTA's Metropolitan Planning Program (20.505). Additionally, for States with an FHWA Metropolitan Planning (PL) fund-matching ratio greater than 80 percent, the State can waive the 20 percent local share requirement, with FTA's concurrence, to allow FTA funds used for metropolitan planning in a CPG to be granted at the higher FHWA rate. For some States, this Federal match rate can exceed 90 percent.
States interested in transferring planning funds between FTA and FHWA should contact the FTA Regional Office or FHWA Division Office for more detailed procedures. Current guidelines are included in Federal Highway Administration Memorandum dated July 12, 2007, “Information: Final Transfers to Other Agencies that Administer Title 23 Programs.” For further information on CPGs, contact Ann Souvandara, Office of Budget and Policy, FTA, at (202)366-0649.
All applications for FTA funds should be submitted to the appropriate FTA Regional Office. All applications are filed electronically. FTA continues to award and manage grants and cooperative agreements using the Transit Award Management System (TrAMS) which re-opened for financial activity on November 1, 2016. Information on accessing and using TrAMS, including a list of FTA points of contact for the system, can be found on FTA's Web site at
FTA regional staff is responsible for working with grantees to review and process grant applications. In order for an application to be considered complete and for FTA to assign a Federal Award Identification Number (FAIN), enabling submission in TrAMS, and submission to the Department of Labor (when applicable), the following requirements must be met:
Before FTA can award grants for competitive projects and activities, notification must be provided to the House and Senate authorizing and appropriations committees.
Other important issues that impact FTA grant processing activities are discussed below.
Each applicant or recipient of Federal Funds is required to: (1) Be registered in SAM before submitting its application; (2) provide a valid DUNS number in its application; and (3) continue to maintain an active SAM registration with current information at all times during which it has an active award or an application or plan under consideration by the Federal Transit Administration (FTA). FTA will not make an award to an applicant until the applicant has complied with all applicable DUNS and SAM requirements and, if an applicant has not fully complied with the requirements by the time the FTA is ready to make a Federal award, FTA may determine that the applicant is not qualified to receive a Federal award and use that determination as a basis for making a Federal award to another applicant.
The System for Award Management (SAM)
FTA uses the Scope and Activity Line Item (ALI) Codes in the award budgets to track disbursements, monitor program trends, report to Congress, and to respond to requests from the Inspector General and the Government Accountability Office (GAO), as well as to manage grants. The accuracy of the data is dependent on the careful and correct use of codes.
For its formula programs, FTA primarily apportions funds to the designated recipient in the large UZAs (areas over 200,000), or for areas under 200,000 (small UZAs and rural areas), it apportions the funds to the Governor, or its designee (
For the programs in which FTA can make grants to eligible direct recipients, other than the designated recipient(s), recipients are reminded that documentation must be on file to support the: (1) Status of the recipient either as a designated recipient or direct recipient; and (2) the allocation of funds to the direct recipient.
Documentation to support existing designated recipients for the UZA must also be on file at the time of the first application in FY 2017. Further, split letters and/or suballocation letters (Governor's Apportionment letters), must also be on file to support grant applications from direct recipients. Once suballocation letters for FY 2017 funding are finalized they should also be uploaded into TrAMS.
The Direct Recipient is required to upload to TrAMS a copy of the Designated Recipient letter indicating their allocation of funding [for the appropriate fund program] when the applicant transmits their application for initial review. The letter must be signed by the Designated Recipient, or as applicable in accordance with their planning requirements. If there are two Designated Recipients, both entities must sign the Letter. The Letter must: (1) Indicate the allocations to the respective Direct Recipients listed in the letter; (2) incorporate language above the signatories to reflect this agreement; and (3) make clear that the Direct Recipient will assume any/all responsibility associated with the award for the funds. When drafting the letter, Designated Recipients may use the template language below:
“As identified in this Letter, the Designated Recipient(s) authorize the reassignment/reallocation of [enter fund source;
Once a grant has been awarded and executed, requests for payment can be processed. To process payments, FTA uses ECHO-Web, an Internet accessible system that provides grantees the capability to submit payment requests on-line, as well as receive user-IDs and passwords via email. New applicants should contact the appropriate FTA Regional Office to obtain and submit the registration package necessary for set-up under ECHO-Web.
FTA is responsible for conducting oversight activities to help ensure that grants recipients use FTA Federal financial assistance in a manner consistent with their intended purpose and in compliance with regulatory and statutory requirements. FTA conducts periodic oversight reviews to assess grantee compliance with applicable Federal requirements. Each Urbanized Area Formula Program recipient is reviewed every three years, (also known as FTA's Triennial Review); and States and state-wide public transportation agencies are reviewed periodically to assess the management practices and program implementation of FTA state-wide programs (
As noted throughout the notice, FTA continues to rely on several of the existing program circulars for general program guidance. FTA is continuing to update the program circulars, with an opportunity for notice and comment (where warranted), to reflect amendments to chapter 53 of title 49, U.S.C. made by the FAST Act. In the meantime, if you have any questions, please do not hesitate to contact FTA. FTA headquarters and regional staff will be pleased to answer your questions and provide any technical assistance you may need to apply for FTA program funds and manage the grants you receive. At its discretion, FTA may also use program oversight consultants to provide technical assistance to grantees on a case by case basis. This notice and the program guidance circulars previously identified in this document may be accessed via the FTA Web site at
Recipients of FTA funds are reminded that all FTA grantees are required to report on their grants and it is critical to ensure reports demonstrate that reasonable progress is being made on the project. At a minimum, all awards require a Federal Financial Report (FFR) and a Milestone Progress Report (MPR) on an annual basis, with some reports required quarterly depending on the recipient and the type of projects funded under the grant. The requirements for these reports and other reporting requirements can be found in the latest version of FTA Circular 5010. FTA staff, auditors, and contractors rely on the information provided in the FFR and MPR to review and report on the status of both financial and project-level activities contained in the grant. It is critical that recipients provide accurate and complete information in these reports and submit them by the required due date. Failure to report and/or demonstrate reasonable progress on projects can result in suspension or premature close-out of a grant.
In FY 2017, FTA will continue to focus on identifying and working with recipients to close inactive grants. If appropriate, FTA will take action to close out and deobligate funds from these grants if reasonable progress is not made. The efficient use of funds will further FTA's fulfillment of its mission to provide efficient and effective public transportation systems for the nation. As inactive grants continue to be an audit finding within the DOT, FTA must take action to ensure its grants do not impact the DOT from receiving a “clean audit” opinion on its annual financial statements.
In October 2016, FTA identified a list of grants that were awarded on or prior to September 30, 2013 and have had no funds disbursed since September 30, 2015 or have never had a disbursement. FTA Regional Offices will be contacting grant recipients with grants that meet this criteria to notify them that FTA intends to close the grant and deobligate any remaining funds unless the grantee can provide information that demonstrates that the projects funded by the grant remain active and the grantee has a realistic schedule to expedite completion of the projects funded in the grant.
Federal Transit Administration (FTA), DOT.
Notice of Funding Opportunity (NOFO).
The Federal Transit Administration (FTA) announces the availability of approximately $5 million in funding provided by the Public Transportation on Indian Reservations Program (Tribal Transit Program), as authorized by Federal Transit law 49 U.S.C. 5311(c)(1)(A), as amended by the Fixing America's Surface Transportation (FAST) Act, Public Law 114-94 (December 4, 2015), contingent on full appropriations. This notice is a national solicitation for project proposals and includes the selection criteria and program eligibility information for FY 2017 projects. FTA may fund the program for more or less than the full year appropriation when made available, and may include other funding toward project proposals received in response to this Notice of Funding Opportunity (NOFO).
This announcement is available on the FTA Web site at:
Complete proposals for the Tribal Transit Program announced in this Notice must be submitted by 11:59 p.m. EDT on March 20, 2017. All proposals must be submitted electronically through the
Contact the appropriate FTA Regional Office at
The Tribal Transit Program (TTP) was established by the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU) as a competitive program from FY 2006 & FY 2012. The Moving Ahead for Progress in the 21st Century (MAP-21) Act modified the program to include a $25 million formula component and a $5 million competitive program, totaling $30 million. The FAST Act increased the Tribal Transit Formula Program to $30 million and continued the $5 million competitive program found at
The primary purpose of these competitively selected grants is to support planning, capital, and, in limited circumstances, operating assistance for tribal public transit services. Funds distributed to Indian tribes under the TTP should NOT replace or reduce funds that Indian tribes receive from States through FTA's Formula Grants for Rural Areas Program. Specific project eligibility under this competitive allocation is described in Section C below.
Five million dollars is authorized for the Tribal Transit comptitive allocation in FY 2017 subject to enactment of funds to projects selected pursuant to the process described in the following sections. Federal awards under this comepetitive program will be in the form of grants. Additionally, there is a cap on planning grant awards at $25,000, and FTA has the discretion to cap capital and operating awards as well.
Eligible applicants include federally recognized Indian tribes or Alaska Native villages, groups, or communities as identified by the U.S. Department of Interior (DOI) Bureau of Indian Affairs (BIA). As evidence of Federal recognition, an Indian tribe may submit a copy of the most up-to-date
There is a 90 percent federal share for projects selected under the TTP competitive program, unless the Indian tribe can demonstrate a financial hardship in its application. FTA is interested in the Indian tribe's financial commitment to the proposed project, thus the proposal should include a description of the Indian tribe's financial commitment. Tribes may use any eligible local match under Chapter 53.
Eligible projects include public transportation planning and capital expenses. Operating projects are eligible in limited circumstances as, in FY 2017, FTA will only consider operating assistance requests from tribes without existing transit service, or those tribes who received a TTP formula allocation of less than $20,000.
Public transportation includes regular, continuing shared-ride surface transportation services open to the public or open to a segment of the public defined by age, disability, or low income. Projects exclusive to an urbanized area, as defined by the Census Bureau, are not eligible. FTA will award grants to eligible Indian tribes located in rural areas. Applicants may submit one proposal for each project or one proposal containing multiple projects. Specific types of projects include: Capital projects for start-ups, replacement or expansion needs; operating assistance for start-ups; and planning projects up to $25,000. Indian tribes applying for capital replacement or expansion needs must demonstrate a sustainable source of operating funds for existing or expanded services.
A complete proposal submission will consist of at least two files: (1) The SF 424 Mandatory form (downloaded from
A complete proposal submission will consist of at least two files: (1) The SF 424 Mandatory form (downloaded from
Applicants are encouraged to begin the process of registration on the
Applicants may submit one proposal for each project or one proposal containing multiple projects. Applicants submitting multiple projects in one proposal must be sure to clearly define each project by completing a supplemental form for each project. Additional supplemental forms must be added within the proposal by clicking the “add project” button in Section II of the supplemental form.
Information such as applicant name, Federal amount requested, description of areas served, and other information may be requested in varying degrees of detail on both the SF 424 form and supplemental form. Applicants must fill in all fields unless stated otherwise on the forms. Applicants should use both the “Check Package for Errors” and the “Validate Form” validation buttons on both forms to check all required fields on the forms, and ensure that the Federal and local amounts specified are consistent.
The SF424 Mandatory Form and the Supplemental Form will prompt applicants for the required information, including:
a. Name of federally recognized tribe and, if appropriate, the specific tribal agency submitting the application.
b. Dun and Bradstreet (D&B) Data Universal Numbering System (DUNS) number if available. (Note: If selected, applicant will be required to provide DUNS number prior to grant award).
c. Contact information including: Contact name, title, address, fax and phone number, email address if available.
d. Description of existing public transportation services including areas currently served by the tribe, if any.
e. Name of person(s) authorized to apply on applicant's behalf must accompany the proposal (attach a signed transmittal letter).
f. Complete Project Description:
Indicate the category for which funding is requested (
g. Project Timeline:
Include significant milestones such as date of contract for purchase of vehicle(s), actual or expected delivery date of vehicles; facility project phases (
h. Budget:
Provide a detailed budget for each proposed purpose noting the Federal amount requested and any additional funds that will be used. An Indian tribe may use up to fifteen percent of a grant award for capital projects for specific project-related planning and administration, and the indirect costs rate may not exceed ten percent (if necessary add as an attachment) of the total amount requested/awarded. Indian tribes must also provide their annual operating budget as an attachment or under the
i. Technical, Legal, Financial Capacity: Applicants must be able to demonstrate adequate technical, legal and financial capacity to be considered for funding. Every proposal MUST describe this capacity to implement the proposed project.
1. Technical Capacity: Provide examples of management of other Federal projects, including previously funded FTA projects and/or similar types of projects for which funding is being requested. Describe the resources available to implement the proposed transit project.
2. Legal Capacity: Provide documentation or other evidence to demonstrate status as a federally recognized Indian tribe. Further, demonstrate evidence of an authorized representative with authority bind the applicant and execute legal agreements with FTA. If applying for capital or operating funds, identify whether appropriate Federal or State operating authority exists.
3. Financial Capacity: Provide documentation or other evidence demonstrating current adequate financial systems to receive and manage a Federal grant. Fully describe: (1) All financial systems and controls; 2) other sources of funds currently managed; and (3) the long-term financial capacity to maintain the proposed or existing transit services.
Each applicant is required to: (1) Be registered in SAM before submitting an application; (2) provide a valid unique entity identifier in its application; and (3) continue to maintain an active SAM registration with current information at all times during which the applicant has an active Federal award or an application or plan under consideration by FTA. These requirements do not apply if the applicant: (1) Is an individual; (2) is excepted from the requirements under 2 CFR 25.110(b) or (c); or (3) has an exception approved by FTA under 2 CFR 25.110(d). FTA may not make an Award until the applicant has complied with all applicable unique entity identifier and SAM requirements. If an applicant has not fully complied with the requirements by the time FTA is ready to make an Award, FTA may determine that the applicant is not qualified to receive an Award and use that determination as a basis for making a Federal award to another applicant. SAM registration takes approximately three to five business days, but FTA recommends allowing ample time, up to several weeks, for completion of all steps.
Same day. If requested by phone (1-866-705-5711) DUNS is provided immediately. If your organization does not have one, you will need to go to the Dun & Bradstreet Web site at
Three to five business days or up to two weeks. If you already have a Taxpayer Identification Number (TIN), your SAM registration will take three to five business days to process. If you are applying for an Employer Identification Number (EIN) please allow up to two weeks. Ensure that your organization is registered with the System for Award Management (SAM) at
Same day. Complete your Authorized Organization Representative (AOR) profile on
* Same day. The E-Business Point of Contact (E-Biz POC) at your organization must login to
At any time, you can track your AOR status by logging in with your username and password. Login as an Applicant (enter your username & password you obtained in Step 3) using the following link:
Project proposals must be submitted electronically through
Funds must be used only for the specific purposes requested in the application. Funds under this NOFO cannot be used to reimburse projects for otherwise eligible expenses incurred prior to FTA award.
FTA requires that all project proposals be submitted electronically through
FTA will use the following primary selection criteria when evaluating competing capital and operating assistance projects eligible under this program. Applications will be evaluated based on the quality and extent to which the following evaluation criteria are addressed.
Applications will be evaluated based on the degree to which the applicant: (1) Describes how the proposed project was developed; (2) demonstrates that a sound basis for the project exists; and (3) demonstrates that the applicant is ready to implement the project if funded. Information may vary depending upon how the planning process for the project was conducted and what is being requested. Planning and local/regional prioritization should:
a. Describe the planning document and/or the planning process conducted to identify the proposed project;
b. Provide a detailed project description including the proposed service, vehicle and facility needs, and other pertinent characteristics of the proposed or existing service implementation;
c. Identify existing transportation services in and near the proposed service area, and document in detail whether the proposed project will provide opportunities to coordinate service with existing transit services, including human service agencies, intercity bus services, or other public transit providers;
d. Discuss the level of support by the community and/or tribal government for the proposed project;
e. Describe how the mobility and client-access needs of tribal human service agencies were considered in the planning process;
f. Describe what opportunities for public participation were provided in the planning process and how the proposed transit service or existing service has been coordinated with transportation provided for the clients of human service agencies, with intercity bus transportation in the area, or with any other rural public transit providers;
g. Describe how the proposed service complements rather than duplicates any currently available services;
h. Describe the implementation schedule for the proposed project, including time period, staffing, and procurement; and
i. Describe any other planning or coordination efforts not mentioned above.
ii. Project Readiness: Applications will be evaluated on the degree to which the applicant describes readiness to implement the project. The project readiness factor involves assessing whether:
a. Project is a Categorical Exclusion (CE) or the required environmental work has been initiated or completed for construction projects requiring an Environmental Assessment (EA) or Environmental Impact Statement (EIS) under, among others, the National Environmental Policy Act of 1969, as Amended;
b. Project implementation plans are complete, including initial design of facilities Projects;
c. Project funds can be obligated and the project can be implemented quickly, if selected; and
d. Applicant demonstrates the ability to carry out the proposed project successfully.
Applications will be evaluated based on the degree to which the applicant identies the need for transit for resources. In addition to project-specific criteria, FTA will consider the project's impact on service delivery and whether the project represents a one-time or periodic need that cannot reasonably be funded from the FTA program formula allocations or State and/or local resources. FTA will evaluate how the proposal demonstrates the transit needs of the Indian tribe as well as how the proposed transit improvements or the new service will address identified transit needs. Proposals should include information such as destinations and services not currently accessible by transit, needs for access to jobs or health care, safety enhancements or special needs of elders, individuals with disabilities, behavioral health care needs of youth, income-based community needs, or other mobility needs. If an applicant received a planning grant in previous fiscal years, it should indicate the status of the planning study and how the proposed project relates to that study.
Applicants applying for capital expansion or replacement projects should also address the following factors in their proposal. If the proposal is for capital funding associated with an expansion or expanded service, the applicant should describe how current or growing demand for the service necessitates the expansion (and therefore, more capital) and/or the degree to how the project is addressing a current capacity constraint. Capital replacement projects should include information about the age, condition, and performance of the asset to be replaced by the proposed project and/or how the replacement may be necessary to maintain the transit system in a state of good repair.
Applications will be evaluated based on the degree to which the applicant
Based on the information provided under the demonstration of benefits, FTA will rate proposals rated based on the quality and extent to which they discuss the following four factors:
a. The project's ability to improve transit efficiency or increase ridership;
b. Whether the project will improve or maintain mobility, or eliminate gaps in service for the Indian tribe;
c. Whether the project will improve or maintain access to important destinations and services;
d. Any other qualitative benefits, such as greater access to jobs, education and health care.
Applications must identify the source of local match (ten percent is required for all operating and capital projects), and any other funding sources used by the Indian tribe to support proposed transit services, including human service transportation funding, FHWA's Tribal Transportation Program funding, or other FTA programs. If requesting that FTA waive the local match based on financial hardship, the applicant must submit budgets and sources of other revenue to demonstrate hardship. FTA will review this information and notify tribes at the time of award if the waiver is approved. If applicable, the applicant also should describe how prior year TTP funds were spent to date to support the service. Additionally, Indian tribes applying for operating of new services should provide a sustainable funding plan that demonstrates how it intends to maintain operations.
In evaluating proposals, FTA will consider any other resources the Indian tribe will contribute to the project, including in-kind contributions, commitments of support from local businesses, donations of land or equipment, and human resources. The proposal should describe to what extent the new project or funding for existing service leverages other funding. Based upon the information provided, the proposals will be rated on the extent to which the proposal demonstrates that:
a. TTP Funding does not replace existing funding;
b. The Indian tribe will provide non-financial support to the project;
c. The Indian tribe is able to demonstrate a sustainable funding plan; and
d. Project funds are used in coordination with other services for efficient utilization of funds.
For planning grants, the proposal must describe the need for and a general scope of the proposed study. Applications will be evaluated based on the degree to which the applicant addresses the following:
1. The tribes' long-term commitment to transit; and
2. The method used to implement the proposed study and/or further tribal transit.
A technical evaluation committee will review proposals under the project evaluation criteria. Members of the technical evaluation committee and other involved FTA staff reserve the right to screen, rate the applications, and seek clarification about any statement in an application. After consideration of the findings of the technical evaluation committee, the FTA Administrator will determine the final selection and amount of funding for each project. Geographic diversity and the applicant's receipt and management of other Federal transit funds may be considered in FTA's award decisions. FTA expects to announce the selected projects and notify successful applicants in the spring of 2017.
Subsequent to an announcement by the FTA Administrator of the final project selections posted on the FTA Web site, FTA will publish a list of the selected projects, including Federal dollar amounts and recipients in the
Successful proposals will be awarded through TrAMS as Grant Agreements. The appropriate FTA Regional Office and tribal liaison will manage project agreements.
Except as otherwise provided in this NOFO, TTP grants are subject to the requirements of 49 U.S.C. 5311(c)(1) as described in the latest FTA Circular 9040.1G for the Formula Grants for Rural Areas Program.
The post award reporting requirements include submission of the Federal Financial Report (FFR) and Milestone Progress Report in TrAMs, and National Transit Database (NTD) reporting as appropriate (see FTA Circular 9040.1G). Reports to TrAMS and NTD are due annually.
For further information concerning this notice, please contact Élan Flippin, Office of Program Management, (202) 366-3800, email:
This program is not subject to Executive Order 12372, “Intergovernmental Review of Federal Programs.” FTA will consider applications for funding only from eligible recipients for eligible projects listed in Section C-2. Due to funding limitations, applicants that are selected for funding may receive less than the amount requested.
Additionally, to assist tribes with understanding requirements under the TTP, FTA has conducted Tribal Transit Technical Assistance Workshops, and will continue those efforts in FY2017. FTA also has expanded its technical assistance to tribes receiving funds under this program. Additionally, through the Tribal Transit Technical
FTA will post information about upcoming workshops to its Web site and will disseminate information about the assessments through its regional offices. Contact information for FTA's regional offices can be found on FTA's Web site at
Registration takes approximately three to five business days, please allow four weeks for completion of all steps.
In order to apply for a grant, you and/or your organization must first complete the registration process in
The
The required registration steps are described in greater detail on
Summary of steps (these steps are available in
Same day. If requested by phone (1-866-705-5711) DUNS is provided immediately. If your organization does not have one, you will need to go to the Dun & Bradstreet Web site at
Three to five business days or up to two weeks. If you already have a Taxpayer Identification Number (TIN), your SAM registration will take three to five business days to process. If you are applying for an Employer Identification Number (EIN) please allow up to two weeks. Ensure that your organization is registered with the System for Award Management (SAM) at
Same day. Complete your Authorized Organization Representative (AOR) profile on
* Same day. The E-Business Point of Contact (E-Biz POC) at your organization must login to
* Please Note:
Maritime Administration
Notice.
The Secretary of Transportation, as represented by the Maritime Administration (MARAD), is authorized to grant waivers of the U.S.-build requirement of the coastwise laws under certain circumstances. A request for such a waiver has been received by MARAD. The vessel, and a brief description of the proposed service, is listed below.
Submit comments on or before February 21, 2017.
Comments should refer to docket number MARAD-2017-0004. Written comments may be submitted by hand or by mail to the Docket Clerk, U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590. You may also send comments electronically via the Internet at
Bianca Carr, U.S. Department of Transportation, Maritime Administration, 1200 New Jersey Avenue SE., Room W23-453, Washington, DC 20590. Telephone 202-366-9309, Email
As described by the applicant the intended service of the vessel MIRA MAR is:
In accordance with 5 U.S.C. 553(c), DOT/MARAD solicits comments from the public to better inform its rulemaking process. DOT/MARAD posts these comments, without edit, to
By Order of the Maritime Administrator.
Maritime Administration.
Notice.
The Secretary of Transportation, as represented by the Maritime Administration (MARAD), is authorized to grant waivers of the U.S.-build requirement of the coastwise laws under certain circumstances. A request for such a waiver has been received by MARAD. The vessel, and a brief description of the proposed service, is listed below.
Submit comments on or before February 21, 2017.
Comments should refer to docket number MARAD-2017- 0003. Written comments may be submitted by hand or by mail to the Docket Clerk, U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590. You may also send comments electronically via the Internet at
Bianca Carr, U.S. Department of Transportation, Maritime Administration, 1200 New Jersey Avenue SE., Room W23-453, Washington, DC 20590. Telephone 202-366-9309, Email
As described by the applicant the intended service of the vessel SHAUN T is:
In accordance with 5 U.S.C. 553(c), DOT/MARAD solicits comments from the public to better inform its rulemaking process. DOT/MARAD posts these comments, without edit, to
By Order of the Maritime Administrator.
Maritime Administration.
Notice.
The Secretary of Transportation, as represented by the Maritime Administration (MARAD), is authorized to grant waivers of the U.S.-build requirement of the coastwise laws under certain circumstances. A request for such a waiver has been received by MARAD. The vessel, and a brief description of the proposed service, is listed below.
Submit comments on or before February 21, 2017.
Comments should refer to docket number MARAD-2017-0008. Written comments may be submitted by hand or by mail to the Docket Clerk, U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590. You may also send comments electronically via the Internet at
Bianca Carr, U.S. Department of Transportation, Maritime Administration, 1200 New Jersey Avenue SE., Room W23-453, Washington, DC 20590. Telephone 202-366-9309, Email
As described by the applicant the intended service of the vessel MAJESTIK is:
In accordance with 5 U.S.C. 553(c), DOT/MARAD solicits comments from the public to better inform its rulemaking process. DOT/MARAD posts these comments, without edit, to
By Order of the Maritime Administrator.
Maritime Administration, Department of Transportation.
Notice and request for comments.
The Department of Transportation (DOT) invites public comments about our intention to request the Office of Management and Budget (OMB) approval to renew an information collection. The information collection is necessary for MARAD to determine whether the applicant is committed to the redevelopment plan; the plan is in the best interests of the public, and the property will be used in accordance with the terms of the conveyance and applicable statutes and regulations. We are required to publish this notice in the
Written comments should be submitted by March 20, 2017.
You may submit comments [identified by Docket No. DOT-MARAD-2017-0010 through one of the following methods:
•
•
•
Linden Houston, Office of Deepwater Ports and Offshore Activities, Maritime Administration, 1200 New Jersey Avenue SE., Washington, DC 20590; Telephone: (202) 366-4839 or Email:
Anyone is able to search the electronic form of all comments received into any of our dockets by the name of the individual submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc.). You may review DOT's complete Privacy Act Statement in the
The Paperwork Reduction Act of 1995; 44 U.S.C. Chapter 35, as amended; and 49 CFR 1.93
Maritime Administration, Department of Transportation.
Notice.
The Secretary of Transportation, as represented by the Maritime Administration (MARAD), is authorized to grant waivers of the U.S.-build requirement of the coastwise laws under certain circumstances. A request for such a waiver has been received by MARAD. The vessel, and a brief description of the proposed service, is listed below.
Submit comments on or before February 21, 2017.
Comments should refer to docket number MARAD-2017-0009. Written comments may be submitted by hand or by mail to the Docket Clerk, U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590. You may also send comments electronically via the Internet at
Bianca Carr, U.S. Department of Transportation, Maritime Administration, 1200 New Jersey Avenue SE., Room W23-453, Washington, DC 20590. Telephone 202-366-9309, Email
As described by the applicant the intended service of the vessel GRAVITY is:
In accordance with 5 U.S.C. 553(c), DOT/MARAD solicits comments from the public to better inform its rulemaking process. DOT/MARAD posts these comments, without edit, to
By Order of the Maritime Administrator.
Maritime Administration
Notice.
The Secretary of Transportation, as represented by the Maritime Administration (MARAD), is authorized to grant waivers of the U.S.-build requirement of the coastwise laws under certain circumstances. A request for such a waiver has been received by MARAD. The vessel, and a brief description of the proposed service, is listed below.
Submit comments on or before February 21, 2017.
Comments should refer to docket number MARAD-2017-0006. Written comments may be submitted by hand or by mail to the Docket Clerk, U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590. You may also send comments electronically via the Internet at
Bianca Carr, U.S. Department of Transportation, Maritime Administration, 1200 New Jersey Avenue SE., Room W23-453, Washington, DC 20590. Telephone 202-366-9309, Email
As described by the applicant the intended service of the vessel SERENITY is:
The complete application is given in DOT docket MARAD-2017-0006 at
In accordance with 5 U.S.C. 553(c), DOT/MARAD solicits comments from the public to better inform its rulemaking process. DOT/MARAD posts these comments, without edit, to
By Order of the Maritime Administrator.
Maritime Administration, DOT.
Notice.
The Secretary of Transportation, as represented by the Maritime Administration (MARAD), is authorized to grant waivers of the U.S.-build requirement of the coastwise laws under certain circumstances. A request for such a waiver has been received by MARAD. The vessel, and a brief description of the proposed service, is listed below.
Submit comments on or before February 17, 2017.
Comments should refer to docket number MARAD-2017-0002. Written comments may be submitted by hand or by mail to the Docket Clerk, U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590. You may also send comments electronically via the Internet at
Bianca Carr, U.S. Department of Transportation, Maritime Administration, 1200 New Jersey Avenue SE., Room W23-453, Washington, DC 20590. Telephone 202-366-9309, Email
As described by the applicant the intended service of the vessel SAIL BE HAPPY is:
The complete application is given in DOT docket MARAD-2017- 0002 at
In accordance with 5 U.S.C. 553(c), DOT/MARAD solicits comments from the public to better inform its rulemaking process. DOT/MARAD posts these comments, without edit, to
By Order of the Maritime Administrator.
Maritime Administration.
Notice.
The Secretary of Transportation, as represented by the Maritime Administration (MARAD), is authorized to grant waivers of the U.S.-build requirement of the coastwise laws under certain circumstances. A request for such a waiver has been received by MARAD. The vessel, and a brief description of the proposed service, is listed below.
Submit comments on or before February 21, 2017.
Comments should refer to docket number MARAD-2017-0007. Written comments may be submitted by hand or by mail to the Docket Clerk, U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590. You may also send comments electronically via the Internet at
Bianca Carr, U.S. Department of Transportation, Maritime Administration, 1200 New Jersey Avenue SE., Room W23-453, Washington, DC 20590. Telephone 202-366-9309, Email
As described by the applicant the intended service of the vessel HAVORN is:
The complete application is given in DOT docket MARAD-2017-0007 at
In accordance with 5 U.S.C. 553(c), DOT/MARAD solicits comments from the public to better inform its rulemaking process. DOT/MARAD posts these comments, without edit, to
By Order of the Maritime Administrator.
Internal Revenue Service (IRS), Treasury.
Notice and request for comments.
The Department of the Treasury, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to take this opportunity to comment on proposed and/or continuing information collections, as required by the Paperwork Reduction Act of 1995, Public Law 104-13 (44 U.S.C. 3506(c)(2)(A)). Currently, the IRS is soliciting comments concerning Revenue Procedure 98-32, Electronic Federal Tax Payment System (EFTPS) Programs for Reporting Agents.
Written comments should be received on or before March 20, 2017 to be assured of consideration.
Direct all written comments to Tuawana Pinkston, Internal Revenue Service, Room 6526, 1111 Constitution Avenue NW., Washington, DC 20224.
Requests for additional information or copies of the regulations should be directed to LaNita Van Dyke at Internal Revenue Service, Room 6526, 1111 Constitution Avenue NW., Washington, DC 20224, or through the internet at
The following paragraph applies to all the collections of information covered by this notice:
An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid OMB control number. Books or records relating to a collection of information must be retained as long as their contents may become material in the administration of any internal revenue law. Generally, tax returns and tax return information are confidential, as required by 26 U.S.C. 6103.
Internal Revenue Service (IRS), Treasury.
Notice and request for comments.
The Department of the Treasury, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to take this
Written comments should be received on or before March 20, 2017 to be assured of consideration.
Direct all written comments to Tuawana Pinkston, Internal Revenue Service, Room 6526, 1111 Constitution Avenue NW., Washington, DC 20224.
Requests for additional information or copies of the form and instructions should be directed to LaNita Van Dyke at Internal Revenue Service, Room 6526, 1111 Constitution Avenue NW., Washington, DC 20224, or through the internet at
The following paragraph applies to all of the collections of information covered by this notice:
An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid OMB control number. Books or records relating to a collection of information must be retained as long as their contents may become material in the administration of any internal revenue law. Generally, tax returns and tax return information are confidential, as required by 26 U.S.C. 6103.
Internal Revenue Service (IRS), Treasury.
Notice and request for comments.
The Department of the Treasury, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to take this opportunity to comment on proposed and/or continuing information collections, as required by the Paperwork Reduction Act of 1995, Public Law 104-13 (44 U.S.C. 3506(c)(2)(A)). Currently, the IRS is soliciting comments concerning, (TD 7533, Disc Rules on Procedure and Administration; Rules on Export Trade Corporations), and (TD 7896, Income From Trade Shows).
Written comments should be received on or before March 20, 2017 to be assured of consideration.
Direct all written comments to Tuawana Pinkston, Internal Revenue Service, Room 6526, 1111 Constitution Avenue NW., Washington, DC 20224.
Requests for additional information or copies of the regulations should be directed to LaNita Van Dyke, at Internal Revenue Service, Room 6526, 1111 Constitution Avenue NW., Washington, DC 20224, or through the internet at
The following paragraph applies to all of the collections of information covered by this notice:
An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid OMB control number. Books or records relating to a collection of information must be retained as long as their contents may become material in the administration of any internal revenue law. Generally, tax returns and tax return information are confidential, as required by 26 U.S.C. 6103.
National Cemetery Administration, Department of Veterans Affairs.
Notice.
The National Cemetery Administration (NCA), Department of Veterans Affairs (VA), is announcing an opportunity for public comment on the proposed collection of certain information by the agency. Under the Paperwork Reduction Act (PRA) of 1995, Federal agencies are required to publish notice in the
Written comments and recommendations on the proposed collection of information should be received on or before March 20, 2017.
Submit written comments on the collection of information through Federal Docket Management System (FDMS) at
Willie Lewis at (202) 461-4242 or FAX (202) 501-2240.
Under the PRA of 1995 (Pub. L. 104-13; 44 U.S.C. 3501-21), Federal agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. This request for comment is being made pursuant to Section 3506(c)(2)(A) of the PRA.
With respect to the following collection of information, NCA invites comments on:
(1) Whether the proposed collection of information is necessary for the proper performance of NCA's functions, including whether the information will have practical utility; (2) the accuracy of NCA's estimate of the burden of the proposed collection of information; (3) ways to enhance the quality, utility, and clarity of the information to be collected; and (4) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or the use of other forms of information technology.
Upon appropriate approval, the NCA Web site will display the updated version of the VA Form 40-0247 for public use.
By direction of the Secretary.
Veterans Benefits Administration, Department of Veterans Affairs.
Notice.
The Veterans Benefits Administration (VBA), Department of Veterans Affairs (VA), is announcing an opportunity for public comment on the proposed collection of certain information by the agency. Under the Paperwork Reduction Act (PRA) of 1995, Federal agencies are required to publish notice in the
Written comments and recommendations on the proposed collection of information should be received on or before March 20, 2017.
Submit written comments on the collection of information through Federal Docket Management System (FDMS) at
Nancy J. Kessinger at (202) 632-8924 or FAX (202) 632-8925.
Under the PRA of 1995 (Pub. L. 104-13; 44 U.S.C. 3501-21), Federal agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. This request for comment is being made pursuant to Section 3506(c)(2)(A) of the PRA.
With respect to the following collection of information, VBA invites comments on: (1) Whether the proposed collection of information is necessary for the proper performance of VBA's functions, including whether the information will have practical utility; (2) the accuracy of VBA's estimate of the burden of the proposed collection of
By direction of the Secretary.
Veterans Benefits Administration, Department of Veterans Affairs.
Notice.
The Veterans Benefits Administration (VBA), Department of Veterans Affairs (VA), is announcing an opportunity for public comment on the proposed collection of certain information by the agency. Under the Paperwork Reduction Act (PRA) of 1995, Federal agencies are required to publish notice in the
VA Form 21-4192 is used to gather necessary employment information from veterans' employers so VA can determine eligibility to increased disability benefits based on unemployability.
Written comments and recommendations on the proposed collection of information should be received on or before March 20, 2017.
Submit written comments on the collection of information through Federal Docket Management System (FDMS) at
Nancy J. Kessinger at (202) 632-8924 or FAX (202) 632-8925.
Under the PRA of 1995 (Pub. L. 104-13; 44 U.S.C. 3501-21), Federal agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. This request for comment is being made pursuant to Section 3506(c)(2)(A) of the PRA.
With respect to the following collection of information, VBA invites comments on: (1) Whether the proposed collection of information is necessary for the proper performance of VBA's functions, including whether the information will have practical utility; (2) the accuracy of VBA's estimate of the burden of the proposed collection of information; (3) ways to enhance the quality, utility, and clarity of the information to be collected; and (4) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or the use of other forms of information technology.
By direction of the Secretary.
Veterans Benefits Administration, Department of Veterans Affairs.
Notice.
The Veterans Benefits Administration (VBA), Department of Veterans Affairs (VA), is announcing an opportunity for public comment on the proposed collection of certain information by the agency. Under the Paperwork Reduction Act (PRA) of 1995, Federal agencies are required to publish notice in the
Written comments and recommendations on the proposed collection of information should be received on or before March 20, 2017.
Submit written comments on the collection of information through Federal Docket Management System (FDMS) at
Nancy J. Kessinger at (202) 632-8924 or FAX (202) 632-8925.
Under the PRA of 1995 (Pub. L. 104-13; 44 U.S.C.
With respect to the following collection of information, VBA invites comments on: (1) Whether the proposed collection of information is necessary for the proper performance of VBA's functions, including whether the information will have practical utility; (2) the accuracy of VBA's estimate of the burden of the proposed collection of information; (3) ways to enhance the quality, utility, and clarity of the information to be collected; and (4) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or the use of other forms of information technology.
By direction of the Secretary.
1. Nothing in this Proclamation precludes the activities and training of the Armed Forces; however, they shall be carried out in a manner consistent with the care and management of the objects to the extent practicable.
2. In the event of threatened or actual destruction of, loss of, or injury to a monument resource or quality resulting from an incident caused by a component of the Department of Defense or any other Federal agency, the appropriate Secretary or agency head shall promptly coordinate with the Secretary of the Interior for the purpose of taking appropriate action to respond to and mitigate the harm and, if possible, restore or replace the monument resource or quality.
3. Nothing in this proclamation or any regulation implementing it shall limit or otherwise affect the U.S. Armed Forces' discretion to use, maintain, improve, or manage any real property under the administrative control of a Military Department or otherwise limit the availability of such real property for military mission purposes.
(a) Provide professional development opportunities and tools. A diverse and inclusive work environment enhances the ability of each covered agency to create, retain, and sustain a strong workforce by allowing all employees to perform to their full potential and talent. Professional development opportunities and tools are key to fostering that potential, and ensuring that all employees have access to them should be a priority for all agencies, consistent with merit system principles. Accordingly, each covered agency shall:
(b) Strengthen leadership engagement and accountability. Senior leadership and supervisors play an important role in fostering diversity and inclusion in the workforce they lead and setting an example for cultivating this and future generations of talent. Toward that end, each covered agency shall:
(c) Analyze existing data and identify opportunities for improvement. Each covered agency shall continue to evaluate and eliminate existing barriers to the successful growth of diversity and inclusion in the Federal workplace. The following actions shall be taken to ensure continued progress on this issue:
(b) In identifying actions to improve opportunities for all Americans to experience our Federal lands and waters, each covered agency should consider a range of actions including the following:
(c) In identifying actions to improve opportunities for all Americans to participate in the protection and management of important historic, cultural, and natural areas, each covered agency shall consider a range of actions including the following:
(b) This memorandum shall be implemented consistent with applicable law, and subject to the availability of appropriations.
(c) The Secretary of the Interior is hereby authorized and directed to publish this memorandum in the
Food Safety and Inspection Service, USDA.
Proposed rule.
Consistent with the recent changes that the Food and Drug Administration (FDA) finalized, the Food Safety and Inspection Service (FSIS) is proposing to amend the nutrition labeling requirements for meat (including fish of the order Siluriformes) and poultry products to better reflect the most recent scientific research and dietary recommendations and to improve the presentation of nutrition information to assist consumers in maintaining healthy dietary practices. FSIS is proposing to update the list of nutrients that are required or permitted to be declared; provide updated Daily Reference Values (DRVs) and Reference Daily Intake (RDI) values that are based on current dietary recommendations from consensus reports; and amend the labeling requirements for foods represented or purported to be specifically for children under the age of 4 years and pregnant women and lactating women and establish nutrient reference values specifically for these population subgroups. FSIS is also proposing to revise the format and appearance of the Nutrition Facts label; amend the definition of a single-serving container; require dual-column labeling for certain containers; and update and modify several reference amounts customarily consumed (RACCs or reference amounts). Finally, FSIS is proposing to consolidate the nutrition labeling regulations for meat and poultry products into a new Code of Federal Regulations (CFR) part.
Comments must be received by March 20, 2017.
FSIS invites interested persons to submit comments on this proposed rule. Comments may be submitted by one of the following methods:
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•
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Jeff Canavan, Deputy Director, Labeling and Program Delivery Staff, Office of Policy and Program Development, Food Safety and Inspection Service, U.S. Department of Agriculture, Stop Code 3784, Patriots Plaza 3, 8-161A, 1400 Independence Avenue SW., Washington, DC 20250-3700; Telephone (301) 504-0879; Fax (202) 245-4792.
The Federal Meat Inspection Act (FMIA) (21 U.S.C. 601
To prevent meat and poultry products from being misbranded, the meat and poultry product inspection regulations require that the labels of meat and poultry products include specific information, and that such information be displayed as prescribed in the regulations (9 CFR part 317 and part 381). The nutrition labeling requirements for meat and meat food products are in 9 CFR 317.300-317.400, and the nutrition labeling requirements for poultry products are in 9 CFR 381.400-381.500. The nutrition labeling regulations for meat and poultry products include requirements regarding: Location of nutrition information; labeling with number of servings; nutrition label content; reference amounts customarily consumed per eating occasion; and nutrient content claims.
On March 3, 2014, the Food and Drug Administration (FDA) published two proposed rules, “Food Labeling: Revision of the Nutrition and Supplement Facts Labels” (the “FDA Nutrition Labeling Proposed Rule”)(79 FR 11880) and “Food Labeling: Serving Sizes of Foods That Can Reasonably Be Consumed at One-Eating Occasion; Dual-Column Labeling; Updating, Modifying, and Establishing Certain Reference Amounts Customarily Consumed; Serving Size for Breath Mints; and Technical Amendments” (the “FDA Serving Size Proposed Rule”)(79 FR 11989). FDA proposed these rules to update the Nutrition Facts label to reflect newer nutrition and public health research and recent dietary recommendations from expert groups and to improve the presentation of nutrition information to help consumers make more informed choices and maintain healthy dietary practices. On July 27, 2015, FDA published a supplemental notice of proposed rulemaking “Food Labeling: Revision of the Nutrition and Supplement Facts Labels; Supplemental Notice of Proposed Rulemaking” (the “FDA Nutrition Labeling Supplemental Proposed Rule”) (80 FR 44303) to revise certain provisions of the FDA Nutrition Labeling Proposed Rule. On May 27, 2016, FDA published two final rules, “Food Labeling: Revision of the Nutrition and Supplement Facts Labels”
FSIS has reviewed FDA's analysis, and to ensure that there is consistency in how nutrition information is presented across the food supply, FSIS is proposing to amend the nutrition labeling regulations for meat and poultry products to parallel, to the extent possible, FDA's final regulations. This approach will clarify information for consumers and improve efficiency in the marketplace.
FSIS is proposing to consolidate the nutrition labeling regulations that currently are presented separately for meat and for poultry products (in 9 CFR 317.300-317.400 and 381.400-381.500, respectively) into a single part, 9 CFR part 413. Consistent with FDA's final regulations, FSIS is also proposing to update the list of nutrients that are required or permitted to be declared and to provide updated DRVs and RDIs that are based on current dietary recommendations from consensus reports. For example, FSIS is proposing to remove the requirement to declare “Calories from Fat;” require the declaration of “Added Sugars,” vitamin D, and potassium; permit the voluntary declaration of vitamins A and C; and update the reference value for the declaration of percent Daily Value (DV) for sodium from the current value of 2,400 mg (milligrams) to 2,300 mg. FSIS is also proposing to amend the requirements for foods represented or purported to be specifically for children under the age of 4 years and pregnant women and lactating women and establish nutrient reference values specifically for these population subgroups.
FSIS is also proposing to revise the format and appearance of the Nutrition Facts label. Some of the proposed changes include increasing the type size for “Calories,” “servings per container,” and the “Serving size” declarations, and bolding the number of calories and the “Serving size” declaration to highlight this information.
FSIS is also proposing to amend the definition of a single-serving container; require dual-column labeling for certain containers; and update and modify several RACCs. These proposed changes will provide consumers information to assist them in maintaining healthy dietary practices.
Quantitative costs for the proposed rule include relabeling, recordkeeping, and reformulation. Quantitative benefits are a measure of expected health improvements experienced from increased label-use by overweight and hypertensive adults. The summary of cost and benefits in Table 1 are annualized at a 3 percent discount rate over 20 years with a compliance period of 24 months for large manufacturers and 36 months for small.
The Nutrition Labeling and Education Act (NLEA) of 1990 required the nutrition labeling of most foods regulated by the FDA. Because FSIS is committed to providing consumers with the most informative labeling system possible, FSIS published regulations establishing comparable nutrition labeling requirements for meat and poultry products on January 6, 1993 (58 FR 632). These regulations required nutrition labels on the packages of all multi-ingredient and heat-processed meat and poultry products, unless an exemption applied. The required nutrition labeling provisions were referred to as “the mandatory nutrition labeling program.” The Agency's 1993 regulations also established guidelines for voluntary nutrition labeling of single-ingredient, raw meat and poultry products, including single-ingredient, raw ground or chopped products.
FSIS published technical amendments to the 1993 final rule (August 18, 1993, 58 FR 43787; September 10, 1993, 58 FR 47624; and March 16, 1994, 59 FR 12157), a final rule on the placement of nutrition labeling on meat and poultry products (August 8, 1994), a final rule with additional technical amendments to the nutrition labeling regulations (September 1, 1994; 59 FR 45189), and a final rule to provide codified language for provisions that previously cross-referenced FDA's nutrition labeling regulations on January 3, 1995 (60 FR 174). FSIS also published a final rule to require nutrition labeling of the major cuts of single-ingredient raw meat and poultry products and ground or chopped meat and poultry products on December 29, 2010 (75 FR 82164).
Currently, FSIS requires nutrition labels on the packages of all multi-ingredient and heat-processed meat and poultry products, and all ground or chopped products, unless an exemption applies (9 CFR 317.300; 317.301; 381.400; 381.401). FSIS also requires that nutrition information be provided on the label or at the point-of-purchase for the major cuts of single-ingredient, raw meat and poultry products identified in 9 CFR 317.344 and 381.444 that are not ground or chopped, except for certain exemptions. The following exemptions in 9 CFR 317.400 and 381.500 from the nutrition labeling requirements apply to the major cuts of single-ingredient, raw meat and poultry products and ground or chopped meat and poultry products:
• Products intended for further processing, provided that the labels for these products bear no nutrition claims or nutrition information;
• Products that are not for sale to consumers, provided that the labels for these products bear no nutrition claims or nutrition information;
• Products in small packages that are individually wrapped packages of less than
• Products that are custom slaughtered or prepared; and
• Products intended for export.
FSIS also provides the following additional exemptions in 9 CFR 317.400 and 381.500 for ground or chopped products:
• Ground or chopped products that qualify for the small business exemption in 9 CFR 317.400(a)(1) or 381.500(a)(1);
• Products that are ground or chopped at an individual customer's request and that are prepared and served at retail, provided that the labels or labeling of these products bears no nutrition claims or nutrition information;
• Ground or chopped products in packages that have a total surface area for labeling of less than 12 square inches, provided that the product's labeling includes no nutrition claims or nutrition information and provided that an address or telephone number that a consumer can use to obtain the required information is included on the label; and
• Ground products produced by small businesses that use statements of percent fat and percent lean on the label or in labeling of ground products, provided they include no other nutrition claims or nutrition information on the product labels or labeling.
Generally, ready-to-eat products that are packaged and portioned at a retail store or similar retail-type establishment and multi-ingredient products (
FSIS does not require nutrition information for single-ingredient, raw meat and poultry products that are not major cuts and that are not ground or chopped. But, if nutrition information is provided for these products, it must be provided in accordance with the nutrition labeling requirements for the major cuts (9 CFR 317.300 and 381.400).
Nutrition labeling continues to be an integral part of USDA's efforts to educate consumers about nutrition and diet. Since 1980, USDA and the Department of Health and Human Services (HHS) have jointly published the Dietary Guidelines for Americans (DGA) every five years. The 2015-2020 DGA provides advice on food choices that promote overall health, reduce the risk of chronic disease, and help individuals attain and maintain a healthy weight.
For example, the 2015-2020 DGA concluded that some Americans do not consume enough vitamin D or potassium, and inadequate intake of these nutrients presents public health concerns (pages 60). Vitamin D is important for bone health, and potassium helps to reduce the effects of excess sodium on blood pressure. This proposed rule would require vitamin D and potassium to be declared on nutrition labels, to assist consumers in maintaining healthy dietary practices. Moreover, consistent with the 2015-2020 DGA, the information should help consumers follow the 2015-2020 DGA's
This proposed rule also proposes changes to the Daily Values for certain nutrients, consistent with the more recent scientific evidence from the 2015-2020 DGA. For example, FSIS is proposing to amend the current DV for sodium of 2,400 to 2,300 mg, which is consistent with the scientific evidence reflected in the 2015-2020 DGA's recommendation to limit intake of sodium to less than 2,300 mg per day and is the upper limit for individuals ages 14 years and older set by the Institute of Medicine. (page 15). Revising DVs to reflect the most current science on nutrient requirements will help consumers choose a better overall diet.
The 2015-2020 DGA also supports listing added sugars on nutrition labels. It affirms that poor diet and physical inactivity are primary factors contributing to overweight, obesity, and chronic illness (pages 2-3). Calories from added sugars, solid fats (including saturated and
Section 403(q)(1)(A) of the Federal Food, Drug, and Cosmetic Act (FD&C Act) (21 U.S.C. 343(q)(1)(A)) defines serving size as an amount customarily consumed and which is expressed in a common household measure that is appropriate to the food. FSIS, consistent with FDA, is proposing to update, modify, and establish certain RACCs and require that packages which contain more than 150 percent and less than 200 percent of a given RACC be labeled as containing one serving, regardless of the RACC of the product. Certain packages that contain at least 200 percent and up to and including 300 percent of a given RACC would be required to include dual column labels that provide nutrition information per serving or per package, as applicable. These changes will ensure that serving sizes are based on current consumption data and will provide consumers with information on the Nutrition Facts label related to the serving size that will assist them in maintaining healthy dietary practices.
Finally, FSIS is proposing several updates to the design of the current Nutrition Facts labels, including making the caloric content and serving size declarations more prominent. These and other changes aim to address current public health problems such as obesity, chronic disease, and nutrient deficiency by emphasizing important nutritional information and providing additional information to consumers.
Currently, the nutrition labeling regulations for meat and poultry products are presented separately (in 9 CFR 317.300-317.400 and 381.400-381.500, respectively). FSIS believes that the public would be better served by consolidating these regulations in one part of title 9. Rather than searching through two separate parts of title 9-CFR parts 317 and 381— to find the nutrition labeling regulations, interested parties would only have to read part 413. Therefore, FSIS is proposing to consolidate the nutrition labeling regulations for meat and poultry products into a single part, 9 CFR part 413.
FSIS requires the total number of calories per serving of a meat or poultry product to be declared on the Nutrition Facts label (9 CFR 317.309(c)(1); 9 CFR 381.409(c)(1); and proposed 9 CFR 413.309(c)(1)). FSIS is not proposing to change this requirement but is proposing changes to the requirements related to “Calories from fat” and “Calories for saturated fat.”
FSIS currently requires that “Calories from Fat” be declared on Nutrition Facts labels (9 CFR 317.309(c)(1)(ii); 9 CFR 381.409(c)(1)(ii)). FSIS is proposing to no longer require, and to not allow voluntarily, the declaration of “Calories from fat” on the Nutrition Facts label.
Section 403(q)(2)(B) of the FD&C Act (21 U.S.C. 343(q)(2)(B)) grants the Secretary of HHS (and by delegation, FDA) discretion to remove information relating to a nutrient required to be declared on food labels by regulation if the Secretary determines that it is not necessary to assist consumers in maintaining healthy dietary practices. FDA considered a number of factors related to the declaration of “Calories from Fat,” including dietary recommendations and consensus reports that emphasize intake of total calories and the type of fat consumed, as well as comments from their 2005 and 2007 Advanced Notices of Proposed Rulemaking (ANPRMS) (April 4, 2005, 70 FR 17008; November 2, 2007; 72 FR 62149) that supported eliminating the declaration of “Calories from fat” in order to place greater emphasis on total calories. FDA determined that the declaration of “Calories from fat” is not necessary to assist consumers in maintaining healthy dietary practices (81 FR 33780). Under FDA's Nutrition Labeling Final Rule, FDA no longer requires, and does not allow voluntarily, the declaration of “Calories from fat” on the Nutrition Facts label (81 FR 33780). FSIS has reviewed FDA's analysis and has tentatively concluded that the declaration of “Calories from fat” is not necessary to assist consumers in maintaining healthy dietary practices. FSIS agrees with FDA that “the amount of fat being consumed can still be obtained from the total fat declaration elsewhere on the Nutrition Facts label, and consumers can still use the percent DV for total fat to put fat content in the context of a total daily diet, compare products, and plan diets” (79 FR 11891; 81 FR 33780).
Under current FSIS regulations, the declaration of “Calories from saturated fat” on the Nutrition Facts label is voluntary (9 CFR 317.309(c)(1)(iii); 9 CFR 381.409(c)(1)(iii); will be consolidated in proposed 9 CFR 413.309(c)(1)(ii)). FSIS continues to believe that “Calories from saturated fat” can be declared voluntarily. The amount of saturated fat can be obtained from the total saturated fat declaration on the Nutrition Facts label, and consumers can use the percent DV for saturated fat to put saturated fat content in the context of a total daily diet, compare products, and plan diets (79 FR 11892; 81 FR 33781). Therefore, FSIS does not believe it is necessary to require the mandatory declaration of “Calories from saturated fat” on the Nutrition Facts label. But with the revisions to the Nutrition Facts label, FSIS is proposing to require that “Calories from saturated fat” be indented when declared under the statement of calories (proposed 9 CFR 413.309(c)(1)(ii)).
FSIS regulations (9 CFR 317.309(c)(9) and 381.409(c)(9)) set a percent DRV for fat, saturated fatty acids, cholesterol, total carbohydrate, fiber, sodium, potassium, and protein, based on a reference caloric intake of 2,000
FDA considered a number of factors related to the reference calorie intake of 2,000 calories, including the relevant recommendations from the IOM macronutrient report
FSIS's current regulations do not establish a DRV for calories and do not require a percent DV declaration for calories. FDA reviewed recommendations in current consensus reports, including the IOM macronutrient report,
FSIS is not proposing any changes to its definition of “total fat” under 9 CFR 317.309(c)(2) and 381.409(c)(2) (which will both be consolidated in proposed 9 CFR 413.309(c)(2)). FSIS is proposing to define “fatty acids” in 9 CFR 413.309(c)(2) as aliphatic carboxylic acids consisting of a chain of alkyl groups and characterized by a terminal carboxyl group to harmonize with FDA's Nutrition Labeling Final Rule and clarify what FSIS considers to be a fatty acid. FSIS is not proposing to change the requirement for mandatory declaration for total fat on the Nutrition Facts label.
FSIS's regulations 9 CFR 317.309(c)(9) and 381.409(c)(9), which would be consolidated in proposed 9 CFR 413.309(c)(9), set 65 grams as the DRV for total fat based on a reference calorie intake of 2,000 calories (
FSIS regulations currently define “Saturated fat” as the sum of all fatty acids, including stearic acid, containing no double bonds (
In FDA's Nutrition Labeling Proposed Rule, FDA considered voluntary declaration of stearic acid on the Nutrition Facts label, as recommended by a few comments to their 2007 ANPRM (79 FR 11894). The effects of stearic acid on Low-density lipoprotein (LDL) cholesterol levels appear to vary depending on the macronutrient component that is replaced by stearic acid (79 FR 11894). FDA found that moderate evidence indicates that when stearic acid substitutes for other saturated fatty acids or
Based on this updated scientific information and the fact that few if any companies have included stearic acid as a voluntary nutrient in the current Nutrition Facts label, FSIS is proposing to remove the voluntary declaration of stearic acid below saturated fat.
Also, consistent with FDA's final rule, FSIS is not proposing to exclude acetic, propionic, and butyric acids from the definition of saturated fat.
FSIS requires the mandatory declaration of the number of grams of saturated fat per serving (9 CFR 317.309(c)(2)(i) and 381.409(c)(2)(i) will be consolidated in proposed 9 CFR 413.309(c)(2)(i)). FSIS is not proposing to change this requirement because FSIS is unaware of any evidence that supports that this information is no longer needed to assist consumers in maintaining healthy dietary practices.
FSIS's regulations 9 CFR 317.309(c)(9) and 381.409(c)(9), which will be consolidated in proposed 9 CFR 413.309(c)(9), set 20 grams as the DRV for saturated fat based on a reference calorie intake of 2,000 calories. FSIS is not proposing to change the DRV for saturated fat.
FDA reviewed the IOM Labeling Committee recommendation,
On July 11, 2003, FDA published a final rule requiring manufacturers to declare
Based on FSIS's label review, FSIS believes that the majority of meat and poultry product Nutrition Facts labels voluntarily declare
Although FDA's final determination that PHOs are not GRAS for use in any human food may eliminate the source of industrially produced
FSIS permits the voluntary declaration of the number of grams of polyunsaturated fat per serving (defined as
FSIS's regulations do not provide a DRV for polyunsaturated fat. FDA did not propose a DRV for polyunsaturated fat, tentatively concluding “that there is no appropriate quantitative intake recommendation to form a basis for setting a DRV for polyunsaturated fat” (79 FR 11898). FDA did not change its position in the final rule (81 FR 33789). Consistent with FDA's final rule, FSIS is not proposing to provide a DRV for polyunsaturated fat.
FSIS's regulations do not permit the declaration of individual polyunsaturated fatty acids on the Nutrition Facts label. Consistent with FDA's final rule, FSIS is not proposing to provide for the individual declaration of either
FSIS's regulations currently allow the voluntary declaration of monounsaturated fat (defined as
FSIS's regulations do not provide a DRV for monounsaturated fat. FDA did not provide a DRV for monounsaturated fat for the same reasons it did not set a DRV for polyunsaturated fat (81 FR 33789). Consistent with FDA's final rule, FSIS is not proposing to set a DRV for monounsaturated fat.
FSIS's regulations require the amount of cholesterol be declared on the Nutrition Facts label (9 CFR 317.309(c)(3) and 381.409(c)(3), which would be consolidated in proposed 9 CFR 413.309(c)(3)). Consistent with FDA's final rule, FSIS is not proposing changes to the requirement for mandatory declaration of cholesterol.
FSIS sets 300 mg as the DRV for cholesterol based on the reference calorie intake of 2,000 calories (9 CFR 317.309(c)(9) and 381.409(c)(9), which would be consolidated in proposed 9 CFR 413.309(c)(9)). FSIS is not proposing to change the DRV for cholesterol.
FSIS requires the number of grams of total carbohydrate per serving be listed on the Nutrition Facts label (9 CFR 317.309(c)(6) and 381.409(c)(6), which would be consolidated in proposed 9 CFR 413.309(c)(6)). Total carbohydrate content must be calculated by subtracting the sum of the crude protein, total fat, moisture, and ash from the total weight of the product (9 CFR 317.309(c)(6) and 381.409(c)(6), which would be consolidated in proposed 9 CFR 413.309(c)(6)).
FDA considered a citizen petition requesting that dietary fiber be excluded from the calculation of total carbohydrate, comments received on its 2007 ANPRM, and scientific evidence and declined to change the current method for calculating total carbohydrate (79 FR 11899-11900; 81 FR 33794-33795). Just as FDA is not making any change, FSIS has reviewed FDA's analysis and has decided not to propose to change the current method for calculating total carbohydrate.
FSIS is not proposing to change its requirements for the classification or declaration of carbohydrates (9 CFR 317.309(c)(6) and 381.409(c)(6), which would be consolidated in proposed 9 CFR 413.309(c)(6)). FSIS agrees with FDA that a chemical definition for total carbohydrate is still consistent with the classification and declaration of fat on the Nutrition Facts label (79 FR 11901; 81 33795). It would be difficult to apply a definition for total carbohydrates based on physiological effects because the different components of carbohydrates have different physiological effects.
FSIS is not proposing to require the separate declaration of additional types of individual carbohydrates (
FSIS requires the number of grams of total carbohydrate per serving be listed on the Nutrition Facts label (9 CFR 317.309(c)(6) and 381.409(c)(6), which would be consolidated in proposed 9 CFR 413.309(c)(6)), and has tentatively concluded, that the mandatory declaration of total carbohydrates continues to be necessary to assist consumers in making informed choices. Therefore, consistent with FDA's Nutrition Labeling Final Rule, FSIS is not proposing to change the requirement for mandatory declaration of total carbohydrate.
FSIS sets 300 grams as the DRV for total carbohydrate based on 60 percent of a 2,000 calorie diet ((0.60 × 2,000 calories)/4 calories per gram of carbohydrate = 300 grams) (9 CFR 317.309(c)(9) and 381.409(c)(9), which would be consolidated in proposed 9 CFR 413.309(c)(9)). The percentage of calories from total carbohydrate, total fat, and protein must add up to 100 percent on the Nutrition Facts label. Because, as discussed in part (II)(C)(1), FSIS is proposing to increase the DRV for total fat from 30 to 35 percent of calories consistent with FDA's final rule, either the DRV for total carbohydrate or protein must be decreased. As discussed in FDA's Nutrition Labeling Final Rule, decreasing the DRV for protein from 10 percent of calories to 5 percent of calories to account for the increase in the DRV for total fat would result in a DRV of 5 grams of protein, which falls below the RDA for protein for children
FSIS requires that calories from total carbohydrate be calculated using the general factor of 4 calories per gram total carbohydrate less the amount of insoluble dietary fiber (9 CFR 317.309(c)(1)(i)(C) and 381.409(c)(1)(i)(C)). Consistent with FDA's final rule, FSIS is proposing a new definition for dietary fiber (see section II.E.5) that only allows for the declaration of dietary fibers that FDA has determined to have a physiological effect that is beneficial to human health. The new definition of dietary fiber includes: (1) Non-digestible soluble and insoluble carbohydrates (with 3 or more monomeric units) and lignin that are intrinsic and intact in plants; and (2) isolated or synthetic non-digestible carbohydrates (with 3 or more monomeric units) determined by FDA to have physiological effects that are beneficial to human health. For the purpose of calculating calories from carbohydrate, all soluble and insoluble non-digestible carbohydrates should be excluded from the calculation, not just those known to meet the definition of dietary fiber. Therefore, FSIS is proposing that all soluble and insoluble non-digestible carbohydrates be excluded from the calculation for calories from total carbohydrate (proposed 9 CFR 413.309(c)(1)(i)(C)).
FSIS requires a statement of the number of grams of sugars per serving on the Nutrition Facts label, except for products that contain less than 1 gram of sugars per serving if no claims are made about sweeteners, sugars, or sugar alcohol content (9 CFR 317.309(c)(6)(ii) and 381.409(c)(6)(ii); would be consolidated in proposed 9 CFR 413.309(c)(6)(ii)). FSIS defines sugars as the sum of all free mono- and disaccharides (such as glucose, fructose, lactose, and sucrose) (9 CFR 317.309(c)(6)(ii) and 381.409(c)(6)(ii)). Consistent with FDA's final rule, FSIS has tentatively concluded that the mandatory declaration of sugars continues to be necessary to assist consumers in making informed choices and maintaining healthy dietary practices. But, FSIS is proposing to replace the declaration of “Sugars” with the term “Total Sugars,” which is also consistent with FDA's final rule. The rationale for this proposed change is discussed in part K(5).
FSIS's regulations do not provide a DRV for sugars. FDA did not propose a DRV for sugars because there are no upper limits or set dietary reference values on which a DRV for sugars could be based (79 FR 11902). Consistent with FDA's final rule, FSIS is not proposing to set a DRV for sugars.
FSIS's regulations do not define “added sugars” nor permit its declaration on the Nutrition Facts label. FDA is requiring the declaration of added sugars on the Nutrition Facts label and considered, in its review, new data and information from U.S. consensus reports and scientific evidence supporting recommendations related to the consumption of added sugars, a citizen petition, and public comments (79 FR 11902-11906; 81 FR 33799-33851) and FDA's consumer study on added sugars
FSIS regulations do not currently define the term “added sugars.” Because FSIS is proposing to require the mandatory declaration of added sugars on the Nutrition Facts label, FSIS is also proposing to define the term “added sugars.” Proposed 9 CFR 413.309(c)(6)(iii) defines “added sugars” as sugars that are either added during the processing of foods or are packaged as such and include sugars (free, mono- and disaccharides), sugars from syrups, honey, and fruit juice concentrates (see proposed 9 CFR 413.309(c)(6)(iii) for specific requirements for fruit juice concentrates) (see proposed 9 CFR 413.309(c)(6)(iii) for the complete “added sugars” definition). Examples of “added sugars” added to meat and poultry products include: Table sugar, brown sugar, corn sweetener, corn syrup, dextrose, fructose, apple juice concentrate glucose, Glucono-Delta-Lactone (GDL), high-fructose corn syrup, invert sugar, lactose, maltose, malt sugar, maple syrup, molasses, raw sugar, turbinado, sugar, trehalose, and sucrose. Sugar alcohols would not be considered added sugars.
FDA established a DRV for added sugars of 10 percent of total energy intake based on new information in the “Scientific Report of the 2015 Dietary Guidelines Advisory Committee” (the “2015 DGAC report”
FSIS is not aware of an analytical method that is capable of distinguishing between added and intrinsically occurring sugars in a food product, nor did FDA identify such a method (79 FR 11906). Therefore, to verify compliance with the proposed mandatory declaration of added sugars, FSIS is proposing in 9 CFR 413.309(h)(8)(iv) that establishments make and keep certain records to verify the amount of added sugars in the product (see compliance section II.N. below for more details about this requirement). For example, FSIS is proposing that a manufacturer must make and keep written records of the amount of sugars added to the product during the processing of the product and, if packaged as a separate ingredient, as packaged (whether as part of a package containing one or more ingredients or packaged as a single ingredient).
FSIS is aware that sugars in some foods may undergo chemical changes as a result of non-enzymatic browning (
In some food products, non-enzymatic browning or fermentation could result in a significant reduction in the amount of added sugars, leaving manufacturers with no way to reasonably approximate the amount of added sugars in a serving of the finished food. Similar to FDA, FSIS is proposing that manufacturers may submit a request to FSIS's LPDS to use an alternative means of compliance. The request must provide scientific data or other information for why the amount of added sugars in a serving of the product is likely to have a significant reduction in added sugars compared to the amount added prior to non-enzymatic browning or fermentation.
For nutrition labeling purposes, consistent with FDA, FSIS defines sugar alcohols “as the sum of saccharide derivatives in which a hydroxyl group replaces a ketone or aldehyde group and whose use in the food is listed by FDA (
Consistent with FDA, FSIS does not provide a DRV for sugar alcohols and is not proposing a DRV for sugar alcohols because there is no quantitative reference intake recommendation for sugar alcohols from current consensus reports on which to base a DRV.
Caloric content for total carbohydrate less the amount of insoluble dietary fiber is calculated using a factor of 4 calories per gram (9 CFR 317.309(c)(1)(i)(C) and 381.409(c)(1)(i)(C)). FSIS has reviewed the Life Sciences Research Office reports
FSIS's regulations do not define “dietary fiber.” After considering IOM recommendations, comments received on FDA's 2007 ANPRM, and international guidelines (
FSIS is proposing to include isolated or synthetic non-digestible carbohydrates that have been determined by FDA to have a physiological effect that is beneficial to human health in the proposed definition of dietary fiber in 9 CFR 413.309(c)(6)(i). For example, β-glucan soluble fiber and psyllium husk that are added to foods meet the proposed definition of dietary fiber and would be listed in 9 CFR 413.309(c)(6)(i). FSIS would consider amending 9 CFR 413.309(c)(6)(i) to list any additional isolated or synthetic non-digestible carbohydrates that FDA determines have a physiological effect that is beneficial to human health.
FSIS requires that a statement of the number of grams of total dietary fiber per serving be declared on the Nutrition Facts label, except when a serving contains less than 1 gram of total dietary fiber (9 CFR 317.309(c)(6)(i) and 381.409(c)(6)(i), which would be consolidated in proposed 9 CFR 413.309(c)(6)(i)). FSIS is not proposing to change the requirement for mandatory declaration of dietary fiber, just as FDA did not.
The amount of dietary fiber may be calculated by subtracting the amount of non-digestible carbohydrates added during processing that do not meet the proposed definition of dietary fiber from the value obtained using AOAC 2009.01, AOAC 2011.25, or an equivalent AOAC method of analysis as given in the “Official Methods of Analysis of the AOAC International” 19th Edition. Because an AOAC method would not accurately quantify the dietary fiber that meets the proposed definition if the product contains both non-digestible carbohydrates that meet the definition and those that do not, consistent with FDA's final rule, FSIS is proposing to require that manufacturers maintain written records to verify the amount of added non-digestible carbohydrates that do not meet the proposed definition of dietary fiber. (See Compliance section II.N. below.)
Currently, 25 g is the DRV for total dietary fiber based on the reference calorie intake of 2,000 calories (9 CFR 317.309(c)(9) and 381.409(c)(9)). FSIS is proposing to amend its regulations to establish 28 g as the DRV for total dietary fiber (proposed 9 CFR 413.309(c)(9)). FSIS is proposing to use 28 g as the DRV for total dietary fiber because: (1) the IOM set an adequate intake level (AI) of 14 g/1,000 kcal for total fiber primarily based on the intake level that was associated with the greatest reduction in the risk of CHD;
Soluble fibers (
AOAC 2011.25 or an equivalent AOAC method may be used to calculate soluble and insoluble fiber that meet the proposed definition of dietary fiber and can be declared on the Nutrition Facts label. AOAC 2011.25 can measure low molecular weight non-digestible carbohydrates, as well as separately measure soluble and insoluble non-digestible carbohydrates.
FDA did not find a basis on which to derive DRVs for soluble or insoluble fiber. Consistent with FDA's final rule, FSIS is not proposing DRVs for soluble fiber or insoluble fiber.
FSIS regulations provide that the caloric content of a product may be calculated by, among other methods, using general factors of 4, 4, and 9 calories per gram for protein, total carbohydrate less the amount of insoluble dietary fiber, and total fat, respectively (9 CFR 317.309(c)(1)(i)(C) and 381.409(c)(1)(i)(C)). Soluble fiber, which is included in total carbohydrate, is assigned a general factor of 4 kcal/g. FDA established a general factor of 2 kcal/g as the caloric value of soluble non-digestible carbohydrates (81 FR 33867). Insoluble non-digestible carbohydrates are not included in the caloric calculation (81 FR 33867). FDA required that calories from carbohydrate be calculated using a general factor of 4 kcal/g of total carbohydrate less the amount of non-digestible carbohydrates, which includes soluble (2 kcal/g) and insoluble non-digestible carbohydrates (0 kcal/g) that do and do not meet the definition of dietary fiber (81 FR 33867). The calorie contribution of soluble non-digestible carbohydrate would be added
FSIS's regulations define “Other carbohydrate” as the difference between total carbohydrate and the sum of dietary fiber, sugars, and sugar alcohol, except that if sugar alcohol is not declared (even if present), “Other carbohydrate” is defined as the difference between total carbohydrate and the sum of dietary fiber and sugars (9 CFR 317.309(c)(6)(iv) and 381.409(c)(6)(iv)). A statement of the number of grams of “Other carbohydrate” per serving may be voluntarily declared on the Nutrition Facts label (9 CFR 317.309(c)(6)(iv) and 381.409(c)(6)(iv)).
FDA concluded that “Other carbohydrate” should no longer be permitted on the Nutrition Facts label because of its lack of public health significance and a quantitative intake recommendation for “Other carbohydrate” is not available from relevant consensus reports (81 FR 33867-33868). FDA removed the provision that allows for its voluntary declaration in the regulations (81 FR 33867-33868). FSIS has reviewed FDA's analysis and is proposing to no longer permit the voluntary declaration of “Other carbohydrate” on the Nutrition Facts label for the reasons above.
FSIS's regulations require that a statement of the number of grams of protein per serving be declared on the Nutrition Facts label (9 CFR 317.309(c)(7) and 381.409(c)(7), which would be consolidated in proposed 9 CFR 413.309(c)(7)). The DRV for protein is 50 g and represents 10 percent of the 2,000 reference calories intake level. Consistent with FDA, FSIS is not proposing to change the mandatory declaration of protein or the DRV for protein.
Under FSIS's regulations (9 CFR 317.309(c)(7) and 381.409(c)(7)), protein may be calculated on the basis of the factor of 6.25 times the nitrogen content of the food as determined by appropriate methods of analysis in accordance with 9 CFR 317.309(h) or 9 CFR 381.409(h), except when the procedure for a specific food requires another factor. According to 9 CFR 317.309(h)(2) and 381.409(h)(2), FSIS determines compliance by appropriate methods and procedures used by the Department for each nutrient in accordance with the
FSIS's regulations require the declaration of the number of milligrams of sodium per serving on the Nutrition Facts label (9 CFR 317.309(c)(4) and 381.409(c)(4), which would be consolidated in proposed 9 CFR 413.309(c)(4)). Consistent with FDA, FSIS is not proposing to change the requirement that sodium be declared.
FSIS's regulations set a DRV of 2,400 mg of sodium based on a reference caloric intake of 2,000 calories (9 CFR 317.309(c)(9) and 381.409(c)(9)). FDA considered the following options for updating the DRV for sodium: “(1) A DRV of 2,300 mg which reflects the Upper Intake Level (UL)
FSIS's regulations do not permit the declaration of fluoride on the Nutrition Facts label. FDA amended its regulations to provide for the voluntary declaration of fluoride because fluoride's positive health effects are well established (
FSIS currently requires the declaration of vitamin A, vitamin C, calcium, and iron on the Nutrition Facts label (9 CFR 317.309(c)(8)(ii) and 381.409(c)(8)(ii)). Vitamin D, vitamin E, vitamin B
FDA amended its regulations to: (i) Require the declaration of vitamin D, calcium, iron, and potassium on the Nutrition Facts label; (ii) allow the voluntary declaration of vitamin A and C; (iii) retain the voluntary declaration of vitamin E, vitamin K, vitamin B
FDA also revised the existing RDIs for vitamins and minerals after considering the Dietary Reference Intakes (DRIs)
FSIS is proposing to adopt FDA's list of nutrients as mandatory or voluntary components of nutrition labeling, the definition of those nutrients, and the increments for declaring nutrients, in the interest of harmonizing with FDA (proposed 9 CFR 413.309(c)(8)(iv)). Consistent with FDA's final rule, FSIS is also proposing to update the RDIs for calcium, copper, folate, iodine, iron, magnesium, niacin, phosphorus, riboflavin, thiamin, zinc, and vitamins A, B
FSIS currently allows the term “Folacin” to be added in parenthesis immediately following the term “Folate” on the Nutrition Facts label (9 CFR 317.309(c)(8)(v) and 381.409(c)(8)(v)). FSIS is proposing to remove the synonym “folacin” from 9 CFR 317.309(c)(8)(v) and 381.409(c)(8)(v) and require that the term “folate” be used on meat and poultry products that contain folate, folic acid, or a mixture of folate and folic acid (proposed 9 CFR 413.309(c)(8)(vii)). The declaration must be folate in mcg DFE (when expressed as a quantitative amount by weight) and the percent Daily Value based on folate in mcg DFE, or may be expressed as folate and the percent DV based on folate in mcg DFE. Because of the proposed changes to the units of measure for folate that take into account the differences between folate and folic acid, FSIS is proposing that when folic acid is added or when a claim is made about the nutrient, folic acid must be declared in parentheses as mcg of folic acid after the folate declaration. FSIS's proposed changes are consistent with FDA's Nutrition Labeling Final Rule (81 FR 33909-33912).
The general labeling requirements for foods in 9 CFR 317.309(c) and 381.409(c) apply to foods for infants, young children, and pregnant women and lactating women with certain exceptions. For example, meat and poultry products represented or purported to be specifically for infants and children less than 4 years of age are not permitted to include declarations of percent DV for the following nutrients: Total fat, saturated fat, cholesterol, sodium, potassium, total carbohydrate, and dietary fiber (9 CFR 317.400(c)(2)(i) and 381.500(c)(2)(i)). There are additional exceptions to labeling for meat and poultry products represented or purported to be specifically for infants and children less than 2 years of age. For example, these foods are also not permitted to declare calories from fat, calories from saturated fat, saturated fat, stearic acid, polyunsaturated fat, monounsaturated fat and cholesterol on the Nutrition Facts label (9 CFR 317.400(c)(1) and 381.500(c)(1)).
FSIS regulations do not include DRVs or RDIs for nutrients, generally, for infants, children under 4 years of age, or pregnant women and lactating women. However, there are requirements for a DRV for protein for children 4 or more years of age, and an RDI for protein for each of the following subpopulations: (1) Children less than 4 years of age; (2) infants; (3) pregnant women; and (4) lactating women (9 CFR 317.309(c)(7)(iii) and 381.409(c)(7)(iii)).
FDA changed its requirements for the labeling of foods, other than infant formula, represented or purported to be specifically for infants, children under 4 years of age, and pregnant women and lactating women after considering current consensus reports, changes to the Nutrition Facts label, and comments to its 2007 ANPRM (81 FR 33916-33932). FSIS has reviewed FDA's analysis and is proposing to make consistent changes to its requirements for the labeling of meat and poultry products represented or purported to be specifically for infants, children under 4 years of age, and pregnant women and lactating women (proposed 9 CFR 413.309(c)).
FSIS regulations currently use the age ranges “less than 2 years of age” and “less than 4 years of age” to establish labeling requirements for meat and poultry products represented or purported to be specifically for infants and young children (9 CFR 317.400(c) and 381.500(c)). FDA amended its regulations so that the age categories were changed to infants through 12 months and young children 1 through 3 years (13 through 48 months) which would be consistent with the age ranges used in the IOM's DRIs for infants and children (81 FR 33916-33917). FDA's new DVs are also based on these age-specific DRIs (81 FR 33916-33917)
Consistent with FDA's final rule, FSIS is proposing to replace the current category of infants and children less than 4 years in 9 CFR 317.400(c)(1); 381.500(c)(1); 317.309(c)(7)-(8); 381.409(c)(7)-(8); 317.309(d)(1); 381.409(d)(1); 317.313(b)(3); 381.413(b)(3); 317.313(q)(3); and 381.413(q)(3) with infants through 12 months and children 1 through 3 years of age (proposed 9 CFR 413.400(c)(1); 413.309(c)(7)-(9); 413.309(d)(1); 413.313(b)(3); and 413.313(q)(3)).
Currently, meat and poultry products represented or purported to be specifically for infants and children less than 4 years must declare certain nutrients, including calories, calories from fat, total fat, saturated fat, cholesterol, sodium, total carbohydrate, sugars, dietary fiber, and protein (9 CFR 317.400(c)(2) and 381.500(c)(2)). For meat and poultry products represented or purported to be for infants and children less than 2 years, the declaration of certain nutrients, which include calories from fat, saturated fat, and cholesterol, is not required or permitted (9 CFR 317.400(c)(1) and 381.500(c)(1)).
Because FSIS is proposing new categories of infants through 12 months and children 1 through 3 years of age, FSIS is considering whether there is a need to require or permit the declaration of calories from fat, saturated fat, and cholesterol in the labeling for foods represented or purported to be specifically for these subpopulations. As discussed in section II.B.1. above, FSIS is proposing to no longer require and not permit the declaration of calories from fat on the Nutrition Facts label (proposed 9 CFR 413.309(c)(1)(ii)). Therefore, if these proposed changes are finalized, the exception in 9 CFR 317.400(c)(1) and 381.500(c)(1) for calories from fat will no longer be needed, and the reference to calories from fat will be removed. FSIS's regulations currently do not require or permit the labeling of any fat, with the exception of total fat, or fatty acids on meat and poultry products represented or purported to be specifically for children less than 2 years of age.
FDA considered a recent consensus report suggesting that: Fat intake in infants less than 12 months of age should not be restricted. Fat is still an important source of calories for infants and young children. Evidence suggests a diet with saturated fat of less than 10 percent of calories and cholesterol intake less than 300 mg/d can safely and effectively reduce the levels of total and LDL cholesterol in healthy children, and that the 2010 DGA recommended that Americans 2 years of age and older consume less saturated fatty acids and less than 300 mg/d of cholesterol (79 FR 11934). FDA requires, except for the declaration of calories from fat, the mandatory declaration of statutorily required nutrients under section 403(q) of the FD&C Act that include saturated fat and cholesterol on the label of foods represented or purported to be specifically for infants through 12 months and children 1 through 3 years of age (81 FR 33917-33918). Therefore, consistent with FDA's final rule, FSIS is proposing to require the declaration of saturated fat and cholesterol on the label of meat and poultry products purported to be for infants through 12 months and children 1 through 3 years of age (proposed 9 CFR 413.400(c)(1)).
Currently, meat and poultry products consumed by pregnant women and lactating women must declare certain nutrients, including calories, calories from fat, total fat, saturated fat, cholesterol, sodium, total carbohydrate, sugars, dietary fiber, and protein. As discussed in FDA's Nutrition Labeling Proposed Rule, women of reproductive age consume the same foods as the general population and, in general, continue consuming similar foods during pregnancy and lactation (79 FR 11934). FDA requires, except for the declaration of calories from fat, the mandatory declaration of statutorily required nutrients under section 403(q) of the FD&C Act (81 FR 33917-33918).
Accordingly, FSIS is proposing to require the mandatory declaration of calories and the amount of total fat, saturated fat, cholesterol, sodium, total carbohydrate, dietary fiber, sugars, and protein on foods represented or purported to be specifically for infants through 12 months of age, children 1 through 3 years of age, and pregnant women and lactating women and to permit the declaration of calories from saturated fat such that these nutrients would be subject to the same requirements applicable to meat and poultry products for the general population (proposed 9 CFR 413.309(c)).
Currently, the percent DV declaration is not permitted on the Nutrition Facts label for meat and poultry products represented or purported to be specifically for infants and children less than 4 years of age (which includes infants and children less than 2 years of age) for total fat, saturated fat, cholesterol, sodium, potassium, total carbohydrate, and dietary fiber (9 CFR 317.400(c)(2)(i) and 381.500(c)(2)(i)). Percent DV is required for protein and vitamins and other minerals and, as discussed in sections II.F and II.I, provides information in a manner that enables consumers to understand the relative significance of nutrition information in the context of a total daily diet. FDA concluded that it is appropriate to require declarations of percent DV for those nutrients for which FDA is establishing a DRV or RDI for infants through 12 months, for children 1 through 3 years of age, and for pregnant women and lactating women (81 FR 33918-33919). Accordingly, FSIS is proposing in 9 CFR 413.400(c)(2)(i) to require declarations of percent DV for those nutrients for which FSIS is establishing a DRV or RDI for infants through 12 months, for children 1 through 3 years of age, and for pregnant women and lactating women consistent with FDA's Nutrition Labeling Final Rule.
As discussed in section II.E.3, FSIS is proposing to require the mandatory declaration of added sugars on the Nutrition Facts label. The 2010 DGA provides recommendations for consumption of added sugars for the U.S. population 2 years of age and older but not for infants and children under age 2. It is expected, however, that the role of added sugars are not markedly different between children 1 and 2 years of age (79 FR 11936). Similarly, the IOM has established DRI ranges for 1-through-3-year-olds because growth velocity is most similar during this age range (79 FR 11936; 81 FR 33916). FDA has concluded that mandatory declaration of added sugars is needed for foods for infants through 12 months, just as it is for the general population, to provide consumers with information to construct a healthy dietary pattern that meets the dietary recommendations for added sugars (81 FR 33921).
Consistent with FDA's Nutrition Labeling Final Rule, FSIS is proposing the mandatory declaration of added sugars on the Nutrition Facts label of meat and poultry products represented or purported to be specifically for infants through 12 months, children 1 through 3 years of age, and pregnant women and lactating women.
As discussed in section II.C.3, FSIS is proposing to require the mandatory declaration of
Consistent with FDA's Nutrition Labeling Final Rule, FSIS is proposing to require the declaration of trans fat on the Nutrition Facts label of meat and poultry products represented or purported to be specifically for infants through 12 months, children 1 through 3 years of age, and pregnant women and lactating women.
Currently, meat and poultry products represented or purported to be specifically for infants and children less than 2 years of age are not permitted to declare calories from fat, calories from saturated fat, and the amount of polyunsaturated fat and monounsaturated fat (9 CFR 317.400(c)(1) and 381.500(c)(1)), whereas soluble fiber, insoluble fiber, and sugar alcohols can be voluntarily declared. Polyunsaturated fat, monounsaturated fat, soluble fiber, insoluble fiber, and sugar alcohols can be voluntarily declared on the label of meat and poultry products represented or purported to be specifically for children 2 through 4 years of age and pregnant women and lactating women (9 CFR 317.400(c)(2) and 381.500(c)(2)). FSIS is proposing the following changes to voluntary declaration of certain nutrients.
For infants through 12 months, there are no specific recommendations provided about calories from saturated, polyunsaturated, or monounsaturated fat. However, as discussed in FDA's Nutrition Labeling Proposed Rule, there is some evidence to suggest that reduction of total and LDL cholesterol levels can occur with reducing saturated fat intake to less than 10 percent of calories, beginning in infancy and sustained throughout childhood into adolescence (79 FR 11935). Because consensus reports provide no discussion or recommendation about providing nutrient guidelines for fatty acids to children under the age of 2 years, and there is no evidence to suggest that infants through 12 months of age would
Also, as discussed in FDA's Nutrition Labeling Proposed Rule, quantitative intake recommendations are not available from relevant U.S. consensus reports for monounsaturated and polyunsaturated fats for children 1 through 3 years of age or pregnant women and lactating women. There is well-established evidence to indicate that replacing saturated fatty acids with polyunsaturated and monounsaturated fatty acids reduces blood LDL cholesterol levels and, therefore, the risk of CVD; and that monounsaturated and polyunsaturated fats have public health significance when they replace saturated fat (79 FR 11936). FDA finalized its proposed requirements and permits the declaration of calories from saturated fat, polyunsaturated and monounsaturated fat on foods represented or purported to be specifically for infants through 12 months and children 1 through 3 years of age (81 FR 33919-33920).
Consistent with FDA's Nutrition Labeling Final Rule, FSIS is proposing to revise 9 CFR 317.400(c)(1) and 381.500(c)(1) (which would be consolidated in proposed 9 CFR 413.400(c)(1)) to remove the exceptions for the declaration of calories from saturated fat and the amount of polyunsaturated fat and monounsaturated fat on meat and poultry products represented or purported to be specifically for infants through 12 months, children 1 through 3 years of age, or pregnant or lactating women. If finalized, these declarations for the new age categories, infants through 12 months and children 1 through 3 years of age, would be the same as the proposed voluntary declarations for foods for the general population.
As discussed in section II.E, FSIS is proposing to allow the declaration of soluble fiber and insoluble fiber that meet the definition of “dietary fiber” on the Nutrition Facts label for the general population. FDA has concluded that there is no evidence to suggest that the role of these nutrients would be different among infants through 12 months, children 1 through 3 years of age, or pregnant women and lactating women compared to the general population (81 FR 33920).
FSIS has reviewed FDA's analysis and is not proposing any changes to the provisions for the voluntary declaration of soluble fiber, insoluble fiber, and sugar alcohols on the label of meat and poultry products represented or purported to be specifically for infants through 12 months, children 1 through 3 years of age, or pregnant women and lactating women, consistent with FDA's Nutrition Labeling Final Rule (81 FR 33920).
FSIS regulations currently do not provide for the declaration of fluoride on the Nutrition Facts label of any meat or poultry product. For the reasons discussed in section II.H, FSIS is proposing to permit voluntary declaration of fluoride on the labeling of meat and poultry products for the general population. As discussed in FDA's Nutrition Labeling Proposed Rule and Final Rule (in which FDA did not change its tentative conclusions from the proposed rule), because fluoride provides protection against dental caries by strengthening the tooth enamel before and after teeth appear, and because excessive fluoride intake can cause dental fluorosis in young children, the declaration of fluoride on foods represented or purported to be specifically for children 1 through 3 years of age and for pregnant women and lactating women can assist in maintaining healthy dietary practices (79 FR 11936; 81 FR 33921). Further, while evidence on dental caries is lacking for infants through 12 months of age, there is no reason to expect the role of fluoride in the protection against dental caries to be different from other age groups (
FSIS requires the declarations of vitamin A, vitamin C, calcium, and iron on the Nutrition Facts label, and there are no specific exceptions to this requirement for meat and poultry products represented or purported to be specifically for infants and children less than 2 years and children less than 4 years of age, and pregnant women and lactating women (9 CFR 317.309(c)(8) and 381.409(c)(8)). FSIS is proposing to replace the current categories “infants and children less than 2 years of age and children less than 4 years of age” with “infants through 12 months and children 1 through 3 years of age.”
Since the needs of essential vitamin and minerals are increased for both pregnant women and lactating women, FDA applied its conclusions about nutrient inadequacy during pregnancy to lactating women and made the requirements related to essential vitamins and minerals in labeling of foods for pregnant women and lactating women the same (81 FR 33921-33922). Consistent with FDA's Nutrition Labeling Final Rule, FSIS is proposing to remove the current provision in 9 CFR 317.309(c)(8)(i) and 381.409(c)(8)(i) that requires separate declaration of percent DVs based on both RDI values for pregnant women and for lactating women in the labeling of foods represented or purported to be for use by both pregnant women and lactating women (proposed 9 CFR 413.309(c)(8)(i)).
FSIS is not proposing any changes to the mandatory declaration of calcium on foods for the general population (see section II.I.1.). As discussed in FDA's Nutrition Labeling Proposed Rule, the AI for calcium for infants through 12 months of age is based on average calcium consumption of this nutrient rather than on chronic disease risk, health related-condition, or physiological endpoints (79 FR 11937). For children 1 through 3 years of age and pregnant women and lactating women, the Recommended Dietary Allowances (RDAs)
FDA's analysis of the Centers for Disease Control and Prevention (CDC) National Health and Nutrition Examination Survey (NHANES) 2003-2006 data estimated that infants ages 7 to 12 months have usual calcium intakes above the AI and estimated that about 12 percent of children 1 through 3 years of age had usual intakes of calcium below the Estimated Average
FDA concluded that calcium is a nutrient of public health significance for children 1 through 3 years of age and pregnant women and lactating women and infants through 12 months and requires the mandatory declaration of calcium on foods purported to be specifically for infants through 12 months, children 1 through 3 years of age, or pregnant and lactating women (81 FR 33922). Consistent with FDA's Nutrition Labeling Final Rule, FSIS is not proposing to change the mandatory declaration of calcium for meat and poultry products purported to be specifically for infants through 12 months, children 1 through 3 years of age, or pregnant or lactating women.
FSIS is not proposing any changes to the mandatory declaration of iron on foods for the general population (see section II.I.1.). As discussed in FDA's Nutrition Labeling Proposed Rule, although the EAR and RDA are based on daily iron requirements and not directly on chronic disease risk, iron deficiency is associated with delayed normal infant motor function (
As discussed in FDA's Nutrition Labeling Proposed Rule, about 1 percent of children 1 through 3 years of age have usual iron intakes below the EAR, based on intakes from conventional foods only, and 0.4 percent of children have usual iron intakes below the EAR based on intakes from conventional foods and supplements (79 FR 11937). The IOM set the EAR by modeling components of iron requirements. The prevalence of iron deficiency in children ages 1 to 2 years has been reported to be 14.4 percent, and the prevalence of iron deficiency anemia in children younger than 5 years has been reported to be 14.9 percent. FDA requires the mandatory declaration of iron in the labeling of foods for infants through 12 months and children 1 through 3 years of age (81 FR 33922).
As discussed in FDA's Nutrition Labeling Proposed Rule, inadequate iron intakes during pregnancy are of public health significance because of the adverse effects for both the mother and the fetus (such as maternal anemia, premature delivery, low birth weight, and increased perinatal infant mortality) (79 FR 11938). FDA analyzed NHANES 2003-2006 data and estimated that 5 percent of pregnant women 14 to 50 years of age had usual iron intakes below the EAR based on intakes from conventional foods, and 4 percent of pregnant women 14 to 50 years of age had usual iron intakes below the EAR based on intakes from conventional foods and supplements. The EAR for iron for pregnant women was based on estimates of iron stores needed during the first trimester (79 FR 11938). FDA's analysis of NHANES 2003-2006 data also indicated that, among pregnant women aged 12 to 49 years, 25 percent were iron deficient, and 13 percent had iron deficiency anemia (79 FR 11938). FDA considered iron deficiency based on two out of three cutoffs of iron deficiency variables (transferrin saturation, serum ferritin, and erythrocyte protoporphyrin) (79 FR 11938).
FDA found that calcium and iron have quantitative intake recommendations and have public health significance for infants through 12 months, children 1 through 3 years of age, and pregnant women and lactating women. FDA did not receive comments to its proposed rule to change its tentative conclusion that the declaration of calcium and iron is necessary to assist consumers in maintaining healthy dietary practices (81 FR 33922). FSIS has reviewed FDA's analysis and is proposing to require the mandatory declaration of calcium and iron on foods represented or purported to be specifically for infants through 12 months, children 1 through 3 years of age, or pregnant women and lactating women without providing any exceptions for these subpopulations from the requirement for declaration of calcium and iron applicable to foods for the general population (proposed 9 CFR 413.309(c)(8)(ii)).
FSIS is proposing to require the declaration of vitamin D on meat and poultry products for the general population (see section II.I.1.). FDA identified vitamin D as a nutrient of public health significance in children 1 through 3 years of age and pregnant women based on the high prevalence of inadequate intakes of vitamin D and its important role in bone development and health (81 FR 33922-33923). FDA also identified vitamin D as a nutrient of public health significance for infants through 12 months of age based on its importance for growth and development during infancy (81 FR 33922-33923).
FSIS is proposing to require the declaration of potassium on foods for the general population (see proposed 9 CFR 413.309(c)(8)(ii) and section II.I.1.). As discussed in FDA's Nutrition Labeling Proposed Rule, the AI for infants is based on average potassium intake from breast milk and complementary foods (79 FR 11938). The AI for the other life-stage and gender groups is set at a level to maintain blood pressure, reduce the adverse effects of sodium chloride intake on blood pressure, and reduce the risk of recurrent kidney stones (79 FR 11938).
FSIS has reviewed FDA's analysis of potassium intake from NHANES 2003-2006 for infants 7 to 12 months of age; potassium intake for children 1 through 3 years of age; and the importance of potassium in the risk reduction of chronic diseases for children 2 years of age and older (79 FR 11938). Because of the benefits of adequate potassium intake in lowering blood pressure and data indicating low likelihood of potassium adequacy, FSIS agrees with FDA that it is important to establish healthy dietary practices for later life (79 FR 11938). FDA tentatively concluded in the Nutrition Labeling Proposed Rule that there is no basis to conclude that the public health significance of potassium among infants through 12 months of age would be different than the science-based evidence for children 1 through 3 years of age, and that potassium is of public health significance to infants through 12 months, children 1 through 3 years of age and pregnant women and lactating women (79 FR 11938). FDA did not change its tentative conclusion in the final rule (81 FR 33922-33923).
Consistent with FDA's Nutrition Labeling Final Rule, FSIS is proposing to require the labeling of vitamin D and potassium on foods represented or purported to be specifically for infants through 12 months of age, children 1 through 3 years of age, and pregnant women and lactating women based on the quantitative intake recommendations for vitamin D and potassium and the public health significance of these nutrients. Consequently, FSIS is not providing for any exceptions for these subpopulations from the general requirement in proposed 9 CFR 413.309(c)(8)(ii) to declare vitamin D and potassium.
FSIS is proposing to no longer require the declaration of vitamin A and vitamin C on foods for the general population (see section II.I.1.). As discussed in FDA's Nutrition Labeling Proposed Rule, none of the DRIs (AIs or RDAs) for vitamin A were based on chronic disease risk, a health related-condition, or health-related physiological endpoints (79 FR 11939).
FDA looked at vitamin A intake from NHANES 2003-2006 for children and pregnant women and found a very low prevalence of inadequate intakes of vitamins A and C or inadequate status among children 1 through 3 years of age or pregnant women and also the lack of evidence to indicate that this would be different for infants or lactating women (79 FR 11939). FDA concluded that vitamin A and vitamin C are not of public health significance among infants through 12 months of age, children 1 through 3 years of age, and pregnant women and lactating women and that this supports the voluntary declaration of vitamins A and C in the labeling of foods for young children (81 FR 33923-33924). Consistent with FDA's Nutrition Labeling Final Rule, FSIS is proposing to permit, but not to require, that the declaration of vitamin A and vitamin C on foods represented and purported to be specifically for infants through 12 months, children 1 through 3 years of age, or pregnant women and lactating women. Similar to other voluntary nutrients, the declaration of vitamins A and C would be required when claims are made about them on the label or labeling (proposed 9 CFR 413.309(c)(8)(ii)).
As discussed in section II.I.3., for the general population, FSIS is proposing to permit the voluntary declaration of vitamin E, vitamin K, vitamin B
FSIS regulations do not include DRVs or RDIs for nutrients for infants through 12 months of age, except an RDI for protein of 14 g for infants. Consistent with FDA, FSIS is considering establishing DRVs and RDIs for nutrients for infants through 12 months of age and revisions to the current RDI for protein.
FSIS's regulations do not provide, and FDA has not established, a reference calorie intake level for infants and children less than 2 years of age. As discussed in FDA's Nutrition Labeling Proposed Rule, there is no quantitative intake recommendation for calories for infants, and FDA is not aware of other scientific data and information on which it could rely to establish that level (79 FR 11939). FDA did not establish a reference calorie intake for infants through 12 months of age in the final rule (81 FR 33925). Therefore, consistent with FDA's Nutrition Labeling Final Rule, FSIS is not proposing to establish a reference calorie intake level for infants through 12 months (81 FR 33925).
As discussed in FDA's Nutrition Labeling Proposed Rule, the IOM set an AI of 30 g/d for fat for infants through 12 months of age based on the average intake of human milk and complementary foods. There was no AI available in 1993, and the current AI provides a basis to determine an appropriate DRV for total fat for this subpopulation that can assist consumers in maintaining healthy dietary practices among this subpopulation (79 FR 11939). FDA established a DRV of 30 g for fat for infants through 12 months in its final rule (81 FR 33925). Therefore, consistent with FDA's Nutrition Labeling Final Rule, FSIS is proposing to include a DRV of 30 g for fat for infants through 12 months of age (proposed 9 CFR 413.309(c)(9)).
As discussed in FDA's Nutrition Labeling Proposed Rule, there are no quantitative intake recommendations from U.S. consensus reports available for saturated fat,
As discussed in FDA's Nutrition Labeling Proposed Rule, quantitative intake recommendations from U.S. consensus reports are not available for polyunsaturated fat, monounsaturated fat, insoluble fiber, soluble fiber, added sugars, or sugar alcohols for infants (79
As discussed in FDA's Nutrition Labeling Proposed Rule, the IOM set an AI of 95 g/d for carbohydrate for infants through 12 months of age based on the average intake of human milk and complementary foods. There was no AI available in 1993, and the current AI provides a basis on which FDA could determine an appropriate DRV for total carbohydrate for this subpopulation that can assist consumers in maintaining healthy dietary practices among this subpopulation (79 FR 11940). FDA established a DRV of 95 g for total carbohydrate for infants through 12 months of age in its final rule (81 FR 33925). Therefore, consistent with FDA's Nutrition Labeling Final Rule, FSIS is proposing to establish a DRV of 95 g for total carbohydrate for infants through 12 months of age (proposed 9 CFR 413.309(c)(9)).
As discussed in FDA's Nutrition Labeling Proposed Rule, the DV for protein for infants is an RDI, rather than a DRV. Before 1993, FDA established the RDIs for protein for all age groups based on the 1989 RDA. In 1993, FDA changed the RDI for protein for the general population to a DRV (58 FR 2206 at 2216). FDA retained the RDI for infants based on the highest 1968 RDA value (14 g/d for infants) to be consistent with a population-coverage approach, but it found no reason to change the approach of using the RDI for infants through 12 months. FDA determined that it would be appropriate to revise the RDI to rely on current quantitative intake recommendations. In 2002, the IOM established an RDA for infants through 12 months of 1.2 g/kg/d based on nitrogen balance studies and using a reference body weight of 9 kg consistent with current growth charts for infants. Protein intakes are well above the current and proposed RDI, and mean protein intake for infants 6 to 11 months of age was well above the RDA of 11 g/d (79 FR 11940). FDA established an RDI of 11 grams for protein for infants through 12 months of age in its final rule (81 FR 33925). Accordingly, consistent with FDA's Nutrition Labeling Final Rule, FSIS is proposing to establish an RDI of 11 g for protein for infants through 12 months of age (proposed 9 CFR 413.309(c)(8)(iv)).
FSIS is proposing to establish a DRV for sodium based on the IOM's UL for the general population (section II.G.). However, as discussed in FDA's Nutrition Labeling Proposed Rule, the IOM did not set a UL for sodium for infants through 12 months of age because there was insufficient data on adverse effects of chronic overconsumption in this age group (79 FR 11940). In addition, FDA was not aware of other reliable scientific data and information on which to establish a DRV for sodium for this subpopulation (79 FR 11940). FDA did not establish a DRV for sodium for infants through 12 months of age in its final rule (81 FR 33926). Therefore, consistent with FDA's Nutrition Labeling Final Rule, FSIS is not proposing a DRV for sodium for infants through 12 months of age because of the lack of appropriate scientific data.
As discussed in section II.H, although the IOM set an AI for fluoride, the AIs for infants through 12 months and children 1 through 3 years are close to the Environmental Protection Agency benchmarks for total fluoride intake. FDA did not propose a DRV for fluoride for use in the labeling of foods for the general population because of a concern about excess intakes associated with dental fluorosis (79 FR 11918). FDA did not establish a DRV for fluoride for infants through 12 months in its final rule (81 FR 33926). The use of such a DRV to calculate percent DV may have the unintended effect of consumers selecting foods with higher fluoride amounts, which are not necessary or advised (79 FR 11940). Accordingly, consistent with FDA's Nutrition Labeling Final Rule, FSIS is not proposing to establish a DRV for fluoride for infants through 12 months of age.
FSIS regulations do not include DRVs or RDIs for nutrients, generally, for infants, children under 4 years of age, or pregnant women and lactating women. However, there are requirements for a DRV for protein for children 4 or more years of age and an RDI for protein for (1) children less than 4 years of age; (2) infants; (3) pregnant women; and (4) lactating women (9 CFR 317.309(c)(7)(iii) and 381.409(c)(7)(iii)).
FDA reviewed current quantitative intake recommendations for vitamins and minerals for infants and considered comments received in response to its 2007 ANPRM to determine appropriate RDIs for vitamins and minerals for infants through 12 months of age (79 FR 11940). FSIS agrees with FDA that it is important to establish RDIs for infants through 12 months of age because infants in this age range transition from a diet of mostly breast milk and infant formula to infant cereal and baby foods; that labeling foods for this subpopulation with percent DV declarations can assist parents in making nutritious food choices; that the DRIs (AIs and RDAs) provide a basis on which to determine RDIs for vitamins and minerals for this subpopulation; that it is appropriate to use RDAs and, in the absence of RDAs, AIs to determine appropriate micronutrient RDIs for infants; that both RDAs and AIs are sufficient for setting RDIs because they both represent intake levels that are expected to meet or exceed the nutrient needs of the majority of infants; that the IOM established DRIs based on scientific knowledge that update and supersede previous RDA recommendations; and that DRIs are available for infants through 12 months of age (79 FR 11940).
FDA established RDIs for vitamin A, vitamin C, vitamin D, vitamin E, vitamin K, vitamin B
FSIS regulations do not include DRVs or RDIs for nutrients for children 1 through 3 years of age, except an RDI for protein of 16 g for children less than 4 years of age. As discussed in FDA's Nutrition Labeling Proposed Rule, FDA reviewed scientific evidence and current recommendations, as well as comments in response to FDA's 2007 ANPRM, to consider establishing DRVs and RDIs for nutrients for this subpopulation and to consider revisions
FSIS regulations currently do not provide a reference calorie intake level for nutrition labeling for children ages 1 through 3 years. FDA established a reference calorie intake level for children 1 through 3 years of age and set DRVs using quantitative intake recommendations that are based on calories (
Currently, FSIS regulations do not provide a DRV for total fat for children ages 1 through 3 years. As discussed in FDA's Nutrition Labeling Proposed Rule, FDA agreed with a comment to its 2007 ANPRM that 35 percent of calories from fat for children 1 through 3 years of age, the midpoint of the IOM AMDR of 30 to 40 percent, serves as an appropriate basis on which to set the DRV for total fat. The approach to calculating the DRV for total fat is consistent with FDA's approach to setting the DRV for total fat for the general population. Thirty-five percent is consistent with AHA and AAP recommendations that 30 to 40 percent of calories consumed by children 12 through 24 months of age, and 30 to 35 percent of calories consumed by children 24 through 48 months of age, should come from fat (79 FR 11941). In FDA's Nutrition Labeling Proposed Rule, FDA tentatively concluded that 35 percent of total calories from fat (
FSIS has not established DRVs for saturated fat,
FSIS is not proposing to establish a DRV for
FSIS has not established DRVs for polyunsaturated fat, monounsaturated fat, sugars, added sugars, insoluble fiber, soluble fiber, or sugar alcohol for children 1 through 3 years of age. As discussed in FDA's Nutrition Labeling Proposed Rule, FDA stated that there was no reliable data or information available to establish DRVs for polyunsaturated fat, monounsaturated fat, sugars, insoluble fiber, soluble fiber, and sugar alcohols, and tentatively concluded that there was no basis for setting DRVs for these nutrients (79 FR 11941). FDA established a DRV reference point for the added sugars declaration at 10 percent of calories in its final rule, after considering the scientific evidence in the 2015 DGAC report (81 FR 33842). FDA set a DRV for children 1 through 3 years of age of 25 g of added sugars (1,000 calorie reference amount × .10 = 100 calories and 100 calories ÷ 4 calories/gram = 25 grams) (81 FR 33928-33929). FSIS has reviewed FDA's analysis and is proposing a DRV for added sugars of 25 g for children 1 through 3 years of age and that the percent DV for added sugars be declared on the Nutrition Facts label consistent with FDA's final rule. FSIS is not proposing DRVs for polyunsaturated fat, including
FSIS has not established a DRV for total carbohydrate for children 1 through 3 years of age. As discussed in section II.E.1, consistent with FDA, FSIS is proposing a DRV for total carbohydrate for the general population based on the percentage of calories in a 2,000 calorie diet remaining after the sum of the DRV for fat (30 percent) plus the DRV for protein (10 percent) have been subtracted consistent with FDA's Nutrition Labeling Final Rule. As discussed in FDA's proposed rule, FDA considered this method to be appropriate for setting a DRV for total carbohydrate for children 1 through 3 years of age because it falls within the IOM AMDR recommendation of 45 to 65 percent of calories from carbohydrates for children 1 through 3 years of age (79 FR 11941). FDA tentatively concluded that an appropriate DRV for total carbohydrate is 60 percent of calories (
FSIS has not established a DRV for dietary fiber for children 1 through 3 years of age. As discussed in FDA's Nutrition Labeling Proposed Rule, FDA tentatively concluded that the AI of 14 g/1,000 calories for dietary fiber for children 1 through 3 years of age should be used to set a DRV for dietary fiber to be consistent with how other proposed DRVs are being set; for example, proposing a reference calorie intake level of 1,000 calories/d for this subpopulation (79 FR 11941-11942). FDA established a DRV of 14 g for dietary fiber in its final rule (81 FR 33929). Consistent with FDA's Nutrition Labeling Final Rule, FSIS is proposing to establish a DRV of 14 g for dietary fiber for children 1 through 3 years of age (9 CFR 413.309(c)(9)).
The current RDI for protein for children less than 4 years of age was based on the 1989 RDA for protein of 16 g/d (9 CFR 317.309(c)(7)(iii) and 381.409(c)(7)(iii)).
As discussed in FDA's Nutrition Labeling Proposed Rule, FDA considered current recommendations and acknowledged that protein intakes are well above the current RDI; the mean protein intake for children 12 to 23 months of age was 44 g/d; the protein AMDR for children 1 through 3 years of age is 5 to 20 percent of calories; and the proposed reference calorie intake level and the approaches used for the proposed DRVs for fat and carbohydrate are based on percent of calories (79 FR 11942). FDA tentatively concluded that the DV for protein for children 1 through 3 years of age should be a DRV, rather than an RDI (using the RDA), and that a DRV for protein should be based on 5 percent of 1,000 calories or 50 calories, which equals 12.5 g or, when rounded up, is 13 g (
For the general population, FSIS is proposing to establish a DRV based on the UL for sodium (section II.G.). There is no current DRV for sodium for children 1 through 3 years of age.
As discussed in FDA's Nutrition Labeling Proposed Rule, FDA agreed with comments to its 2007 ANPRM that 1,500 mg is an appropriate DRV for sodium for children 1 through 3 years of age (79 FR 11942). FDA did not receive comments on this proposed requirement and finalized this requirement (81 FR 33929). Consistent with FSIS's proposed approach for the general population and FDA's Nutrition Labeling Final Rule, FSIS is proposing to establish a DRV of 1,500 mg for sodium for children 1 through 3 years of age (proposed 9 CFR 413.309(c)(9)).
FSIS has not established a DV for fluoride for children 1 through 3 years of age. As discussed in section II.H, FSIS is not establishing a DRV for fluoride for the general population. FSIS agrees with FDA that a DRV for fluoride is not warranted for children 1 through 3 years of age and is not proposing to establish a DRV for fluoride for children 1 through 3 years of age (79 FR 11942; 81 FR 33929).
FSIS regulations do not currently include a table listing the RDIs for children less than 4 years of age. The preamble to FDA's 1993 DRV/RDI final rule provides a table listing RDIs for children less than 4 years of age (58 FR 2206 at 2213), which is also provided in FDA's Food Labeling Guide. FDA reviewed current quantitative intake recommendations for vitamins and minerals for infants and considered comments received in response to their 2007 ANPRM to determine appropriate RDIs for vitamins and minerals for children 1 through 3 years of age.
As discussed in FDA's Nutrition Labeling Proposed Rule, the IOM's quantitative intake recommendations (AIs and RDAs) provide a basis on which to determine RDIs for vitamins and minerals for this subpopulation. The IOM determined that available evidence was sufficient to establish appropriate RDAs and AIs for vitamins and minerals for this subpopulation; that it is appropriate to use RDAs and, in the absence of RDAs, AIs to determine appropriate micronutrient RDIs for children 1 through 3 years of age; that the RDA, when available, is the best estimate of an intake level that will meet the nutrient goals of practically all consumers who would use the Nutrition Facts label; that AIs have less certainty than RDAs, but they represent goals for nutrient intake for individuals and provide the best estimate based on current science for use in setting RDIs for such nutrients; that promoting the development of eating patterns associated with adequate potassium intake later in life is important because chronic conditions such as elevated blood pressure, bone demineralization, and kidney stones likely result from inadequate potassium intakes over an extended period of time, including childhood; and that the AI for potassium is 3,000 mg/d and is considered an appropriate basis for establishing a RDI for potassium for children 1 through 3 years of age (79 FR 11942). FDA established RDIs for vitamin A, vitamin C, vitamin D, vitamin E, vitamin K, vitamin B
Therefore, consistent with FDA's Nutrition Labeling Final Rule (81 FR 33927), using the RDAs and AIs, FSIS is proposing to establish RDIs as set forth in proposed 9 CFR 413.309(c)(8)(iv) for these same nutrients for children 1 through 3 years of age.
The reference calorie intake of 2,000 used for the general population applies to pregnant women and lactating women (9 CFR 317.309(c)(9) and 381.409(c)(9)). As discussed in FDA's Nutrition Labeling Proposed Rule, the calorie needs for pregnant women and lactating women are similar to the general population, and few products are purported for pregnant women and lactating women (79 FR 11943). FDA explained that the calorie needs for pregnant and lactating women are similar to the general population (
FSIS regulations do not provide DRVs for total fat, saturated fat, cholesterol, total carbohydrate, sodium, and dietary fiber for pregnant women and lactating women. As discussed in FDA's Nutrition Labeling Proposed Rule, quantitative intake recommendations for total fat, saturated fat, cholesterol, total carbohydrate, sodium, and dietary fiber
There are no DRVs for
FSIS has established RDIs of 60 g protein for pregnant women and 65 g protein for lactating women (9 CFR 317.309(c)(7)(iii) and 381.409(c)(7)(iii)). As discussed in FDA's Nutrition Labeling Proposed Rule, the IOM established 71 g/d protein as the RDA for pregnant women and lactating women based on the needs for maternal and fetal development and human milk production (79 FR 11943). FDA tentatively concluded that the DV for protein for pregnant women and lactating women should remain an RDI (using the RDA) instead of a DRV because the DRV approach used to calculate protein for the general population based on 10 percent of 2,000 calories, which equals 50 g of protein/d, falls short of the recommended protein needs of pregnant women and lactating women of 71 g/d (
There is no DRV for fluoride for the general population or for pregnant women and lactating women. While an AI has been established for fluoride, FSIS is not proposing to establish a DRV for fluoride for the general population for the reasons discussed in section II.H. Similarly, because the AI for fluoride for pregnant women and lactating women is not different from the general population, as discussed in FDA's Nutrition Labeling Proposed Rule (79 FR 11943), FSIS is not proposing a DRV for fluoride for pregnant women and lactating women.
While not included in FSIS regulations, the preamble to the FDA 1993 DRV/RDI final rule provides a table listing RDIs for pregnant women and lactating women (58 FR 2206 at 2213), which is also provided in FDA's Food Labeling Guide (79 FR 11943). As discussed in FDA's Nutrition Labeling Proposed Rule, FDA reviewed current quantitative intake recommendations for vitamins and minerals for pregnant women and lactating women and concluded that it is appropriate to establish RDIs for pregnant women and lactating women for vitamins and minerals that have DRIs, using population-coverage RDAs and AIs, instead of population-weighted EARs (79 FR 11943). In addition, FDA established a single set of RDIs intended for both pregnant women and lactating women because nutrient needs during pregnancy and lactation are similar and because using one set of RDIs would address practical concerns related to limited space on food labels (81 FR 33932).
Therefore, FSIS is proposing to establish RDIs as set forth in proposed 9 CFR 413.309(c)(8)(iv) for vitamin A, vitamin C, vitamin D, vitamin E, vitamin K, vitamin B
FSIS requires that nutrition information for meat and poultry products be presented in a specific format on the labels of those products (see 9 CFR 317.309(d)(1)-(f) and 381.409(d)(1)-(f)). Since 1995 when FSIS last published a final rule effecting the nutrition labeling format regulations (60 FR 174; January 3, 1995), more research has been done on trends in health conditions and how best to present information to consumers. FDA, in its changes to the Nutrition Facts label format, took into consideration “graphic design principles such as alignment, consistency, repetition, and contrast,” emphasizing “key nutrients and key information” through highlighting and “removing or modifying parts of the label to assist consumers in maintaining healthy dietary practices” (79 FR 11948; 81 FR 33936). FSIS has reviewed FDA's rationale for the changes to the Nutrition Facts label format (
Consistent with FDA's final rule (81 FR 33937-33940), FSIS is proposing (i) to increase the type size for “Calories” and the numeric value for “Calories,” and (ii) to require that the numeric value for calories be highlighted in bold or extra bold type (proposed 9 CFR 413.309(d)). These changes will emphasize the importance of calories on the label and draw more consumer attention to the calories declaration.
FSIS currently requires that information on serving size, which includes a statement of the serving size and the number of servings per container, follow the heading “Nutrition Facts” (9 CFR 317.309(d)(3) and
Currently, the label statement for “Serving size” expressed in common household measures (
FSIS currently requires that the column heading “% Daily Value” and a list of nutrient names and amounts as described in 9 CFR 317.309(d)(7) and 381.409(d)(7) be to the left of and below this column heading in the Nutrition Facts label (9 CFR 317.309(d)(6) and (7) and 381.409(d)(6) and (7)). On all dual column labels, including those (1) for two or more forms of the same food (proposed 9 CFR 413.309(e)(5)); (2) displaying nutrition information per container and per unit, in addition to nutrition information per serving (proposed 9 CFR 413.309(e)(6)(i); (3) using the tabular display (proposed 9 CFR 413.309(e)(6)(ii)); and (4) that provide the aggregate display (proposed 9 CFR 413.309(d)(13)(ii)), FSIS is proposing to use thin vertical lines to separate the information in the “% Daily Value” column from the information in the column containing the quantitative weights. Further, FSIS is proposing to use the same style of thin vertical lines to separate each of the dual columns and aggregate display columns from each other. FSIS has tentatively concluded that the use of these vertical lines will help differentiate the columns and make the information easier to read for consumers. In addition, FSIS is proposing that protein would no longer be listed with the vitamins and minerals at the bottom of these labels as currently required.
As discussed in section II.E.3 of this proposed rule, FSIS is proposing to require the declaration of added sugars as an indented line item underneath the declaration of “Total Sugars” on the Nutrition Facts label. “Added Sugars” would be the only mandatory nutrient required to be listed in a double indentation format on the Nutrition Facts label.
FDA conducted a consumer study that, among other things, looked at how consumers would use the new information regarding added sugars, but did not evaluate the impact of listing a percent DV for added sugars on the Nutrition Facts label (80 FR 44306). The study was a controlled, randomized, web-based experiment where participants viewed three different Nutrition Facts label formats and responded to questions regarding their ability to accurately recognize and compare nutrients on the Nutrition Facts label and their judgments about the foods' overall healthfulness and relative nutrient levels (80 FR 44306). The study found that when both total and added sugars declarations appeared on the label, the majority of study participants correctly reported the added sugars amount and accurately identified which products had less added sugars (80 FR 44306). The study also found that where an added sugars declaration was indented below a “Total Sugars” declaration the study participants' understanding that added sugars are part of the total amount of sugars in the product improved (80 FR 44306). Therefore, consistent with FDA's final rule, FSIS is proposing to use the term “Total Sugars” instead of “Sugars” on the label. A summary of FDA's Added Sugars Experiment is available at 80 FR 44306 and a full description is available in the FDA Nutrition Labeling Supplemental Proposed Rule docket.
FDA's Nutrition Labeling Final Rule also addressed commenters' concerns regarding potential consumer confusion when including an “Added Sugars” declaration under “Total Sugars” on the Nutrition Facts label. Based on the recommendations of two independent FDA experts, as well as literature suggesting linking terms are useful for increasing comprehension, FDA added the word “Includes” in front of “Added Sugars” (81 FR 33827.) FDA also minimized the line between “Total Sugars” and “Added Sugars” to help denote that “Added Sugars” are a subcomponent of “Total Sugars.” Consistent with FDA, FSIS is proposing to add the word “Includes” in front of “Added Sugars” such that the added sugars declaration reads “Includes X g Added Sugars.” FSIS is also proposing to minimize the hairline between “Total Sugars” and “Added Sugars.”
FSIS currently requires that the quantitative amount by weight of mandatory and voluntary nutrients be declared on the Nutrition Facts label, except for vitamins and minerals (other than sodium and potassium) which must be declared only as percent DVs(9 CFR 317.309(c)(8) and 381.309(c)(8)). Consistent with FDA's Nutrition Labeling Final Rule (81 FR 33946-33949), FSIS is not proposing to require the declaration of the absolute amounts of all mandatory and voluntary vitamins and minerals as well as the percent DV declaration on the Nutrition Facts label. FSIS is, however, proposing to clarify in proposed 9 CFR 413.309(c)(8) that the declaration of voluntarily declared vitamins and minerals listed in proposed 9 CFR 413.309(c)(8)(iv) may include the quantitative amount by weight and percent of the RDI. FSIS is also proposing that if vitamins or minerals are added or there is a claim made about them, the manufacturer must include a declaration of the nutrient as a percent DV, or alternatively, as a quantitative amount by weight and percent DV (proposed 9 CFR 413.309(c)(8)(ii)).
FSIS currently requires that a footnote, preceded by an asterisk, be placed beneath the list of vitamins and minerals and be separated from that list by a hairline on the Nutrition Facts label (9 CFR 317.309(d)(9) and 381.409(d)(9)). The footnote must state “Percent Daily Values are based on a 2,000 calorie diet. Your daily values may be higher or lower depending on your calorie needs” followed by a table that lists the DRVs for total fat, saturated fat, cholesterol, sodium, total carbohydrate, and dietary fiber based on 2,000 and 2,500 calorie diets. (9 CFR 317.309(d)(9)(i) and 381.409(d)(9)(i)). Caloric conversion information on a per-gram basis for fat, carbohydrate, and protein may be presented beneath the information required in paragraph 9 CFR 317.309(d)(9) and 381.409(d)(9) separated by a hairline (9 CFR 317.309(d)(10) and 381.409(d)(10)).
Comments to FDA's 2007 ANPRM cited to research that the comments said showed that consumers do not understand what information is being conveyed in the footnote (79 FR 11953). In 2014, FDA conducted a controlled, randomized, web-based experiment that compared consumer reactions to seven footnote formats, which included five modified footnotes, in addition to the current footnote and no footnote at all, for explaining percent DVs and how to use them (the “Footnote Experiment”).
FDA stated that the new footnote “which explains the term “% Daily Value” and provides a reference calorie level will assist consumers in better understanding the information of the Nutrition Facts label and in maintaining healthy dietary practices” (81 FR 33952). FDA did not change the caloric conversion information in the footnote specified in 21 CFR 101.9(d)(10. FDA stated, in its Nutrition Labeling Proposed Rule, that “increasing the type size, bolding key elements of the footnote (space permitting), and adding a bar clearly separating it from the micronutrient information directly above will assist consumers in using the information” (79 FR 11953). FDA did not finalize this proposed requirement.
Under the Nutrition Labeling Final Rule, FDA now allows the footnote to be omitted from products that qualify for a simplified format (21 CFR 101.9(f)), provided that the following abbreviated statement is used “%DV = %Daily Value” in a type size no smaller than 6 point on these package labels when Daily Value is not spelled out in the column heading (81 FR 33952). FDA is also not requiring the footnote on small or intermediate-sized packages (21 CFR 101.9(j)(13)(ii)(A)(
Consistent with FDA's Nutrition Labeling Final Rule (81 FR 33949-33954), FSIS is proposing to remove the requirement for the footnote table listing the DRVs for total fat, saturated fat, cholesterol, sodium, total carbohydrate, and dietary fiber for 2,000 and 2,500 calorie diets (proposed 9 CFR 413.309(d)(9)(i)). FSIS is also proposing the following footnote text: “The %Daily Value tells you how much a nutrient in a serving of food contributes to a daily diet. 2,000 calories a day is used for general nutrition advice.” Consistent with FDA, FSIS is not proposing changes to the caloric conversion information in the footnote currently specified in 9 CFR 317.309(d)(10) and 381.409(d)(10) (which would be consolidated in proposed 9 CFR 413.309(d)(10)). FSIS is proposing that the footnote may be omitted from products that qualify for a simplified format (proposed 9 CFR 413.309(f)), provided that the following abbreviated statement is used “%DV = %Daily Value,” when the package labels do not spell out Daily Value in the column heading. FSIS is also proposing that the footnote may be omitted from small or intermediate-sized packages (proposed 9 CFR 413.309(g)). FSIS is also proposing an exemption from the footnote requirement for foods that can use the terms “calorie free,” “free of calories,” “no calories,” “zero calories,” “without calories,” “trivial source of calories,” “negligible source of calories,” or “dietarily insignificant source of calories” on the label or in the labeling of foods as defined in proposed 9 CFR 413.360(b). FSIS is also proposing to allow the voluntary use of the first part of the footnote statements, “*The %Daily Value tells you how much a nutrient in a serving of food contributes to a daily diet,” on these products.
FSIS requires that the “Nutrition Facts” heading on the Nutrition Facts label be set in a type size larger than all other print size in the nutrition label (9 CFR 317.309(d)(2) and 381.409(d)(2)). FDA amended its regulations to require a hairline rule be inserted directly beneath the “Nutrition Facts” heading on all label formats, except for the linear display for small packages, to direct the reader's eye to the serving size information, place emphasis on the information about servings, and break the information into smaller chunks to make it easier to process (79 FR 11954; 81 FR 33954). Consistent with FDA's final rule, FSIS is proposing to require that a hairline rule be inserted immediately below the “Nutrition Facts” heading on all nutrition label formats except for the linear display for small packages (proposed 9 CFR 413.309(d)(1)(iii)).
FSIS's current regulations require that a product that is packaged and sold individually and that contains less than 200 percent of the applicable RACC be considered a single-serving container, and that the entire content of the product be labeled as one serving, except that for products that have RACCs of 100g or 100mL or larger, manufacturers may decide whether a package containing more than 150 percent but less than 200 percent of the RACC be labeled as 1 or 2 servings (9 CFR 317.309(b)(8) and 381.409(b)(8)). FSIS's current regulations also require that for products that have RACCs of 100g or 100mL or larger and are individual units within a multi-serving package, manufacturers may decide whether an individual unit that contains more than 150 percent but less than 200 percent of the RACC be labeled as 1 or 2 servings (9 CFR 317.309(b)(4)(v) and 381.409(b)(4)(v)).
Based on a review of recent research, FDA has determined that many consumers do not correctly calculate nutrient amounts in food products by multiplying the nutrient amount by the number of servings per container (79 FR 11998-11999). FDA also found that the exemption from the requirement to label a product with a large RACC as a single-serving container is no longer warranted because “there is a low correlation between the RACCs (whether the reference amount is more than or less than 100 g or mL) and the consumption variation for all products containing less than 200 percent of the RACC, regardless of whether the RACC is `large' (
FSIS has reviewed FDA's research and analysis and tentatively agrees with FDA's conclusions. Therefore, FSIS is proposing to revise the requirements for single-serving labeling so that a product packaged and sold individually that contains less than 200 percent of the applicable RACC must be considered a single serving, and that a discrete unit containing at least 150 percent but less than 200 percent of the RACC must be labeled as one serving regardless of whether the RACC exceeds 100 g or mL (proposed 9 CFR 413.309(b)(8)).
FSIS currently permits manufacturers to voluntarily provide an additional column of nutrition information (
• Per 100 g, 100 mL, or 1 oz of the product as packaged or purchased (9 CFR 317.309(b)(13)(i) and 381.409(b)(13)(i));
• Per one unit if the serving size of a product in discrete units in a multi-serving container is more than one unit (9 CFR 317.309(b)(13)(ii) and 381.409(b)(13)(ii));
• For the product alone if the product is commonly combined with other ingredients or is cooked or otherwise prepared before eating, and directions for such combination or preparations are provided (
• For two or more forms of the same product (
• For two or more groups for which RDIs are established (
Research has shown that package and portion sizes have a considerable impact on the amount of food consumed, and that the size of the package or unit of food can set a consumption norm for consumers; that consumers do not correctly calculate nutrient amounts in food products by multiplying the nutrient amount by the number of servings per container; and that dual-column labeling with the nutrition information given per serving and per package may help certain consumers recognize nutrient amounts per package in certain types of packaged food (79 FR 11998-11999). Therefore, consistent with FDA's Serving Size Final Rule, FSIS is proposing mandatory dual-column labeling on certain packages of meat and poultry products.
FSIS is proposing that meat and poultry products in packages or units that contain at least 200 percent and up to and including 300 percent of the applicable RACC be required to have two columns in the Nutrition Facts label. One column would list the quantitative amounts and percent DVs for the entire package or unit, and the other column would list the quantitative amounts and percent DVs for a serving, based on the amount most closely approximating the RACC, that is less than the entire package or unit (proposed 9 CFR 413.309(b)(4)(iv) and 9 CFR 413.309(b)(16)). FSIS is proposing an upper limit of 300 percent for dual-column labeling based on FDA's analysis that showed that ” providing an upper limit at 300 percent of the RACC would ensure that dual-column labeling captures 90 percent of the consumption habits for about 91 percent of food products and limit the possibility that dual-column labeling will be required for package sizes that are not likely to be consumed in a single eating occasion” (81 FR 34015-34016). Providing nutrition information for these products in dual columns will make it easier for consumers, regardless of whether they consume the entire container or unit in a single eating occasion, consume part of the entire container or unit in a single eating occasion, or share the container or unit, to identify the amount of nutrients consumed without having to perform mathematical calculations.
FSIS is proposing that meat and poultry products in packages that meet the requirements to use a tabular display for small packages or to use a linear format be exempt from the dual-column labeling requirements (proposed 9 CFR 413.309(b)(16)(i)(A)). FSIS is also proposing that products that require further preparation and provide two columns of nutrition information (
FSIS is proposing that the Nutrition Facts label for a meat or poultry product that is packaged and sold individually that contains more than 150 percent and less than 200 percent of the applicable reference amount, may voluntarily provide, to the left of the column that provides nutrition information per container (
RACCs set forth in 9 CFR 317.312(b)-(e) and 381.412(b)-(e) are currently used to determine whether a product meets the criteria for a nutrient content claim (9 CFR 317.313(p) and 381.413(p)). Consistent with the FDA Serving Size Final Rule, if nutrition information is presented on a per serving basis and on a per container or unit basis (
FSIS currently allows by policy the use of an ounce unit in the serving size,
Current FSIS regulations require the serving size to declare the as-packaged amount in accordance with 9 CFR 317.309(b)(3) and 381.409(b)(3). Consistent with 21 CFR 101.9(b)(7)(v), proposed 9 CFR 413.309(b)(9)(5) would permit the serving size to include the finished product amount as part of the serving size when water or other ingredients with insignificant amounts of nutrients are instructed to be added during preparation. For example, when the consumer is directed to add a specific amount of water to prepare a condensed soup, the serving size may state “
Currently, FSIS requires the serving size for a product marketed for two different purposes,
The current RACCs for meat and poultry products are listed in 9 CFR 317.312 and 381.412, respectively. The RACCs represent the amount of food customarily consumed per eating occasion and are listed by product categories. The RACCs and product categories are used as the basis for determining serving sizes for specific products. The current RACCs were primarily derived from the 1977-1978 (
FSIS analyzed the recent consumption data from the NHANES 2003-2008 surveys using Statistical Analysis Systems (SAS)
FSIS is proposing to combine the tables containing the RACCs for infant and toddler foods that exist in 9 CFR 317.312 for meat products and 9 CFR 381.412 for poultry products into a new table for meat and poultry products in proposed 9 CFR 413.312 for infants and children 1 through 3 years of age. FSIS is also proposing to add a third column titled “label statement” to the RACC table to provide examples of how the “label statement” may appear in the Nutrition Facts label as a formatted serving size and to parallel the FDA proposed RACC table 1 (21 CFR 101.12(b)). The titles of the combined product categories would stay the same, except the combined product category for meat sticks and poultry sticks would be titled “Plain meats, plain poultry, meat sticks, poultry sticks, ready to serve.”
FSIS is also proposing to change the RACC from 60 g to 110 g for the product category “Dinners, ready-to-serve, strained type.” The 2003-2008 median intake estimates for dinner, ready-to-serve, strained type poultry was 101.8 g, and dinner, ready-to-serve, strained type, meat was 88.9 g. FDA, which regulates products containing less than 2% cooked meat or poultry, and less than 3% raw meat, increased the RACC for the comparable product category, “Dinner, desserts, fruits, vegetables, or soups, ready-to-serve, strained type” from 60 g to 110 g. The 2003-2008 median intake estimates for these two product categories was 104 g and 103 g, respectively. The products in these FDA regulated product categories are comparable to the FSIS regulated product category, “Dinner, ready-to-serve, strained type, poultry” and “Dinner, ready-to-serve, strained type meat”, because all of the products have similar type usage and product characteristics as strained baby foods. In addition, the current RACC for “Dinner, soups, ready-to-serve junior type” is 110 g, and the same RACC for both strained type and junior baby foods would help consumers compare nutrition information.
FSIS is also proposing to update the footnotes to proposed RACC Table 1 as follows: Footnote 1 would be updated to include new data sources, footnote 2 would be updated to include “brown and serve” as a type of “almost ready-to-serve” product and to include “(
FSIS is proposing to combine the tables containing the RACCs for the general food supply that currently exist in 9 CFR 317.312 for meat products and 9 CFR 381.412 for poultry products into a new table for meat and poultry products in proposed 9 CFR 413.312. FSIS is proposing to include a third column titled “label statement” in the new RACC table for meat and poultry products. The “label statement” column, which provides similar examples to what FDA provides in FDA RACC table 2 (21 CFR 101.12(b), provides examples of how serving size statements may appear in the Nutrition Facts label as a formatted serving size. For example, the RACC for a raw poultry cut is 114 grams but the formatted serving size in the Nutrition Facts label would be based on instructions in proposed 9 CFR 413.309(b), for example, 4oz (112g).
FSIS is also proposing to change some of the RACCs and product categories, establish new product categories for the general food supply, and update the footnotes to RACC table 2 as follows.
In the product category “Egg mixtures (western style omelet, soufflé, egg foo young),” FSIS is proposing to combine the meat and poultry categories for egg mixtures into one product category. The new name for the product category would be “Egg mixtures with meat or poultry;
FSIS is proposing to combine the meat and poultry categories for luncheon meat into one product category as follows, “Luncheon products, luncheon meat, bologna, poultry bologna, Canadian style bacon, poultry Canadian style bacon, meat or poultry pattie crumbles, blood pudding, meat or poultry luncheon loaf, old fashioned loaf, berlinger, bangers, minced luncheon roll, thuringer, liver sausage, mortadella, uncured sausage (franks), ham and cheese loaf, P&P loaf, scrapple souse, head cheese, pizza loaf, olive loaf, pate, deviled ham, sandwich spread, teawurst, cervelat, Lebanon bologna, potted meat or poultry food product, taco fillings, pie fillings.” Luncheon meat and luncheon products made with poultry are comparable products with similar dietary usage and product characteristics. The same RACC will help consumers compare nutrition information between these products.
FSIS is proposing to combine the meat and poultry categories for entrees without sauce into one product category as follows, “Entrees without sauce;
FSIS is proposing to combine the meat and poultry categories for mixed dishes not measurable with a cup into one product category as follows, “Mixed dishes NOT measurable with a cup;
FSIS is proposing to combine the meat and poultry categories for mixed dishes measurable with a cup into one product category as follows, “Mixed dishes measurable with a cup;
FSIS is proposing to combine the meat and poultry categories for “Salads-all other” into one product category as follows, “Salads—all other meat salads, all other poultry salads;
FSIS is proposing to combine the meat and poultry categories for “Soups-all varieties” into one category as follows, “Soups with meat or poultry-all varieties.” Soups made with meat and soups made with poultry are comparable products with similar dietary usage and product characteristics. The same RACC (245g) will help consumers compare nutrition information between these products.
FSIS is proposing to create a new product category “Appetizers, hors d'oeuvres, Mini mixed dishes with meat or poultry;
FSIS is proposing to create a new category “Appetizers, hors d'oeuvres—Dips with meat or poultry;
FSIS is proposing to create a new product category “Candies with meat or poultry;
FSIS is proposing to combine the separate canned meat and poultry categories into one product category as follows, “Canned Meats (
FSIS is proposing to include pork back fat into the category for “Bacon” with the category name of “Bacon;
FSIS is proposing the following category names for the combined meat and poultry product categories that have the same RACC values and did not meet any of the factors for updating the RACCs: “Salad and potato toppers;
FSIS is proposing to update the footnotes to proposed 9 CFR 413.312 Table 2 as follows: Footnote 1 will be updated to include new data sources and to clarify that the RACC values presented in the table are for the “edible portion” of the food, and Footnote 6 will be added to explain the purpose and use of the “label statement” column.
Currently, 9 CFR 317.309(h) and 381.409(h) provide information about how FSIS determines compliance with its nutrition labeling requirements, including the methods of analysis used, reasonable excesses and deficiencies of nutrients, acceptable levels of variance from declared values, and records requirements. FSIS is proposing to consolidate 9 CFR 317.309(h) and 381.409(h) into a single section (proposed 9 CFR 413.309(h)). The following discusses the additional revisions that FSIS will be proposing in 9 CFR 413.309(h), as compared to current 9 CFR 317.309(h) and 381.409(h).
Proposed 9 CFR 413.309(h)(5) establishes that a meat or poultry product with a label declaration of calories, sugars, added sugars (when the only source of sugars in the food is added sugars), total fat, saturated fat, cholesterol, or sodium shall be deemed to be misbranded under sections 1(n) of the FMIA (21 U.S.C. 601(n)(1)) or 4(h) of the PPIA (21 U.S.C. 453(h)) if the nutrient content of the composite is greater than 20 percent in excess of the value for that nutrient declared on the label. However, no regulatory action will be based on such a determination if the excess is less than the inherent nutrient variation in a product or the variability generally recognized for the analytical method used in that product at the level involved. FSIS is not proposing to change the level of variance allowed for the label declaration of nutrients.
Under proposed 9 CFR 413.309(h)(2), a sample for nutrient analysis must consist of at least six consumer units, each from a production lot, or alternatively, chosen randomly to be representative of a production lot. In each case, the units may be individually analyzed, and the results averaged, or the units may be combined, and the composite analyzed. FSIS will consider the results—whether the average or the single result from the composite—to be the nutrient content of the composite. All analyses must be performed, if possible, by the appropriate methods and procedures used by the U.S. Department of Agriculture (USDA) for each nutrient in accordance with the “Chemistry Laboratory Guidebook.” If no USDA method is available, the appropriate methods for the nutrient in accordance with the 2016 edition of the “Official Methods of Analysis” of the AOAC International, 20th ed., must be used, unless a particular method of analysis is specified in 9 CFR 413.309(c). If no USDA, AOAC, or specified method is available or appropriate, any other reliable and appropriate analytical procedures may be used, as determined by FSIS. The current edition (20th ed.) of the “Official Methods of Analysis” includes many updates to the 15th edition.
When FSIS issued 9 CFR 317.309(h) and 381.409(h) on compliance with nutrition labeling requirements, the most current version of the AOAC methods was its 15th edition, and, therefore, FSIS identified the 15th edition in its regulation. Newer and better methods of analysis have since been validated and recognized as “official” methods in the current 20th edition. Accordingly, FSIS is proposing, in 9 CFR 413.309(h)(2), to use the 20th edition and incorporate it by reference in 9 CFR (h)(9)(i). The “Official Methods of Analysis of AOAC International” is a comprehensive collection of chemical and microbiological methods of analysis. The Official Methods of Analysis have undergone rigorous scientific review and validation to determine the performance characteristics for the intended analytical application and fitness for purpose. Each method includes specific instructions for performing the chemical analysis of a substance in a particular matrix. If a newer edition of the Official Methods of Analysis is published before issuance of a final rule, FSIS intends to finalize this rule with the newer edition, as appropriate, provided there are no substantive changes in the newer edition requiring additional comment.
FSIS does not currently sample or conduct routine nutrient analyses of products for regulatory purposes because FSIS has not, in the past, found gross non-compliance with the nutrition labeling requirements (
FSIS will explore its regulatory options, including seeking criminal penalties or rescinding label approvals, if it discovers a violation of the nutrition labeling requirements. In addition, FSIS will consider when additional surveillance sampling for nutrient content should be conducted for various products, as well as when regulatory verification testing should occur.
Currently, FSIS regulations require that establishment management maintain records to support the validity of nutrient declarations contained on meat and poultry product labels (9 CFR 317.309(h)(8) and 381.409(h)(8)). Such records are required to be made available to the inspector or any duly authorized representative of FSIS upon request (9 CFR 317.309(h)(8) and 381.409(h)(8)). These records are generally required to be retained for 2 years (9 CFR 320.3 and 381.177). FSIS is proposing to consolidate the requirements in 9 CFR 317.309(h)(8) and 381.409(h)(8) into proposed 9 CFR 413.309(h)(8).
As discussed in sections II.E.5.a. (dietary fiber), II.E.5.b. (soluble and insoluble fiber), II.E.3. (added sugars), II.J.2. (vitamin E), and II.J.3. (folate), there are no suitable analytical procedures for measuring the following nutrients under the circumstances described: (1) Dietary fiber (when non-digestible carbohydrates that do and do not meet the proposed definition of dietary fiber are both contained in a food product); (2) soluble fiber (when a mixture of soluble fiber and non-digestible carbohydrates that do not meet the definition of dietary fiber is present in a food); (3) insoluble fiber (when a mixture of insoluble fiber and non-digestible carbohydrates that do not meet the definition of dietary fiber is present in a food); (4) added sugars (when a food product contains both naturally occurring sugars and added sugars); (5) vitamin E (when a food product contains both RRR-α-tocopherol and all rac-α-tocopherol); and (6) folate (when a food product contains both folate and folic acid).
Because there are no reliable or appropriate analytical procedures available for FSIS to ensure that the declared nutrient amount for certain nutrients is truthful, accurate, and in compliance with all applicable labeling requirements, FSIS is proposing to require specific recordkeeping for certain nutrients. FSIS is proposing to require that manufacturers make and keep written records to verify the declaration of: (1) The amount of added non-digestible carbohydrates that do not meet the proposed definition of dietary fiber when the dietary fiber present in a food is a mixture of dietary fiber and non-digestible carbohydrates that do not meet the definition of dietary fiber (proposed 9 CFR 413.309(h)(8)(i)); (2) the amount of added non-digestible carbohydrates that do not meet the proposed definition of dietary fiber when the food contains a mixture of soluble fiber and non-digestible carbohydrates that do not meet the definition of dietary fiber (proposed 9 CFR 413.309(h)(8)(ii)); (3) the amount of added insoluble non-digestible carbohydrates that do not meet the proposed definition of dietary fiber when the food contains a mixture of insoluble fiber and non-digestible carbohydrates that do not meet the definition of dietary fiber (proposed 9 CFR 413.309(h)(8)(iii)); (4) the amount of added sugars added to the food during the processing of the food, and if packaged as a separate ingredient, as packaged (whether as part of a package containing one or more ingredients or packaged as a single-ingredient), when both naturally occurring and added sugars are present in a food (proposed 9 CFR 413.309(h)(8)(iv)); (5)(a) scientific data and information that demonstrate the amount of added sugars in the food after non-enzymatic browning or fermentation and a narrative explaining why the data and information are sufficient to demonstrate the amount of added sugars declared in the finished food, provided the data and information used is specific to the type of food manufactured; or (b) records of the amount of sugars added to the food before and during the processing of the food, and if packaged as a separate ingredient, as packaged (whether as part of a package containing one or more ingredients or packaged as a single ingredient) and in no event shall the amount of added sugars declared exceed the amount of total sugars on the label (proposed 9 CFR 413.309(h)(8)(v); (6) the amount of all rac-α-tocopherol added to the food and RRR-α-tocopherol in the finished food when a mixture of both forms of vitamin E is present in a food (proposed 9 CFR 413.309(h)(8)(vi)); and (7) the amount of synthetic folate or folic acid added to the food and the amount of naturally-occurring folate in the finished food, when a mixture of folate and folic acid is present in a food (proposed 9 CFR 413.309(h)(8)(vii)).
Most manufacturers should already have the types of records needed to validate the declared amount of each nutrient. They are in the best position to know which records will contain the information necessary for FSIS to determine compliance. These records may include analyses of databases, recipes or formulations, or batch records. FSIS recognizes that the nutrient profile of processed foods that have dietary fiber, soluble fiber, insoluble fiber, added sugars, vitamin E, or folate/folic acid can vary depending on the recipe or formulation, the suppliers of ingredients, and other factors. Although the nutrient levels in foods may change if a manufacturer changes ingredient suppliers or recipes, manufacturers still need to ensure that the records they maintain substantiate the nutrient composition of the specific food. Therefore, manufacturers must be able to distinguish among the same or similar products they have in the marketplace that may contain differing amounts of a declared nutrient. The records required under proposed 9 CFR 413.309(h)(8) must be available for review and copying while the product is available for purchase in the marketplace. There is a wide range of shelf lives among food products. The current retention period for nutrition labeling records under 9 CFR 320.3 and 381.177—a period not to exceed two years after December 31 of the year in which the transaction to which the record relates has occurred—will be sufficient to enforce the nutrient declarations on the nutrition labels.
Potassium is currently the only vitamin or mineral specified as a Class I and Class II nutrient in 9 CFR
The labeling requirements for Class I and Class II nutrients are provided in proposed 9 CFR 413.309(h)(4). For the reasons discussed in section II.E.6., FSIS is proposing to omit the provision for voluntary declaration of “Other carbohydrate” in proposed 9 CFR 413.309(c)(6) that is in 9 CFR 317.309(c)(6)(iv) and 381.409(c)(6)(iv). Therefore, FSIS is proposing to omit the compliance requirements related to “Other carbohydrate” in proposed 9 CFR 413.309(h)(4) and (h)(6) that are in 9 CFR 317.309(h)(4) and (h)(6) and 381.409(h)(4) and (h)(6)).
Dietary fiber is included as both a Class I and Class II nutrient because food products may contain only non-digestible carbohydrates that meet the definition of dietary fiber and that may be naturally occurring or that may be added to fortified or fabricated foods. The same is true for soluble and insoluble fiber, yet these nutrients are not currently listed as Class I or Class II nutrients (see 9 CFR 317.309(h)(4) and 381.409(h)(4)). Therefore, FSIS is proposing to include dietary fiber in 9 CFR 413.309(h)(4) as both a Class I and Class II nutrient.
Currently, 9 CFR 317.309(h)(5) and 381.409(h)(5) (consolidated in proposed 9 CFR 413.309(h)(5)) specify that a food with a label declaration of calories, sugars, total fat, saturated fat, cholesterol, or sodium is deemed to be misbranded under section 1(n) of the FMIA (21 U.S.C. 601(n)(1)) or 4(h) of the PPIA (21 U.S.C. 453(h)) if the nutrient content of the composite is greater than 20 percent in excess of the value for that nutrient declared on the label. The nutrients listed in this section can have a negative impact on health in the general U.S. population if consumed in excess, and there are current dietary recommendations to reduce the consumption of these nutrients. Therefore, FSIS is ensuring in proposed 9 CFR 413.309(h)(5) that foods do not contain excessive amounts of these nutrients of which the consumer is unaware.
Current dietary recommendations acknowledge that Americans consume excess amounts of added sugars and encourage reducing intake of calories from added sugars. A FSIS has an interest in ensuring that foods do not contain excessive amounts of added sugars that are not declared on the label (see section II.E.3) and is proposing to include added sugars in 9 CFR 413.309(h)(5). In some food products, all of the sugars are added. In such cases, an analytical method could be used to determine the amount of added sugars, and the permitted analytical variability would be applicable. Accordingly, FSIS is proposing to include “added sugars (when the only source of sugars in the food is added sugars)” among the list of nutrients in proposed 9 CFR 413.309(h)(5).
Reasonable excesses or deficiencies in relation to certain declared nutrients are acceptable within current good manufacturing practice. FSIS is proposing to allow reasonable excesses over the labeled amount of soluble and insoluble fiber and sugar alcohols when they are acceptable within current good manufacturing practice, and reasonable deficiencies under labeled amounts of added sugars when they are acceptable within current good manufacturing practice (proposed 9 CFR 413.309(h)(6)). FSIS expects that when a food product only contains added sugars, when all of the dietary fiber (both soluble and insoluble) is added non-digestible carbohydrates that meet the definition of dietary fiber, when all of the vitamin E is all rac-α-tocopherol, and when only folic acid is present in a food, the declared amount must be at least equal to the amount of the nutrient added to the food.
In summary, FSIS is proposing the following changes related to compliance in 9 CFR 413.309(h) as compared to current 9 CFR 317.309(h) and 381.409(h): (1) Cite the 20th edition of the Official Methods of Analysis of the AOAC International and incorporate it as the reference for the appropriate methods used to determine compliance with amounts of nutrients declared on the Nutrition Facts label (proposed 9 CFR 413.309(h)(2) and (h)(9)(i)); (2) establish general recordkeeping requirements when records are necessary to verify information related to dietary fiber, soluble and insoluble fiber, added sugars, folate, and vitamin E provided on the label (proposed 9 CFR 413.309(h)(8)); (3) omit a specific reference to potassium in proposed 9 CFR 413.309(h)(4)(i-ii) and (h)(6) such that any listing of potassium on the Nutrition Facts label would meet the specific compliance requirements for minerals under proposed 9 CFR 413.309(h)(4) and (h)(6); (4) include dietary fiber, under proposed 9 CFR 413.309(h)(4); (5) include added sugars within proposed 9 CFR 413.309(h)(5) such that the label declaration of added sugars will be deemed misbranded under sections 1(n) of the FMIA (21 U.S.C. 601(n)(1)) or 4(h) of the PPIA (21 U.S.C. 453(h)) if the nutrient content of the composite is greater than 20 percent in excess of the added sugars declared on the label, and within proposed 9 CFR 413.309(h)(6) such that reasonable deficiencies of added sugars would be permitted; (6) include soluble and insoluble fiber and sugar alcohols within proposed 9 CFR 413.309(h)(6) such that reasonable excesses of these nutrients would be permitted; and (7) consistent with the tentative conclusion in section II.E.6., omit references to “Other carbohydrate” in proposed 9 CFR 413.309(h).
FSIS is proposing to update the name of Food Labeling Division in proposed 9 CFR 413.312 and 413.369 to the Labeling and Program Delivery Staff, Office of Policy and Program Development. FSIS is also proposing to update the docket room address in proposed 9 CFR 413.309.
Proposed 9 CFR 413.400(a)(1)(ii) is updated to remove compliance criteria that expired in July 1997.
FSIS is proposing to update the cross-references to parts 317 and 381 in sections 301.2, 304.2, 316.8, 316.11, 316.13, 317.16, 318.10, 319.1, 319.10, 320.1, 327.15, 362.2, 381.172, 381.2, and 412.2.
Executive Orders 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This proposed rule has been designated an “economically significant regulatory
The USDA began requiring nutrition and serving size information on food labels in the early 1990's (58 FR 632). The requirements were intended to provide producers with a credible way of communicating nutrient related information to consumers and ensure consumers had access to the necessary information for maintaining a healthy diet. Today, nearly 80 percent of U.S. adults report using nutrition labels at least some of the time,
Government labeling requirements provide producers with a credible way to communicate product attributes that are not obvious to consumers,
As is shown on Graph 1, from 1971—2010, mean energy intake increased by 240 kcal/day
Of those U.S. adults who rarely or never use Nutrition Facts labels, over 31 million of them are overweight or obese; conditions linked to increased incidence of coronary heart disease, stroke, type 2 diabetes, cancer, and high blood pressure. For perspective, overweight and obese individuals spend 10 and 43 percent more money on health care as compared to normal weight individuals, respectively.
A daily energy surplus of 50-100 kcals will lead to overweight and
These modest reductions are known to lead to significant benefits in the form of weight loss, health improvements, and reduced medical expenditures.
In total, the USDA and FDA regulate roughly 50,000
FSIS estimates that there are roughly 50,000 different retail nutrition labels for meat or poultry products, roughly 25 percent of which are private labels (store brand). The Agency estimates that FSIS products are produced by 3,307 establishments, of which, 3,125 are considered either small or very small establishments. The number of labels and establishments is based on Information Resources, Incorporated (IRI) scanner data
There are almost 50 million adults who rarely or never use the Nutrition Facts label. Of this population, nearly 32 million are overweight, are obese, or have hypertension, Table 11 and 12. FSIS estimated this proposed rule would impact a portion of these consumers by increasing the usability of nutrition labeling which will, in turn, improve their health and welfare.
Quantitative costs for the proposed rule include relabeling, recordkeeping, and reformulation costs. FSIS anticipates allowing a 24-month compliance period with a 36-month compliance for small businesses,
United States Small Business Administration (SBA), Table of Small Business Standards Matched to North American Industry Classification System Codes. Effective February 26, 2016. Available at
The combined expected annualized costs equal $10.8 million annualized at a 3 percent rate over 20 years. The one-time costs, staggered over the first three years, are $165,540,072. In addition, consumers will incur costs associated with learning how to use new labels, which is a form of qualitative costs. What follows are details for each of the quantitative costs.
To estimate the costs associated with relabeling products under USDA jurisdiction, this analysis utilized the 2014 FDA Labeling Cost Model
Using SBA's small business definition of small business and IRI scanner data, FSIS estimates 53.6 percent of UPCs are from small businesses and 46.4 percent of UPCs are from large. The 26,859 UPCs (53.6 percent of 50,110) from small manufacturers have 36 months to comply with the proposed regulations and the 23,251 (46.4 percent of 50,110) from large manufacturers will have 24 months to comply. In total, there are 6,778 private labels (12,645 × 53.6%) and 20,081 branded labels (37,465 × 53.6%) for small businesses, and 5,867 private labels (12,645 × 46.4%) and 17,384 branded labels (37,465 × 46.4%) for large businesses. The Small Business Administration (SBA) defines a small business in NAICS code 311611—Animal (except Poultry) Slaughter and NAICS code 311612—Meat Processed from Carcasses as having less than 1,000 employees.
To adjust for inflation in the 2014 FDA Labeling Cost Model, we updated the wage rates using the most current (2015) wages and applied a benefits and overhead factor of two to estimate the total cost per type of label change. The cost estimates in 2015 U.S. Dollars (USD) are $572 per label (with a range of $141 to $1,620) for minor coordinated changes and $3,887 per label (with a range of $1,842 to $7,741) for minor uncoordinated changes (FDA Labeling Cost Model, 2014). The cost estimates in 2015 USD are $1,152 per label (with a range of $296 and $3,204) for major coordinated changes and $9,401 per label (with a range of $5,125 to $17,400) for major uncoordinated changes. The cost estimate in 2015 USD is $13,858 per label (with a range of $7,038 and $25,399) for both coordinated and uncoordinated extensive changes.
Based on FDA's Labeling Cost Model, the majority of the label changes required by the proposed rule are considered minor. Minor changes are categorized as alterations that do not require the entire label to be redesigned,
Over 24 percent of the labels will undergo a major change; 22.8 percent (11,432/50,110) for the dual column and 1.6 percent (805/50,110) for removing a front of package (FOP) health or nutrient claim in response to changes in the DVs, RACCs, or the definition of dietary fiber, Table 3. The estimate of products requiring a dual column label was determined using IRI scanner data and identifying packaged products containing between 200 to 300 percent of the RACC. From this group, packaged products that required further processing before consuming or that are traditionally eaten in combination with other products, such as raw meat, poultry, and condiments, were excluded as they are exempted from the dual column labeling requirements. Alterations of health and nutrient claims were dependent on updates in Daily Values, RACCs, or the definition of dietary fiber.
Extensive changes are changes for products that may increase their package size to continue to make a health or nutrient content claim in response to the change in definition of a single-serving container. The proposed rule requires products that have RACCs of 100 g or larger and are packaged such that they contain more than 150 percent but less than 200 percent of the RACC to be defined as a single-serving container. Using IRI scanner data, we identified the UPCs with RACCs over 100 g that contain more than 150 percent but less than 200 percent of the RACC and that make a health or nutrient content claim. Based on these criteria, we estimate 13 UPCs may have an extensive change due to increasing the package size to continue to make a health or nutrient content claim. See Table 3 below for details.
As shown in Table 4—Label Changes That Can Be Coordinated with a Planned Change, private (store brand) labels change less frequently than branded labels. Allowing a producer to coordinate a required label change with a planned change saves costs associated with recordkeeping, labor, and materials. As such, under a 24 month compliance period for large businesses, changes to all branded labels will be coordinated with another planned label change. However, for private (store brand) labels only 26 percent will be coordinated with another change, and 74 percent will be uncoordinated. Allowing small businesses 36 months to comply, all branded products can coordinate a change and 57 percent of private labels can coordinate the label changes, Table 4—Label Changes That Can Be Coordinated with a Planned Change. As a result, the mid-point annualized cost at a 3 percent discount rate over 20 years for updating all of the labels under USDA jurisdiction is estimated to equal $4,484,734, with an average per label one-time cost of $1,371, Table 5. The total one-time cost, staggered over the total 36-month compliance period, is $68,723,156 with a range of $26,933,776 to $159,581,369.
This proposed rule requires that under certain circumstances manufacturers must maintain additional records to verify the amount of added sugars, dietary fiber, soluble fiber, insoluble fiber, vitamin E, and folate/folic acid in products. Thus, if adopted, manufacturers will be required to maintain records sufficient to verify the label declaration for these nutrients. Examples of appropriate retained records include nutrient database analyses, nutrient database calculation based on recipes or formulations, batch records, or any other information a
We assume that manufacturers currently have records for added sugars, dietary fiber, soluble fiber, insoluble fiber, vitamin E, and folate/folic acid. However, the proposed changes will require manufacturers to maintain these records and verify as needed. Thus, the recordkeeping cost is the initial time burden for meat and poultry product manufacturers to maintain these records to verify the amount of such nutrients in a food and to make such records available to appropriate regulatory officials upon request. From IRI scanner data, we estimate there are roughly 3,307 manufacturers making products regulated by FSIS. The declaration of Vitamin E and folate/folic acid is not mandatory unless accompanied with a nutrient claim. However, consistent with FDA's Final RIA, FSIS estimates each manufacturer would incur six hours of recordkeeping burden, one hour for each nutrient, resulting in 19,842 recordkeeping hours for the industry as a whole. This estimate is likely an overestimate as not all manufacturers will need to keep records for added sugars, dietary fiber, soluble fiber, vitamin E, and folate/folic acid. According to the Bureau of Labor Statistics, Occupational Employment and Wages, the median hourly wage of an operations manager is $46.99
The proposed rule could motivate food manufacturers to reformulate their products. Food manufacturers may reformulate their products due to the increased visibility of added sugars or to maintain a health or nutrient content claim driven by a change in the Daily Values or RACC and changes in the definition of dietary fiber. We estimate reformulation costs associated with each group in the sections below. Note that we do not anticipate reformulation costs for mandating
Consistent with FDA, the Agency estimated costs using the 2014 FDA Reformulation Cost Model.
The compliance period used in our estimate is 24 months for all businesses, as an estimate for a 36-month compliance period for a small business is not available in the model. The model only estimates the cost for small businesses at the 12 or 24-month compliance period and at the 12, 24 or 36 month for large businesses. Therefore, the reformulation cost estimates is an overestimate.
To adjust for inflation in the 2014 Reformulation model, we adjusted the wage rates using the most current (2015) Consumer Price Index for All Urban Consumers and applied a benefits and overhead factor of two to estimate the total cost per formula. The cost per formula ranges from $4,723 to $361,371 for a high complexity product, $2,898 to $361,371 for a medium complexity product, and $2,264 to $338,918 for a low complexity product. The cost varies by the size of company, with large and medium businesses having higher costs per formula than small businesses.
The proposed rule emphasizes the amount of sugar in a product by requiring a label to declare both the amount of “Total Sugar” and “Added Sugars” with a Daily Reference Value (DRV) for added sugars of 10 percent of calories.
FSIS does not estimate that manufacturers would reformulate all 10,518 products because reformulation is voluntary and can be quite expensive. We assume 7.5 to 9 percent (8.25%) of all formulas with high sugar content will reformulate, which is consistent with FDA's assumptions.
The proposed rule would disqualify some products from bearing a health or nutrient claim as a result of changes in the RACC categories, changes in Daily Values for certain vitamins and minerals, and modifications to the definition of fiber to exclude certain isolated and synthetic fibers from the definition. As a result, manufacturers of these products would either have to remove the claim from the product's label or reformulate in order to continue to make the claim.
1. Reformulate due to DV change—A Beef Tomato Sauce with 12 mgs of vitamin C makes a “High in Vitamin C” claim since it meets the claim requirement of 20 percent or more of the Vitamin C RDI per RACC. By increasing the Vitamin C RDI from 60 mg to 90 mg, the product can no longer make the claim.
2. Reformulate due to New Fiber definition—A product with mostly synthetic fiber is making an “excellent source of fiber” fiber since certain synthetic and isolated fibers are included in the fiber definition. By removing some synthetic fibers from the fiber definition, the product can no longer make the claim.
To determine the reformulation cost related to RACC changes, the Agency used IRI scanner data and identified 62 products with new or changing RACC categories with a health or nutrient claim (
The mean one-time cost for reformulation is $77,294,020, with an average per formula one-time cost of $77,009. The annualized cost at a 3 percent discount rate over 20 years for reformulation is $6,196,385, with a range of $2,908,387 to $10,019,460. One-time reformulation costs are $94,952,165 with a range of $44,567,540 to $153,536,199. See Table 9 below for a summary of the estimated reformulation cost in 2015 dollars.
By ensuring that recommendations are based on current dietary guidelines and making the most salient information prominent, the proposed rule will benefit the nearly 186 million Americans who frequently or sometimes use nutritional facts and serving size labels. However, this Preliminary Regulatory Impact Analysis (PRIA) limits the quantitative benefits to the medical costs savings for overweight or hypertensive adults who report not using or rarely using Nutrition Facts labels that are expected to experience health benefits with increased label use and modified diet. The annual present value of benefits at a 3 percent discount rate over 20 years is estimated at $36,894,007. A detailed description of this analysis follows.
As noted in the Need for Rule section above, a significant portion of U.S. citizens are overweight, obese, or hypertensive. Such conditions afflict individuals and society with poorer health and higher medical expenditures. It is well established that improved nutrition reduces overweight, obesity, and hypertension rates, which in turn reduces medical expenses.
In this analysis, quantified benefits are a measure of expected health improvements resulting from increased label-use, causing diet modification for some overweight and hypertensive adults. The benefits analysis can be broken down into a series of steps. The first step is determining the baseline caloric and sodium intake for consumers by label-use. The second step is estimating the number of consumers who could potentially change their behavior from increased label-use because of this rule. The third step is estimating the change in diet from increased label-use. The final step is measuring the medical cost savings benefit using the Dall et al. (2009), Nutrition Impact Model, which links the health benefits and medical cost savings from reductions in caloric and sodium intake. A description of each step in the benefits analysis is given in this section.
The first step in this analysis is to determine the baseline relationship between caloric and sodium intake with label-use. To determine this relationship, FSIS used NHANES data to correlate use of nutritional and serving size labels with caloric and sodium intake. NHANES is a continuous CDC survey with data released in two-year segments. This analysis included data from the 2009-2010 survey. NHANES collects detailed information through questionnaires, dietary recall, and a physical exam. In the Flexible Consumer Behavior Survey (FCBS) section of NHANES, respondents provided information on how frequently they used nutritional and serving size information found on food labels. Also, respondents who reported rarely or never using labels provided reasons for not doing so.
In the dietary recall component, respondents report everything they ate or drank, and where the food was obtained, for two days (two 24 hour periods). Food obtained from a store or catalog was identified as food at home (FAH). This analysis excluded calories consumed away from home, as these foods typically do not include a Nutrition Facts label. Weights were applied to the dataset to account for the survey design (including oversampling of certain groups), survey non-response, and post stratification so that the population totals represent the U.S. Census civilian non-institutionalized adult population.
The baseline links degree of label use, ranging from always to never, with average caloric, sugar and sodium intake, Table 1—Use of Nutritional Facts Label by Average Daily Caloric, Sodium and Sugar Intake from Food at Home. While data limitations prevent establishing causation between label use and behavior, the two are inversely correlated. Revealed in Table 1—Use of Nutritional Facts Label by Average Daily Caloric, Sodium and Sugar Intake from Food at Home, Nutrition Facts label use has an inverse relationship with total caloric, sugar and sodium intake. Based on this information, this analysis assumes if an average consumer who “never” used the Nutrition Facts label began to rarely read labels, they would reduce their daily caloric intake by 187 kcals. For most overweight or obese individuals, a stable daily reduction of 187 kcals would lead to weight loss and corresponding reductions in medical expenditures.
Further, we find as nutritional label usage increases, not only is the average caloric intake reduced, but also the portion of calories from sugar is reduced. For consumers that “never” use the Nutrition Facts label, calories from sugar account for 27 percent of their total at home consumption.
This study monetizes the health benefits derived from adults:
For caloric reduction benefits, we only include overweight individuals who are maintaining or losing weight. This is because the Nutrition Impact Model assumed that all overweight adults are at weight equilibrium and not gaining weight. The overweight and gaining weight adults may not experience weight loss from a small reduction in caloric intake and therefore will not obtain the medical cost savings from weight loss as calculated in the Nutrition Impact Model. The caloric reduction benefits from the model is calculated by a constant reduction in caloric intake below the Estimated Energy Requirement
For adult females: EER = 354 − (6.91 × age) + PAL × (9.36 × weight + 726 × height).
NHANES data identified the number of overweight adults who are maintaining or losing weight that never or rarely use labels, Table 8. An overweight adult maintaining or losing weight has a Body Mass Index (BMI) of 25 or over, aged 16 years or older and consumes calories equal to or less than their Estimated Energy Requirement, EER.
For adult females: EER = 354 − (6.91 × age) + PAL × (9.36 × weight + 726 × height).
For adult males:
For adult females:
For a conservative estimate, the IOM PAL coefficient associated with sedentary activity estimated individuals EER (1.0 for men and women). All other components of the IOM EER calculation (gender, age, weight, height) were derived from NHANES 2009-2010 and calculated using SAS.
Although the same person can experience health costs savings from both caloric and sodium reduction, it may overestimate benefits if using both the caloric and sodium reduction models. Therefore, to avoid double counting for the sodium reduction benefits, the analysis excluded the population benefiting from caloric reduction, overweight rarely and never label-users maintaining or losing weight. The sodium reduction analysis only includes hypertensive individuals who are normal weight or overweight and gaining weight. An estimated 461,384 and 118,705 normal weight hypertensive adults rarely or never use labels, respectively. In addition, an estimated 563,394 rarely and 551,856 never adult label-users are overweight and gaining weight with hypertension. In total, there are 1,024,778 rarely and 670,561 never hypertensive label-users who are normal weight or overweight and gaining weight, Table 12.
While the proposed changes will help many normal weight, non-hypertensive consumers use labels to maintain healthy diets, this analysis does not quantify these benefits.
Identifying the reasons overweight or hypertensive consumers do not read nutritional and serving size information is another important factor in estimating
For the lower bound estimate, only those overweight or hypertensive consumers who exclusively gave “the print is too small for me to read” reason for not reading labels were considered (1 percent) as print size is directly changed by the regulation. The lower bound estimate excludes everyone who did not exclusively give “the print is too small for me to read” as a reason for not reading labels, 99 percent of consumers.
For the upper bound estimate, only those overweight or hypertensive consumers who selected one or more of the following reasons for not reading labels were considered: “the print is too small,” “I won't know what to look for,” and “I don't have time”. This group constitutes approximately 44 percent. The upper bound estimate includes consumers who gave the three above reasons and does not exclude anyone if they gave other reasons for not using labels.
Increasing label use does not necessarily lead to a change in behavior. Our analysis further refines the benefits analysis by estimating only a portion of the overweight or hypertensive rarely/never label-users increasing their label use will potentially change their diet. This estimate was derived from data in the FDA 2008 Health and Diet Survey. In 2008, FDA asked consumers “In the last two weeks, can you remember an instance where your decision to buy or use a food product was changed because you read the nutrition label?” and 49 percent of respondents said yes.
FSIS assumed that the population expected to change its behavior will do so by moderately increasing its label-use from either never to rarely or rarely to sometimes. The expected diet change is the difference in caloric and sodium intake between each user group. Accordingly, the mid-point estimate of 259,376 overweight consumers who never use the Nutrition Facts label could potentially begin to rarely use labels and reduce their daily caloric intake by 187 kcals (1,741−1,554). The mid-point estimate of 609,005 overweight consumers who rarely use the Nutrition Facts label could potentially begin to use labels sometimes and reduce their caloric intake by 92 kcal (1,554−1,462). The same formula is followed for the normal weight consumers with hypertension resulting in a 87 mg daily sodium reduction for the 32,857 former never label-users and 104 mg reduction for 50,214 former rarely label-users.
To quantify the medical cost savings from reductions in caloric and sodium intake, FSIS used the Nutrition Impact Model developed by Tim Dall et al. (2009). The Nutrition Impact Model estimates the potential health benefits of weight loss by reducing daily caloric intake for overweight adults.
The Nutrition Impact Model also estimates the benefits of sodium reduction in adults with hypertension. The model combines these benefits to estimate national medical costs savings from changes in dietary habits among the general adult population. The model concludes modest to aggressive changes in diet can improve health and reduce annual national medical expenditures by $60 to $120 billion.
The Nutrition Impact Model used scientific reports and peer-reviewed literature to quantify the relationships between dietary change, body mass index, and blood pressure (Systolic BP/Diastolic BP) and between these same factors and disease risk. By modeling the reduction in health conditions associated with long-term improved nutritional intake, the model can measure the potential health conditions averted by reducing daily caloric and sodium intake in the American diet. For example, weight loss can improve or prevent many diseases risks such as cancer and diabetes, resulting in a medical savings. The benefits of caloric reductions in overweight adults is measured by the medical savings of reductions in the following health conditions; arthritis, asthma, cancer, cerebrovascular disease, congestive heart failure, coronary heart disease, diabetes, esophagus/stomach disease, gallbladder disease, gynecological conditions, kidney/urinary disease, other cardiovascular disease, and sleep apnea. The benefits of sodium reductions are measured by the medical savings of reductions in hypertension cases. Some health conditions are jointly attributed to multiple risk factors.
For caloric reductions benefits, the Nutrition Impact Model begins to calculate the benefits starting in the fourth year of diet as weight loss is more
As displayed in Table 13, our analysis expects potentially 259,376 overweight adults to reduce their total caloric intake by 187 kcal and 609,005 adults to reduce their total caloric intake by 92 kcal as the mid-point estimate. The Nutrition Impact Model estimates a 92 kcal reduction could potentially result in $55 billion of annual medical savings after 4 years or $395.68 ($55B/139M) dollars per person. For a 187 kcal reduction, the potential annual medical savings is $84 billion or $575.54 ($84B/139M) per person after four years. Table 13 provides details of the distribution of increased label users, associated reductions in calories, and potential savings.
Recognizing that individuals will benefit from both improved FDA and FSIS labels, this analysis took additional steps to distill out benefits specific to FSIS products with Nutrition Facts labeling. First, our analysis scaled down the estimate by only including the average caloric and sodium intake of FSIS products for adults. Using Table 1B—Mean Intake of Energy and Mean Contribution (KCAL) of Various Foods among U.S. Population by Age from the National Cancer Institute,
In addition, although the analysis only incorporates sodium and caloric intake from food at home, some meat and poultry products are exempt from nutrition labeling, and therefore removed from the benefits analysis. As discussed in the cost section above, we estimate approximately 11.95 percent (30.64% * 39%) of food-at-home meat and poultry products are exempt from nutrition labeling. Therefore, our analysis further scales back the benefits estimate first by removing 81.9 percent for the kcal intake of FDA products and second by removing 11.95 percent for the FSIS products exempt from nutrition labeling. This results in the mid-point annual benefits of $79,173,871 (496M * (100% − 81.9%) * (100% − 11.95%)) for caloric reduction. The lower bound estimate is $7,917,474 and upper bound estimate is $348,365,416, Table 13.
While the benefits of caloric reduction weight-loss are measured at year four in the Nutrition Impact Model, sodium reduction benefits are experienced right away. In most individuals, blood pressure is reduced within days to weeks of reducing sodium intake.
As displayed in Table 14, our mid-point estimate expects 32,857 adults with hypertension to reduce their sodium intake by 87 mg for food at home, and 50,214 adults with hypertension to reduce their sodium intake by 104 mg for food at home. The Nutrition Impact Model estimates a 104 mg daily sodium reduction for all adults with hypertension results in $1.17B dollars of annual medical savings, or $27.86 ($1.17B/42M) dollars per person. For an 87 mg daily sodium reduction for all adults with hypertension, the potential annual medical savings are $1.11B, or $26.43 ($1.11B/42M) per person.
As calculated with the caloric benefits, our analysis scaled down the estimate for sodium reduction benefits by only incorporating the average sodium intake of FSIS products with labeling for adults. Using Table 1B—Mean Intake of Sodium, Mean Intake of Energy, and Mean Sodium Contribution
In addition, as discussed in the caloric reduction benefits section above, we scaled back the potential benefits by 11.95 percent for the food-at-home FSIS products that are exempt from nutrition labeling. Overall, our benefits estimate scales back the benefits by removing 72.7 percent for the sodium intake of FDA products and removing 11.95 percent for the FSIS products exempt from nutrition labeling, resulting in the mid-point annual benefits estimate of $693,815 ($2.9M*(100%-72.7%) * (100%-11.95%)) for sodium reduction. The lower bound estimate is $69,389 and upper bound estimate is $3,052,804, Table 14.
The welfare gains from caloric and sodium reduction estimated above reflect the full annual potential impact of the regulation without adjusting for the potential lag between reaching a particular weight and experiencing the associated health outcomes and medical cost savings. However, industry would need time to modify labels under the new regulations. Table 15 uses the FDA Cost Label model
To arrive at the present value estimate of potential benefits, FSIS multiplied the percentage of label changes in each 12 month period by the annual potential benefits estimate. The percentage of label changes estimates the percentage of updated labels at a given time: 10 percent after 12 months, 90.35 percent after 24 months, and 100 percent after 36 or more months. Again, the Nutrition Impact Model estimates benefits immediately for reductions in sodium intake and at year four for reductions in caloric intake. Therefore, benefits for caloric reduction start four years after the labels update while benefits for sodium reduction are realized as the labels are updated. For example, as is shown in Table 4—Label Changes That Can Be Coordinated with a Planned Change, 12 months after publication of the final rule, an estimated 10 percent of FSIS labels are changed, resulting in 10 percent of the annual sodium benefits and no quantified benefits for the caloric intake reductions. After 24 months, 90.35 percent of Nutrition Facts labels are updated, resulting in 90.35 percent of the annual sodium benefits and no quantified benefits for the caloric intake reductions. The benefits in year 6 are a product of 100 percent of the sodium reduction benefits and 10 percent of the caloric reduction benefits as four years have passed since 10 percent of the labels were updated. Not until year seven are the full annual sodium and caloric reduction mid-point benefits without latency applied.
FSIS could not determine the weight-level-to-health outcome latency for each health condition included in the Nutrition Impact Model. But, to try and account for this latency, FSIS assumed a uniform health impacts time pattern between present age and age 80 and a uniform age distribution between age 18 and 79 to determine weighting factors that could be applied to the benefits estimates from the Nutrition Impact Model to calculate the present and annualized benefits. FSIS multiplied average weighting factors of 0.665 (3 percent discount rate) and 0.458 (7 percent discount rate) by the present value annual benefit from caloric and sodium reduction to estimate the total annual health impact for each year. FSIS is requesting comment on accounting for latency between weight change and health outcomes.
The mid-point present value, discounted at 3 percent rate is $549 million and $239 million with a 7 percent discount rate. The mid-point annual benefit is $37 million at a 3 percent discount rate and $23 million at 7 percent. The lower bound estimate is $3,689,445 and upper bound estimate is $162,333,818 at a 3 percent discount rate, Table 15.
The ramifications of the proposed rule are not expected to have a significant impact on the food market. As a mid-point estimate, we estimate potentially 609,005 adults would potentially reduce their caloric intake by 92 kcals, and 259,376 adults will potentially reduce their caloric intake by 187 kcals for FDA and FSIS regulated products. Additionally, as a mid-point estimate, we estimate potentially 50,214 adults would potentially reduce their sodium intake by 104 mg and 32,857 adults would potentially reduce sodium intake by 87 mg for FDA and FSIS regulated products. Only a small portion of the caloric and sodium intake are from meat or poultry products as only 18 percent of all caloric intake is from FSIS products. Further still, this small change in diet may lead to increased consumption of lower calorie or lower sodium products, including food products reformulated in response to the changes on the label. Therefore, we estimate the market impact will distribute across all food markets with minimal impact on meat and poultry markets. The benefits analysis for the proposed rule may underestimate the full consumer welfare gain for several reasons. This analysis only includes the potential medical savings for the overweight and hypertension population that sparsely uses labels. The analysis does not account for benefits in diet modifications for children under the age of 16 or most people of normal weight. Though, we can expect the diet behavior of adults to transfer to their children under the age of 16. Normal weight consumers and consumers currently using labels when buying food may modify their diet and benefit from the new content and design on the Nutrition Facts label. The analysis only includes benefits from caloric and sodium reductions leading to averted health conditions associated with hypertension, overweight and obesity. Many major health conditions are associated with obesity; therefore the medical savings benefit for calorie reduction weight-loss is substantial in overweight and obese individuals. However, other modifications to the label, such as updates to RACCs and Daily Values for added sugars, nutrients and minerals, may help consumers adjust their diet and improve their personal welfare. Modifications such as the dual column labels will simplify the calculation for total nutrients in an entire package, which may contribute to a healthful diet. Additionally, health benefits from caloric reduction do occur before four years, and health benefits may continue to increase over time; however the Nutrition Impact Model begins to calculate the benefits from caloric reductions starting at year four. FSIS has no means to quantify these benefits. Further, there may be indirect benefits to reducing caloric and sodium intake through improved lifestyle, wages, or productivity that are not measured in this benefits estimate. Therefore, the resulting potential benefits estimate should be interpreted as an underestimate of overall benefits.
However, data supporting the benefits analysis is from national consumer surveys where results are on self-reported behavior changes, which could potentially overstate actual results. In addition, the consumers in our quantitative benefits estimate may lose utility associated with consuming products high in sugar, calories and sodium.
FSIS believes there are several additional benefits associated with the proposed changes which are hard to quantify. To start, the millions of normal weight not hypertensive users who currently use nutritional information will benefit from the clearer label format. Additionally, the proposed changes would harmonize the labels between FDA and USDA products, reducing producer administration costs. Further still, the proposed changes could potentially simplify the communication of hard to distinguish, but sought after, product attributes benefiting both producers and consumers.
The mandatory declaration of
Small businesses will benefit from the additional 12-month compliance period. Allowing small businesses additional time to comply reduces costs of relabeling, reformulation and recordkeeping and allows additional time to understand and implement the proposed regulations.
Also, the Agency believes that the public would be better served by having the regulations governing nutrition labeling consolidated in one part of title 9. Rather than searching through two separate parts of title 9—317 and 381—to find the nutrition labeling regulations, interested parties would only have to survey one, 9 CFR part 413, to be able to apply nutrition panels to their meat and poultry products.
Four alternatives, Table 16, are considered for the proposed serving size and Nutrition Facts label proposed rule.
• Alternative 1: Take no regulatory action by continuing with the existing labeling requirements.
• Alternative 2: The proposed rule, giving large manufacturers a 24-month compliance period and small manufacturers 36-months.
• Alternative 3: The proposed rule, giving manufacturers a 42-month compliance period.
• Alternative 4: The proposed rule, giving all manufacturers 24-months to comply.
• Alternative 5: The proposed rule, giving large manufacturers a 12-month compliance period and small manufactures 24-months.
Both producers and consumers will be worse off absent the proposed action. While “no action” means the 3,307 manufacturers with roughly 50,000 products under USDA jurisdiction would continue to be regulated in the same manner as they currently are, the market will be impacted in several costly ways.
First, no action would create inconsistencies between USDA and FDA labels. As such, the manufacturers that produce products regulated by both USDA and FDA will have to operate under two differentiated procedures,
Second, if the USDA were to take “no action,” the Agency would fail to address the health problems related to diet by making it more difficult for consumers to heed dietary guidelines. Third, the “no action” would fail to make any improvements to address the problems that prohibit millions of consumers from using labels: The print being too small, not knowing what to look for, or not having enough time. The targeted population of nearly 32 million overweight or hypertensive adults, whom rarely or never use the Nutrition Facts label, would continue to not read the labels and continue with high sodium or calorie diets. In combination, these impacts would hinder producers vying to compete based on hard to
Alternative 2, the proposed rule, addresses many of the current nutritional and serving size labels' short comings by applying the changes proposed in the preamble with a 24-month compliance period for large and 36-month for small, consistent with FDA's compliance period. While industry will incur costs associated with relabeling, recordkeeping, and reformulation, consumers will benefit from an increase in information which may lead to improved health. The estimated net benefits are $26.1 million. The proposed costs and benefits associated with this alternative are detailed in Expected Costs of the Proposed Rule and Quantitative Benefits of the Proposed Rule sections of this PRIA.
Alternative 3 would apply the changes detailed in the preamble but extends the compliance period to 42 months. Compared to alternative 2, this alternative reduces costs while holding benefits nearly constant. As shown in Table 4—Label Changes That Can Be Coordinated with a Planned Change, a 42-month compliance period would provide industry sufficient time to coordinate all required label changes, subsequently reducing annualized relabeling costs by about $2.1 million, as compared to alternative 2. Recordkeeping costs would remain the same as alternative 2 and annualized reformulation costs would be reduced by about $1 million.
Health benefits would be delayed by extending the compliance period. Annual benefits at a 3 percent discount rate under alternative 3 are estimated to be $36.4 million, which is roughly $500,000 less than alternative 2's estimated annual benefits. However, a 42-month compliance period would result in delayed label updates, and extend inconsistencies between USDA and FDA labels for an additional 18 months compared to alternative 2.
Also, extending the compliance period would require a further exception to current uniform compliance guidelines
Alternative 3 applies FDA's 2014 Labeling Cost Model to estimate the cost of relabeling roughly 50,000 food labels under a 42-month compliance period. In this scenario both branded and private (store brand) label changes can be coordinated, reducing the average one time per label cost from $1,371 to $717, Table 17. In sum, extending the compliance period reduces the average annualized relabeling costs to $2.3 million, assuming a 3 percent discount rate over 20 years.
Alternative 3 does not alter the recordkeeping requirements as presented in the Expected Cost section above. As such, we assume the recordkeeping costs associated under alternative 3 are equal to those under alternative 2.
Extending the compliance period reduces the cost for product reformulation. However, the longest compliance period covered in the 2014 Reformulation Cost Model is 36 months for large and 24 months for small businesses. As such, the reformulation costs associated with alternative 3 are based on a 24 month compliance period for small and 36 month compliance
Again, the present value of health benefits was derived by multiplying the percentage of label changes in each 12 month period by annual health benefits. The prolonged compliance period reduces the rate labels are updated, which in turn reduces the rate at which consumers are exposed to updated labels and overall benefits. As is shown on Table 19, the expected difference in annual health benefits between alternative 2 and alternative 3 is about $0.5 million. Alternative 3 has the benefit of saving roughly $3 million annually from reductions in labeling and reformulation costs, $2.1 million of which is derived from reductions in labeling costs.
Alternative 3 is expected to have the same type of qualitative benefits as alternative 2, but their realization is delayed. Labels would not be harmonized as soon as alternative 2, resulting in confusion between USDA and FDA labels. Producers who market FDA-regulated products also may voluntarily adopt the FDA timetable and update their labels prior to the 42-month compliance period.
Under this alternative, all manufacturers are given a 24 month compliance period. This alternative does not give small businesses additional time to comply and is inconsistent with FDA's compliance period.
Under alternative 4, small and large businesses are given 24 months to comply with the proposed changes. Under a 24-month compliance period, all branded labels and 26 percent of private labels will incur a coordinated label change while 74 percent of private labels will incur an uncoordinated label change, Table 20.
Compared to alternative 2, alternative 4 does not alter the recordkeeping requirements. As such, we assume the recordkeeping costs associated under alternative 4 are equal to those under alternative 2.
Reducing the compliance period for small businesses increases the cost for product reformulation. However, the longest compliance period covered in the 2014 Reformulation Cost Model for small businesses is 24 months. Therefore, the reformulation cost for alternative 2 and alternative 3 are both estimated on a 24 month compliance period for both large and small businesses. Alternative 2 overestimated reformulation cost since this alternative is based on a 24 month compliance period for large and 36 months for small businesses and alternative 4 reformulation cost is most accurate given the compliance period is 24 months for large and small businesses.
The reduced compliance period increases the rate labels are updated, which in turn increases the rate at which consumers are exposed to updated labels, resulting in earlier and higher consumer welfare benefits. Again, the present value of health benefits was calculated by multiplying the percentage of label changes in each 12 month period by annual health benefits. As is shown in Table 22, the expected difference in annual health benefits between alternative 2 and alternative 4 is about $288,829. Alternative 4 increases the annual labeling cost by over $0.6 million annually. Overall, the net benefit decreases by $330,858 under alternative 4.
Alternative 4 may benefit consumers from the potential reformulation of products to reduce added sugars. Also, alternative 4 would still benefit the public by consolidating nutrition labeling regulations to one location; however, it would result in inconsistencies between products regulated by either the FDA or USDA. These inconsistencies would likely increase confusion amongst both producers and consumers, reducing overall benefits.
Alternative 5 more closely aligns the compliance date with FDA labels. Sharing the same compliance date with FDA products allows for harmonized labels across agencies. However, FSIS labels will have a shorter time to comply than FDA by sharing the same compliance date. FDA is giving a 24-month compliance period for large businesses and 36 months for small businesses to comply, the same compliance period as alternative 2. Also, compared to alternative 2, this alternative greatly increases costs while holding benefits nearly constant. For
Alternative 5 applies FDA's 2014 Labeling Cost Model to estimate the cost of relabeling roughly 50,000 food labels under a 12-month compliance period for large manufacturers and 24 months for small. Reducing the compliance period increases the number of uncoordinated changes, resulting in higher labeling costs. For a 12-month compliance period, only 11 percent of branded and 5 percent of private labels will have a coordinated change. For a 24-month compliance period, only 26 percent of private brands will have a coordinated change. The average one-time per label cost increases from $1,371 to $2,591, Table 23.
Alternative 5 does not alter the recordkeeping requirements as presented in the Expected Cost section above. As such, we assume the recordkeeping costs associated under alternative 5 are equal to those under alternative 2.
Reducing the compliance period increases the cost for product reformulation. However, the longest compliance period covered in the 2014 Reformulation Cost Model for a small business is 24 months. Therefore, the reformulation cost for small and medium businesses in alternative 2 is based on a 24 month compliance period, resulting in an overestimate of cost in alternative 2. Even with the overestimation in alternative 2 reformulation cost, the one-time cost for reformulation increases by $40.2 million with alternative 5, with an average per formula cost increasing from $77,009 to $109,638, Table 24. The increase is attributed to the 12-month compliance period for large manufacturers.
By reducing the compliance period, labels are updated faster, resulting in earlier consumer welfare benefits. Again, the present value of health benefits was derived by multiplying the percentage of label changes in each 12-month period by annual health benefits. Alternative 5 proposed a 12-month compliance period for large and 24 month compliance period for small. Based on IRI scanner data and SBA small business standards, 53.6 percent of labels are from small businesses and 46.4 percent are from Large. Utilizing these proportions and Table 4—Label Changes That Can Be Coordinated with a Planned Change, we estimate that after 12 months, 50.76 percent of FSIS's Nutrition Facts labels are updated ((100% of Large * 46.4% of labels) + (10% of Small * 53.6% of Labels)). After 24 months, 100 percent of FSIS's nutrition facts labels are updated.
As shown in Table 25, the expected increase in annual health benefits between alternative 2 and alternative 5 is about $1.6 million. However, alternative 5 increases cost by $6.6
Alternative 5 is expected to have similar qualitative benefits as alternative 2, with the additional benefit of harmonized labels between FSIS and FDA. Assuming FSIS has a one-year lag from FDA's final rule (81 FR 33742 and 81 FR 34000), under this alternative, USDA and FDA labels will have the same compliance date, resulting in less confusion over similar food products.
The FSIS Administrator made a preliminary determination that this proposed rule will not have a significant impact on a substantial number of small entities, as defined by the Regulatory Flexibility Act (5 U.S.C. 601). This determination was made because small businesses only account for 50 percent of the Nutrition Facts Labels and are given an additional 12 months to comply, reducing the costs of the proposed regulations.
All manufacturers are required to update labels if this proposed rule is finalized. FSIS considered other alternatives and the preferred alternative gives small businesses an additional 12 months to comply with the regulations to reduce the impact on small businesses. The additional compliance time reduces the burden and cost for small business and is consistent with FDA's compliance period.
On the basis of IRI scanner data, FSIS estimates that 3,307 manufacturers produce roughly 50,000 different retail labels with nutrition labeling for meat or poultry products. Using SBA's small business definition
The average one-time cost per label change is $1,208 or $79 annualized over 10 years at a 3-percent discount rate for small businesses. The annualized costs at a 3-percent discount rate for all labels changes from small retail manufacturers is $2,116,554 with an average cost of $677 ($2.1M/3,125) per small business. Relabeling costs for small businesses are less than half ($2.1M out of $4.5M) of the total annualized cost at a 3-percent discount rate (Table 5—Alternative 2—Labeling Costs (24 Month for Large, 36 Months for Small)). These estimates in Table 5 include small business relabeling costs from minor, major, extensive coordinated and uncoordinated changes for a 36-month compliance period.
In accordance with section 3507(j) of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
Under this proposed rule manufacturers must maintain additional records for Added Sugars, Dietary Fiber, Soluble Fiber, Insoluble Fiber, Dietary Fiber, Vitamin E, and Folate/Folic Acid. Manufacturers are also required to provide these records to the inspector or any duly authorized representative of the Agency upon request.
FSIS believes the new records required from this proposed rule are records that responsible manufacturers use and retain as a normal part of business. Thus, the recordkeeping burden consists of the time required to identify and assemble the records for copying and holding and the reporting burden consists of the time required to assemble and provide records to the appropriate FSIS officials. FSIS estimates one hour of recordkeeping and one hour of recordkeeping burden for each newly required nutrient per manufacturer. If the rule is finalized as proposed, the declaration for added sugars, dietary fiber, soluble fiber, and insoluble fiber would be mandatory and 3,307 manufacturers for FSIS products would incur this burden. The declaration of Vitamin E and folate/folic acid is not mandatory unless accompanied with a nutrient claim. However, we estimate that roughly all 3,307 FSIS manufacturers will incur a one hour recordkeeping burden for the mandatory components and one hour record burden for vitamin E and folic acid. As shown in Table 26, the initial recordkeeping and reporting burden for covered respondents is 39,684 hours.
FSIS estimated that the burden associated with the proposed changes would be a one-time burden for the food manufacturers to revise the nutrition labels. We estimate the one-time third party disclosure burden would be approximately two hours. Each label would require a respondent one hour of review to determine how to bring it into compliance with the proposed requirements. FSIS estimated each label redesign would require one additional hour per label, for a total of two hours per unique label for each respondent. Based on estimates from IRI scanner data, there are 50,110 unique nutrition labels under FSIS jurisdiction. Therefore, the estimated burden for this collection of information is 200,440 hours for respondents as shown in Table 27.
Copies of this information collection assessment can be obtained from Gina Kouba, Paperwork Reduction Act Coordinator, Food Safety and Inspection Service, USDA, 1400 Independence Avenue SW., Room 6065, South Building, Washington, DC 20250.
Comments may be sent to both Gina Kouba, Paperwork Reduction Act Coordinator, at the address provided above, and the Desk Officer for Agriculture, Office of Information and Regulatory Affairs, Office of Management and Budget, Washington, DC 20253. To be most effective, comments should be sent to OMB.
FSIS and USDA are committed to achieving the purposes of the E-Government Act (44 U.S.C. 3601,
This proposed rule has been reviewed under Executive Order 12988, Civil Justice Reform. Under this rule: (1) All State and local laws and regulations that are inconsistent with this rule will be preempted; (2) no retroactive effect will be given to this rule; and (3) no administrative proceedings will be required before parties may file suit in court challenging this rule.
This rule has been reviewed in accordance with the requirements of Executive Order 13175, “Consultation and Coordination with Indian Tribal Governments.” E.O. 13175 requires Federal agencies to consult and coordinate with tribes on a government-to-government basis on policies that have tribal implications, including regulations, legislative comments or proposed legislation, and other policy statements or actions that have substantial direct effects on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes or on the distribution of power and responsibilities between the Federal Government and Indian tribes.
FSIS has assessed the impact of this rule on Indian tribes and determined that this rule does not, to our knowledge, have tribal implications that require tribal consultation under E.O. 13175. If a Tribe requests consultation, the Food Safety and Inspection Service will work with the Office of Tribal Relations to ensure meaningful consultation is provided where changes, additions and modifications identified herein are not expressly mandated by Congress.
No agency, officer, or employee of the USDA shall, on the grounds of race, color, national origin, religion, sex, gender identity, sexual orientation, disability, age, marital status, family/parental status, income derived from a public assistance program, or political beliefs, exclude from participation in, deny the benefits of, or subject to discrimination any person in the United States under any program or activity conducted by the USDA.
To file a complaint of discrimination, complete the USDA Program Discrimination Complaint Form, which may be accessed online at
Send your completed complaint form or letter to USDA by mail, fax, or email:
Persons with disabilities who require alternative means for communication (Braille, large print, audiotape, etc.), should contact USDA's TARGET Center at (202) 720-2600 (voice and TDD).
Public awareness of all segments of rulemaking and policy development is important. Consequently, FSIS will announce this
FSIS also will make copies of this publication available through the FSIS Constituent Update, which is used to provide information regarding FSIS policies, procedures, regulations,
Meat inspection.
Food labeling, Food packaging, Meat inspection.
Food labeling, Food packaging, Meat inspection, Nutrition, Reporting and recordkeeping.
Food additives, Food packaging, Laboratories, Meat inspection, Reporting and recordkeeping requirements, Signs and symbols.
Food grades and standards, Food labeling, Frozen foods, Meat inspection, Oils and fats.
Meat inspection, Reporting and recordkeeping.
Food labeling, Food packaging, Imports, Meat inspection.
Meat inspection, Poultry and poultry products, Reporting and recordkeeping.
Administrative practice and procedure, Animal diseases, Crime, Exports, Food grades and standards, Food labeling, Food packaging, Government employees, Grant programs—agriculture, Imports, Intergovernmental relations, Laboratories, Meat inspection, Nutrition, Polychlorinated biphenyls (PCB's), Poultry and poultry products, Reporting and recordkeeping requirements, Seizures and forfeitures, Signs and symbols, Technical assistance, Transportation.
Food labeling, Food packaging, Meat inspection, Poultry and poultry products, Reporting and recordkeeping requirements.
For the reasons discussed in the preamble, FSIS is proposing to amend 9 CFR Chapter III as follows:
21 U.S.C. 601-695; 7 U.S.C. 138-138i, 450, 1901-1906; 7 CFR 2.7, 2.18, 2.53.
(10) If it purports to be or is represented for special dietary uses, unless its label bears such information concerning its vitamin, mineral, and other dietary properties as is required by the regulations in part 317 of this subchapter and part 413 of subchapter E.
21 U.S.C. 601-695; 7 CFR 2.18, 2.53.
(b) The Administrator is authorized to grant inspection upon his or her
21 U.S.C. 601-695; 7 CFR 2.17, 2.55.
21 U.S.C. 601-695; 7 CFR 2.18, 2.53.
7 U.S.C. 138f, 450, 1901-1906; 21 U.S.C. 601-695; 7 CFR 2.18, 2.53.
7 U.S.C. 450, 1901-1906; 21 U.S.C. 601-695; 7 CFR 2.18, 2.53.
(a)
21 U.S.C. 601-695; 7 CFR 2.7, 2.18, 2.53.
(b) * * *
(8) Records of nutrition labeling as required by part 413 of subchapter E.
21 U.S.C. 601-695; 7 CFR 2.18, 2.53.
(b) All labeling used with an outside container of foreign product must be approved in accordance with part 317 of this subchapter and parts 412 and 413 of subchapter E.
7 U.S.C. 1622; 7 CFR 2.18(g) and (i) and 2.53.
7 U.S.C. 138f, 450; 21 U.S.C. 451-470; 7 CFR 2.7, 2.18, 2.53.
(a)
(b)
(b) * * *
(5) Records of nutrition labeling as required by part 413.
21 U.S.C. 451-470, 601-695; 7 CFR 2.18, 2.53.
(a)(1) An official establishment, or an establishment certified under a foreign inspection system in accordance with part 327, or part 381, subpart T of this chapter, is authorized to use generically approved labels, as defined in paragraph (b) of this section, and thus is free to use such labels without submitting them to the Food Safety and Inspection Service for approval, provided the label, in accordance with this section, displays all mandatory features in a prominent manner in compliance with parts 317, 381, and 413 and is not otherwise false or misleading in any particular.
21 U.S.C. 451-470, 601-695; 7 CFR 2.7, 2.18, 2.53.
(a) Nutrition labeling must be provided for all meat, meat food products, and poultry products intended for human consumption and offered for sale, except single-ingredient, raw meat or poultry products that are not ground or chopped meat or poultry products described in § 413.301 and are not major cuts of single-ingredient, raw meat or poultry products identified in § 413.344, unless the product is exempted under § 413.400. Nutrition labeling must be provided for the major cuts of single-ingredient, raw meat or poultry products identified in § 413.344, either in accordance with the provisions of § 413.309 for nutrition labels, or in accordance with the provisions of § 413.345 for point-of-purchase materials, except as exempted under § 413.400. For all other products for which nutrition labeling is required, including ground or chopped meat or poultry products described in § 413.301, nutrition labeling must be provided in accordance with the provisions of § 413.309, except as exempted under § 413.400.
(b) Nutrition labeling may be provided for single-ingredient, raw meat or poultry products that are not ground or chopped meat or poultry products described in § 413.301 and that are not major cuts of single-ingredient, raw meat or poultry products identified in § 413.344, either in accordance with the provisions of § 413.309 for nutrition labels, or in accordance with the provisions of § 413.345 for point-of-purchase materials.
(a) Nutrition labels must be provided for all ground or chopped products (livestock species or kind) and hamburger with or without added seasonings (including, but not limited to, ground beef, ground beef patties, ground sirloin, ground pork, ground lamb, ground chicken, ground turkey, and (kind) burgers) that are intended for human consumption and offered for sale, in accordance with the provisions of § 413.309, except as exempted under § 413.400.
(b) [Reserved]
(a) Nutrition information on a label of a packaged product shall appear on the label's principal display panel or on the information panel, except as provided in paragraphs (b) and (c) of this section.
(b) Nutrition information for gift packs may be shown at a location other than on the product label, provided that the labels for these products bear no nutrition claim. In lieu of on the product label, nutrition information may be provided by alternate means such as product label inserts.
(c) Products in packages that have a total surface area available to bear labeling greater than 40 square inches but whose principal display panel and information panel do not provide sufficient space to accommodate all required information may use any alternate panel that can be readily seen by consumers for the nutrition information. In determining the sufficiency of available space for the nutrition information, the space needed for vignettes, designs, and other nonmandatory label information on the principal display panel may be considered.
The label of any package of a product that bears a representation as to the number of servings contained in such package shall meet the requirements of § 317.2(h)(10) or § 381.121(c)(7).
(a) All nutrient and food component quantities shall be declared in relation to a serving as defined in this section.
(b)(1) The term “serving” or “serving size” means an amount of food customarily consumed per eating occasion by persons 4 years of age or older, which is expressed in a common household measure that is appropriate to the product. When the product is specially formulated or processed for use by infants or by toddlers, a serving or serving size means an amount of food customarily consumed per eating occasion by infants up to 12 months of age or by children 1 through 3 years of age, respectively.
(2) Except as provided in paragraphs (b)(8), (b)(12), and (b)(14) of this section and for products that are intended for weight control and are available only through a weight-control or weight-maintenance program, serving size declared on a product label shall be determined from the “Reference Amounts Customarily Consumed Per Eating Occasion—General Food Supply” (Reference Amounts) that appear in § 413.312(b) using the procedures described in this paragraph (b). For products that are both intended for weight control and available only through a weight-control program, a manufacturer may determine the serving size that is consistent with the meal plan of the program. Such products must bear a statement, “for sale only through the _______program” (fill in the blank with the name of the appropriate weight-control program,
(3) The declaration of nutrient and food component content shall be on the basis of the product “as packaged” for all products, except that single-ingredient, raw products that are not ground or chopped products described in § 413.301 may be declared on the basis of the product “as consumed”. For single-ingredient, raw products that are not ground or chopped products described in § 413.301, if data are based on the product `as consumed,' the data must be presented in accordance with § 413.345(d). In addition to the required declaration on the basis of “as packaged” for products other than single-ingredient, raw products that are not ground or chopped products described in § 413.301, the declaration may also be made on the basis of “as consumed,” provided that preparation and cooking instructions are clearly stated.
(4) For products in discrete units (
(i) If a unit weighs 50 percent or less of the Reference Amount, the serving size shall be the number of whole units that most closely approximates the Reference Amount for the product category.
(ii) If a unit weighs more than 50 percent but less than 67 percent of the Reference Amount, the manufacturer may declare one unit or two units as the serving size.
(iii) If a unit weighs 67 percent or more but less than 200 percent of the Reference Amount, the serving size shall be one unit.
(iv) If a unit weighs at least 200 percent and up to and including 300 percent of the applicable reference amount, the serving size shall be the amount that approximates the reference amount. In addition to providing a column within the Nutrition Facts label that lists the quantitative amounts and percent Daily Values per serving size, the manufacturer shall provide a column within the Nutrition Facts label that lists the quantitative amounts and percent Daily Values per individual unit. The first column would be based on the serving size for the product and the second column would be based on the individual unit. The exemptions in paragraphs (b)(16)(i)(A), (B), and (C) of this section apply to this provision.
(v) For products which consist of two or more foods packaged and presented to be consumed together where the ingredient represented as the main ingredient is in discrete units (
(vi) For packages containing several individual single-serving containers, each of which is labeled with all required information including nutrition labeling as specified in this section (
(vii) The serving size for products that naturally vary in size (
(5) For products in large discrete units that are usually divided for consumption (
(6) For nondiscrete bulk products (
(7) For labeling purposes, the term “common household measure” or “common household unit” means cup, tablespoon, teaspoon, piece, slice, fraction (
(i) Cups, tablespoons, or teaspoons shall be used wherever possible and appropriate. Cups shall be expressed in
(ii) If cups, tablespoons or teaspoons are not applicable, units such as piece, slice, tray, jar, and fraction shall be used.
(iii) If cups, tablespoons and teaspoons, or units such as piece, slice, tray, jar, or fraction are not applicable, ounces may be used. Ounce measurements shall be expressed in 0.5-ounce increments most closely approximating the Reference Amount with rounding indicated by the use of the term “about” (
(iv) A description of the individual container or package shall be used for single-serving containers and for individually packaged products within multi-serving containers (
(v) For unprepared products where the entire contents of the package is used to prepare large discrete units that are usually divided for consumption (
(vi) For products that consist of two or more distinct ingredients or components packaged and presented to be consumed together (
(vii) For nutrition labeling purposes, a teaspoon means 5 milliliters (mL), a tablespoon means 15 mL, a cup means 240 mL, and 1 oz in weight means 28 grams (g).
(viii) When a serving size, determined from the Reference Amount in § 413.312(b) and the procedures described in this section, falls exactly half way between two serving sizes (
(8) A product that is packaged and sold individually that contains less than 200 percent of the applicable reference amount must be considered to be a single-serving container, and the entire content of the product must be labeled as one serving. In addition to providing a column within the Nutrition Facts label that lists the quantitative amounts and percent Daily Values per serving, for a product that is packaged and sold individually that contains more than 150 percent and less than 200 percent of the applicable reference amount, the Nutrition Facts label may voluntarily provide, to the left of the column that provides nutrition information per container (
(9) A label statement regarding a serving shall be the serving size expressed in common household measures as set forth in paragraphs (b)(2) through (b)(8) of this section and shall be followed by the equivalent metric quantity in parenthesis (fluids in milliliters and all other foods in grams), except for single-serving containers.
(i) For a single-serving container, the parenthetical metric quantity, which will be presented as part of the net weight statement on the principal display panel, is not required except where nutrition information is required on a drained weight basis according to paragraph (b)(11) of this section. However, if a manufacturer voluntarily provides the metric quantity on products that can be sold as single servings, then the numerical value provided as part of the serving size declaration must be identical to the metric quantity declaration provided as part of the net quantity of contents statement.
(ii) The gram or milliliter quantity equivalent to the household measure should be rounded to the nearest whole number except for quantities that are less than 5 g (mL). The gram (mL) quantity between 2 and 5 g (mL) should be rounded to the nearest 0.5 g (mL) and the g (mL) quantity less than 2 g (mL) should be expressed in 0.1-g (mL) increments.
(iii) In addition, serving size may be declared in ounce, in parenthesis, following the metric measure separated by a slash where other common household measures are used as the primary unit for serving size,
(iv) If a manufacturer elects to use abbreviations for units, the following abbreviations shall be used: tbsp for tablespoon, tsp for teaspoon, g for gram, mL for milliliter, and oz for ounce.
(v) For products that only require the addition of water or another ingredient that contains insignificant amounts of nutrients in the amount added and that are prepared in such a way that there are no significant changes to the nutrient profile, the amount of the finished product may be declared in parentheses at the end of the serving size declaration (
(10) Determination of the number of servings per container shall be based on the serving size of the product determined by following the procedures described in this section.
(i) The number of servings must be rounded to the nearest whole number except for the number of servings between 2 and 5 servings and random weight products. The number of servings between 2 and 5 servings must be rounded to the nearest 0.5 serving. Rounding should be indicated by the use of the term “about” (
(ii) When the serving size is required to be expressed on a drained solids basis and the number of servings varies because of a natural variation in unit size (
(iii) For random weight products, manufacturers may declare “varied” for the number of servings per container provided the nutrition information is based on the reference amount expressed in the appropriate household measure based on the hierarchy described in paragraph (b)(7) of this section. Random weight products are foods such as meat roasts or whole turkeys that are sold as random weights that vary in size, such that the net contents for different containers would vary. The manufacturer may provide the typical number of servings in parentheses following the “varied”
(iv) For packages containing several individual single-serving containers, each of which is labeled with all required information including nutrition labeling as specified in this section (
(v) For packages containing several individually packaged multi-serving units, the number of servings shall be determined by multiplying the number of individual multi-serving units in the total package by the number of servings in each individual unit. The declaration of the number of servings per container need not be included in nutrition labeling of single-ingredient, raw products that are not ground or chopped products described in § 413.301, including those that have been previously frozen.
(11) The declaration of nutrient and food component content shall be on the basis of product as packaged or purchased with the exception of single-ingredient, raw products that are not ground or chopped products described in § 413.301 and products that are packed or canned in water, brine, or oil but whose liquid packing medium is not customarily consumed. Declaration of the nutrient and food component content of products that are packed in liquid which is not customarily consumed shall be based on the drained solids.
(12) The serving size for meal-type products and main-dish products as defined in § 413.313(l) and § 413.313(m) in single-serving containers will be the entire edible content of the package. Serving size for meal-type products and main-dish products in multi-serve containers will be based on the reference amount applicable to the product in § 413.312(b) if the product is listed in § 413.312(b). Serving size for meal-type products and main-dish products in multi-serve containers that are not listed in § 413.312(b) will be based on the reference amount according to § 413.312(c), (d), and (e).
(13) Another column of figures may be used to declare the nutrient and food component information in the same format as required by § 413.309(e).
(i) Per 100 grams, 100 milliliters, or 1 ounce of the product as packaged or purchased.
(ii) Per one unit if the serving size of a product in discrete units in is more than one unit.
(14) If a product consists of assortments of meat, meat food products, or poultry products (
(15) If a product is commonly combined with other ingredients or is cooked or otherwise prepared before eating, and directions for such combination or preparations are provided, another column of figures may be used to declare nutrition information on the basis of the product as consumed in the format required in paragraph (e) of this section (
(16)(i) Products that are packaged and sold individually and that contain at least 200 percent and up to and including 300 percent of the applicable reference amount must provide an additional column within the Nutrition Facts label that lists the quantitative amounts and percent Daily Values for the entire package, as well as a column listing the quantitative amounts and percent Daily Values for a serving that is less than the entire package (
(A) This provision does not apply to products that meet the requirements to use the tabular display for small packages in paragraph (g)(1)(i)(A) of this section or to products that meet the requirements to use the linear format in paragraph (g)(1)(i)(B) of this section.
(B) This provision does not apply to products that require further preparation and provide an additional column of nutrition information under paragraph (e) of this section, to products that are commonly consumed in combination with another food and provide an additional column of nutrition information under paragraph (e) of this section, to products that provide an additional column of nutrition information for two or more groups for which RDIs are established (
(ii) When a nutrient content claim or health claim is made on the label of a product that uses a dual column in accordance with paragraph (b) of this section, the claim must be followed by a statement that sets forth the basis on which the claim is made, except that the statement is not required for products when the nutrient that is the subject of the claim meets the criteria for the claim based on the reference amount for the product and the entire container or the unit amount. When a nutrient content claim is made, the statement must express that the claim refers to the amount of the nutrient per serving (
(c) The declaration of nutrition information on the label and in labeling of a meat or meat food product or poultry product shall contain information about the level of the following nutrients, except for those nutrients whose inclusion, and the declaration of the amounts, is voluntary as set forth in this paragraph. No nutrients or food components other than those listed in this paragraph as either mandatory or voluntary may be included within the nutrition label. Except as provided for in paragraphs (f) or (g) of this section, nutrient information shall be presented using the nutrient names specified and in the following order in the formats specified in paragraphs (d) or (e) of this section.
(1) “Calories, total,” “Total calories,” or “Calories”: A statement of the caloric content per serving, expressed to the nearest 5-calorie increment up to and including 50 calories, and 10-calorie increment above 50 calories, except that amounts less than 5 calories may be expressed as zero. Energy content per serving may also be expressed in kilojoule units, added in parenthesis immediately following the statement of the caloric content.
(i) Caloric content may be calculated by the following methods. Where either specific or general food factors are used, the factors shall be applied to the actual amount (
(A) Using specific Atwater factors (
(B) Using the general factors of 4, 4, and 9 calories per gram for protein, total carbohydrate, and total fat, respectively, as described in USDA Handbook No. 74 (slightly revised, 1973) pp. 9-11;
(C) Using the general factors of 4, 4, and 9 calories per gram for protein, total carbohydrate (less the amount of non-digestible carbohydrates and sugar alcohols), and total fat, respectively, as described in USDA Handbook No. 74 (slightly revised, 1973) pp. 9-11. A general factor of 2 calories per gram for soluble non-digestible carbohydrates shall be used. The general factors for caloric value of sugar alcohols provided in paragraph (c)(1)(i)(F) of this section shall be used;
(D) Using data for specific food factors for particular foods or ingredients approved by the Food and Drug Administration (FDA) and provided in parts 172 or 184 of 21 CFR, or by other means, as appropriate;
(E) Using bomb calorimetry data subtracting 1.25 calories per gram protein to correct for incomplete digestibility, as described in USDA Handbook No. 74 (slightly revised, 1973) p. 10; or
(F) Using the following general factors for caloric value of sugar alcohols: Isomalt—2.0 calories per gram, lactitol—2.0 calories per gram, xylitol—2.4 calories per gram, maltitol—2.1 calories per gram, sorbitol—2.6 calories per gram, hydrogenated starch hydrolysates—3.0 calories per gram, mannitol—1.6 calories per gram, and erythritol—0 calories per gram.
(ii) “Calories from saturated fat” or “Calories from saturated” (VOLUNTARY): A statement of the caloric content derived from saturated fat as defined in paragraph (c)(2)(i) of this section per serving may be declared voluntarily, expressed to the nearest 5-calorie increment, up to and including 50 calories, and the nearest 10-calorie increment above 50 calories, except that amounts less than 5 calories may be expressed as zero. This statement shall be indented under the statement of calories as provided in paragraph (d)(5) of this section.
(2) “Fat, total” or “Total fat”: A statement of the number of grams of total fat per serving defined as total lipid fatty acids and expressed as triglycerides where fatty acids are aliphatic carboxylic acids consisting of a chain of alkyl groups and characterized by a terminal carboxyl group. Amounts shall be expressed to the nearest 0.5 (
(i) “Saturated fat” or “Saturated”: A statement of the number of grams of saturated fat per serving defined as the sum of all fatty acids containing no double bonds, except that label declaration of saturated fat content information is not required for products that contain less than 0.5 gram of total fat per serving if no claims are made about fat, fatty acid, or cholesterol content, and if “calories from saturated fat” is not declared. Saturated fat content shall be indented and expressed as grams per serving to the nearest 0.5 (
(A) [Reserved]
(B) [Reserved]
(ii) “
(iii) “Polyunsaturated fat” or “Polyunsaturated” (VOLUNTARY): A statement of the number of grams of polyunsaturated fat per serving defined as cis, cis-methylene-interrupted polyunsaturated fatty acids may be declared voluntarily, except that when monounsaturated fat is declared, or when a claim about fatty acids or cholesterol is made on the label or in labeling of a product other than one that meets the criteria in § 413.362(b)(1) for a claim for “fat free,” label declaration of polyunsaturated fat is required. Polyunsaturated fat content shall be indented and expressed as grams per serving to the nearest 0.5 (
(iv) “Monounsaturated fat” or “Monounsaturated” (VOLUNTARY): A statement of the number of grams of monounsaturated fat per serving defined as cis-monounsaturated fatty acids may be declared voluntarily, except that when polyunsaturated fat is declared, or when a claim about fatty acids or cholesterol is made on the label or in labeling of a product other than one that meets the criteria in § 413.362(b)(1) for a claim for “fat free,” label declaration of monounsaturated fat is required. Monounsaturated fat content shall be indented and expressed as grams per serving to the nearest 0.5 (
(3) “Cholesterol”: A statement of the cholesterol content per serving expressed in milligrams to the nearest 5-milligram increment, except that label declaration of cholesterol information is not required for products that contain less than 2 milligrams of cholesterol per serving and make no claim about fat, fatty acids, or cholesterol content, or such products may state the cholesterol content as zero. If the product contains 2 to 5 milligrams of cholesterol per serving, the content may be stated as “less than 5 milligrams.”
(4) “Sodium”: A statement of the number of milligrams of sodium per serving expressed as zero when the serving contains less than 5 milligrams of sodium, to the nearest 5-milligram increment when the serving contains 5 to 140 milligrams of sodium, and to the nearest 10-milligram increment when the serving contains greater than 140 milligrams.
(5) “Fluoride” (VOLUNTARY): A statement of the number of milligrams of fluoride in a specified serving of food may be declared voluntarily, except that when a claim is made about fluoride content, label declaration shall be required. Fluoride content shall be expressed as zero when the serving contains less than 0.1 milligrams of fluoride, to the nearest 0.1-milligram increment when the serving contains less than or equal to 0.8 milligrams of fluoride, and the nearest 0.2 milligram-increment when a serving contains more than 0.8 milligrams of fluoride.
(6) “Carbohydrate, total” or “Total carbohydrate”: A statement of the number of grams of total carbohydrate per serving expressed to the nearest gram, except that if a serving contains less than 1 gram, the statement “Contains less than 1 gram” or “less than 1 gram” may be used as an alternative, or, if the serving contains less than 0.5 gram, the content may be expressed as zero. Total carbohydrate content shall be calculated by subtraction of the sum of the crude protein, total fat, moisture, and ash from the total weight of the product. This calculation method is described in USDA Handbook No. 74 (slightly revised, 1973), pp. 2-3.
(i) “Dietary fiber”: A statement of the number of grams of total dietary fiber per serving, indented and expressed to the nearest gram, except that if a serving contains less than 1 gram, declaration of dietary fiber is not required, or, alternatively, the statement “Contains less than 1 gram” or “less than 1 gram” may be used, and if the serving contains less than 0.5 gram, the content may be expressed as zero. Dietary fiber is defined as non-digestible soluble and insoluble carbohydrates (with 3 or more monomeric units) and lignin that are intrinsic and intact in plants; isolated or synthetic non-digestible carbohydrates (with 3 or more monomeric units) determined by FDA to have physiological effects that are beneficial to human health. Except as provided for in paragraph (f) of this section, if dietary fiber content is not required, and as a result not declared, the statement “Not a significant source of dietary fiber” shall be placed at the bottom of the table of nutrient values in the same type size. The following isolated or synthetic non-digestible carbohydrate(s) have been determined by FDA to have physiological effects that are beneficial to human health and, therefore, shall be included in the calculation of the amount of dietary fiber: [beta]-glucan soluble fiber (as described in 21 CFR 101.81(c)(2)(ii)(A)), psyllium husk (as described in 21 CFR 101.81(c)(2)(ii)(A)(6)), cellulose, guar gum, pectin, locust bean gum, and hydroxypropylmethylcellulose. The manufacturer must make and keep records in accordance with paragraphs (h) of this section to verify the declared amount of dietary fiber in the label and labeling of food when a mixture of dietary fiber, and added non-digestible carbohydrate(s) that does not meet the definition of dietary fiber, is present in the food.
(A) “Soluble fiber” (VOLUNTARY): A statement of the number of grams of soluble dietary fiber per serving may be declared voluntarily except when a claim is made on the label or in labeling about soluble fiber, label declaration shall be required. Soluble fiber must meet the definition of dietary fiber in this paragraph (c)(6)(i). The manufacturer must maintain records in accordance with paragraph (h)(8) of this section to verify the declared amount of soluble fiber in the label and labeling of food when a mixture of soluble fiber and added non-digestible carbohydrate(s) that does not meet the definition of dietary fiber, is present in the food. Soluble fiber content shall be indented under dietary fiber and expressed to the nearest gram, except that if a serving contains less than 1 gram, the statement “Contains less than 1 gram” or “less than 1 gram” may be used as an alternative, and if the serving contains less than 0.5 gram, the content may be expressed as zero.
(B) “Insoluble fiber” (VOLUNTARY): A statement of the number of grams of insoluble dietary fiber per serving may be declared voluntarily except when a claim is made on the label or in labeling about insoluble fiber, label declaration shall be required. Insoluble fiber must meet the definition of dietary fiber in this paragraph (c)(6)(i). The manufacturer must make and keep records in accordance with paragraph (h)(8) of this section to verify the declared amount of insoluble fiber in the label and labeling of food when a mixture of insoluble and added non-digestible carbohydrate(s) that does not meet the definition of dietary fiber is present in the food. Insoluble fiber content shall be indented under dietary fiber and expressed to the nearest gram, except that if a serving contains less than 1 gram, the statement “Contains less than 1 gram” or “less than 1 gram” may be used as an alternative, and if the serving contains less than 0.5 gram, the content may be expressed as zero.
(ii) “Total Sugars”: A statement of the number of grams of sugars per serving, except that the label declaration of sugars content is not required for products that contain less than 1 gram of sugars per serving if no claims are made about sweeteners, sugars, or sugar alcohol content. Total sugars shall be defined as the sum of all free mono- and disaccharides (such as glucose, fructose, lactose, and sucrose). Total sugars content shall be indented and expressed to the nearest gram, except that if a serving contains less than 1 gram, the statement “Contains less than 1 gram” or “less than 1 gram” may be used as an alternative, and if the serving contains less than 0.5 gram, the content may be expressed as zero.
(iii) “Added Sugars”: A statement of the number of grams of added sugars in a serving, except that label declaration of added sugars content is not required for products that contain less than 1 gram of added sugars in a serving if no claims are made about sweeteners, sugars, added sugars, or sugar alcohol content. If a statement of the added sugars content is not required and, as a result, not declared, the statement “Not a significant source of added sugars” shall be placed at the bottom of the table of nutrient values in the same type size. Added sugars are either added during the processing of foods, or are packaged as such, and include sugars (free, mono- and disaccharides), sugars from syrups and honey, and sugars from concentrated fruit or vegetable juices that are in excess of what would be expected from the same volume of 100 percent fruit or vegetable juice of the same type. Added sugars content shall be indented under Total Sugars and shall be prefaced with the word “Includes” followed by the amount (in grams) “Added Sugars” (“Includes `X' g Added Sugars”). It shall be expressed to the nearest gram, except that if a serving contains less than 1 gram, the statement “Contains less than 1 gram” or “less than 1 gram” may be used as an alternative, and if the serving contains less than 0.5 gram, the content may be expressed as zero. When a mixture of naturally occurring and added sugars is present in the food, and for specific foods containing added sugars, alone or in combination with naturally occurring sugars, where the added sugars are subject to fermentation and/or non-enzymatic browning, the manufacturer must maintain records in accordance with paragraph (h)(8) of this section to verify the declared amount of added sugars in the label and labeling of food.
(iv) “Sugar alcohol” (VOLUNTARY): A statement of the number of grams of sugar alcohols per serving may be declared voluntarily on the label, except that when a claim is made on the label or in labeling about sugar alcohol, total sugars, or added sugars when sugar alcohols are present in the product, sugar alcohol content shall be declared. For nutrition labeling purposes, sugar alcohols are defined as the sum of saccharide derivatives in which a hydroxyl group replaces a ketone or aldehyde group and whose use in the food is listed by FDA (
(7) “Protein”: A statement of the number of grams of protein per serving, expressed to the nearest gram, except that if a serving contains less than 1 gram, the statement “Contains less than 1 gram” or “less than 1 gram” may be used as an alternative, and if the serving contains less than 0.5 gram, the content may be expressed as zero. When the protein in products represented or
(i) A statement of the corrected amount of protein per serving, as determined in paragraph (c)(7)(ii) of this section, calculated as a percentage of the RDI or DRV for protein, as appropriate, and expressed as percent of Daily Value, may be placed on the label, except that such a statement shall be given if a protein claim is made for the product, or if the product is represented or purported to be specifically for infants through 12 months of age or children 1 through 3 years of age. When such a declaration is provided, it shall be placed on the label adjacent to the statement of grams of protein and aligned under the column headed “%Daily Value,” and expressed to the nearest whole percent. However, the percentage of the RDI for protein shall not be declared if the product is represented or purported to be specifically for infants through 12 months and the protein quality value is less than 40 percent of the reference standard.
(ii) The “corrected amount of protein (grams) per serving” for products represented or purported to be for adults and children 1 or more years of age is equal to the actual amount of protein (grams) per serving multiplied by the amino acid score corrected for protein digestibility. If the corrected score is above 1.00, then it shall be set at 1.00. The protein digestibility-corrected amino acid score shall be determined by methods given in sections 5.4.1, 7.2.1, and 8.00 in “Report of the Joint FAO/WHO Expert Consultation on Protein Quality Evaluation,” except that when official AOAC procedures described in paragraph (c)(7) of this section require a specific factor other than 6.25, that specific factor shall be used.
For products represented or purported to be specifically for infants through 12 months, the corrected amount of protein (grams) per serving is equal to the actual amount of protein (grams) per serving multiplied by the relative protein quality value. The relative protein quality value shall be determined by dividing the subject product's protein PER value by the PER value for casein. If the relative protein value is above 1.00, it shall be set at 1.00.
(iii) For the purpose of labeling with a percent of the DRV or RDI, a value of 50 grams of protein shall be the DRV for adults and children 4 or more years of age, a value of 11 grams of protein shall be the RDI for infants through 12 months, a value of 13 grams shall be the DRV for children 1 through 3 years of age, and a value of 71 grams of protein shall be the RDI for pregnant women and lactating women.
(8) Vitamins and minerals: The requirements related to including a statement of the amount per serving of vitamins and minerals are described in this paragraph (c)(8).
(i) For purposes of declaration of percent of Daily Value as provided for in paragraphs (d) through (g) of this section, products represented or purported to be specifically for infants through 12 months, children 1 through 3 years, pregnant women and lactating women shall use the RDIs that are specified for the intended group. For products represented or purported to be specifically for both infants through 12 months and children 1 through 3 years of age, the percent of Daily Value shall be presented by separate declarations according to paragraph (e) of this section based on the RDI values for infants through 12 months and for children 1 through 3 years of age. When such dual declaration is used on any label, it shall be included in all labeling, and equal prominence shall be given to both values in all such labeling. The percent Daily Value based on the RDI values for pregnant women and lactating women shall be declared on food represented or purported to be specifically for pregnant women and lactating women. All other products shall use the RDI for adults and children 4 or more years of age.
(ii) The declaration of vitamins and minerals as a quantitative amount by weight and percent of the RDI shall include vitamin D, calcium, iron, and potassium in that order, for infants through 12 months, children 1 through 3 years of age, pregnant women, lactating women, and adults and children 4 or more years of age. The declaration of folic acid shall be included as a quantitative amount by weight when added or a claim is made about the nutrient. The declaration of vitamins and minerals in a food as a quantitative amount by weight and percent of the RDI, may include any of the other vitamins and minerals listed in paragraph (c)(8)(iv) of this section. The declaration of vitamins and minerals shall include any of the other vitamins and minerals listed in paragraph (c)(8)(iv) of this section as a statement of the amount per serving of the vitamins and minerals as described in this paragraph, calculated as a percent of the RDI and expressed as a percent of the Daily Value, when they are added, or when a claim is made about them, unless otherwise stated as quantitative amount by weight and percent of the Daily Value. Other vitamins and minerals need not be declared if neither the nutrient nor the component is otherwise referred to on the label or in labeling and the vitamins and minerals are:
(A) Required or permitted in a standardized food (
(B) Included in a product solely for technological purposes and declared only in the ingredients statement. The declaration may also include any of the other vitamins and minerals listed in paragraph (c)(8)(iv) of this section when they are naturally occurring in the food. The additional vitamins and minerals shall be listed in the order established in paragraph (c)(8)(iv) of this section.
(iii) The percentages for vitamins and minerals shall be expressed to the nearest 2-percent increment up to and including the 10-percent level, the nearest 5-percent increment above 10 percent and up to and including the 50-percent level, and the nearest 10-percent increment above the 50-percent level. Quantitative amounts and percentages
(iv) The following RDIs, nomenclature, and units of measure are established for the following vitamins and minerals which are essential in human nutrition:
(v) The following synonyms may be added in parenthesis immediately following the name of the nutrient or dietary component:
(vi) A statement of the percent of vitamin A that is present as
(vii) When the amount of folate is declared in the labeling of a product the nutrient name “folate” shall be listed for products containing folate (natural folate, and/or synthetic folate), folic acid, or a mixture of folate and folic acid. The name of the synthetic form of the nutrient “folic acid”, when added or a claim is made about the nutrient, shall be included in parentheses after this declaration with the amount of folic acid. The declaration must be folate in mcg DFE (when expressed as a quantitative amount by weight) and the percent Daily Value based on folate in mcg DFE, or may be expressed as folate and the percent DV based on folate in mcg DFE. When declared, folic acid must be in parentheses, mcg of folic acid as shown in paragraph (d)(12) of this section in the display that illustrates voluntary declaration of nutrition information.
(9) The following DRVs, nomenclature, and units of measure are established for the following food components:
(d)(1) Nutrient information specified in paragraph (c) of this section shall be presented on products in the following format, as shown in paragraph (d)(12) of this section, except on foods where the horizontal display is permitted as provided for in paragraph (d)(11) of this section, on which dual columns of nutrition information are declared as provided for in paragraph (e) of this section, on those food products on which the simplified format is permitted to be used as provided for in paragraph (f) of this section, on foods for infants through 12 months of age and children 1 through 3 years of age as provided for in § 413.400(c), and on foods in small or intermediate-sized packages as provided for in paragraph (g) of this section.
(i) The nutrition information shall be set off in a box by use of hairlines and shall be all black or one color type, printed on a white or other neutral contrasting background whenever practical.
(ii) All information within the nutrition label shall utilize:
(A) A single easy-to-read type style,
(B) Upper and lower case letters,
(C) At least one point leading (
(D) Letters should never touch.
(iii) Information required in paragraphs (d)(7) and (d)(8) of this section shall be in type size no smaller than 8 point. Information required in paragraph (d)(5) of this section for the “Calories” declaration shall be highlighted in bold or extra bold and shall be in a type size no smaller than 16 point except the type size for this information required in the tabular displays as shown in paragraphs (d)(11)(iii), (e)(6)(ii), and (g)(1)(i)(A) of this section, and the linear display for small packages as shown in paragraph (g)(1)(i)(B) of this section shall be in a type size no smaller than 10 point. The numeric amount for the information required in paragraph (d)(5) of this section shall also be highlighted in bold or extra bold type and shall be in a type size no smaller than 22 point, except the type size for this information required for the tabular display for small packages as shown in paragraph (g)(1)(i)(A) of this section, and for the linear display for small packages as shown in paragraph (g)(1)(i)(B) of this section no smaller than 14 point. The information required in paragraph (d)(9) of this section shall be in a type size no smaller than 6 point. When provided, the information described in paragraph (d)(10) of this section shall be in a type size no smaller than 6 point.
(iv) The headings required by paragraphs (d)(2), (d)(3)(ii), (d)(4), and (d)(6) of this section (
(v) A hairline rule that is centered between the lines of text shall separate “Nutrition Facts” from the servings per container statement required in paragraph (d)(3)(i) of this section, and shall separate each nutrient and its corresponding percent of Daily Value required in paragraphs (d)(7)(i) and (d)(7)(ii) of this section from the nutrient and percent of Daily Value above and below it, as shown in paragraph (d)(12) of this section.
(2) The information shall be presented under the identifying heading of “Nutrition Facts” which shall be set in a type size no smaller than all other print size in the nutrition label except for the numerical information for “Calories” required in paragraph (d)(5) of this section, and except for labels presented according to the format provided for in paragraphs (d)(11)(iii),
(3) Information on servings per container and serving size shall immediately follow the heading as shown in paragraph (d)(12) of this section. Such information shall include:
(i) “__ servings per container”: The number of servings per container, except that this statement is not required on single-serving containers as defined in paragraph (b)(8) of this section or on single-ingredient, raw products that are not ground or chopped products described in § 413.301. The information required in this paragraph shall be located immediately after the “Nutrition Facts” heading and shall be in a type size no smaller than 10 point, except the type size for this information shall be no smaller than 9 point in the tabular display for small packages as shown in paragraph (g)(1)(i)(A) of this section and the linear display for small packages as shown in paragraph (g)(1)(i)(B) of this section. For the linear display for small packages as shown in paragraph (g)(1)(i)(B) of this section, the actual number of servings may be listed after the servings per container declaration.
(ii) “Serving size”: A statement of the serving size as specified in paragraph (b)(9) of this section shall immediately follow the “__ servings per container” declaration. The information required in this paragraph shall be highlighted in bold or extra bold and be in a type size no smaller than 10 point except the type size shall be no smaller than 9 point for this information in the tabular displays as shown in paragraphs (d)(11) and (e)(6)(ii) of this section, the tabular display for small packages as shown in (g)(1)(i)(A) of this section, and the linear display for small packages as shown in paragraph (g)(1)(i)(B) of this section. The serving size amount must be right justified if adequate space is available. If the “Serving size” declaration does not fit in the allocated space a type size of no smaller than 8 point may be used on packages of any size.
(4) A subheading “Amount per serving” shall be separated from serving size information by a bar as shown in paragraph (d)(12) of this section, except this information is not required for the dual column formats shown in paragraphs (e)(5), (e)(6)(i), and (e)(6)(ii) of this section. “Per__” (
(5) Information on calories shall immediately follow the subheading “Amount per serving” and shall be declared in one line. If “Calories from saturated fat” is declared, it shall be indented under “Calories” and shall be in a type size no smaller than 8 point.
(6) The column heading “% Daily Value,” followed by an asterisk (
(7) Except as provided for in paragraph (g)(1)(i)(B) of this section, and except as permitted by § 413.400(d)(2), nutrient information for both mandatory and any voluntary nutrients listed in paragraph (c) of this section that are to be declared in the nutrition label, except for folic acid in conventional food and voluntarily declared vitamins and minerals expressed as a statement of the amount per serving calculated as a percent of the RDI and expressed as a percent Daily Value, shall be declared as follows:
(i) The name of each nutrient, as specified in paragraph (c) of this section, shall be given in a column and followed immediately by the quantitative amount by weight for that nutrient appended with a “g” for grams or “mg” for milligrams, or “mcg” for micrograms as shown in paragraph (d)(12) of this section. The symbol “<” may be used in place of “less than”.
(ii) A listing of the percent of the DRV as established in paragraphs (c)(7)(iii) and (c)(9) of this section shall be given in a column aligned under the heading “% Daily Value” established in paragraph (d)(6) of this section with the percent expressed to the nearest whole percent for each nutrient declared in the column described in paragraph (d)(7)(i) of this section for which a DRV has been established, except that the percent for protein may be omitted as provided in paragraph (c)(7) of this section. The percent shall be calculated by dividing either the amount declared on the label for each nutrient or the actual amount of each nutrient (
(8) Nutrient information for vitamins and minerals (except sodium) shall be separated from information on other nutrients by a bar and shall be arrayed vertically as shown in paragraph (d)(12) of this section (
(9) A footnote, preceded by an asterisk, shall be placed beneath the list of vitamins and minerals and shall be separated from the list by a bar, except that the footnote may be omitted from foods that can use the terms “calorie free,” “free of calories,” “no calories,” “zero calories,” “without calories,” “trivial source of calories,” “negligible source of calories,” or “dietarily insignificant source of calories” on the label or in the labeling of foods as defined in 9 CFR 413.360(b). The first sentence of the footnote: “The % Daily Value tells you how much a nutrient in a serving of food contributes to a daily diet” may be used on foods than can use the terms “calorie free,” “free of calories,” “no calories,” “zero calories,” “without calories,” “trivial source of calories,” “negligible source of calories,” or “dietarily insignificant source of calories” on the label or in the labeling of foods as defined in 9 CFR 413.360(b). The footnote shall state: “*The % Daily Value tells you how much a nutrient in a serving of food contributes to a daily diet. 2,000 calories a day is used for general nutrition advice.” If the food product is represented or purported to be for children 1 through 3 years of age, the second sentence of the footnote shall substitute “1,000 calories” for “2,000 calories”.
(10) Caloric conversion information on a per gram basis for fat, carbohydrate, and protein may be presented beneath the information required in paragraph (d)(9), separated from that information by a hairline. This information may be presented horizontally (
(11)(i) If the space beneath the information on vitamins and minerals is not adequate to accommodate the information required in paragraph (d)(9)
(ii) If the space beneath the mandatory declaration of potassium is not adequate to accommodate any remaining vitamins and minerals to be declared or the information required in paragraph (d)(9) of this section, the remaining information may be moved to the right and set off by a line that distinguishes it and sets it apart from the nutrients and the percent of DV information given to the left. The caloric conversion information provided for in paragraph (d)(10) of this section may be presented beneath either side or along the full length of the nutrition label.
(iii) If there is not sufficient continuous vertical space (
(12) The following sample labels illustrate the mandatory provisions and mandatory plus voluntary provisions of paragraph (d) of this section and the side-by-side display:
(13)(i) Nutrition labeling on the outer label of packages of products that contain two or more products in the same packages (
(ii) Aggregate displays shall comply with format requirements of paragraph (d) of this section to the maximum extent possible, except that the identity of each food shall be specified to the right of the “Nutrition Facts” heading, and both the quantitative amount by weight (
(14) When nutrition labeling appears in a second language, the nutrition information may be presented in a separate nutrition label for each language or in one nutrition label with the information in the second language following that in English. Numeric characters that are identical in both languages need not be repeated (
(e) Nutrition information may be presented for two or more forms of the same product (
(1) Following the serving size information there shall be two or more column headings accurately describing the amount per serving size of the form of the same product (
(2) The quantitative information by weight as required in paragraph (d)(7)(i) and the information required in (d)(7)(ii) of this section shall be presented for the form of the product as packaged and for any other form of the product (
(3) When the dual labeling is presented for two or more forms of the same food, for combinations of food, for different units, or for two or more groups for which RDIs are established, quantitative information by weight and the percent Daily Value shall be presented in two columns and the columns shall be separated by vertical lines as shown in paragraph (e)(5) of this section.
(4) Nutrient information for vitamins and minerals (except sodium) shall be separated from information on other nutrients by a bar and shall be arrayed vertically in the following order: Vitamin D, calcium, iron, potassium as shown in paragraph (e)(5) of this section.
(5) The following sample label illustrates the provisions of paragraph (e) of this section:
(6) When dual labeling is presented for a food on a per serving basis and per container basis as required in paragraph (b)(16)(i) of this section or on a per serving basis and per unit basis as required in paragraph (b)(4)(iv) of this section, the quantitative information by weight as required in (d)(7)(i) and the percent Daily Value as required in paragraph (d)(7)(ii) shall be presented in two columns, and the columns shall be separated by vertical lines as shown in the displays in paragraph (e)(6)(i) of this section.
(i) Nutrient information for vitamins and minerals shall be separated from information on other nutrients by a bar and shall be arrayed vertically in the following order: Vitamin D, calcium, iron, and potassium as shown in the following sample labels.
(ii) The following sample label illustrates the provisions of paragraphs (b)(4)(iv) and (b)(16)(i) of this section for labels that use the dual column format in the horizontal display.
(f)(1) The declaration of nutrition information may be presented in the simplified format as set forth herein when any required nutrients, other than the core nutrients (
(2) The simplified format shall include information on the following nutrients:
(i) Total calories, total fat, sodium, total carbohydrate, and protein;
(ii) Any of the following that are present in more than insignificant amounts: saturated fat,
(iii) Any vitamins and minerals listed in paragraph (c)(8)(iv) of this section when they are added in fortified or fabricated foods.
(3) Other nutrients that are naturally present in the product in more than insignificant amounts may be voluntarily declared as part of the simplified format.
(4) Any required nutrient, other than a core nutrient, that is present in an insignificant amount may be omitted from the columnar listing, provided that the following statement is included at the bottom of the nutrition label, “Not a significant source of __.” The blank shall be filled in with the appropriate nutrient or food component. Alternatively, amounts of vitamins and minerals present in insignificant amounts may be declared by the use of an asterisk (or symbol) that is placed at the bottom of the table of nutrient values and that is followed by the statement “Contains less than 2 percent of the Daily Value of this (these) nutrient (nutrients).”
(5) Except as provided for in paragraph (g) of this section and in § 413.400(c) and (d), nutrient information declared in the simplified format shall be presented in the same manner as specified in paragraphs (d) or (e) of this section, except that the footnote required in paragraph (d)(9) of this section is not required, and an asterisk shall be placed at the bottom of the label followed by the statement “%DV = %Daily Value” when “Daily Value” is not spelled out in the heading, as shown in the following example that illustrates the simplified display
(g) Foods in packages that have a total surface area available to bear labeling of 40 or less square inches may modify the requirements of paragraphs (c) through (f) of this section and § 413.302(a) by one or more of the following means:
(1)(i) Presenting the required nutrition information in a tabular or linear fashion, rather than in vertical columns if the product has a total surface area available to bear labeling of less than 12 square inches, or if the product has a total surface area available to bear labeling of 40 or less square inches and the package shape or size cannot accommodate a standard vertical column or tabular display on any label panel. Nutrition information may be given in a linear fashion only if the package shape or size will not accommodate a tabular display.
(A) The following sample label illustrates the tabular display for small packages.
(B) The following sample label illustrates the linear display.
(2) Using any of the following abbreviations:
Total carbohydrate—Total carb. This abbreviation can also be used on dual column displays as shown in paragraphs (e)(5), (e)(6)(i), and (e)(6)(ii).
(3) Omitting the footnote statement and placing another asterisk at the bottom of the label followed by the statement “%DV=%Daily Value.”
(4) Presenting the required nutrition information on any other label panel.
(h) Compliance with this section shall be determined as follows:
(1) A production lot is a set of food production consumer units that are from one production shift. Alternatively, a collection of consumer units of the same size, type, and style produced under conditions as nearly uniform as possible, designated by a common container code or marking, constitutes a production lot.
(2) The sample for nutrient analysis shall consist of a composite of a minimum of six consumer units, each from a production lot. Alternatively, the sample for nutrient analysis shall consist of a composite of a minimum of six consumer units, each randomly chosen to be representative of a production lot. In each case, the units may be individually analyzed and the results of the analyses averaged, or the units would be composited and the composite analyzed. In both cases, the results, whether an average or a single result from a composite, will be considered by the Agency to be the nutrient content of a composite. All analyses shall be performed by appropriate methods and procedures used by the Department for each nutrient in accordance with the “Chemistry Laboratory Guidebook,” or, if no USDA method is available and appropriate for the nutrient, by appropriate methods for the nutrient in accordance with the 2016 edition of the “Official Methods of Analysis” of the AOAC International, unless a particular method of analysis is specified in § 413.309(c), or, if no USDA, AOAC, or specified method is available and appropriate, by other reliable and appropriate analytical procedures as so determined by the Agency.
(3) Two classes of nutrients are defined for purposes of compliance:
(i) Class I. Added nutrients in fortified or fabricated foods; and
(ii) Class II. Naturally occurring (indigenous) nutrients. When a nutrient is naturally occurring (indigenous) in a food or an ingredient that is added to a food, the total amount of such nutrient in the final food product is subject to Class II requirements, except that when an exogenous source of the nutrient is also added to the final food product, the total amount of the nutrient in the final food product (indigenous and exogenous) is subject to Class I requirements.
(4) A product with a label declaration of a vitamin, mineral, protein, total carbohydrate, dietary fiber, soluble fiber, insoluble fiber, polyunsaturated or monounsaturated fat shall be deemed to be misbranded under section 1(n) of the Federal Meat Inspection Act (21 U.S.C. 601(n)(1)) or 4(h) of the Poultry Products Inspection Act (21 U.S.C. 453(h)) unless it meets the following requirements:
(i) When a vitamin, mineral, protein, or dietary fiber meets the definition of a Class I nutrient, the nutrient content of the composite must be formulated to be at least equal to the value for that nutrient declared on the label.
(ii) When a vitamin, mineral, protein, total carbohydrate, polyunsaturated or monounsaturated fat, dietary fiber meets the definition of a Class II nutrient, the nutrient content of the composite must be at least equal to 80 percent of the value for that nutrient declared on the label. Provided, that no regulatory action will be based on a determination of a nutrient value that falls below this level by a factor less than the variability generally recognized for the analytical method used in that product at the level involved.
(5) A product with a label declaration of calories, total sugars, added sugars (when the only source of sugars in the food is added sugars), total fat, saturated fat,
(6) The amount of vitamins, minerals, protein, total carbohydrate, dietary fiber, soluble fiber, insoluble fiber, sugar alcohols, polyunsaturated or monounsaturated fat may vary over labeled amounts within good manufacturing practice. The amount of calories, sugars, added sugars, total fat, saturated fat,
(7) Compliance will be based on the metric measure specified in the label statement of the serving size.
(8) The management of the official establishment or establishment certified under a foreign inspection system, in accordance with parts 327 and 381, subpart T, of this chapter must maintain records in accordance with parts 320 and 381, subpart Q, of this chapter to support the validity of nutrient declarations contained on product labels including the records in subparagraphs (h)(8)(i)-(vii) of this section for documenting the amount of dietary fiber, soluble fiber, insoluble fiber, added sugars, tocopherol, folate, and folic acid. Such records shall be made available to the inspector or any duly authorized representative of the Agency upon request.
(i) When a mixture of dietary fiber, and added non-digestible carbohydrate(s) that does not meet the definition of dietary fiber, is present in the food, a manufacturer must maintain records of the amount of non-digestible carbohydrate(s) added to the food that does not meet the definition of dietary fiber.
(ii) When a mixture of soluble fiber and added non-digestible carbohydrate(s) that does not meet the definition of dietary fiber is present in the food, a manufacturer must maintain records necessary to verify the amount of the non-digestible carbohydrate(s) added to the food that does not meet the definition of dietary fiber.
(iii) When a mixture of insoluble fiber and added non-digestible carbohydrate(s) that does not meet the definition of dietary fiber is present in the food, a manufacturer must maintain records necessary to verify the amount of the non-digestible carbohydrate(s) added to the food that does not meet the definition of dietary fiber.
(iv) When a mixture of naturally occurring and added sugars is present in the food, a manufacturer must maintain records of the amount of added sugars added to the food during the processing of the food, and if packaged as a separate ingredient, as packaged (whether as part of a package containing one or more ingredients or packaged as a single ingredient).
(v) When the amount of sugars added to food products is reduced through the process of yeast-leavening, non-enzymatic browning or fermentation, manufacturers must:
(A) Maintain records of all relevant scientific data and information relied upon by the manufacturer that demonstrates the amount of added sugars in the food after the process of non-enzymatic browning, yeast-leavening, fermentation, or the manufacture of reaction flavors and a narrative explaining why the data and information are sufficient to demonstrate the amount of added sugars declared in the finished food, provided the data and information used is specific to the type of food that is subject to non-enzymatic browning or fermentation; or
(B) Maintain records of the amount of added sugars added to the food before and during the processing of the food, and if packaged as a separate ingredient, as packaged (whether as part of a package containing one or more ingredients or packaged as a single ingredient) and in no event shall the amount of added sugars declared exceed the amount of total sugars on the label; or
(C) Submit a request to FSIS to use an alternative means of compliance. The request must provide scientific data or other information for why the amount of added sugars in a serving of product is likely to have a significant reduction in added sugars compared to the amount added prior to non-enzymatic browning and/or fermentation. A significant reduction would be where reduction in added sugars after non-enzymatic browning or fermentation may be significant enough to impact the label declaration for added sugars by an amount that exceeds the reasonable deficiency acceptable within good manufacturing practice under § 413.309(h)(6). In addition, the scientific data or other information must include the reason that the manufacturer is unable to determine a reasonable approximation of the amount of added sugars in a serving of their finished product and a description of the process that they used to come to that conclusion.
(vi) When a mixture of
(vii) When a mixture of folate and folic acid is present in a food, manufacturers must maintain records of the amount of synthetic folate and/or folic acid added to the food and the amount of naturally-occurring folate in the finished food.
(9) The compliance provisions set forth in paragraph (h)(1) through (8) of this section shall not apply to single-ingredient, raw products that are not ground or chopped products described in § 413.301, including those that have been previously frozen, when nutrition labeling is based on the most current representative data base values contained in USDA's National Nutrient Data Bank or its released form, the USDA National Nutrient Database for Standard Reference as provided in § 413.345(e) and (f).
(i) The standards required in this section are incorporated by reference into this section with the approval of the Director of the Federal Register under 5 U.S.C. 552(a) and 1 CFR part 51. All approved material is available for inspection at the office of the FSIS Docket Clerk, Room 8-164A, Patriots Plaza 3, 355 E Street SW., Washington, DC, and is available from the sources indicated below. It is also available for inspection at the National Archives and Records Administration (NARA), call 202-741-6030, or go to
(1) AOAC Reseller. Techstreet, 6300 Interfirst Dr., Ann Arbor, MI 48108, Toll free in United States: 1-800-699-9277, Outside United States: 1-734-780-8000, Fax: 1-734-780-2046,
(i) “Official Methods of Analysis of the AOAC INTERNATIONAL,” 20th Edition, Volumes 1 and 2, 2016.
(ii) [Reserved]
(2) Food and Agriculture Organization of the United Nations/World Health Organization (FAO/WHO), Publications Division, Viale delle Terme di Caracalla, 00100 Rome, Italy.
(i) FAO Food and Nutrition Paper 51,”Report of the Joint FAO/WHO Expert Consultation on Protein Quality Evaluation,” Rome, 1991.
(ii) [Reserved]
(3) United States Department of Agriculture (USDA), Agricultural Research Service, Washington, DC, Nutrient Data Laboratory, Bldg. 005, Room 105 BARC—West, Beltsville, MD 20705, 301-504-0630.
(i) USDA Handbook No. 74, Energy Value of Foods—basis and derivation, by A. L. Merrill and B. K. Watt, (slightly revised, 1973)
(ii) [Reserved]
(a) The general principles followed in arriving at the reference amounts customarily consumed per eating occasion (Reference Amounts), as set forth in paragraph (b) of this section, are:
(1) The Reference Amounts are calculated for persons 4 years of age or older to reflect the amount of food customarily consumed per eating occasion by persons in this population group. These Reference Amounts are based on data set forth in appropriate national food consumption surveys.
(2) The Reference Amounts are calculated for an infant or child under 4 years of age to reflect the amount of food customarily consumed per eating occasion by infants through 12 months of age or by children 1 through 3 years of age, respectively. These Reference Amounts are based on data set forth in appropriate national food consumption surveys. Such Reference Amounts are to be used only when the product is specially formulated or processed for use by an infant through 12 months of age or by a child under 4 years of age.
(3) An appropriate national food consumption survey includes a large sample size representative of the demographic and socioeconomic characteristics of the relevant population group and must be based on consumption data under actual conditions of use.
(4) To determine the amount of food customarily consumed per eating occasion, the mean, median, and mode of the consumed amount per eating occasion were considered.
(5) When survey data were insufficient, FSIS took various other sources of information on serving sizes of food into consideration. These other sources of information included:
(i) Serving sizes used in dietary guidance recommendations or recommended by other authoritative systems or organizations;
(ii) Serving sizes recommended in comments;
(iii) Serving sizes used by manufacturers and grocers; and
(iv) Serving sizes used by other countries.
(6) Because they reflect the amount customarily consumed, the Reference Amount and, in turn, the serving size declared on the product label are based on only the edible portion of food, and not bone, seed, shell, or other inedible components.
(7) The Reference Amount is based on the major intended use of the product (
(8) The Reference Amounts for products that are consumed as an ingredient of other products, but that may also be consumed in the form in which they are purchased (
(9) FSIS sought to ensure that foods that have similar dietary usage, product characteristics, and customarily consumed amounts have a uniform Reference Amount.
(b) The following Product Categories and Reference Amounts shall be used as the basis for determining serving sizes for specific products:
(c) For products that have no Reference Amount listed in paragraph (b) of this section for the unprepared or the prepared form of the product and that consist of two or more foods packaged and presented to be consumed together (
(1) The reference amount for the combined product must be the reference amount, as established in paragraph (b) of this section, for the ingredient that is represented as the main ingredient (
(2) If the Reference Amounts are in compatible units, the weights or volumes must be summed (
(d) If a product requires further preparation,
(e) The Reference Amount for an imitation or substitute product or altered product as defined in § 413.313(d), such as a “low calorie” version, shall be the same as for the product for which it is offered as a substitute.
(f) The Reference Amounts set forth in paragraphs (b) through (e) of this section shall be used in determining whether a product meets the criteria for nutritional claims. If the serving size declared on the product label differs from the Reference Amount, and the product meets the criteria for the claim only on the basis of the Reference Amount, the claim shall be followed by a statement that sets forth the basis on which the claim is made. That statement shall include the Reference Amount as it appears in paragraph (b) of this section followed, in parentheses, by the amount in common household measure if the Reference Amount is expressed in measures other than common household measures.
(g) The Administrator, on his or her own initiative or on behalf of any interested person who has submitted a labeling application, may issue a proposal to establish or amend a Product Category or Reference Amount identified in paragraph (b) of this section.
(1) Labeling applications and supporting documentation to be filed under this section shall be submitted in quadruplicate, except that the supporting documentation may be submitted on a computer disc copy. If any part of the material submitted is in a foreign language, it shall be accompanied by an accurate and complete English translation. The labeling application shall state the applicant's post office address.
(2) Pertinent information will be considered as part of an application on the basis of specific reference to such information submitted to and retained in the files of the Food Safety and Inspection Service. However, any reference to unpublished information furnished by a person other than the applicant will not be considered unless use of such information is authorized (with the understanding that such information may in whole or part be subject to release to the public) in a written statement signed by the person who submitted it. Any reference to published information should be accompanied by reprints or photostatic copies of such references.
(3) The availability for public disclosure of labeling applications, along with supporting documentation, submitted to the Agency under this section will be governed by the rules specified in subchapter D, title 9.
(4) Data accompanying the labeling application, such as food consumption data, shall be submitted on separate sheets, suitably identified. If such data has already been submitted with an earlier labeling application from the applicant, the present labeling application must provide the data.
(5) The labeling application must be signed by the applicant or by his or her attorney or agent, or (if a corporation) by an authorized official.
(6) The labeling application shall include a statement signed by the person responsible for the labeling application, that to the best of his or her knowledge, it is a representative and balanced submission that includes unfavorable information, as well as favorable information, known to him or her pertinent to the evaluation of the labeling application.
(7) Labeling applications for a new Reference Amount and/or Product Category shall be accompanied by the following data which shall be submitted in the following form to the Director, Labeling and Program Delivery Staff, Office of Policy and Program Development, Food Safety and Inspection Service, Washington, DC 20250:
The undersigned, _____ submits this labeling application pursuant to 9 CFR 413.312 with respect to Reference Amount and/or Product Category.
Attached hereto, in quadruplicate, or on a computer disc copy, and constituting a part of this labeling application, are the following:
(i) A statement of the objective of the labeling application;
(ii) A description of the product;
(iii) A complete sample product label including nutrition label, using the format established by regulation;
(iv) A description of the form in which the product will be marketed;
(v) The intended dietary uses of the product with the major use identified (
(vi) If the intended use is primarily as an ingredient in other foods, list of foods or food categories in which the product will be used as an ingredient with information on the prioritization of the use;
(vii) The population group for which the product will be offered for use (
(viii) The names of the most closely-related products (or in the case of foods for special dietary use and imitation or substitute foods, the names of the products for which they are offered as substitutes);
(ix) The suggested Reference Amount (the amount of edible portion of food as consumed, excluding bone, skin or other inedible components) for the population group for which the product is intended with full description of the methodology and procedures that were used to determine the suggested Reference Amount. In determining the Reference Amount, general principles and factors in paragraph (a) of this section should be followed.
(x) The suggested Reference Amount shall be expressed in metric units. Reference Amounts for foods shall be expressed in grams except when common household units such as cups, tablespoons, and teaspoons are more appropriate or are more likely to promote uniformity in serving sizes declared on product labels. For example, common household measures would be more appropriate if products within the same category differ substantially in density such as mixed dishes measurable with a cup.
(A) In expressing the Reference Amount in grams, the following general rules shall be followed:
(B) [Reserved]
(xi) A labeling application for a new subcategory of food with its own Reference Amount shall include the following additional information:
(A) Data that demonstrate that the new subcategory of food will be consumed in amounts that differ enough from the Reference Amount for the parent category to warrant a separate Reference Amount. Data must include sample size, and the mean, standard deviation, median, and modal consumed amount per eating occasion for the product identified in the labeling application and for other products in the category. All data must be derived from the same survey data.
(B) Documentation supporting the difference in dietary usage and product characteristics that affect the consumption size that distinguishes the product identified in the labeling application from the rest of the products in the category.
(xii) In conducting research to collect or process food consumption data in support of the labeling application, the following general guidelines should be followed.
(A) Sampled population selected should be representative of the demographic and socioeconomic characteristics of the target population group for which the food is intended.
(B) Sample size (
(C) The study protocol should identify potential biases and describe how potential biases are controlled for or, if not possible to control, how they affect interpretation of results.
(D) The methodology used to collect or process data including study design, sampling procedures, materials used (
(xiii) A statement concerning the feasibility of convening associations, corporations, consumers, and other interested parties to engage in negotiated rulemaking to develop a proposed rule.
(8) Upon receipt of the labeling application and supporting documentation, the applicant shall be notified, in writing, of the date on which the labeling application was received. Such notice shall inform the applicant that the labeling application is undergoing Agency review and that the applicant shall subsequently be notified of the Agency's decision to consider for further review or deny the labeling application.
(9) Upon review of the labeling application and supporting documentation, the Agency shall notify the applicant, in writing, that the labeling application is either being considered for further review or that it has been summarily denied by the Administrator.
(10) If the labeling application is summarily denied by the Administrator, the written notification shall state the reasons therefor, including why the Agency has determined that the proposed Reference Amount or Product Category is false or misleading. The notification letter shall inform the applicant that the applicant may submit a written statement by way of answer to the notification, and that the applicant shall have the right to request a hearing with respect to the merits or validity of the Administrator's decision to deny the use of the proposed Reference Amount or Product Category.
(i) If the applicant fails to accept the determination of the Administrator and files an answer and requests a hearing, and the Administrator, after review of the answer, determines the initial determination to be correct, the Administrator shall file with the Hearing Clerk of the Department the notification, answer, and the request for a hearing, which shall constitute the complaint and answer in the proceeding, which shall thereafter be conducted in accordance with the Department's Uniform Rules of Practice.
(ii) The hearing shall be conducted before an administrative law judge with the opportunity for appeal to the Department's Judicial Officer, who shall make the final determination for the Secretary. Any such determination by the Secretary shall be conclusive unless, within 30 days after receipt of notice of such final determination, the applicant appeals to the United States Court of Appeals for the circuit in which the applicant has its principal place of business or to the United States Court of Appeals for the District of Columbia Circuit.
(11) If the labeling application is not summarily denied by the Administrator, the Administrator shall publish in the
(i) If the Reference Amount or Product Category is denied by the Administrator, the Agency shall notify the applicant, in writing, of the basis for the denial, including the reason why the Reference Amount or Product Category on the labeling was determined by the Agency to be false or misleading. The notification letter shall also inform the applicant that the applicant may submit a written statement by way of answer to the notification, and that the applicant shall have the right to request a hearing with respect to the merits or validity of the Administrator's decision to deny the use of the proposed Reference Amount and/or Product Category.
(A) If the applicant fails to accept the determination of the Administrator and files an answer and requests a hearing, and the Administrator, after review of an answer, determines the initial determination to be correct, the Administrator shall file with the Hearing Clerk of the Department the notification, answer, and the request for a hearing, which shall constitute the complaint and answer in the proceeding, which shall thereafter be conducted in accordance with the Department's Uniform Rules of Practice.
(B) The hearing shall be conducted before an administrative law judge with the opportunity for appeal to the Department's Judicial Officer, who shall make the final determination for the Secretary. Any such determination by the Secretary shall be conclusive unless, within 30 days after receipt of the notice of such final determination, the applicant appeals to the United States Court of Appeals for the circuit in which the applicant has its principal place of business or to the United States Court of Appeals for the District of Columbia Circuit.
(ii) If the Reference Amount or Product Category is approved, the Agency shall notify the applicant, in writing, and shall also publish in the
(a) This section applies to meat, meat food products, or poultry products that are intended for human consumption and that are offered for sale.
(b) A claim which, expressly or by implication, characterizes the level of a nutrient (nutrient content claim) of the type required in nutrition labeling pursuant to § 413.309, may not be made on a label or in labeling of that product unless the claim is made in accordance with the applicable provisions in this part.
(1) An expressed nutrient content claim is any direct statement about the level (or range) of a nutrient in the product,
(2) An implied nutrient content claim is any claim that:
(i) Describes the product or an ingredient therein in a manner that suggests that a nutrient is absent or present in a certain amount (
(ii) Suggests that the product, because of its nutrient content, may be useful in maintaining healthy dietary practices and is made in association with an explicit claim or statement about a nutrient (
(3) Except for claims regarding vitamins and minerals described in paragraph (q)(3) of this section, no nutrient content claims may be made on products intended specifically for use by infants through 12 months and children less than 2 years of age unless the claim is specifically provided for in this part.
(4) Reasonable variations in the spelling of the terms defined in applicable provisions in this part and their synonyms are permitted provided these variations are not misleading (
(c) Information that is required or permitted by § 413.309 to be declared in nutrition labeling, and that appears as
(d) A “substitute” product is one that may be used interchangeably with another product that it resembles,
(1) If there is a difference in performance characteristics that materially limits the use of the product, the product may still be considered a substitute if the label includes a disclaimer adjacent to the most prominent claim as defined in paragraph (j)(2)(iii) of this section, informing the consumer of such difference (
(2) This disclaimer shall be in easily legible print or type and in a size no less than that required by § 317.2(h) or § 381.121(c) for the net quantity of contents statement, except where the size of the claim is less than two times the required size of the net quantity of contents statement, in which case the disclaimer statement shall be no less than one-half the size of the claim but no smaller than
(e)(1) Because the use of a “free” or “low” claim before the name of a product implies that the product differs from other products of the same type by virtue of its having a lower amount of the nutrient, only products that have been specially processed, altered, formulated, or reformulated so as to lower the amount of the nutrient in the product, remove the nutrient from the product, or not include the nutrient in the product, may bear such a claim (
(2) Any claim for the absence of a nutrient in a product, or that a product is low in a nutrient when the product has not been specially processed, altered, formulated, or reformulated to qualify for that claim shall indicate that the product inherently meets the criteria and shall clearly refer to all products of that type and not merely to the particular brand to which the labeling attaches (
(f) A nutrient content claim shall be in type size and style no larger than two times that of the statement of identity and shall not be unduly prominent in type style compared to the statement of identity.
(g) Labeling information required in §§ 413.313, 413.354, 413.356, 413.360, 413.361, 413.362, and 413.380, whose type size is not otherwise specified, is required to be in letters and/or numbers no less than
(h) [Reserved]
(i) Except as provided in § 413.309 or in paragraph (q)(3) of this section, the label or labeling of a product may contain a statement about the amount or percentage of a nutrient if:
(1) The use of the statement on the product implicitly characterizes the level of the nutrient in the product and is consistent with a definition for a claim, as provided in this part, for the nutrient that the label addresses. Such a claim might be, “less than 10 g of fat per serving;”
(2) The use of the statement on the product implicitly characterizes the level of the nutrient in the product and is not consistent with such a definition, but the label carries a disclaimer adjacent to the statement that the product is not “low” in or a “good source” of the nutrient, such as “only 200 milligrams (mg) sodium per serving, not a low sodium product.” The disclaimer must be in easily legible print or type and in a size no less than required by § 317.2(h) or § 381.121(c) for the net quantity of contents, except where the size of the claim is less than two times the required size of the net quantity of contents statement, in which case the disclaimer statement shall be no less than one-half the size of the claim but no smaller than
(3) The statement does not in any way implicitly characterize the level of the nutrient in the product and it is not false or misleading in any respect (
(4) “Percent fat free” claims are not authorized by this paragraph. Such claims shall comply with § 413.362(b)(6).
(j) A product may bear a statement that compares the level of a nutrient in the product with the level of a nutrient in a reference product. These statements shall be known as “relative claims” and include “light,” “reduced,” “less” (or “fewer”), and “more” claims.
(1) To bear a relative claim about the level of a nutrient, the amount of that nutrient in the product must be compared to an amount of nutrient in an appropriate reference product as specified in this paragraph (j).
(i)(A) For “less” (or “fewer”) and “more” claims, the reference product may be a dissimilar product within a product category that can generally be substituted for one another in the diet or a similar product.
(B) For “light,” “reduced,” and “added” claims, the reference product shall be a similar product, and
(ii)(A) For “light” claims, the reference product shall be representative of the type of product that includes the product that bears the claim. The nutrient value for the reference product shall be representative of a broad base of products of that type;
(B) For relative claims other than “light,” including “less” and “more” claims, the reference product may be the same as that provided for “light” in paragraph (j)(1)(ii)(A) of this section or it may be the manufacturer's regular product, or that of another manufacturer, that has been offered for sale to the public on a regular basis for a substantial period of time in the same geographic area by the same business entity or by one entitled to use its trade name, provided the name of the competitor is not used on the labeling of the product. The nutrient values used to determine the claim when comparing a single manufacturer's product to the labeled product shall be either the values declared in nutrition labeling or the actual nutrient values, provided that the resulting labeling is internally consistent (
(2) For products bearing relative claims:
(i) The label or labeling must state the identity of the reference product and the percent (or fraction) of the amount of the nutrient in the reference product by
(ii) This information shall be immediately adjacent to the most prominent claim in easily legible boldface print or type, in distinct contrast to other printed or graphic matter, that is no less than that required by § 317.2(h) or § 381.121(c) for net quantity of contents, except where the size of the claim is less than two times the required size of the net quantity of contents statement, in which case the referral statement shall be no less than one-half the size of the claim, but no smaller than
(iii) The determination of which use of the claim is in the most prominent location on the label or labeling will be made based on the following factors, considered in order:
(A) A claim on the principal display panel adjacent to the statement of identity;
(B) A claim elsewhere on the principal display panel;
(C) A claim on the information panel; or
(D) A claim elsewhere on the label or labeling.
(iv) The label or labeling must also bear:
(A) Clear and concise quantitative information comparing the amount of the subject nutrient in the product per labeled serving size with that in the reference product; and
(B) This statement shall appear adjacent to the most prominent claim or to the nutrition information.
(3) A relative claim for decreased levels of a nutrient may not be made on the label or in labeling of a product if the nutrient content of the reference product meets the requirement for a “low” claim for that nutrient.
(k) The term “modified” may be used in the statement of identity of a product that bears a relative claim that complies with the requirements of this part, followed immediately by the name of the nutrient whose content has been altered (
(l) For purposes of making a claim, a “meal-type” product will be defined as a product that:
(1) Makes a major contribution to the diet by:
(i) Weighing at least 10 ounces per labeled serving; and
(ii) Containing not less than three 40 gram portions of food, or combinations of foods, from two or more of the following four food groups, except as noted in paragraph (l)(1)(ii)(E) of this section:
(A) Bread, cereal, rice, and pasta;
(B) Fruits and vegetables;
(C) Milk, yogurt, and cheese;
(D) Meat, poultry, fish, dry beans, eggs, and nuts; except that:
(E) These foods will not be sauces (except for foods in the four food groups in paragraph (l)(1)(ii)(A) through (D) of this section, that are in the sauces), gravies, condiments, relishes, pickles, olives, jams, jellies, syrups, breadings, or garnishes; and
(2) Is represented as, or is in the form commonly understood to be, a breakfast, lunch, dinner, meal, or entree. Such representations may be made by statements, photographs, or vignettes.
(m) For purposes of making a claim, a main-dish product will be defined as a food that:
(1) Makes a major contribution to the meal by:
(i) Weighing at least 6 ounces per labeled serving; and
(ii) Containing not less than 40 grams of food, or combinations of foods, from two or more of the following four food groups, except as noted in paragraph (m)(1)(ii)(E) of this section.
(A) Bread, cereal, rice, and pasta;
(B) Fruits and vegetables;
(C) Milk, yogurt, and cheese;
(D) Meat, poultry, fish, dry beans, eggs, and nuts; except that:
(E) These foods will not be sauces (except for foods in the four food groups in paragraph (m)(l)(ii)(A) through (D) of this section, that are in the sauces), gravies, condiments, relishes, pickles, olives, jams, jellies, syrups, breadings, or garnishes; and
(3) Is represented as, or is in a form commonly understood to be, a main dish (
(n) Nutrition labeling in accordance with § 413.309, shall be provided for any food for which a nutrient content claim is made.
(o) Compliance with requirements for nutrient content claims shall be in accordance with § 413.309(h).
(p)(1) Unless otherwise specified, the reference amount customarily consumed set forth in § 413.312(b) through (e) shall be used in determining whether a product meets the criteria for a nutrient content claim. If the serving size declared on the product label differs from the reference amount customarily consumed, and the amount of the nutrient contained in the labeled serving does not meet the maximum or minimum amount criterion in the definition for the descriptor for that nutrient, the claim shall be followed by the criteria for the claim as required by § 413.312(f) (
(2) The criteria for the claim shall be immediately adjacent to the most prominent claim in easily legible print or type and in a size that is no less than that required by § 317.2(h) or § 381.121(c) for net quantity of contents, except where the size of the claim is less than two times the required size of the net quantity of contents statement, in which case the criteria statement shall be no less than one-half the size of the claim but no smaller than
(q) The following exemptions apply:
(1) Nutrient content claims that have not been defined by regulation and that appear as part of a brand name that was in use prior to November 27, 1991, may continue to be used as part of that brand name, provided they are not false or misleading under section 1(n) of the Federal Meat Inspection Act (21 U.S.C. 601(n)(1)) or 4(h) of the Poultry Products Inspection Act (21 U.S.C. 453(h)).
(2) [Reserved]
(3) A statement that describes the percentage of a vitamin or mineral in the food, including foods intended specifically for use by infants through 12 months and children less than 2 years of age, in relation to a Reference Daily Intake (RDI) as defined in § 413.309 may be made on the label or in the labeling of a food without a regulation authorizing such a claim for a specific vitamin or mineral.
(4) The requirements of this section do not apply to infant formulas and medical foods, as described in 21 CFR 101.13(q)(4).
(5) [Reserved]
(6) Nutrient content claims that were part of the name of a product that was subject to a standard of identity as of November 27, 1991, are not subject to the requirements of paragraph (b) of this section whether or not they meet the definition of the descriptive term.
(7) Implied nutrient content claims may be used as part of a brand name, provided that the use of the claim has been authorized by FSIS. Labeling applications requesting approval of such a claim may be submitted pursuant to § 413.369.
(a) The major cuts of single-ingredient, raw meat products are: Beef chuck blade roast, beef loin top loin steak, beef rib roast large end, beef round eye round steak, beef round top round steak, beef round tip roast, beef chuck arm pot roast, beef loin sirloin steak, beef round bottom round steak, beef brisket (whole, flat half, or point half), beef rib steak small end, beef loin tenderloin steak, pork loin chop, pork loin country style ribs, pork loin top loin chop boneless, pork loin rib chop, pork spareribs, pork loin tenderloin, pork loin sirloin roast, pork shoulder blade steak, pork loin top roast boneless, ground pork, lamb shank, lamb shoulder arm chop, lamb shoulder blade chop, lamb rib roast, lamb loin chop, lamb leg (whole, sirloin half, or shank half), veal shoulder arm steak, veal shoulder blade steak, veal rib roast, veal loin chop, and veal cutlets.
(b) The major cuts of single-ingredient, raw poultry products are: Whole chicken (without neck and giblets), chicken breast, chicken wing, chicken drumstick, chicken thigh, whole turkey (without necks and giblets; separate nutrient panels for white and dark meat permitted as an option), turkey breast, turkey wing, turkey drumstick, and turkey thigh.
(a)(1) Nutrition information on the major cuts of single-ingredient, raw meat or poultry products identified in § 413.344, including those that have been previously frozen, is required, either on their label or at their point-of-purchase, unless exempted under § 413.400. If nutrition information is presented on the label, it must be provided in accordance with § 413.309. If nutrition information is presented at the point-of-purchase, it must be provided in accordance with the provisions of this section.
(2) Nutrition information on single-ingredient, raw products that are not ground or chopped products described in § 413.301 and are not major cuts of single-ingredient, raw products identified in § 413.344, including those that have been previously frozen, may be provided at their point-of-purchase in accordance with the provisions of this section or on their label, in accordance with the provisions of § 413.309.
(3) A retailer may provide nutrition information at the point-of-purchase by various methods, such as by posting a sign or by making the information readily available in brochures, notebooks, or leaflet form in close proximity to the food. The nutrition labeling information may also be supplemented by a video, live demonstration, or other media. If a nutrition claim is made on point-of-purchase materials, all of the format and content requirements of § 413.309 apply. However, if only nutrition information—and not a nutrition claim—is supplied on point-of-purchase materials, the requirements of § 413.309 apply, provided, however:
(i) The listing of percent of Daily Value for the nutrients (except vitamins and minerals specified in § 413.309(c)(8)) and footnote required by § 413.309(d)(9) may be omitted; and
(ii) The point-of-purchase materials are not subject to any of the format requirements.
(b) [Reserved]
(c) For the point-of-purchase materials, the declaration of nutrition information may be presented in a simplified format as specified in § 413.309(f).
(d) The nutrition label data for products covered in paragraphs (a)(1) and (a)(2) must be based on either the raw or cooked edible portions of meat cuts with external cover fat at trim levels reflecting current marketing practices or the raw or cooked edible portions of poultry cuts with skin. If data are based on cooked portions, the methods used to cook the products must be specified and should be those which do not add nutrients from other ingredients such as flour, breading, and salt. Additional nutritional data may be presented on an optional basis for the raw or cooked edible portions of the separable lean of meat cuts or the raw or cooked edible portions of the skinless poultry meat.
(e) Nutrient data that are the most current representative data base values contained in USDA's National Nutrient Data Bank or its released form, the USDA National Nutrient Database for Standard Reference, may be used for nutrition labeling of single-ingredient, raw products, including those that have been previously frozen. These data may be composite data that reflect different quality grades of beef or different classes of turkey or other variables affecting nutrient content. Alternatively, data that reflect specific grades or specific classes or other variables may be used, except that if data are used on labels attached to a product which is labeled as to grade of meat or class of poultry or other variables, the data must represent the product in the package when such data are contained in the representative data base. When data are used on labels attached to a product, the data must represent the edible meat tissues or the edible poultry tissues present in the package.
(f) If the nutrition information is provided in accordance with paragraph (e) of this section, a nutrition label or labeling will not be subject to the Agency compliance review under § 413.309(h), unless a nutrition claim is made on the basis of the representative data base values.
(g) Retailers may use data bases that they believe reflect the nutrient content of single-ingredient, raw products, including those that have been previously frozen; however, such labeling shall be subject to the compliance procedures of paragraph (e) of this section and the requirements specified in this part for the mandatory nutrition labeling program.
(a)
(1) The claim uses one of the terms defined in this section in accordance with the definition for that term;
(2) The claim is made in accordance with the general requirements for nutrient content claims in § 413.313; and
(3) The product for which the claim is made is labeled in accordance with § 413.309.
(b)
(2) The terms defined in paragraph (b)(1) of this section may be used on the label or in labeling of a meal-type product as defined in § 413.313(l), and main-dish product as defined in § 413.313(m) provided that:
(i) The product contains a food that meets the definition of “high” in paragraph (b)(1) of this section; and
(ii) The label or labeling clearly identifies the food that is the subject of
(c)
(2) The terms defined in paragraph (c)(1) of this section may be used on the label or in labeling of a meal-type product as defined in § 413.313(l), and main-dish product as defined in § 413.313(m) provided that:
(i) The product contains a food that meets the definition of “good source” in paragraph (c)(1) of this section; and
(ii) The label or labeling clearly identifies the food that is the subject of the claim (
(d)
(2) The disclosure shall appear in immediate proximity to such claim and be in a type size no less than one-half the size of the claim.
(e)
(i) The product contains at least 10 percent more of the RDI or the DRV for protein, vitamins, minerals, dietary fiber, or potassium (expressed as a percent of the Daily Value) per reference amount customarily consumed than an appropriate reference product as described in § 413.313(j)(1); and
(ii) As required in § 413.313(j)(2) for relative claims:
(A) The identity of the reference product and the percent (or fraction) that the nutrient is greater relative to the RDI or DRV are declared in immediate proximity to the most prominent such claim (
(B) Quantitative information comparing the level of the nutrient in the product per labeled serving size with that of the reference product that it replaces is declared adjacent to the most prominent claim or to the nutrition information (
(2) A relative claim using the terms “more” and “added” may be used on the label or in labeling to describe the level of protein, vitamins, minerals, dietary fiber, or potassium in meal-type products as defined in § 413.313(l), and main-dish products as defined in § 413.313(m) provided that:
(i) The product contains at least 10 percent more of the RDI or the DRV for protein, vitamins, minerals, dietary fiber, or potassium (expressed as a percent of the Daily Value) per 100 g of product than an appropriate reference product as described in § 413.313(j)(1); and
(ii) As required in § 413.313(j)(2) for relative claims:
(A) The identity of the reference product and the percent (or fraction) that the nutrient is greater relative to the RDI or DRV are declared in immediate proximity to the most prominent such claim (
(B) Quantitative information comparing the level of the nutrient in the meal-type product or a main-dish product per specified weight with that of the reference product that it replaces is declared adjacent to the most prominent claim or to the nutrition information (
(a)
(1) The claim uses one of the terms defined in this section in accordance with the definition for that term;
(2) The claim is made in accordance with the general requirements for nutrient content claims in § 413.313; and
(3) The product for which the claim is made is labeled in accordance with § 413.309.
(b)
(1) If the product derives 50 percent or more of its calories from fat, its fat content is reduced by 50 percent or more per reference amount customarily consumed compared to an appropriate reference product as described in § 413.313(j)(1); or
(2) If the product derives less than 50 percent of its calories from fat:
(i) The number of calories is reduced by at least one-third (33
(ii) Its fat content is reduced by 50 percent or more per reference amount customarily consumed compared to the appropriate reference product as described in § 413.313(j)(1); and
(3) As required in § 413.313(j)(2) for relative claims:
(i) The identity of the reference product and the percent (or fraction) that the calories and the fat were reduced are declared in immediate proximity to the most prominent such claim (
(ii) Quantitative information comparing the level of calories and fat content in the product per labeled serving size with that of the reference product that it replaces is declared adjacent to the most prominent claim or to the nutrition information (
(iii) If the labeled product contains less than 40 calories or less than 3 g fat per reference amount customarily consumed, the percentage reduction for that nutrient need not be declared.
(4) A “light” claim may not be made on a product for which the reference product meets the definition of “low fat” and “low calorie.”
(c)(1)(i) A product for which the reference product contains 40 calories or less and 3 g fat or less per reference amount customarily consumed may use the terms “light” or “lite” without further qualification if it is reduced by 50 percent or more in sodium content compared to the reference product; and
(ii) As required in § 413.313(j)(2) for relative claims:
(A) The identity of the reference product and the percent (or fraction) that the sodium was reduced are declared in immediate proximity to the most prominent such claim (
(B) Quantitative information comparing the level of sodium per labeled serving size with that of the reference product it replaces is declared adjacent to the most prominent claim or to the nutrition information (
(2)(i) A product for which the reference product contains more than 40 calories or more than 3 g fat per reference amount customarily consumed may use the terms “light in sodium” or “lite in sodium” if it is reduced by 50 percent or more in sodium content compared to the reference product, provided that “light” or “lite” is presented in immediate proximity with “in sodium” and the entire term is presented in uniform type size, style, color, and prominence; and
(ii) As required in § 413.313(j)(2) for relative claims:
(A) The identity of the reference product and the percent (or fraction) that the sodium was reduced are declared in immediate proximity to the most prominent such claim (
(B) Quantitative information comparing the level of sodium per labeled serving size with that of the reference product it replaces is declared adjacent to the most prominent claim or to the nutrition information (
(3) Except for meal-type products as defined in § 413.313(l) and main-dish products as defined in § 413.313(m), a “light in sodium” claim may not be made on a product for which the reference product meets the definition of “low in sodium.”
(d)(1) The terms “light” or “lite” may be used on the label or in labeling of a meal-type product as defined in § 413.313(l) and main-dish product as defined in § 413.313(m), provided that:
(i) The product meets the definition of:
(A) “Low in calories” as defined in § 413.360(b)(3); or
(B) “Low in fat” as defined in § 413.362(b)(3); and
(ii)(A) A statement appears on the principal display panel that explains whether “light” is used to mean “low fat,” “low calories,” or both (
(B) The accompanying statement is no less than one-half the type size of the “light” or “lite” claim.
(2)(i) The terms “light in sodium” or “lite in sodium” may be used on the label or in labeling of a meal-type product as defined in § 413.313(l) and main-dish product as defined in § 413.313(m), provided that the product meets the definition of “low in sodium” as defined in § 413.361(b)(5)(i); and
(ii) “Light” or “lite” and “in sodium” are presented in uniform type size, style, color, and prominence.
(3) The term “light” or “lite” may be used in the brand name of a product to describe the sodium content, provided that:
(i) The product is reduced by 50 percent or more in sodium content compared to the reference product;
(ii) A statement specifically stating that the product is “light in sodium” or “lite in sodium” appears:
(A) Contiguous to the brand name; and
(B) In uniform type size, style, color, and prominence as the product name; and
(iii) As required in § 413.313(j)(2) for relative claims:
(A) The identity of the reference product and the percent (or fraction) that the sodium was reduced are declared in immediate proximity to the most prominent such claim; and
(B) Quantitative information comparing the level of sodium per labeled serving size with that of the reference product it replaces is declared adjacent to the most prominent claim or to the nutrition information.
(e) Except as provided in paragraphs (b) through (d) of this section, the terms “light” or “lite” may not be used to refer to a product that is not reduced in fat by 50 percent, or, if applicable, in calories by
(1) It describes some physical or organoleptic attribute of the product such as texture or color and the information (
(2) The attribute (
(f) If a manufacturer can demonstrate that the word “light” has been associated, through common use, with a particular product to reflect a physical or organoleptic attribute to the point where it has become part of the statement of identity, such use of the term “light” shall not be considered a nutrient content claim subject to the requirements in this part.
(g) The term “lightly salted” may be used on a product to which has been added 50 percent less sodium than is normally added to the reference product as described in § 413.313(j)(1)(i)(B) and (j)(1)(ii)(B), provided that if the product is not “low in sodium” as defined in § 413.361(b)(4), the statement “not a low sodium food,” shall appear adjacent to the nutrition information and the information required to accompany a relative claim shall appear on the label or labeling as specified in § 413.313(j)(2).
(a)
(1) The claim uses one of the terms defined in this section in accordance with the definition for that term;
(2) The claim is made in accordance with the general requirements for nutrient content claims in § 413.313; and
(3) The product for which the claim is made is labeled in accordance with § 413.309.
(b)
(i) The product contains less than 5 calories per reference amount customarily consumed and per labeled serving size; and
(ii) If the product meets this condition without the benefit of special processing, alteration, formulation, or reformulation to lower the caloric content, it is labeled to clearly refer to all products of its type and not merely to the particular brand to which the label attaches.
(2) The terms “low calorie,” “few calories,” “contains a small amount of calories,” “low source of calories,” or “low in calories” may be used on the label or in labeling of products, except meal-type products as defined in § 413.313(l) and main-dish products as defined in § 413.313(m), provided that:
(i)(A) The product has a reference amount customarily consumed greater than 30 grams (g) or greater than 2 tablespoons (tbsp) and does not provide more than 40 calories per reference amount customarily consumed; or
(B) The product has a reference amount customarily consumed of 30 g
(ii) If the product meets these conditions without the benefit of special processing, alteration, formulation, or reformulation to lower the caloric content, it is labeled to clearly refer to all products of its type and not merely to the particular brand to which the label attaches.
(3) The terms defined in paragraph (b)(2) of this section may be used on the label or in labeling of a meal-type product as defined in § 413.313(l) and main-dish product as defined in § 413.313(m), provided that:
(i) The product contains 120 calories or less per 100 g of product; and (ii) If the product meets this condition without the benefit of special processing, alteration, formulation, or reformulation to lower the calorie content, it is labeled to clearly refer to all products of its type and not merely to the particular brand to which it attaches.
(4) The terms “reduced calorie,” “reduced in calories,” “calorie reduced,” “fewer calories,” “lower calorie,” or “lower in calories” may be used on the label or in labeling of products, except meal-type products as defined in § 413.313(l) and main-dish products as defined in § 413.313(m), provided that:
(i) The product contains at least 25 percent fewer calories per reference amount customarily consumed than an appropriate reference product as described in § 413.313(j)(1); and
(ii) As required in § 413.313(j)(2) for relative claims:
(A) The identity of the reference product and the percent (or fraction) that the calories differ between the two products are declared in immediate proximity to the most prominent such claim (
(B) Quantitative information comparing the level of calories in the product per labeled serving size with that of the reference product that it replaces is declared adjacent to the most prominent claim or to the nutrition information (
(iii) Claims described in paragraph (b)(4) of this section may not be made on the label or in labeling of products if the reference product meets the definition for “low calorie.”
(5) The terms defined in paragraph (b)(4) of this section may be used on the label or in labeling of a meal-type product as defined in § 413.313(l) and main-dish product as defined in § 413.313(m), provided that:
(i) The product contains at least 25 percent fewer calories per 100 g of product than an appropriate reference product as described in § 413.313(j)(1); and
(ii) As required in § 413.313(j)(2) for relative claims:
(A) The identity of the reference product and the percent (or fraction) that the calories differ between the two products are declared in immediate proximity to the most prominent such claim (
(B) Quantitative information comparing the level of calories in the product per specified weight with that of the reference product that it replaces is declared adjacent to the most prominent claim or to the nutrition information (
(iii) Claims described in paragraph (b)(5) of this section may not be made on the label or in labeling of products if the reference product meets the definition for “low calorie.”
(c)
(i) The product contains less than 0.5 g of sugars, as defined in § 413.309(c)(6)(ii), per reference amount customarily consumed and per labeled serving size or, in the case of a meal-type product or a main-dish product, less than 0.5 g of sugars per labeled serving size;
(ii) The product contains no ingredient that is a sugar or that is generally understood by consumers to contain sugars unless the listing of the ingredient in the ingredients statement is followed by an asterisk that refers to the statement below the list of ingredients, which states: “Adds a trivial amount of sugar,” “adds a negligible amount of sugar,” or “adds a dietarily insignificant amount of sugar;” and
(iii)(A) It is labeled “low calorie” or “reduced calorie” or bears a relative claim of special dietary usefulness labeled in compliance with paragraphs (b)(2), (b)(3), (b)(4), or (b)(5) of this section; or
(B) Such term is immediately accompanied, each time it is used, by either the statement “not a reduced calorie product,” “not a low calorie product,” or “not for weight control.”
(2) The terms “no added sugar,” “without added sugar,” or “no sugar added” may be used only if:
(i) No amount of sugars, as defined in § 413.309(c)(6)(ii), or any other ingredient that contains sugars that functionally substitute for added sugars is added during processing or packaging;
(ii) The product does not contain an ingredient containing added sugars such as jam, jelly, or concentrated fruit juice;
(iii) The sugars content has not been increased above the amount present in the ingredients by some means such as the use of enzymes, except where the intended functional effect of the process is not to increase the sugars content of a product, and a functionally insignificant increase in sugars results;
(iv) The product that it resembles and for which it substitutes normally contains added sugars; and
(v) The product bears a statement that the product is not “low calorie” or “calorie reduced” (unless the product meets the requirements for a “low” or “reduced calorie” product) and that directs consumers' attention to the nutrition panel for further information on sugar and calorie content.
(3) Paragraph (c)(1) of this section shall not apply to a factual statement that a product, including products intended specifically for infants and children less than 2 years of age, is unsweetened or contains no added sweeteners in the case of a product that contains apparent substantial inherent sugar content,
(4) The terms “reduced sugar,” “reduced in sugar,” “sugar reduced,” “less sugar,” “lower sugar,” or “lower in sugar” may be used on the label or in labeling of products, except meal-type products as defined in § 413.313(l) and main-dish products as defined in § 413.313(m), provided that:
(i) The product contains at least 25 percent less sugars per reference amount customarily consumed than an
(ii) As required in § 413.313(j)(2) for relative claims:
(A) The identity of the reference product and the percent (or fraction) that the sugars differ between the two products are declared in immediate proximity to the most prominent such claim (
(B) Quantitative information comparing the level of the sugar in the product per labeled serving size with that of the reference product that it replaces is declared adjacent to the most prominent claim or to the nutrition information (
(5) The terms defined in paragraph (c)(4) of this section may be used on the label or in labeling of a meal-type product as defined in § 413.313(l) and main-dish product as defined in § 413.313(m), provided that:
(i) The product contains at least 25 percent less sugars per 100 g of product than an appropriate reference product as described in § 413.313(j)(1); and
(ii) As required in § 413.313(j)(2) for relative claims:
(A) The identity of the reference product and the percent (or fraction) that the sugars differ between the two products are declared in immediate proximity to the most prominent such claim (
(B) Quantitative information comparing the level of the nutrient in the product per specified weight with that of the reference product that it replaces is declared adjacent to the most prominent claim or to the nutrition information (
(a)
(1) The claim uses one of the terms defined in this section in accordance with the definition for that term;
(2) The claim is made in accordance with the general requirements for nutrient content claims in § 413.313; and
(3) The product for which the claim is made is labeled in accordance with § 413.309.
(b)
(i) The product contains less than 5 milligrams (mg) of sodium per reference amount customarily consumed and per labeled serving size or, in the case of a meal-type product or a main-dish product, less than 5 mg of sodium per labeled serving size;
(ii) The product contains no ingredient that is sodium chloride or is generally understood by consumers to contain sodium unless the listing of the ingredient in the ingredients statement is followed by an asterisk that refers to the statement below the list of ingredients, which states: “Adds a trivial amount of sodium,” “adds a negligible amount of sodium” or “adds a dietarily insignificant amount of sodium”; and
(iii) If the product meets these conditions without the benefit of special processing, alteration, formulation, or reformulation to lower the sodium content, it is labeled to clearly refer to all products of its type and not merely to the particular brand to which the label attaches.
(2) The terms “very low sodium” or “very low in sodium” may be used on the label or in labeling of products, except meal-type products as defined in § 413.313(l) and main-dish products as defined in § 413.313(m), provided that:
(i)(A) The product has a reference amount customarily consumed greater than 30 grams (g) or greater than 2 tablespoons (tbsp) and contains 35 mg or less sodium per reference amount customarily consumed; or
(B) The product has a reference amount customarily consumed of 30 g or less or 2 tbsp or less and contains 35 mg or less sodium per reference amount customarily consumed and per 50 g (for dehydrated products that must be reconstituted before typical consumption with water or a diluent containing an insignificant amount, as defined in § 413.309(f)(1), of all nutrients per reference amount customarily consumed, the per-50-g criterion refers to the “as prepared” form); and
(ii) If the product meets these conditions without the benefit of special processing, alteration, formulation, or reformulation to lower the sodium content, it is labeled to clearly refer to all products of its type and not merely to the particular brand to which the label attaches.
(3) The terms defined in paragraph (b)(2) of this section may be used on the label or in labeling of a meal-type product as defined in § 413.313(l) and main-dish product as defined in § 413.313(m), provided that:
(i) The product contains 35 mg or less of sodium per 100 g of product; and
(ii) If the product meets this condition without the benefit of special processing, alteration, formulation, or reformulation to lower the sodium content, it is labeled to clearly refer to all products of its type and not merely to the particular brand to which the label attaches.
(4) The terms “low sodium,” “low in sodium,” “little sodium,” “contains a small amount of sodium,” or “low source of sodium” may be used on the label and in labeling of products, except meal-type products as defined in § 413.313(l) and main-dish products as defined in § 413.313(m), provided that:
(i)(A) The product has a reference amount customarily consumed greater than 30 g or greater than 2 tbsp and contains 140 mg or less sodium per reference amount customarily consumed; or
(B) The product has a reference amount customarily consumed of 30 g or less or 2 tbsp or less and contains 140 mg or less sodium per reference amount customarily consumed and per 50 g (for dehydrated products that must be reconstituted before typical consumption with water or a diluent containing an insignificant amount, as defined in § 413.309(f)(1), of all nutrients per reference amount customarily consumed, the per-50-g criterion refers to the “as prepared” form); and
(ii) If the product meets these conditions without the benefit of special processing, alteration, formulation, or reformulation to lower the sodium content, it is labeled to clearly refer to all products of its type and not merely to the particular brand to which the label attaches.
(5) The terms defined in paragraph (b)(4) of this section may be used on the label or in labeling of a meal-type product as defined in § 413.313(l) and main-dish product as defined in § 413.313(m), provided that:
(i) The product contains 140 mg or less sodium per 100 g of product; and
(ii) If the product meets these conditions without the benefit of special processing, alteration, formulation, or reformulation to lower the sodium content, it is labeled to clearly refer to all products of its type and not merely to the particular brand to which the label attaches.
(6) The terms “reduced sodium,” “reduced in sodium,” “sodium reduced,” “less sodium,” “lower
(i) The product contains at least 25 percent less sodium per reference amount customarily consumed than an appropriate reference product as described in § 413.313(j)(1); and
(ii) As required in § 413.313(j)(2) for relative claims:
(A) The identity of the reference product and the percent (or fraction) that the sodium differs between the two products are declared in immediate proximity to the most prominent such claim (
(B) Quantitative information comparing the level of sodium in the product per labeled serving size with that of the reference product that it replaces is declared adjacent to the most prominent claim or to the nutrition information (
(iii) Claims described in paragraph (b)(6) of this section may not be made on the label or in labeling of a product if the nutrient content of the reference product meets the definition for “low sodium.”
(7) The terms defined in paragraph (b)(6) of this section may be used on the label or in labeling of a meal-type product as defined in § 413.313(l) and main-dish product as defined in § 413.313(m), provided that:
(i) The product contains at least 25 percent less sodium per 100 g of product than an appropriate reference product as described in § 413.313(j)(1); and
(ii) As required in § 413.313(j)(2) for relative claims:
(A) The identity of the reference product and the percent (or fraction) that the sodium differs between the two products are declared in immediate proximity to the most prominent such claim (
(B) Quantitative information comparing the level of sodium in the product per specified weight with that of the reference product that it replaces is declared adjacent to the most prominent claim or to the nutrition information (
(iii) Claims described in paragraph (b)(7) of this section may not be made on the label or in labeling of products if the nutrient content of the reference product meets the definition for “low sodium.”
(c) The term “salt” is not synonymous with “sodium.” Salt refers to sodium chloride. However, references to salt content such as “unsalted,” “no salt,” “no salt added” are potentially misleading.
(1) The term “salt free” may be used on the label or in labeling of products only if the product is “sodium free” as defined in paragraph (b)(1) of this section.
(2) The terms “unsalted,” “without added salt,” and “no salt added” may be used on the label or in labeling of products only if:
(i) No salt is added during processing;
(ii) The product that it resembles and for which it substitutes is normally processed with salt; and
(iii) If the product is not sodium free, the statement, “not a sodium free product” or “not for control of sodium in the diet” appears adjacent to the nutrition information of the product bearing the claim.
(3) Paragraph (c)(2) of this section shall not apply to a factual statement that a product intended specifically for infants and children less than 2 years of age is unsalted, provided such statement refers to the taste of the product and is not false or otherwise misleading.
(a)
(1) The claim uses one of the terms defined in this section in accordance with the definition for that term;
(2) The claim is made in accordance with the general requirements for nutrient content claims in § 413.313; and
(3) The product for which the claim is made is labeled in accordance with § 413.309.
(b)
(i) The product contains less than 0.5 gram (g) of fat per reference amount customarily consumed and per labeled serving size or, in the case of a meal-type product or a main-dish product, less than 0.5 g of fat per labeled serving size;
(ii) The product contains no added ingredient that is a fat or is generally understood by consumers to contain fat unless the listing of the ingredient in the ingredients statement is followed by an asterisk that refers to the statement below the list of ingredients, which states: “Adds a trivial amount of fat,” “adds a negligible amount of fat,” or “adds a dietarily insignificant amount of fat”; and
(iii) If the product meets these conditions without the benefit of special processing, alteration, formulation, or reformulation to lower the fat content, it is labeled to clearly refer to all products of its type and not merely to the particular brand to which the label attaches.
(2) The terms “low fat,” “low in fat,” “contains a small amount of fat,” “low source of fat,” or “little fat” may be used on the label and in labeling of products, except meal-type products as defined in § 413.313(l) and main-dish products as defined in § 413.313(m), provided that:
(i)(A) The product has a reference amount customarily consumed greater than 30 g or greater than 2 tablespoons (tbsp) and contains 3 g or less of fat per reference amount customarily consumed; or
(B) The product has a reference amount customarily consumed of 30 g or less or 2 tbsp or less and contains 3 g or less of fat per reference amount customarily consumed and per 50 g (for dehydrated products that must be reconstituted before typical consumption with water or a diluent containing an insignificant amount, as defined in § 413.309(f)(1), of all nutrients per reference amount customarily consumed, the per-50-g criterion refers to the “as prepared” form).
(ii) If the product meets these conditions without the benefit of special processing, alteration, formulation, or reformulation to lower the fat content, it is labeled to clearly refer to all products of its type and not merely to the particular brand to which the label attaches.
(3) The terms defined in paragraph (b)(2) of this section may be used on the label or in labeling of a meal-type product as defined in § 413.313(l) and main-dish product as defined in § 413.313(m), provided that:
(i) The product contains 3 g or less of total fat per 100 g of product and not more than 30 percent of calories from fat; and
(ii) If the product meets these conditions without the benefit of special processing, alteration, formulation, or reformulation to lower the fat content, it is labeled to clearly refer to all products of its type and not merely to the
(4) The terms “reduced fat,” “reduced in fat,” “fat reduced,” “less fat,” “lower fat,” or “lower in fat” may be used on the label or in labeling of products, except meal-type products as defined in § 413.313(l) and main-dish products as defined in § 413.313(m), provided that:
(i) The product contains at least 25 percent less fat per reference amount customarily consumed than an appropriate reference product as described in § 413.313(j)(1); and
(ii) As required in § 413.313(j)(2) for relative claims:
(A) The identity of the reference product and the percent (or fraction) that the fat differs between the two products are declared in immediate proximity to the most prominent such claim (
(B) Quantitative information comparing the level of fat in the product per labeled serving size with that of the reference product that it replaces is declared adjacent to the most prominent claim or to the nutrition information (
(iii) Claims described in paragraph (b)(4) of this section may not be made on the label or in labeling of a product if the nutrient content of the reference product meets the definition for “low fat.”
(5) The terms defined in paragraph (b)(4) of this section may be used on the label or in labeling of a meal-type product as defined in § 413.313(l) and main-dish product as defined in § 413.313(m), provided that:
(i) The product contains at least 25 percent less fat per 100 g of product than an appropriate reference product as described in § 413.313(j)(1); and
(ii) As required in § 413.313(j)(2) for relative claims:
(A) The identity of the reference product and the percent (or fraction) that the fat differs between the two products are declared in immediate proximity to the most prominent such claim (
(B) Quantitative information comparing the level of fat in the product per specified weight with that of the reference product that it replaces is declared adjacent to the most prominent such claim or to the nutrition information (
(iii) Claims described in paragraph (b)(5) of this section may not be made on the label or in labeling of a product if the nutrient content of the reference product meets the definition for “low fat.”
(6) The term “__ percent fat free” may be used on the label or in labeling of products, provided that:
(i) The product meets the criteria for “low fat” in paragraph (b)(2) or (b)(3) of this section;
(ii) The percent declared and the words “fat free” are in uniform type size; and
(iii) A “100 percent fat free” claim may be made only on products that meet the criteria for “fat free” in paragraph (b)(1) of this section, that contain less than 0.5 g of fat per 100 g, and that contain no added fat.
(iv) A synonym for “__ percent fat free” is “__ percent lean.”
(c)
(i) The product contains less than 0.5 g of saturated fat and less than 0.5 g
(ii) The product contains no ingredient that is generally understood by consumers to contain saturated fat unless the listing of the ingredient in the ingredients statement is followed by an asterisk that refers to the statement below the list of ingredients, which states: “Adds a trivial amount of saturated fat,” “adds a negligible amount of saturated fat,” or “adds a dietarily insignificant amount of saturated fat;” and
(iii) If the product meets these conditions without the benefit of special processing, alteration, formulation, or reformulation to lower saturated fat content, it is labeled to clearly refer to all products of its type and not merely to the particular brand to which the label attaches.
(2) The terms “low in saturated fat,” “low saturated fat,” “contains a small amount of saturated fat,” “low source of saturated fat,” or “a little saturated fat” may be used on the label or in labeling of products, except meal-type products as defined in § 413.313(l) and main-dish products as defined in § 413.313(m), provided that:
(i) The product contains 1 g or less of saturated fat per reference amount customarily consumed and not more than 15 percent of calories from saturated fat; and
(ii) If the product meets these conditions without benefit of special processing, alteration, formulation, or reformulation to lower saturated fat content, it is labeled to clearly refer to all products of its type and not merely to the particular brand to which the label attaches.
(3) The terms defined in paragraph (c)(2) of this section may be used on the label or in labeling of a meal-type product as defined in § 413.313(l) and main-dish product as defined in § 413.313(m), provided that:
(i) The product contains 1 g or less of saturated fat per 100 g and less than 10 percent calories from saturated fat; and
(ii) If the product meets these conditions without the benefit of special processing, alteration, formulation, or reformulation to lower saturated fat content, it is labeled to clearly refer to all products of its type and not merely to the particular brand to which the label attaches.
(4) The terms “reduced saturated fat,” “reduced in saturated fat,” “saturated fat reduced,” “less saturated fat,” “lower saturated fat,” or “lower in saturated fat” may be used on the label or in labeling of products, except meal-type products as defined in § 413.313(l) and main-dish products as defined in § 413.313(m), provided that:
(i) The product contains at least 25 percent less saturated fat per reference amount customarily consumed than an appropriate reference product as described in § 413.313(j)(1); and
(ii) As required in § 413.313(j)(2) for relative claims:
(A) The identity of the reference product and the percent (or fraction) that the saturated fat differs between the two products are declared in immediate proximity to the most prominent such claim (
(B) Quantitative information comparing the level of saturated fat in the product per labeled serving size with that of the reference product that it replaces is declared adjacent to the most prominent claim or to the nutrition information (
(iii) Claims described in paragraph (c)(4) of this section may not be made on the label or in labeling of a product if the nutrient content of the reference product meets the definition for “low saturated fat.”
(5) The terms defined in paragraph (c)(4) of this section may be used on the
(i) The product contains at least 25 percent less saturated fat per 100 g of product than an appropriate reference product as described in § 413.313(j)(1); and
(ii) As required in § 413.313(j)(2) for relative claims:
(A) The identity of the reference product and the percent (or fraction) that the saturated fat differs between the two products are declared in immediate proximity to the most prominent such claim (
(B) Quantitative information comparing the level of saturated fat in the product per specified weight with that of the reference product that it replaces is declared adjacent to the most prominent claim or to the nutrition information (
(iii) Claims described in paragraph (c)(5) of this section may not be made on the label or in labeling of a product if the nutrient content of the reference product meets the definition for “low saturated fat.”
(d)
(i) The product contains less than 2 milligrams (mg) of cholesterol per reference amount customarily consumed and per labeled serving size or, in the case of a meal-type product as defined in § 413.313(l) and main-dish product as defined in § 413.313(m), less than 2 mg of cholesterol per labeled serving size;
(ii) The product contains no ingredient that is generally understood by consumers to contain cholesterol, unless the listing of the ingredient in the ingredients statement is followed by an asterisk that refers to the statement below the list of ingredients, which states: “Adds a trivial amount of cholesterol,” “adds a negligible amount of cholesterol,” or “adds a dietarily insignificant amount of cholesterol”;
(iii) The product contains 2 g or less of saturated fat per reference amount customarily consumed or, in the case of a meal-type product as defined in § 413.313(l) and main-dish product as defined in § 413.313(m), 2 g or less of saturated fat per labeled serving size; and
(iv) If the product meets these conditions without the benefit of special processing, alteration, formulation, or reformulation to lower cholesterol content, it is labeled to clearly refer to all products of its type and not merely to the particular brand to which it attaches; or
(v) If the product meets these conditions only as a result of special processing, alteration, formulation, or reformulation, the amount of cholesterol is reduced by 25 percent or more from the reference product it replaces as described in § 413.313(j)(1) and for which it substitutes as described in § 413.313(d) that has a significant (
(A) The identity of the reference product and the percent (or fraction) that the cholesterol was reduced are declared in immediate proximity to the most prominent such claim (
(B) Quantitative information comparing the level of cholesterol in the product per labeled serving size with that of the reference product that it replaces is declared adjacent to the most prominent claim or to the nutrition information (
(2) The terms “low in cholesterol,” “low cholesterol,” “contains a small amount of cholesterol,” “low source of cholesterol,” or “little cholesterol” may be used on the label or in labeling of products, except meal-type products as defined in § 413.313(l) and main-dish products as defined in § 413.313(m), provided that:
(i)(A) If the product has a reference amount customarily consumed greater than 30 g or greater than 2 tbsp:
(
(
(B) If the product has a reference amount customarily consumed of 30 g or less or 2 tbsp or less:
(
(
(ii) If the product meets these conditions without the benefit of special processing, alteration, formulation, or reformulation to lower cholesterol content, it is labeled to clearly refer to all products of its type and not merely to the particular brand to which the label attaches; or
(iii) If the product contains 20 mg or less of cholesterol only as a result of special processing, alteration, formulation, or reformulation, the amount of cholesterol is reduced by 25 percent or more from the reference product it replaces as described in § 413.313(j)(1) and for which it substitutes as described in § 413.313(d) that has a significant (
(A) The identity of the reference product and the percent (or fraction) that the cholesterol has been reduced are declared in immediate proximity to the most prominent such claim (
(B) Quantitative information comparing the level of cholesterol in the product per labeled serving size with that of the reference product that it replaces is declared adjacent to the most prominent claim or to the nutrition information (
(3) The terms defined in paragraph (d)(2) of this section may be used on the label or in labeling of a meal-type product as defined in § 413.313(l) and main-dish product as defined in § 413.313(m), provided that:
(i) The product contains 20 mg or less of cholesterol per 100 g of product;
(ii) The product contains 2 g or less of saturated fat per 100 g of product; and
(iii) If the product meets these conditions without the benefit of special processing, alteration, formulation, or reformulation to lower cholesterol content, it is labeled to clearly refer to all products of its type and not merely to the particular brand to which the label attaches.
(4) The terms “reduced cholesterol,” “reduced in cholesterol,” “cholesterol reduced,” “less cholesterol,” “lower cholesterol,” or “lower in cholesterol” may be used on the label or in labeling of products or products that substitute for those products as specified in
(i) The product has been specifically formulated, altered, or processed to reduce its cholesterol by 25 percent or more from the reference product it replaces as described in § 413.313(j)(1) and for which it substitutes as described in § 413.313(d) that has a significant (
(ii) The product contains 2 g or less of saturated fat per reference amount customarily consumed; and
(iii) As required in § 413.313(j)(2) for relative claims:
(A) The identity of the reference product and the percent (or fraction) that the cholesterol has been reduced are declared in immediate proximity to the most prominent such claim (
(B) Quantitative information comparing the level of cholesterol in the product per labeled serving size with that of the reference product that it replaces is declared adjacent to the most prominent claim or to the nutrition information (
(iv) Claims described in paragraph (d)(4) of this section may not be made on the label or in labeling of a product if the nutrient content of the reference product meets the definition for “low cholesterol.”
(5) The terms defined in paragraph (d)(4) of this section may be used on the label or in labeling of a meal-type product as defined in § 413.313(l) and main-dish product as defined in § 413.313(m), provided that:
(i) The product has been specifically formulated, altered, or processed to reduce its cholesterol by 25 percent or more from the reference product it replaces as described in § 413.313(j)(1) and for which it substitutes as described in § 413.313(d) that has a significant (
(ii) The product contains 2 g or less of saturated fat per 100 g of product; and
(iii) As required in § 413.313(j)(2) for relative claims:
(A) The identity of the reference product and the percent (or fraction) that the cholesterol has been reduced are declared in immediate proximity to the most prominent such claim (
(B) Quantitative information comparing the level of cholesterol in the product per specified weight with that of the reference product that it replaces is declared adjacent to the most prominent claim or to the nutrition information (
(iv) Claims described in paragraph (d)(5) of this section may not be made on the label or in labeling of a product if the nutrient content of the reference product meets the definition for “low cholesterol.”
(e)
(1) The term “lean” may be used on the label or in labeling of a product, provided that the product contains less than 10 g of fat, 4.5 g or less of saturated fat, and less than 95 mg of cholesterol per 100 g of product and per reference amount customarily consumed for individual foods, and per 100 g of product and per labeled serving size for meal-type products as defined in § 413.313(l) and main-dish products as defined in § 413.313(m).
(2) The term “extra lean” may be used on the label or in labeling of a product, provided that the product contains less than 5 g of fat, less than 2 g of saturated fat, and less than 95 mg of cholesterol per 100 g of product and per reference amount customarily consumed for individual foods, and per 100 g of product and per labeled serving size for meal-type products as defined in § 413.313(l) and main-dish products as defined in § 413.313(m).
(f) A statement of the lean percentage may be used on the label or in labeling of ground or chopped products described in § 413.301 when the product does not meet the criteria for “low fat,” defined in § 413.362(b)(2), provided that a statement of the fat percentage is contiguous to and in lettering of the same color, size, type, and on the same color background, as the statement of the lean percentage.
(a) The term “healthy,” or any other derivative of the term “health,” may be used on the labeling of any meat, meat food product, or poultry product, provided that the product is labeled in accordance with § 413.309 and § 413.313.
(b)(1) The product shall meet the requirements for “low fat” and “low saturated fat,” as defined in § 413.362, except that single-ingredient, raw products may meet the total fat and saturated fat criteria for “extra lean” in § 413.362.
(2) The product shall not contain more than 60 milligrams (mg) of cholesterol per reference amount customarily consumed, per labeled serving size, and, only for foods with reference amounts customarily consumed of 30 grams (g) or less or 2 tablespoons (tbsp) or less, per 50 g, and, for dehydrated products that must be reconstituted with water or a diluent containing an insignificant amount, as defined in § 413.309(f)(1), of all nutrients, the per-50-g criterion refers to the prepared form, except that:
(i) A main-dish product, as defined in § 413.313(m), and a meal-type product, as defined in § 413.313(l), and including meal-type products that weigh more than 12 ounces (oz) per serving (container), shall not contain more than 90 mg of cholesterol per labeled serving size; and
(ii) Single-ingredient, raw products may meet the cholesterol criterion for “extra lean” in § 413.362.
(3) The product shall not contain more than 480 mg of sodium per reference amount customarily consumed, per labeled serving size, and, only for foods with reference amounts customarily consumed of 30 g or less or 2 tbsp or less, per 50 g, and, for dehydrated products that must be reconstituted with water or a diluent containing an insignificant amount, as defined in § 413.309(f)(1), of all nutrients, the per-50-g criterion refers to the prepared form, except that:
(i) A main-dish product, as defined in § 413.313(m), and a meal-type product, as defined in § 413.313(l), and including meal-type products that weigh more than 12 oz per serving (container), shall not contain more than 600 mg of sodium per labeled serving size;
(ii) The requirements of this paragraph (b)(3) do not apply to single-ingredient, raw products.
(4) The product shall contain 10 percent or more of the Reference Daily Intake or Daily Reference Value as defined in § 413.309 for vitamin A, vitamin C, calcium, iron, protein, or fiber per reference amount customarily consumed prior to any nutrient addition, except that:
(i) A main-dish product, as defined in § 413.313(m), and including main-dish products that weigh less than 10 oz per serving (container), shall meet the level for two of the nutrients per labeled serving size; and
(ii) A meal-type product, as defined in § 413.313(l), shall meet the level for three of the nutrients per labeled serving size.
(a) This section pertains to labeling applications for claims, express or implied, that characterize the level of any nutrient required to be on the label or in labeling of product by this part.
(b) Labeling applications included in this section are:
(1) Labeling applications for a new (heretofore unauthorized) nutrient content claim,
(2) Labeling applications for a synonymous term (
(3) Labeling applications for the use of an implied claim in a brand name.
(c) Labeling applications and supporting documentation to be filed under this section shall be submitted in quadruplicate, except that the supporting documentation may be submitted on a computer disc copy. If any part of the material submitted is in a foreign language, it shall be accompanied by an accurate and complete English translation. The labeling application shall state the applicant's post office address.
(d) Pertinent information will be considered as part of an application on the basis of specific reference to such information submitted to and retained in the files of the Food Safety and Inspection Service. However, any reference to unpublished information furnished by a person other than the applicant will not be considered unless use of such information is authorized (with the understanding that such information may in whole or part be subject to release to the public) in a written statement signed by the person who submitted it. Any reference to published information should be accompanied by reprints or photostatic copies of such references.
(e) If nonclinical laboratory studies accompany a labeling application, the applicant shall include, with respect to each nonclinical study included with the application, either a statement that the study has been, or will be, conducted in compliance with the good laboratory practice regulations as set forth in part 58 of chapter 1, title 21, or, if any such study was not conducted in compliance with such regulations, a brief statement of the reason for the noncompliance.
(f) If clinical investigations accompany a labeling application, the applicant shall include, with respect to each clinical investigation included with the application, either a statement that the investigation was conducted in compliance with the requirements for institutional review set forth in part 56 of chapter 1, title 21, or was not subject to such requirements in accordance with § 56.194 or § 56.105, and that it was conducted in compliance with the requirements for informed consents set forth in part 50 of chapter 1, title 21.
(g) The availability for public disclosure of labeling applications, along with supporting documentation, submitted to the Agency under this section will be governed by the rules specified in subchapter D, title 9.
(h) The data specified under this section to accompany a labeling application shall be submitted on separate sheets, suitably identified. If such data has already been submitted with an earlier labeling application from the applicant, the present labeling application must provide the data.
(i) The labeling application must be signed by the applicant or by his or her attorney or agent, or (if a corporation) by an authorized official.
(j) The labeling application shall include a statement signed by the person responsible for the labeling application, that to the best of his or her knowledge, it is a representative and balanced submission that includes unfavorable information, as well as favorable information, known to him or her pertinent to the evaluation of the labeling application.
(k)(1) Labeling applications for a new nutrient content claim shall be accompanied by the following data which shall be submitted in the following form to the Director, Labeling and Program Delivery Staff, Office of Policy and Program Development, Food Safety and Inspection Service, Washington, DC 20250.
The undersigned, ___, submits this labeling application pursuant to 9 CFR 413.369 with respect to (statement of the claim and its proposed use). Attached hereto, in quadruplicate, or on a computer disc copy, and constituting a part of this labeling application, are the following:
(i) A statement identifying the nutrient content claim and the nutrient that the term is intended to characterize with respect to the level of such nutrient. The statement shall address why the use of the term as proposed will not be misleading. The statement shall provide examples of the nutrient content claim as it will be used on labels or labeling, as well as the types of products on which the claim will be used. The statement shall also specify the level at which the nutrient must be present or what other conditions concerning the product must be met for the appropriate use of the term in labels or labeling, as well as any factors that would make the use of the term inappropriate.
(ii) A detailed explanation supported by any necessary data of why use of the food component characterized by the claim is of importance in human nutrition by virtue of its presence or absence at the levels that such claim would describe. This explanation shall also state what nutritional benefit to the public will derive from use of the claim as proposed and why such benefit is not available through the use of existing terms defined by regulation. If the claim is intended for a specific group within the population, the analysis shall specifically address nutritional needs of such group, and scientific data sufficient for such purpose, and data and information to the extent necessary to demonstrate that consumers can be expected to understand the meaning of the term under the proposed conditions of use.
(iii) Analytical data that demonstrates the amount of the nutrient that is present in the products for which the claim is intended. The assays should be performed on representative samples in accordance with § 413.309(h). If no USDA or AOAC methods are available, the applicant shall submit the assay method used, and data establishing the validity of the method for assaying the nutrient in the particular food. The validation data shall include a statistical analysis of the analytical and product variability.
(iv) A detailed analysis of the potential effect of the use of the proposed claim on food consumption, and any corresponding changes in nutrient intake. The analysis shall specifically address the intake of nutrients that have beneficial and negative consequences in the total diet. If the claim is intended for a specific group within the population, the analysis shall specifically address the dietary practices of such group, and shall include data sufficient to demonstrate that the dietary analysis is representative of such group.
Yours very truly,
(2) Upon receipt of the labeling application and supporting documentation, the applicant shall be notified, in writing, of the date on which the labeling application was received. Such notice shall inform the applicant that the labeling application is undergoing Agency review and that the applicant shall subsequently be notified of the Agency's decision to consider for further review or deny the labeling application.
(3) Upon review of the labeling application and supporting documentation, the Agency shall notify the applicant, in writing, that the labeling application is either being considered for further review or that it
(4) If the labeling application is summarily denied by the Administrator, the written notification shall state the reasons therefor, including why the Agency has determined that the proposed nutrient content claim is false or misleading. The notification letter shall inform the applicant that the applicant may submit a written statement by way of answer to the notification, and that the applicant shall have the right to request a hearing with respect to the merits or validity of the Administrator's decision to deny the use of the proposed nutrient content claim.
(i) If the applicant fails to accept the determination of the Administrator and files an answer and requests a hearing, and the Administrator, after review of the answer, determines the initial determination to be correct, the Administrator shall file with the Hearing Clerk of the Department the notification, answer, and the request for a hearing, which shall constitute the complaint and answer in the proceeding, which shall thereafter be conducted in accordance with the Department's Uniform Rules of Practice.
(ii) The hearing shall be conducted before an administrative law judge with the opportunity for appeal to the Department's Judicial Officer, who shall make the final determination for the Secretary. Any such determination by the Secretary shall be conclusive unless, within 30 days after receipt of notice of such final determination, the applicant appeals to the United States Court of Appeals for the circuit in which the applicant has its principal place of business or to the United States Court of Appeals for the District of Columbia Circuit.
(5) If the labeling application is not summarily denied by the Administrator, the Administrator shall publish in the
(i) If the claim is denied by the Administrator, the Agency shall notify the applicant, in writing, of the basis for the denial, including the reason why the claim on the labeling was determined by the Agency to be false or misleading. The notification letter shall also inform the applicant that the applicant may submit a written statement by way of answer to the notification, and that the applicant shall have the right to request a hearing with respect to the merits or validity of the Administrator's decision to deny the use of the proposed nutrient content claim.
(A) If the applicant fails to accept the determination of the Administrator and files an answer and requests a hearing, and the Administrator, after review of the answer, determines the initial determination to be correct, the Administrator shall file with the Hearing Clerk of the Department the notification, answer, and the request for a hearing, which shall constitute the complaint and answer in the proceeding, which shall thereafter be conducted in accordance with the Department's Uniform Rules of Practice.
(B) The hearing shall be conducted before an administrative law judge with the opportunity for appeal to the Department's Judicial Officer, who shall make final determination for the Secretary. Any such determination by the Secretary shall be conclusive unless, within 30 days after receipt of the notice of such final determination, the applicant appeals to the United States Court of Appeals for the circuit in which the applicant has its principal place of business or to the United States Court of Appeals for the District of Columbia Circuit.
(ii) If the claim is approved, the Agency shall notify the applicant, in writing, and shall also publish in the
(l)(1) Labeling applications for a synonymous term shall be accompanied by the following data which shall be submitted in the following form to the Director, Labeling and Program Delivery Staff, Office of Policy and Program Development, Food Safety and Inspection Service, Washington, DC 20250:
Attached hereto, in quadruplicate, or on a computer disc copy, and constituting a part of this labeling application, are the following:
(i) A statement identifying the synonymous term, the existing term defined by a regulation with which the synonymous term is claimed to be consistent, and the nutrient that the term is intended to characterize the level of. The statement shall address why the use of the synonymous term as proposed will not be misleading. The statement shall provide examples of the nutrient content claim as it will be used on labels or labeling, as well as the types of products on which the claim will be used. The statement shall also specify whether any limitations not applicable to the use of the defined term are intended to apply to the use of the synonymous term.
(ii) A detailed explanation supported by any necessary data of why use of the proposed term is requested, including whether the existing defined term is inadequate for the purpose of effectively characterizing the level of a nutrient. This explanation shall also state what nutritional benefit to the public will derive from use of the claim as proposed, and why such benefit is not available through the use of existing terms defined by regulation. If the claim is intended for a specific group within the population, the analysis shall specifically address nutritional needs of such group, scientific data sufficient for such purpose, and data and information to the extent necessary to demonstrate that consumers can be expected to understand the meaning of the term under the proposed conditions of use.
Yours very truly,
(2) Upon receipt of the labeling application and supporting documentation, the applicant shall be notified, in writing, of the date on which the labeling application was received. Such notice shall inform the applicant that the labeling application is undergoing Agency review and that the applicant shall subsequently be notified of the Agency's decision to consider for further review or deny the labeling application.
(3) Upon review of the labeling application and supporting documentation, the Agency shall notify the applicant, in writing, that the labeling application is either being considered for further review or that it has been summarily denied by the Administrator.
(4) If the labeling application is summarily denied by the Administrator, the written notification shall state the reasons therefor, including why the Agency has determined that the proposed synonymous term is false or misleading. The notification letter shall inform the applicant that the applicant may submit a written statement by way
(i) If the applicant fails to accept the determination of the Administrator and files an answer and requests a hearing, and the Administrator, after review of the answer, determines the initial determination to be correct, the Administrator shall file with the Hearing Clerk of the Department the notification, answer, and the request for a hearing, which shall constitute the complaint and answer in the proceeding, which shall thereafter be conducted in accordance with the Department's Uniform Rules of Practice.
(ii) The hearing shall be conducted before an administrative law judge with the opportunity for appeal to the Department's Judicial Officer, who shall make the final determination for the Secretary. Any such determination by the Secretary shall be conclusive unless, within 30 days after receipt of notice of such final determination, the applicant appeals to the United States Court of Appeals for the circuit in which the applicant has its principal place of business or to the United States Court of Appeals for the District of Columbia Circuit.
(5) If the claim is approved, the Agency shall notify the applicant, in writing, and shall publish in the
(m)(1) Labeling applications for the use of an implied nutrient content claim in a brand name shall be accompanied by the following data which shall be submitted in the following form to the Director, Labeling and Program Delivery Staff, Office of Policy and Program Development, Food Safety and Inspection Service, Washington, DC 20250:
The undersigned, ___ submits this labeling application pursuant to 9 CFR 413.369 with respect to (statement of the implied nutrient content claim and its proposed use in a brand name).
Attached hereto, in quadruplicate, or on a computer disc copy, and constituting a part of this labeling application, are the following:
(i) A statement identifying the implied nutrient content claim, the nutrient the claim is intended to characterize, the corresponding term for characterizing the level of such nutrient as defined by a regulation, and the brand name of which the implied claim is intended to be a part. The statement shall address why the use of the brand-name as proposed will not be misleading. The statement shall provide examples of the types of products on which the brand name will appear. It shall also include data showing that the actual level of the nutrient in the food would qualify the label of the product to bear the corresponding term defined by regulation. Assay methods used to determine the level of a nutrient shall meet the requirements stated under labeling application format in paragraph (k)(1)(iii) of this section.
(ii) A detailed explanation supported by any necessary data of why use of the proposed brand name is requested. This explanation shall also state what nutritional benefit to the public will derive from use of the brand name as proposed. If the branded product is intended for a specific group within the population, the analysis shall specifically address nutritional needs of such group and scientific data sufficient for such purpose.
Yours very truly,
(2) Upon receipt of the labeling application and supporting documentation, the applicant shall be notified, in writing, of the date on which the labeling application was received. Such notice shall inform the applicant that the labeling application is undergoing Agency review and that the applicant shall subsequently be notified of the Agency's decision to consider for further review or deny the labeling application.
(3) Upon review of the labeling application and supporting documentation, the Agency shall notify the applicant, in writing, that the labeling application is either being considered for further review or that it has been summarily denied by the Administrator.
(4) If the labeling application is summarily denied by the Administrator, the written notification shall state the reasons therefor, including why the Agency has determined that the proposed implied nutrient content claim is false or misleading. The notification letter shall inform the applicant that the applicant may submit a written statement by way of answer to the notification, and that the applicant shall have the right to request a hearing with respect to the merits or validity of the Administrator's decision to deny the use of the proposed implied nutrient content claim.
(i) If the applicant fails to accept the determination of the Administrator and files an answer and requests a hearing, and the Administrator, after review of the answer, determines the initial determination to be correct, the Administrator shall file with the Hearing Clerk of the Department the notification, answer, and the request for a hearing, which shall constitute the complaint and answer in the proceeding, which shall thereafter be conducted in accordance with the Department's Uniform Rules of Practice.
(ii) The hearing shall be conducted before an administrative law judge with the opportunity for appeal to the Department's Judicial Officer, who shall make the final determination for the Secretary. Any such determination by the Secretary shall be conclusive unless, within 30 days after receipt of notice of such final determination, the applicant appeals to the United States Court of Appeals for the circuit in which the applicant has its principal place of business or to the United States Court of Appeals for the District of Columbia Circuit.
(5) If the labeling application is not summarily denied by the Administrator, the Administrator shall publish a notice of the labeling application in the
(i) If the claim is denied by the Administrator, the Agency shall notify the applicant, in writing, of the basis for the denial, including the reason why the claim on the labeling was determined by the Agency to be false or misleading. The notification letter shall also inform the applicant that the applicant may submit a written statement by way of answer to the notification, and that the applicant shall have the right to request a hearing with respect to the merits or validity of the Administrator's decision to deny the use of the proposed implied nutrient content claim.
(A) If the applicant fails to accept the determination of the Administrator and files an answer and requests a hearing, and the Administrator, after review of the answer, determines the initial determination to be correct, the Administrator shall file with the Hearing Clerk of the Department the notification, answer, and the request for a hearing, which shall thereafter be conducted in accordance with the Department's Uniform Rules of Practice.
(B) The hearing shall be conducted before an administrative law judge with the opportunity for appeal to the Department's Judicial Officer, who shall make the final determination for the Secretary. Any such determination by the Secretary shall be conclusive unless, within 30 days after receipt of the notice of such final determination, the applicant appeals to the United States Court of Appeals for the circuit in which the applicant has its principal place of business or to the United States Court of Appeals for the District of Columbia Circuit.
(ii) If the claim is approved, the Agency shall notify the applicant, in writing, and shall also publish in the
(a)
(1) Nutrition labeling in conformity with § 413.309 of this part, unless exempt under that section, and
(2) A conspicuous statement of the basis upon which the product claims to be of special dietary usefulness.
(b)
(2) A special dietary product may contain a nonnutritive sweetener or other ingredient only if the ingredient is safe for use in the product under the applicable law and regulations of this chapter. Any product that achieves its special dietary usefulness in reducing or maintaining body weight through the use of a nonnutritive sweetener shall bear on its label the statement required by paragraph (b)(1) of this section, but need not state the percentage by weight of the nonnutritive sweetener. If nutritive sweeteners as well as nonnutritive sweeteners are added, the statement shall indicate the presence of both types of sweetener;
(c)
(d)
(e)
(1) Except as provided in paragraphs (e)(2) and (e)(3) of this section, a product may be labeled with terms such as “diet,” “dietetic,” “artificially sweetened,” or “sweetened with nonnutritive sweetener” only if the claim is not false or misleading, and the product is labeled “low calorie” or “reduced calorie” or bears another comparative calorie claim in compliance with the applicable provisions in this part.
(2) Paragraph (e)(1) of this section shall not apply to any use of such terms that is specifically authorized by regulation governing a particular food, or, unless otherwise restricted by regulation, to any use of the term “diet” that clearly shows that the product is offered solely for a dietary use other than regulating body weight,
(3) Paragraph (e)(1) of this section shall not apply to any use of such terms on a formulated meal replacement or other product that is represented to be of special dietary use as a whole meal, pending the issuance of a regulation governing the use of such terms on foods.
(f)
(a) The following products are exempt from nutrition labeling:
(1) Food products produced by small businesses, other than the major cuts of single-ingredient, raw products identified in § 413.344 produced by small businesses, provided that the labels for these products bear no nutrition claims or nutrition information, and ground or chopped products described in § 413.301 produced by small businesses that bear a statement of the lean percentage and fat percentage on the label or in labeling in accordance with § 413.362(f), provided that labels or labeling for these products bear no other nutrition claims or nutrition information,
(i) A food product, for the purposes of the small business exemption, is defined as a formulation, not including distinct flavors which do not significantly alter the nutritional profile, sold in any size package in commerce.
(ii) For purposes of this paragraph, a small business is any single-plant facility, including a single retail store, or multi-plant company/firm, including a multi-retail store operation, that employs 500 or fewer people and produces no more than 100,000 pounds of the product qualifying the firm for exemption from this part.
(iii) For purposes of this paragraph, calculation of the amount of pounds shall be based on the most recent 2-year average of business activity. Where firms have been in business less than 2 years or where products have been produced for less than 2 years, reasonable estimates must indicate that the annual pounds produced will not exceed the amounts specified.
(2) Products intended for further processing, provided that the labels for these products bear no nutrition claim or nutrition information,
(3) Products that are not for sale to consumers, provided that the labels for these products bear no nutrition claims or nutrition information,
(4) Products in small packages that are individually wrapped packages of less than
(5) Products custom slaughtered or prepared,
(6) Products intended for export, and
(7) The following products prepared and served or sold at retail provided that the labels or the labeling of these products bear no nutrition claims or nutrition information:
(i) Ready-to-eat products that are packaged or portioned at a retail store or similar retail-type establishment, provided, however, that this exemption does not apply to ready-to-eat ground or chopped products described in § 413.301 that are packaged or portioned at a retail establishment, unless the establishment qualifies for an exemption under (a)(1) of this section;
(ii) Multi-ingredient products (
(iii) Products that are ground or chopped at an individual customer's request.
(b) Restaurant menus generally do not constitute labeling or fall within the scope of these regulations.
(c)(1) Foods represented or purported to be specifically for infants through 12 months of age and children 1 through 3 years of age shall bear nutrition labeling. The nutrients declared for infants through 12 months of age and children 1 through 3 years of age shall include calories, total fat, saturated fat,
(2) Foods represented or purported to be specifically for infants through 12 months of age shall bear nutrition labeling, except that:
(i) Such labeling shall not declare a percent of Daily Value for saturated fat,
(ii) The following sample label illustrates the provisions of paragraph (c)(2) of this section.
(3) Foods represented or purported to be specifically for children 1 through 3 years of age shall include a footnote that states: “ * The %Daily Value tells you how much a nutrient in a serving of food contributes to a daily diet. 1,000 calories a day is used for general nutrition advice.”
(i) The following sample label illustrates the provisions of paragraph (c)(3) of this section.
(ii) [Reserved]
(d)(1) Products in packages that have a total surface area available to bear labeling of less than 12 square inches are exempt from nutrition labeling, provided that the labeling for these products bear no nutrition claims or other nutrition information, except that this exemption does not apply to the major cuts of single-ingredient, raw products identified in § 413.344. The manufacturer, packer, or distributor shall provide, on the label of packages that qualify for and use this exemption, an address or telephone number that a consumer can use to obtain the required nutrition information (
(2) When products bear nutrition labeling, either voluntarily or because nutrition claims or other nutrition information is provided, all required information shall be provided in accordance with 9 CFR 413.309(d) for the linear nutrition display as shown in 9 CFR 413.309(g)(1)(i)(B).
Office of Energy Efficiency and Renewable Energy, Department of Energy.
Final rule.
The Energy Policy and Conservation Act of 1975 (EPCA), as amended, prescribes energy conservation standards for various consumer products and certain commercial and industrial equipment, including ceiling fans. EPCA also requires the U.S. Department of Energy (DOE) to periodically determine whether more-stringent standards would be technologically feasible and economically justified, and would save a significant amount of energy. In this final rule, DOE amends the energy conservation standards for ceiling fans. It has determined that the amended energy conservation standards for these products would result in significant conservation of energy, and are technologically feasible and economically justified.
The effective date of this rule is March 20, 2017. Compliance with the amended standards established for ceiling fans in this final rule is required on and after January 21, 2020.
The docket for this rulemaking, which includes
A link to the docket web page can be found at
For further information on how to review the docket, contact Ms. Lucy deButts at: (202) 287-1604 or by e-mail:
Lucy deButts, U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Office, EE-5B, 1000 Independence Avenue SW., Washington, DC 20585-0121. Telephone: (202) 287-1604. E-mail:
Elizabeth Kohl, U.S. Department of Energy, Office of the General Counsel, GC-33, 1000 Independence Avenue SW., Washington, DC 20585-0121. Telephone: (202) 586-7796. E-mail:
Title III, Part B
Pursuant to EPCA, any new or amended energy conservation standard must be designed to achieve the maximum improvement in energy efficiency that DOE determines is technologically feasible and economically justified. (42 U.S.C. 6295(o)(2)(A)) Furthermore, the new or amended standard must result in significant conservation of energy. (42 U.S.C. 6295(o)(3)(B))
In accordance with these and other statutory provisions discussed in this document, DOE is adopting amended energy conservation standards for ceiling fans. The amended standards, which are expressed for each product class as the minimum allowable efficiency in terms of cubic feet per minute per watt (CFM/W), as a function of ceiling fan diameter in inches, are shown in Table I.1. These standards would apply to all ceiling fans listed in Table I.1 and manufactured in, or imported into, the United States on and after January 21, 2020.
Table I.2 presents DOE's evaluation of the economic impacts of the adopted standards on consumers of ceiling fans, as measured by the average life-cycle cost (LCC) savings and the simple payback period (PBP).
DOE's analysis of the impacts of the adopted standards on consumers is described in section IV.F of this document.
The industry net present value (INPV) is the sum of the discounted cash flows to the industry from the reference year through the terminal year of the analysis period (2016-2049). Using a real discount rate of 7.4 percent, DOE estimates that the INPV for manufacturers of ceiling fans in the case without amended standards is $1,211.6 million in 2015$. Under the adopted standards, DOE expects that manufacturers may lose up to 9.9 percent of this INPV, which is approximately $119.4 million.
DOE's analysis of the impacts of the adopted standards on manufacturers is described in section IV.J of this document.
DOE's analyses indicate that the adopted energy conservation standards for ceiling fans would save a significant amount of energy. Relative to the case without amended standards (referred to as the “no-new-standards case”), the lifetime energy savings for ceiling fans
The cumulative net present value (NPV) of total consumer costs and savings of the standards for ceiling fans ranges from $4.488 billion (at a 7-percent discount rate) to $12.123 billion (at a 3-percent discount rate). This NPV expresses the estimated total value of future operating-cost savings minus the estimated increased product costs for ceiling fans purchased in 2020-2049.
In addition, the standards for ceiling fans are projected to yield significant environmental benefits. DOE estimates that the standards would result in cumulative greenhouse gas emission reductions (over the same period as for energy savings) of 120.2 million metric tons (Mt)
The value of the CO
Table I.3 summarizes the economic benefits and costs expected to result from the adopted standards for ceiling fans.
The benefits and costs of the adopted standards, for ceiling fans sold in 2020-2049, can also be expressed in terms of annualized values. The monetary values for the total annualized net benefits are the sum of (1) the national economic value of the benefits in reduced consumer operating costs, minus (2) the increases in product purchase prices and installation costs, plus (3) the value of the benefits of CO
The national operating cost savings are domestic private U.S. consumer monetary savings that occur as a result of purchasing the covered products. The national operating cost savings is measured for the lifetime of ceiling fans shipped in 2020-2049. The CO
Estimates of annualized benefits and costs of the adopted standards are shown in Table I.4. The results under the primary estimate are as follows. Using a 7-percent discount rate for benefits and costs other than CO
DOE's analysis of the national impacts of the adopted standards is described in sections IV.H, IV.K, and IV.L of this notice.
Based on the analyses culminating in this final rule, DOE found the benefits to the nation of the standards (energy savings, consumer LCC savings, positive NPV of consumer benefit, and emission reductions) outweigh the burdens (loss of INPV and LCC increases for some users of these products). DOE has concluded that the standards in this final rule represent the maximum improvement in energy efficiency that is technologically feasible and economically justified, and would result in significant conservation of energy.
The following section briefly discusses the statutory authority underlying this adopted rule, as well as some of the relevant historical background related to the establishment of standards for ceiling fans.
Title III, Part B of the Energy Policy and Conservation Act of 1975 (EPCA or the Act), Public Law 94-163 (42 U.S.C. 6291,
Under 42 U.S.C. 6295(m), DOE must periodically review its already established energy conservation standards for a covered product. Under this requirement, the next review that DOE would need to conduct must occur no later than 6 years from the issuance of any final rule establishing or amending a standard for a covered product. EPCA also provides that not later than 6 years after issuance of any final rule establishing or amending a standard, DOE must publish either a notice of determination that standards for the product do not need to be amended, or a notice of proposed rulemaking including new proposed energy conservation standards. (42 U.S.C. 6295(m))
Pursuant to EPCA, DOE's energy conservation program for covered products consists essentially of four parts: (1) Testing, (2) labeling, (3) the establishment of Federal energy conservation standards, and (4) certification and enforcement procedures. The Federal Trade Commission (FTC) is primarily responsible for labeling, and DOE implements the remainder of the program. Subject to certain criteria and conditions, DOE is required to develop test procedures to measure the energy efficiency, energy use, or estimated annual operating cost of each covered product. (42 U.S.C. 6295(o)(3)(A) and (r)) Manufacturers of covered products must use the prescribed DOE test procedure as the basis for certifying to DOE that their products comply with the applicable energy conservation standards adopted under EPCA and when making representations to the public regarding the energy use or efficiency of those products. (42 U.S.C. 6293(c) and 6295(s)) Similarly, DOE must use these test procedures to determine whether the products comply with standards adopted pursuant to EPCA. (42 U.S.C. 6295(s)) The DOE test procedures for ceiling fans appear at title 10 of the Code of Federal Regulations (CFR) part 430, subpart B, appendix U, 10 CFR 430.23(w) and 10 CFR 429.32.
DOE must follow specific statutory criteria for prescribing new or amended standards for covered products, including ceiling fans. Any new or amended standard for a covered product must be designed to achieve the maximum improvement in energy efficiency that is technologically feasible and economically justified. (42 U.S.C. 6295(o)(2)(A) and (3)(B)) Furthermore, DOE may not adopt any standard that would not result in the significant conservation of energy. (42 U.S.C. 6295(o)(3)) Moreover, DOE may not prescribe a standard (1) for certain products, including ceiling fans, if no test procedure has been established for the product, or (2) if DOE determines by rule that the standard is not technologically feasible or economically justified. (42 U.S.C. 6295(o)(3)(A)-(B)) In deciding whether a proposed standard is economically justified, DOE must determine whether the benefits of the standard exceed its burdens. (42 U.S.C. 6295(o)(2)(B)(i)) DOE must make this determination after receiving comments on the proposed standard, and by considering, to the greatest extent practicable, the following seven statutory factors:
(1) The economic impact of the standard on manufacturers and consumers of the products subject to the standard;
(2) The savings in operating costs throughout the estimated average life of the covered products in the type (or class) compared to any increase in the price, initial charges, or maintenance expenses for the covered products that are likely to result from the standard;
(3) The total projected amount of energy (or as applicable, water) savings likely to result directly from the standard;
(4) Any lessening of the utility or the performance of the covered products likely to result from the standard;
(5) The impact of any lessening of competition, as determined in writing by the Attorney General, that is likely to result from the standard;
(6) The need for national energy and water conservation; and
(7) Other factors the Secretary of Energy (Secretary) considers relevant.
Further, EPCA, as codified, establishes a rebuttable presumption that a standard is economically justified if the Secretary finds that the additional cost to the consumer of purchasing a product complying with an energy conservation standard level will be less than three times the value of the energy savings during the first year that the consumer will receive as a result of the standard, as calculated under the applicable test procedure. (42 U.S.C. 6295(o)(2)(B)(iii))
EPCA, as codified, also contains what is known as an “anti-backsliding” provision, which prevents the Secretary from prescribing any amended standard that either increases the maximum allowable energy use or decreases the minimum required energy efficiency of a covered product. (42 U.S.C. 6295(o)(1)) Also, the Secretary may not prescribe an amended or new standard if interested persons have established by a preponderance of the evidence that the standard is likely to result in the unavailability in the United States in any covered product type (or class) of performance characteristics (including reliability), features, sizes, capacities, and volumes that are substantially the same as those generally available in the United States. (42 U.S.C. 6295(o)(4))
Additionally, EPCA specifies requirements when promulgating an energy conservation standard for a covered product that has two or more subcategories. DOE must specify a different standard level for a type or class of products that has the same function or intended use if DOE determines that products within such group (A) consume a different kind of energy from that consumed by other covered products within such type (or class); or (B) have a capacity or other performance-related feature which other products within such type (or class) do not have and such feature justifies a higher or lower standard. (42 U.S.C. 6295(q)(1)) In determining whether a performance-related feature justifies a different standard for a group of products, DOE must consider such factors as the utility to the consumer of such a feature and other factors DOE deems appropriate.
Federal energy conservation requirements generally supersede State laws or regulations concerning energy conservation testing, labeling, and standards. (42 U.S.C. 6297(a)-(c)) DOE may, however, grant waivers of Federal preemption for particular State laws or regulations, in accordance with the procedures and other provisions set forth under 42 U.S.C. 6297(d)).
EPCA also requires that for any final rule for new or amended energy conservation standards promulgated after July 1, 2010, DOE must address standby mode and off mode energy use. (42 U.S.C. 6295(gg)(3)) Specifically, when DOE adopts a standard for a covered product after that date, it must, if justified by the criteria for adoption of standards under EPCA (42 U.S.C. 6295(o)), incorporate standby mode and off mode energy use into a single standard, or, if that is not feasible, adopt a separate standard for such energy use for that product. (42 U.S.C. 6295(gg)(3)(A)-(B)) The amended standards DOE is adopting in this final rule incorporate standby mode and off mode energy use into a single standard.
The Energy Policy and Conservation Act of 1975 (EPCA) defined and established design standards for ceiling fans. EPCA defined a “ceiling fan” as “a nonportable device that is suspended from a ceiling for circulating air via the rotation of fan blades.” (42 U.S.C. 6291(49)) In a final rule technical amendment published in the on October 18, 2005, DOE codified the statutorily-prescribed design standards for ceiling fans. 70 FR 60407, 60413. These standards are set forth in DOE's regulations at 10 CFR 430.32(s), and require all ceiling fans manufactured on or after January 1, 2007, to have the following features:
1. Fan speed controls separate from any lighting controls;
2. adjustable speed controls (either more than one speed or variable speed); and
3. the capability for reverse action (other than fans sold for industrial or outdoor application or where safety would be an issue)).
EPCA established energy conservation standards for ceiling fans as described in Section II.B.1 and authorized DOE to consider, if the requirements of 42 U.S.C. 6295(o) and (p) are met, establishing energy efficiency or energy use standards for the electricity used by ceiling fans to circulate air in a room. (42 U.S.C. 6295(ff))
As noted in section II.B.1, DOE codified the statutorily-prescribed design standards for ceiling fans in the CFR at 10 CFR 430.32(s). 70 FR 60407, 60413 (Oct. 18, 2005). DOE also adopted test procedures for ceiling fans at 10 CFR part 430, subpart B, appendix U and 10 CFR 430.23(w). 71 FR 71340, 71366-67 (Dec. 8, 2006). Sampling and certification requirements for ceiling fans are set forth at 10 CFR 429.32.
On March 15, 2013, DOE published a notice announcing the availability of the framework document, “Energy Conservation Standards Rulemaking Framework Document for Ceiling Fans and Ceiling Fan Light Kits,”
On September 29, 2014, DOE published the preliminary analysis for the ceiling fan energy conservation standards rulemaking. 79 FR 58290. DOE posted the preliminary analysis, as well as the complete preliminary technical support document (TSD), on its website.
On January 13, 2016, DOE published a notice of proposed rulemaking (NOPR) for the ceiling fans energy conservation standards rulemaking (ceiling fans NOPR). 81 FR 1688. DOE posted the ceiling fans NOPR analysis, as well as the complete NOPR TSD on its Web site.
This final rule responds to issues raised by commenters in response to the framework document, preliminary analysis, and NOPR.
DOE developed this proposal after considering comments, data, and information from interested parties that represent a variety of interests. The following section provides general discussion of the final standards rule; section IV addresses the issues raised by these commenters.
EPCA defines a “ceiling fan” as “a nonportable device that is suspended from a ceiling for circulating air via the rotation of fan blades.” (42 U.S.C. 6291(49))
DOE previously interpreted the definition of a ceiling fan such that it excluded certain types of ceiling fans commonly referred to as hugger fans. 71 FR 71343 (Dec. 8, 2006). Hugger ceiling fans are typically understood to be set flush to the ceiling (
The changes in interpretation of the ceiling fan definition discussed above resulted in the applicability of the design standards set forth in EPCA at 42 U.S.C. 6295(ff)(1) to these fan types as of January 25, 2016. DOE research indicates that all ceiling fans currently on the market, including hugger ceiling fans and ceiling fans that produce a large volume of airflow, appear to meet the EPCA design standards. Compliance with requirements related to the ceiling fan reinterpretation was discussed in the Ceiling Fan Light Kit test procedure final rule. 80 FR 80209 (Dec. 24, 2015) Specifically, DOE will not assert civil penalty authority for violations of the applicable standards arising as a result of the reinterpretation of the ceiling fan definition before June 26, 2017.
DOE is also establishing efficiency standards for these fan types, which include hugger ceiling fans and ceiling fans that produce a large volume of airflow, in this ceiling fans final rule. Compliance with those standards, as discussed in the
Additionally, in the ceiling fan test procedure final rule, DOE provided clarification on those ceiling fans that are not subject to the test procedure. 81 FR 48620 (July 25, 2016). The test procedures do not apply to belt-driven ceiling fans, centrifugal ceiling fans, oscillating ceiling fans, or ceiling fans whose blades' plane of rotation cannot be within 45 degrees of horizontal. American Lighting Association (ALA) requested that DOE clarify that if the plane of rotation is not within 45 degrees of horizontal, the ceiling fan is not subject to DOE's proposed efficiency standards, certification requirements or labeling requirements. (ALA, No. 137 at p. 4) DOE confirms that it is not establishing performance standards for ceiling fans whose blades' plane of rotation cannot be within 45 degrees of horizontal in this final rule. The design standards set forth in EPCA at 42 U.S.C.
In summary, this DOE final rule is not establishing performance standards for belt-driven ceiling fans, centrifugal ceiling fans, oscillating ceiling fans, or ceiling fans whose blades' plane of rotation cannot be within 45 degrees of horizontal. DOE is also not establishing performance standards for highly decorative fans. Manufacturers must continue to submit certification reports to DOE for such fans with respect to the statutory design standards. Both DOE and manufacturers would determine whether a fan met the definition of a highly decorative fan using the final test procedure, though manufacturers would not be required to submit the supporting information, including any test data that supports their highly decorative classification as part of their certification submission to DOE. In addition, manufacturers would be required to test highly-decorative fans according to the test procedure established in the test procedure final rule to make representations of the energy efficiency of such fans (
When establishing energy conservation standards, DOE divides covered products into product classes by the type of energy used or by capacity or other performance-related features that justify differing standards. In making a determination whether a performance-related feature justifies a different standard, DOE must consider such factors as the utility of the feature to the consumer and other factors DOE determines are appropriate. (42 U.S.C. 6295(q))
Currently there are no product classes for ceiling fans, because the previous final rule for ceiling fans published on October 18, 2005 set design standards, but did not establish product classes. 70 FR 60407. In the ceiling fans NOPR, DOE proposed seven product classes and their associated definitions, which included highly-decorative, belt-driven, very small-diameter, hugger, standard, high-speed small-diameter and large-diameter fans. 81 FR 1688 (January 13, 2016). Chapter 3 of the TSD provides additional discussion on the establishment of these product classes pursuant to 42 U.S.C. 6295(q). In the ceiling fans test procedure final rule, DOE finalized the definitions for these types of ceiling fans. 81 FR 48620 (July 25, 2016). In this final rule, DOE is finalizing all seven product classes proposed in the ceiling fans NOPR. For further details on product classes, see section IV.A.1 of this rulemaking.
EPCA sets forth generally applicable criteria and procedures for DOE's adoption and amendment of test procedures. (42 U.S.C. 6293) Manufacturers of covered products must use these test procedures to certify to DOE that their product complies with energy conservation standards and to quantify the efficiency of their product. (42 U.S.C. 6293, 6295(s)) Similarly, DOE must use these test procedures to determine compliance with its energy conservation standards. (42 U.S.C. 6295(s)) As noted, the test procedures for ceiling fans are provided in 10 CFR 430.23(w) and appendix U to subpart B of 10 CFR part 430. DOE published a NOPR to amend the ceiling fan test procedures on October 17, 2014, 79 FR 62521, and published a supplemental NOPR (SNOPR) on June 3, 2015. 80 FR 31487. DOE finalized the test procedure on July 25, 2016. 81 FR 48620.
With respect to the process of establishing test procedures and standards for a given product, DOE notes that, while not legally obligated to do so, it generally follows the approach laid out in guidance found in 10 CFR part 430, subpart C, Appendix A (Procedures, Interpretations and Policies for Consideration of New or Revised Energy Conservation Standards for Consumer Products). That guidance provides, among other things, that DOE issues final, modified test procedures for a given product prior to publication of the NOPR proposing energy conservation standards for that product. While DOE strives to follow the procedural steps outlined in its guidance, there may be circumstances in which it may be necessary or appropriate to deviate from it. In such instances, the guidance indicates that DOE will provide notice and an explanation for the deviation. Accordingly, DOE has provided notices while it continued to develop the final test procedure for ceiling fans. DOE received comments regarding test methods for ceiling fans for which the plane of rotation of the ceiling fan's blades cannot be within 45 degrees of horizontal, high-volume small-diameter ceiling fans and ceiling fans with blade spans greater than seven feet leading to modification to test methods proposed in the NOPR. (79 FR 62521 (October 17, 2014)). DOE also received comments regarding the variability of results from the test procedures proposed in the SNOPR (80 FR 31487 (June 3, 2015)), based on testing conducted by manufacturers. Lastly, DOE conducted a thorough review of all available test data, including additional test data supplied by manufacturers, to identify opportunities to decrease testing variation.
DOE attempted to issue the final test procedure prior to the NOPR proposing energy conservation standards. However, additional time to address comments received on the NOPR and SNOPR lead to modification of the test procedure, which caused deviations from the guidance provided in 10 CFR part 430, subpart C, Appendix A.
Currently no energy efficiency performance standards exist for ceiling fans, just design standards for certain ceiling fans. In this final rule, DOE is setting energy efficiency performance standards in terms of a minimum efficiency equation established in the test procedure final rule. 81 FR 48620 (July 25, 2016). The test procedure final rule established test procedures for an integrated efficiency metric measured in cubic feet per minute per watt (CFM/W) that is applicable to all ceiling fans for which DOE establishes energy conservation standards in this final rule.
In the July 2016 test procedure final rule, DOE: (1) Specified new test procedures for large-diameter ceiling fans, multi-mount ceiling fans, ceiling fans with multiple fan heads, and ceiling fans where the airflow is not directed vertically, and (2) adopted the following changes to the current test procedure: (a) Low-speed small-diameter ceiling fans must be tested at high and low speeds; (b) high-speed small-diameter ceiling fans must be tested at high speed only; (c) large-diameter ceiling fans must be tested at up to five speeds; (d) a test cylinder is not to be used during testing; (e) fans that can be mounted at more than one height are to be mounted in the configuration that minimizes the distance between the fan blades and the ceiling; (f) any heater installed with a ceiling fan is to be switched off during testing; (g) small-diameter ceiling fans must be mounted directly to the real ceiling; (h) the allowable measurement tolerance for air velocity sensors is ± 5%; (i) the allowable mounting distance tolerance for air velocity sensors is± 1/16”; (j) the air delivery room must be at 70 F ± 5 F during testing; (k) air delivery room doors and air conditioning vents must be closed and forced-air conditioning equipment turned off during testing; (l) low speed small diameter and HSSD fans capable of operating with single- and multi-phase power be tested with single-phase power, and large diameter fans capable of operating with single- and multi-phase power be tested with multi-phase
In each energy conservation standards rulemaking, DOE conducts a screening analysis based on information gathered on all current technology options and prototype designs that could improve the efficiency of the products or equipment that are the subject of the rulemaking. As the first step in such an analysis, DOE develops a list of technology options for consideration in consultation with manufacturers, design engineers, and other interested parties. DOE then determines which of those means for improving efficiency are technologically feasible. DOE considers technologies incorporated in commercially available products or in working prototypes to be technologically feasible. 10 CFR part 430, subpart C, appendix A, section 4(a)(4)(i)
After DOE has determined that particular technology options are technologically feasible, it further evaluates each technology option in light of the following additional screening criteria: (1) Practicability to manufacture, install, and service; (2) adverse impacts on product utility or availability; and (3) adverse impacts on health or safety. 10 CFR part 430, subpart C, appendix A, section 4(a)(4)(ii)-(iv) Additionally, it is DOE policy not to include in its analysis any proprietary technology that is a unique pathway to achieving a certain efficiency level. Section IV.B of this notice discusses the results of the screening analysis for ceiling fans, particularly the designs DOE considered, those it screened out, and those that are the basis for the standards considered in this rulemaking. For further details on the screening analysis for this rulemaking, see section IV.B of this notice and chapter 4 of the final rule TSD.
When DOE proposes to adopt an amended standard for a type or class of covered product, it must determine the maximum improvement in energy efficiency or maximum reduction in energy use that is technologically feasible for such product. (42 U.S.C. 6295(p)(1)) Accordingly, in the engineering analysis, DOE determined the maximum technologically feasible (“max-tech”) improvements in energy efficiency for ceiling fans, using the design parameters for the most efficient products available on the market or in working prototypes. The max-tech levels that DOE determined for this rulemaking are described in section IV.C of this proposed rule and in chapter 5 of the final rule TSD.
For each trial standard level (TSL), DOE projected energy savings from application of the TSL to ceiling fans purchased in the 30-year period that begins in the first full year of compliance with any amended standards (2020-2049).
DOE used its national impact analysis (NIA) spreadsheet models to estimate national energy savings (NES) from potential amended standards for ceiling fans. The NIA spreadsheet model (described in section IV.H of this rulemaking) calculates energy savings in terms of site energy, which is the energy directly consumed by products at the locations where they are used. Based on the site energy, DOE calculates NES in terms of primary energy savings at the site or at power plants, and also in terms of full-fuel-cycle (FFC) energy savings. The FFC metric includes the energy consumed in extracting, processing, and transporting primary fuels (
To adopt standards for a covered product, DOE must determine that such action would result in significant energy savings. (42 U.S.C. 6295(o)(3)(B)) Although the term “significant” is not defined in the Act, the U.S. Court of Appeals, for the District of Columbia Circuit in
As noted above, EPCA provides seven factors to be evaluated in determining whether a potential energy conservation standard is economically justified. (42 U.S.C. 6295(o)(2)(B)(i)(I)-(VII)) The following sections discuss how DOE has addressed each of those seven factors in this rulemaking.
In determining the impacts of a potential amended standard on manufacturers, DOE conducts a manufacturer impact analysis (MIA), as discussed in section IV.J. DOE first uses an annual cash-flow approach to determine the quantitative impacts. This step includes both a short-term assessment—based on the cost and capital requirements during the period between when a regulation is issued and when entities must comply with the
For individual consumers, measures of economic impact include the changes in LCC and payback period (PBP) associated with new or amended standards. These measures are discussed further in the following section. For consumers in the aggregate, DOE also calculates the national net present value of the economic impacts applicable to a particular rulemaking. DOE also evaluates the LCC impacts of potential standards on identifiable subgroups of consumers that may be affected disproportionately by a national standard.
EPCA requires DOE to consider the savings in operating costs throughout the estimated average life of the covered product in the type (or class) compared to any increase in the price of, or in the initial charges for, or maintenance expenses of, the covered product that are likely to result from a standard. (42 U.S.C. 6295(o)(2)(B)(i)(II)) DOE conducts this comparison in its LCC and PBP analysis.
The LCC is the sum of the purchase price of a product (including its installation) and the operating cost (including energy, maintenance, and repair expenditures) discounted over the lifetime of the product. The LCC analysis requires a variety of inputs, such as product prices, product energy consumption, energy prices, maintenance and repair costs, product lifetime, and discount rates appropriate for consumers. To account for uncertainty and variability in specific inputs, such as product lifetime and discount rate, DOE uses a distribution of values, with probabilities attached to each value.
The PBP is the estimated amount of time (in years) it takes consumers to recover the increased purchase cost (including installation) of a more-efficient product through lower operating costs. DOE calculates the PBP by dividing the change in purchase cost due to a more-stringent standard by the change in annual operating cost for the year that standards are assumed to take effect.
For its LCC and PBP analysis, DOE assumes that consumers will purchase the covered products in the first full year of compliance with amended standards. The LCC savings for the considered efficiency levels are calculated relative to the case that reflects projected market trends in the absence of amended standards. DOE's LCC and PBP analysis is discussed in further detail in section IV.F.
Although significant conservation of energy is a separate statutory requirement for adopting an energy conservation standard, EPCA requires DOE, in determining the economic justification of a standard, to consider the total projected energy savings that are expected to result directly from the standard. (42 U.S.C. 6295(o)(2)(B)(i)(III)) As discussed in section IV.H, DOE uses the NIA spreadsheet models to project national energy savings.
In establishing product classes, and in evaluating design options and the impact of potential standard levels, DOE evaluates potential standards that would not lessen the utility or performance of the considered products. (42 U.S.C. 6295(o)(2)(B)(i)(IV)) Based on data available to DOE, the standards adopted in this final rule would not reduce the utility or performance of the products under consideration in this rulemaking.
EPCA directs DOE to consider the impact of any lessening of competition, as determined in writing by the Attorney General, that is likely to result from a standard. (42 U.S.C. 6295(o)(2)(B)(i)(V)) It also directs the Attorney General to determine the impact, if any, of any lessening of competition likely to result from a standard and to transmit such determination to the Secretary within 60 days of the publication of a proposed rule, together with an analysis of the nature and extent of the impact. (42 U.S.C. 6295(o)(2)(B)(ii)) To assist the Department of Justice (DOJ) in making such a determination, DOE transmitted copies of its proposed rule and the NOPR TSD to the Attorney General for review, with a request that the DOJ provide its determination on this issue. In its assessment letter responding to DOE, DOJ concluded that the proposed energy conservation standards for ceiling fans are unlikely to have a significant adverse impact on competition. DOE is publishing the Attorney General's assessment at the end of this final rule.
DOE also considers the need for national energy conservation in determining whether a new or amended standard is economically justified. (42 U.S.C. 6295(o)(2)(B)(i)(VI)) The energy savings from the adopted standards may provide improvements to the security and reliability of the nation's energy system. Reductions in the demand for electricity also may result in reduced costs for maintaining the reliability of the Nation's electricity system. DOE conducts a utility impact analysis to estimate how standards may affect the nation's needed power generation capacity, as discussed in section IV.M.
The adopted standards also are likely to result in environmental benefits in the form of reduced emissions of air pollutants and greenhouse gases (GHGs) associated with energy production and use. DOE conducts an emissions analysis to estimate how potential standards may affect these emissions, as discussed in section IV.K; the emissions impacts are reported in section V.B.6 of this rulemaking. DOE also estimates the economic value of emissions reductions resulting from the considered TSLs, as discussed in section IV.L. To date, this accounting for environmental benefits has not had a decisive impact on the outcome of any standards rulemaking, which is also the case for today's final rule.
In determining whether an energy conservation standard is economically justified, DOE may consider any other factors that the Secretary deems to be relevant. (42 U.S.C. 6295(o)(2)(B)(i)(VII)) To the extent interested parties submit any relevant information regarding economic justification that does not fit into the other categories described above, DOE could consider such information under “other factors.”
As set forth in 42 U.S.C. 6295(o)(2)(B)(iii), EPCA creates a rebuttable presumption that an energy conservation standard is economically justified if the additional cost to the
This section addresses the analyses DOE has performed for this rulemaking with regard to ceiling fans. Separate subsections address each component of DOE's analyses. DOE also responds to comments received on its analyses in this section.
DOE used several analytical tools to estimate the impact of the standards considered in this document. The first tool is a spreadsheet that calculates the LCC savings and PBP of amended energy conservation standards (the Life-Cycle Cost Analysis spreadsheet). The national impacts analysis uses a second spreadsheet set that provides shipments forecasts and calculates national energy savings and net present value of total consumer costs and savings expected to result from potential energy conservation standards (the National Impact Analysis spreadsheet). DOE uses the third spreadsheet tool, the Government Regulatory Impact Model (GRIM), to assess manufacturer impacts of potential standards. These three spreadsheet tools are available on the DOE website for this rulemaking:
DOE develops information in the market and technology assessment that provides an overall picture of the market for the products concerned, including the purpose of the products, the industry structure, manufacturers, market characteristics, and technologies used in the products. This activity includes both quantitative and qualitative assessments, based primarily on publicly-available information. The subjects addressed in the market and technology assessment for this rulemaking include (1) the scope of the rulemaking and product classes, (2) manufacturers and industry structure, (3) existing efficiency programs, (4) shipments information, (5) market and industry trends, and (6) technologies or design options that could improve the energy efficiency of ceiling fans. See chapter 3 of the final rule TSD for further discussion of the market and technology assessment.
DOE received several comments regarding product classes, and the technology options DOE identified that can improve the efficiency of ceiling fans. The comments are discussed in the following sections.
DOE divides covered products into classes by: (a) The type of energy used by the product; (b) the capacity of the product; or (c) other performance-related features that justify different standard levels, considering the consumer utility of the feature and other relevant factors. (42 U.S.C. 6295(q))
In the ceiling fans NOPR, DOE proposed seven product classes based on the capacity of the product and other performance-related features that justify a different standard, considering the utility to the consumer. 81 FR 1688. The product classes include: Highly-decorative, belt-driven, very-small-diameter, hugger, standard, high-speed small-diameter and large-diameter ceiling fans. DOE also proposed definitions for these product classes in the ceiling fan energy conservation standard proposed rule. In the ceiling fan test procedure final rule, DOE finalized the definitions for the following types of ceiling fans: highly-decorative, belt-driven, very-small-diameter, hugger, standard, high speed small-diameter and large-diameter ceiling fans. DOE responded to any comments received in response to the ceiling fans NOPR regarding the definitions for these type of ceiling fans in the test procedure final rule. 81 FR 48620 (July 25, 2016).
In this final rule, DOE finalizes the product classes proposed in the ceiling fans NOPR for the energy conservation standards. DOE received several comments to the ceiling fans NOPR regarding the product classes that were proposed. Westinghouse stated that they agree and appreciate the minor changes made to the product class structure, and that the changes make a big difference, particularly regarding safety. (Westinghouse, Public Meeting Transcript, No. 133 at p. 21) ALA commented that they agreed in general with the product class structure proposed in the NOPR. (ALA, No. 137 at p. 4) BAS stated that they are generally supportive of the product class structure. (BAS, No. 138 at p. 2) However, BAS expressed concern that the product classes may be too complex, in particular, comparing the standard fans to HSSD fans. The two different methods of tests may provide some confusion to end users. Specifically, BAS was concerned that HSSD ceiling fans will be tested at one speed, while standard ceiling fans will be tested at two speeds (BAS, Public Meeting Transcript, No. 133 at p. 22) (BAS, No. 138 at p. 2)
DOE finds that HSSD ceiling fans provide different utility to the consumer than standard ceiling fans. HSSD ceiling fans generally operate at much higher speeds (in terms of RPM) than standard ceiling fans, and are installed in commercial applications. HSSD ceiling fans are available in a blade span range similar to standard ceiling fans, but an HSSD fan typically provides more airflow at a given blade span because it runs at much higher RPMs. Additionally, DOE observed that HSSD ceiling fans are generally used in commercial buildings whereas standard fans are installed in residential buildings. Therefore, HSSD and standard ceiling fans provide distinct utility to different end-users and are not market substitutes. As a result, establishing separate product classes and differing test methods should not provide confusion to end-users.
Also, in general, the product class structure was developed to follow the Underwriters Laboratory (UL) ceiling fan existing safety standards (UL Standard 507-1999, “UL Standard for Safety for Electric Fans” (UL 507)).
In summary, HSSD ceiling fans provide a different utility to consumers compared to standard fans, and that warrants a separate product class for these ceiling fans. Therefore, in this final rule, DOE continues to define separate product classes for HSSD and standard ceiling fans.
For the reasons discussed above, DOE finalizes the seven product classes proposed in the ceiling fans NOPR in this final rule. The product classes finalized in this final rule are: Highly-decorative, belt-driven, very-small-diameter, hugger, standard, high-speed small-diameter and large-diameter ceiling fans.
In the ceiling fans NOPR, DOE did not propose standards for ceiling fans in the highly-decorative fan and belt-driven ceiling fan product classes. EPCA requires DOE to consider exempting, or setting different standards for, certain product classes for which the “primary standards” are not technically feasible or economically justified. EPCA also requires DOE to consider establishing separate exempted product classes for highly-decorative fans for which air movement performance is a secondary design feature. (42 U.S.C.6295(ff)(6)(B)(i)-(ii)) DOE did not have data to determine whether standards for belt-driven ceiling fans were technically feasible and economically justified due to the limited number of basic models for belt-driven ceiling fans. DOE did not receive any comments regarding these product classes and has not received any additional data to analyze potential standards for belt-driven ceiling fans. As a result, in this final rule, DOE does not set any standards for highly-decorative and belt-driven ceiling fans.
DOE is also not establishing performance standards for centrifugal ceiling fans, oscillating ceiling fans, or ceiling fans whose blades' plane of rotation cannot be within 45 degrees of horizontal fans. In the ceiling fan test procedure final rule, DOE stated that those ceiling fans are also not subject to the test procedure. 81 FR 48620 (July 25, 2016).
In the NOPR market and technology assessment, DOE identified technology options that would improve the efficiency of ceiling fans, as measured by the DOE test procedure. These technology options fall into four main categories: (1) More efficient motors, which include larger direct-drive single phase induction motors, three-phase induction motors, geared brushless DC motors, gearless brushless DC motors, and brushless DC motors, and; (2) more efficient blades, which include curved blades, airfoil blades, twisted blades, beveled blades, blade attachments, alternative blade materials; (3) ceiling fan controls, which include occupancy sensors; and (4) fan optimization.
DOE received no comments in opposition to the technology options proposed in the ceiling fans NOPR. However, DOE did receive comments regarding including an additional technology option specific to large-diameter ceiling fans. BAS requested that an additional efficiency level be added to represent a large diameter fan using a premium AC motor instead of a three-phased geared brushless DC motor. BAS stated that premium AC motors are almost as efficient as permanent magnet motors. (BAS, Public Meeting Transcript, No. 133 at pp. 35-36)
In response to BAS's comment, and for the reasons discussed in section IV.C.3, DOE added premium AC motor as an additional technology option in this final rule to account for the costs and benefits of premium AC motors used in ceiling fans in DOE's analysis. Further discussion regarding how DOE implemented this technology option in the analysis is provided in chapter 5 of the TSD.
In the absence of adverse comments, DOE analyzed the same technology options from the ceiling fans NOPR, as well as the premium AC motor technology option specific to large-diameter ceiling fans, in this final rule. Table IV.1 provides the list of technology options considered in the analysis and their descriptions. The screening analysis, which is discussed in the next section, provides further discussion on which of these technology options DOE retained as design options for the engineering analysis.
DOE uses the following four screening criteria to determine which technology options are suitable for further consideration in an energy conservation standards rulemaking:
(1)
(2)
(3)
(4)
In sum, if DOE determines that a technology, or a combination of technologies, fails to meet one or more of the above four criteria, DOE will exclude it from further consideration in the engineering analysis. The reasons for eliminating any technology are discussed below. The subsequent sections include comments from interested parties pertinent to the screening criteria, DOE's evaluation of each technology option against the screening analysis criteria, and whether DOE determined that a technology option should be excluded (“screened out”) based on the screening criteria.
Westinghouse agreed in general with the screened in and screened out technologies, and said they appreciated that DOE considered a significant amount of stakeholder feedback. (Westinghouse, Public Meeting Transcript, No. 133 at p. 46) With the exception of brushless DC motors, ALA agreed with DOE's screening analysis for hugger and standard ceiling fans. (ALA, No. 137 at p. 6) The discussion regarding retaining brushless DC motors as a technology option is provided in section IV.B.2.
In the ceiling fans NOPR, DOE screened out the following technologies: (1) For standard, hugger and VSD ceiling fans: Three-phase induction motors, occupancy sensors, and blade design elements including airfoil blades, beveled blades, twisted blades, blade attachments, and alternative blade materials; (2) For HSSD ceiling fans: Larger direct-drive single-phase induction motors, three-phase induction motors, twisted blades, blade attachments, alternative blade materials, and occupancy sensors; (3) For large-diameter ceiling fans: Larger direct-drive single-phase induction motors, beveled blades, twisted blades, blade attachments, alternative blade materials, and occupancy sensors. 81 FR 1688, (January 13, 2016).
DOE received several comments regarding the screened-out technologies, specifically occupancy sensors, and wind and temperature sensors. ALA supported screening out occupancy sensors from DOE's analysis. According to ALA, while this technology has the potential to reduce consumer ceiling fan usage, occupancy sensors would be
DOE acknowledges that occupancy sensors have the potential to save energy by reducing the number of ceiling fan operating hours. However, available data was insufficient for DOE to evaluate any potential tradeoff between consumer utility and the energy savings of reduced operating hours. DOE also researched the option of introducing occupancy sensors in ceiling fans. DOE did not find data to show that occupancy sensor can be installed reliably market-wide. Therefore, in this final rule, DOE continues to screen out occupancy sensors because DOE cannot satisfactorily evaluate the energy savings potential, technological feasibility and impact on consumer utility of implementing sensors or schedule controls.
In terms of wind and temperature sensors, Center for the Built Environment (CBE) commented that additional research is needed to demonstrate to what degree integrated temperature and wind sensors in a ceiling fan may save energy with current commercial building controls, or standard thermostats found in most homes. (CBE, No. 143 at p. 1) ALA agreed with DOE's decision to not include wind or temperature sensors as technology options. ALA stated they are not aware of any ceiling fans or working prototypes that include integrated wind or temperature sensors, or any data that would indicate that these products could lead to energy savings in real world applications. (ALA, No. 137 at p. 6) BAS stated that many large diameter fan manufacturers offer some sort of speed control based on space temperature (Big Ass Fans' SmartSense). (BAS, No. 138 at pp. 4-5)
Similar to occupancy sensors, DOE acknowledges that wind and temperature sensors have the potential to save energy by reducing the number of ceiling fan operating hours. As BAS stated, there are large-diameter manufacturers that offer some sort of speed control based on space temperature. However, available data is insufficient for DOE to evaluate any potential tradeoff between consumer utility and the energy savings of reduced operating hours based on implementing controls. DOE also did not find data to show that wind and temperature sensors can be installed reliably market-wide. Therefore, for this final rule, DOE continues to screen out wind and temperature sensors for all ceiling fans because DOE cannot satisfactorily evaluate the energy savings potential, technological feasibility and impact on consumer utility of implementing wind and temperature sensors.
In the absence of any adverse comments regarding the technology options that were screened out in the NOPR, DOE continues to screen-out the same technology options from the NOPR in this final rule. Specifically, DOE screened out the following technologies in this final rule—(1) For standard, hugger and VSD ceiling fans: Three-phase induction motors, and blade design elements including airfoil blades, beveled blades, twisted blades, blade attachments, and alternative blade materials, and occupancy, wind and temperature sensors; (2) For HSSD ceiling fans: More efficient direct-drive single-phase induction motors, three-phase induction motors, twisted blades, blade attachments, alternative blade materials, and occupancy, wind and temperature sensors; (3) For large-diameter ceiling fans: More efficient direct-drive single-phase induction motors, beveled blades, twisted blades, blade attachments, alternative blade materials, and occupancy, wind and temperature sensors.
In the ceiling fans NOPR, DOE retained the following technology options—(1) For standard, hugger and VSD ceiling fans: Fan optimization, larger direct-drive single-phase induction motor and brushless DC motors; (2) For HSSD ceiling fans: fan optimization, curved blades, airfoil blades and brushless DC motors; (3) For large-diameter ceiling fans: Fan optimization, airfoil blades, geared brushless DC motors and gearless brushless DC motors. 81 FR 1688 (January 13, 2016).
DOE received several comments regarding the retained technology options. For fan optimization, Westinghouse commented that there are always a few changes that can be made to fans to optimize fans, but not all of the options can be made or it will result in a completely different product. (Westinghouse, Public Meeting Transcript, No. 133 at p. 48) DOE recognizes Westinghouse's concern that making changes to a ceiling fan to improve performance may result in what the industry or consumer would consider a different fan model. DOE defined “fan optimization” for its analysis as adjusting existing design features. These adjustments include adjusting blade pitch, fine-tuning motor rpm, and changing internal motor characteristics. DOE does not expect any of these adjustments to require significant changes to the appearance, materials, or outputs of the fan. Consequently, the optimized fan should look and feel almost identical to the non-optimized version of the same fan, only consume less energy.
Regal requested that DC motors be referred to as “brushless DC motors” instead of just “DC motors” in the standard. (Regal, Public Meeting Transcript, No. 133 at p. 52) DOE agrees with Regal and recognizes that “brushless DC motors” is a more accurate technical descriptor for these motors. As such, DOE refers to these motors as “brushless DC motors” throughout this final rule notice and accompanying TSD.
For brushless DC motors in standard and hugger ceiling fans, ALA commented that they are concerned about the technological feasibility of DC motors due to concerns about their reliability and their incompatibility with existing wall-mounted controls. (ALA, No. 137 at p. 6) Appliance Standards Awareness Project (ASAP), Alliance to Save Energy (ASE), American Council for an Energy-Efficient Economy (ACEEE), Natural Resources Defense Council (NRDC), and Northwest Energy Efficiency Alliance (herein knows as “Advocates”) claimed they were unaware of any data indicating any reliability issues associated with DC motors for ceiling fans. (Advocates, No. 142 at p. 4)
DOE has observed that several ceiling fan manufacturers offer small-diameter ceiling fans that use brushless DC motors, and that these fans are some of the most efficient small-diameter ceiling fans on the market. DOE does acknowledge, however, that brushless DC motors are a relatively new technology. Consequently, most small diameter ceiling fans that use brushless DC motors that are currently installed in the field are early in their expected lifespan and, in turn, any reliability issues may become apparent as these fans age. Nevertheless, their availability in the market indicates to DOE that brushless DC motors meet the screening criteria of technological feasibility, practicability to manufacture, install, and service, and no significant impacts on utility (including reliability and product availability). Consequently, DOE screened in brushless DC motors
For brushless DC motors in VSD ceiling fans, ALA objected to screening in this technology option. ALA stated they are not aware of any brushless DC motor VSD fans on the market, or currently in development, that would provide an acceptable substitute for the functionality of AC motors in VSD fans. (ALA, No. 137 at p. 6) Pacific Gas and Electric Company (PG&E), Southern California Gas Company (SCGC), San Diego Gas and Electric (SDG&E), Southern California Edison (SCE), and Arizona Public Service (APS) (herein known as California Investor Owned Utilities, or CA IOUs), on the other hand, commented that they continue to support the inclusion of brushless DC motor technology for all product classes, including VSD ceiling fans. CA IOUs also identified several VSD models that use brushless DC motors, including Vaxcel F1008, Fanimation MAD3255, and Sunpentown SF-1691C. In addition, CA IOUs stated that several pedestal and desk fans that are similar in technology, utility, and physical dimensions to VSD ceiling fans use brushless DC motors. (CA IOUs, No. 144 at p. 2)
DOE's understanding from manufacturer interviews is that brushless DC motors in VSD ceiling fans could be technologically feasible, as brushless DC motors are used in traditional standard and hugger ceiling fans. DOE reviewed the list provided by CA IOUs regarding VSD ceiling fans with brushless DC motors that are available in the market. The Fanimation MAD 3255 ceiling fan model specifications on the Fanimation website states that the smallest diameter for the model is 44-inches;
For the large-diameter product class, BAS requested that an additional efficiency level be added with a premium AC motor instead of the three-phased geared brushless DC motor. (BAS, Public Meeting Transcript, No. 133 at p. 35) DOE acknowledges that for large-diameter ceiling fans, premium AC motors and three-phase geared motors are readily available in the market. Therefore, DOE retained both technology options in the screening analysis because they meet the four screening criteria for this final rule.
Through a review of each technology, DOE concludes that all of the other identified technologies listed in this section meet all four screening criteria to be examined further as design options in DOE's final rule analysis. In summary, DOE retained the following technology options: (1) For standard, hugger and VSD ceiling fans: Fan optimization, larger direct-drive single-phase induction motors and brushless DC motors; (2) For HSSD ceiling fans: Fan optimization, curved blades, airfoil blades and brushless DC motors; (3) For large-diameter ceiling fans: Fan optimization, airfoil blades, premium AC motors, geared brushless DC motors and gearless brushless DC motors.
DOE determined that these technology options are technologically feasible because they are being used in commercially-available products or working prototypes. DOE also finds that all of the remaining technology options meet the other screening criteria (
In the engineering analysis, DOE establishes the relationship between the manufacturer production cost (MPC) and improved ceiling fan efficiency. This relationship serves as the basis for cost-benefit calculations for individual consumers, manufacturers, and the Nation.
In this final rule, for small-diameter ceiling fans (VSD, Standard, Hugger and HSSD ceiling fans), DOE performed its analysis in terms of incremental increases in efficiency due to the implementation of selected design options. DOE selected representative sizes, and for each size, DOE identified a baseline efficiency as a reference point from which to measure changes resulting from each design option. For large-diameter ceiling fans, DOE performed its analysis based on a representative data set of ceiling fan performance data. DOE determined efficiency as observed in the representative dataset by best-fitting lines to the data for fans that incorporate each design option analyzed. Efficiency for all ceiling fans is represented in terms of the metric finalized in the test procedure. 81 FR 48620 (July 25, 2016).
For both small and large-diameter ceiling fans, MPCs for each successive design option are based on reverse-engineering, which includes product teardowns and a bottom-up manufacturing cost assessment. The estimated MPCs also include the costs of controls. DOE then developed the relationship between MPC and ceiling fan efficiency; this relationship is referred to as a cost-efficiency curve. The efficiency ranges from that of the least-efficient ceiling fan sold today (
The following is a summary of the method DOE used to determine the
• Perform airflow and power consumption tests on a representative sample of ceiling fans in each product class.
• Develop a detailed BOM for the tested ceiling fans through product teardowns, and construct a ceiling fan cost model.
DOE used a combination of test data, data from spec sheets, the cost model, and feedback from manufacturers to calculate the incremental increase in efficiency and cost increase from baseline to max-tech. Further details can be found in chapter 5 of the TSD.
In the ceiling fans NOPR, DOE combined the cost-efficiency curves of flat-blade fans and unconventional-blade fans in the standard and hugger product classes to create an aggregate curve for all standard ceiling fans and all hugger ceiling fans. DOE used the following design options to create the curves: Fan optimization, larger direct drive motors, and brushless DC motors. DOE used the maximum efficiency of the unconventional-blade fans as the max-tech for the aggregate curve to ensure that all types of ceiling fans, including designs with unconventional-blades, can achieve the max-tech level of efficiency. DOE received several comments on the engineering analysis specific to the standard and hugger product classes.
Advocates commented that the energy savings associated with EL 4 for standard and hugger fans are likely to be significantly greater than shown in the analysis. They stated that it looks like the analysis is assuming that the power consumption of a flat-blade fan incorporating a DC motor would be equivalent to that of an unconventional-blade fan with a DC motor. In practice, it seems very unlikely that flat-blade fans with DC motors would not significantly exceed the efficiency levels given that DOE's analysis shows that a flat-blade fan with a DC motor is 30% more efficient than an unconventional-blade fan with a DC motor. (Advocates, No. 142 at p. 4)
For the NOPR, because DOE set the max-tech efficiency for standard and hugger ceiling fan product classes as the max-tech efficiency for unconventional-blade fans, DOE also set the power consumption at max-tech as the max-tech power consumption for unconventional-blade fans to match the max-tech efficiency. DOE acknowledges that to comply with the EL 4 efficiency for both flat blade fans and unconventional-blade fans, manufacturers are likely to employ brushless DC motors. Therefore, at the max-tech efficiency, there is potential for energy savings for the flat-blade fans. For this final rule, DOE adjusted the power consumption at max-tech to include the potential energy savings from the flat-blade fans. DOE used the same weighting between flat and unconventional blade fans at max tech (
In the engineering analysis for standard and hugger ceiling fans, DOE used an aggregate cost-efficiency curve for flat and unconventional blade fans, as opposed to defining two separate product classes, because fans with flat blades and fans with unconventional blades are functionally indistinguishable. Both fan types move air via the rotation of fan blades, improve comfort by this air movement, and can be used in similar spaces (unlike the distinction between standard and hugger fans, where the former cannot be used in rooms with low ceilings). Further, because flat blade and unconventional blade fans on the market appear to operate within the same CFM range, they have the same product capacity. Therefore, when setting the max-tech for the standard and hugger ceiling fan product classes, DOE set it at the max-tech efficiency for unconventional-blade fans, because this ensures that even at max-tech, all types of ceiling fans, including designs with unconventional blades, can achieve this level of efficiency.
Advocates also stated that the costs associated with EL4 for standard and hugger fans are likely to be lower than shown in the analysis, but did not provide supporting data for this statement. (Advocates, No. 142 at p. 4) As described in section IV.C, DOE reverse engineered several ceiling fans at EL4 (with brushless DC motors) to determine the MPC for that EL. To investigate the Advocates' claims, DOE reverse engineered several more brushless DC motor fans, and revisited the cost model to review the costs used in the NOPR. Based on the review, DOE corroborated the costs presented in the NOPR, rather than lower costs. Absent any additional cost data, DOE continues to use the MPC results from the NOPR for EL4 for standard and hugger fans in this final rule.
In summary, in this final rule, DOE continues to use the combined cost-efficiency curves of flat-blade fans and unconventional-blade fans in the standard and hugger product classes to create an aggregate curve for all standard ceiling fans and all hugger ceiling fans.
Since the NOPR, DOE received additional test data for hugger and standard fans from manufacturers, which was used in the analysis for the final rule. The additional test data was used to update some of the efficiency deltas (
For the NOPR analysis, DOE was not aware of unconventional blade and flat blade fan variations for VSD and HSSD fans, so DOE did not use an aggregate curve approach for these ceiling fans. DOE used the same design option approach as standard and hugger ceiling fans to determine cost-efficiency relationships for all representative sizes in both VSD and HSSD product classes. DOE used the following design options for VSD ceiling fans to create the curves: Fan optimization, larger direct drive single-phase induction motors, and brushless DC motors. DOE used the following design options for HSSD ceiling fans to create the curves: Fan optimization, curved blades, airfoil blades and brushless DC motors.
DOE did not receive any specific comments on the engineering approach used for the VSD product class. However, DOE received several comments specific to the HSSD engineering analysis. Westinghouse commented that they were concerned with the additive approach used in calculating cost differences for the HSSD efficiency levels. They stated that the approach may not be fully calculating or capturing what the true cost increase will be. (Westinghouse, Public Meeting Transcript, No. 133 at p. 92)
DOE interprets Westinghouse's comment to mean that the full cost for the ELs with multiple design options is not being captured in the engineering analysis. As described in section IV.C, DOE developed the manufacturer production costs based on actual
Westinghouse also asked if DOE had considered reordering the HSSD efficiency levels to have EL3 with DC motor and with flat metal blade followed by EL4 with DC motor and airfoil blades instead of adding the airfoil blades in EL3 and DC motor in EL4. Westinghouse commented that this is different from hugger and standard fans, where the motor options are what drive the cost. They stated that the airfoil blade is a high cost adder with not the same payback as a motor upgrade would be. (Westinghouse, Public Meeting Transcript, No. 133 at p. 113) Fanimation agreed with Westinghouse's comments. (Fanimation, Public Meeting Transcript, No. 133 at pp. 113-114) ALA commented that they are skeptical of DOE's estimate of the net benefits that DC motor-based fan provide to consumers, and generally believe that DC motor-based ceiling fan efficiency standards, like DOE's proposed TSL 4-based standard for HSSD fans, are not technologically feasible. Additionally, ALA stated that DOE's proposed max-tech standard is not economically justified because it relies upon the airfoil blade design option, which is not economically justified. ALA stated that if DOE declines to adopt a standard at EL 3 or below for HSSD fans, DOE should consider adopting a standard for HSSD fans based on an efficiency level that corresponds to the fan optimization and DC motor design options, without the use of curved blades or airfoil blades. (ALA, No. 137, pp. 2-3)
Pursuant to EPCA, DOE must adopt standards that achieve the maximum improvement in energy efficiency that is technologically feasible and economically justified. (42 U.S.C. 6295(o)(2)(A)) To do this, DOE first establishes TSLs by combining specific efficiency levels for each of the product classes analyzed. Higher TSLs generally consist of a combination of higher efficiency levels for each product class, and the highest TSL generally represents the max-tech efficiency level for all product classes. Therefore, higher TSLs typically represent higher potential energy savings. (See section V.A for more details on TSLs chosen for this rulemaking). DOE then considers the impacts of amended standards for ceiling fans at each TSL beginning with the maximum technologically feasible level, to determine whether that level is economically justified. Where the max-tech level is not justified, DOE then “walks down” to the next most efficient level and conducts the same evaluation until it reached the highest efficiency level that is both technologically feasible and economically justified and saves a significant amount of energy.
For this final rule, TSLs 4 and 5 correspond to the max-tech efficiency level for HSSD ceiling fans.
Since the NOPR, DOE received additional test data for hugger and standard fans from manufacturers that was used in the analysis for the final rule. The additional test data was used to update some of the efficiency deltas in the analysis. Because some of the VSD and HSSD efficiency deltas are dependent on the standard and hugger analysis, the engineering results for VSD and HSSD analyses were updated accordingly. Further details on the engineering analysis is provided in Chapter 5 of the TSD.
In the NOPR, DOE used a combination of the reverse-engineering and design option approach for the large-diameter ceiling fan engineering analysis. DOE relied on test data and feedback from manufacturers to determine energy ELs to analyze. DOE estimated baseline ceiling fan efficiencies based on test data for large-diameter ceiling fans at intermediate ELs adjusted by efficiency deltas. After establishing the baseline efficiency for large-diameter ceiling fans, DOE applied efficiency deltas associated with each design option to the baseline to calculate the efficiency consistent with performance of large-diameter ceiling fans that use each design option from baseline to max-tech. In DOE's analysis, efficiency deltas are estimated differences in ceiling fan efficiency based on comparing performance of ceiling fans that use different technology options, but are otherwise identical. This analysis resulted in an efficiency curve, as a function of ceiling fan diameter, for each efficiency level.
During the NOPR public meeting, BAS requested that an additional efficiency level be added to represent large-diameter ceiling fans that use a premium AC motor instead of a three-phased geared brushless DC motor, and stated that the premium AC motors are almost as efficient as permanent magnet motors. (BAS, Public Meeting Transcript, No. 133 at pp. 35-36)
DOE received test data from BAS that included ceiling fans using premium AC
In addition to the test data for fans with premium AC motors, DOE also received additional test data from BAS for the other efficiency levels analyzed in the analysis. With this data, DOE's database of large-diameter fan performance includes 87 ceiling fans at EL 2, EL 3 and EL 4, comprising of ceiling fans from six different manufacturers, and with blade spans of 8, 10, 12, 14, 16, 18, 20 and 24 feet. Due to the large number of ceiling fans, the range of efficiency levels, and the variety of manufacturers, DOE determined that this dataset is representative of the EL 2, EL 3 and EL 4 large-diameter ceiling fans in the market.
A representative dataset allowed DOE to shift from the design option approach used in the NOPR (
During the NOPR public meeting, BAS recommended that efficiencies be gauged using a CFM/W curve as a function of airflow for each diameter. This would essentially require a CFM per watt standard equation as a function of airflow at every diameter available. (BAS, Public Meeting Transcript, No. 133 at p. 39) In written comments, BAS stated that the fundamental assumption that all ceiling fans of the same diameter move the same amount of air is untrue, allows inefficient low airflow products to remain on the market, and creates an upper limit to ceiling fan performance at each diameter. (BAS, No. 138 at p. 12) BAS further urged DOE to consider a metric that will not eliminate high efficiency, high utility ceiling fans from the market. BAS recommended that an efficiency metric based on ceiling fan diameter and maximum airflow be used to provide energy savings across all airflows and diameters, while still allowing the continued development of high utility products. (BAS, No. 138 at p. 15) In this discussion, DOE understood BAS' use of the phrase “high utility ceiling fans” to mean ceiling fans with high maximum airflows. The Advocates also encouraged DOE to consider standards for large-diameter ceiling fans that take both diameter and airflow into account. According to the Advocates, by taking only diameter into account in establishing ELs for large-diameter ceiling fans, the standards may have little impact on ceiling fans that deliver relatively low airflow rates, while simultaneously prohibiting ceiling fans of the same diameter that deliver higher airflow rates than those assumed in the analysis. (Advocates, No. 142 at pp. 1-2)
DOE's understanding of both BAS and Advocates concern is that an efficiency standard only based on diameter only could disproportionally impact ceiling fans that deliver higher airflows, compared to those that deliver lower airflows. To investigate this further, DOE analyzed the test data provided by BAS, in addition to DOE's own test data of large-diameter ceiling fans.
DOE began its analysis by confirming that the relationship between diameter and ceiling fan efficiency is an appropriate basis for an energy efficiency standard. DOE plotted a best fit line between diameter and efficiency of all the ceiling fans at max-tech and observed a R
For this final rule, the energy conservation standard efficiency level adopted is consistent with performance achieved by large-diameter ceiling fans with EL 3 characteristics. See section V.C.1 for discussion on TSLs. Therefore, DOE believes that the relationship between diameter and efficiency is an appropriate basis for an energy efficiency standard. However, based on the data, DOE did observe that there were some high airflow ceiling fans that might be disproportionally disadvantaged based on a standard using the best fit line. Therefore, to preserve consumer utility that require ceiling fans with high airflow, DOE decreased the y-intercept of the best fit equations, while maintaining the slopes. DOE aimed to preserve consumer utility by maintaining the maximum airflow produced at each diameter, or identify a close alternative, by shifting the equation downwards.
For each of the eight diameters analyzed (ranging from 8-24 feet), DOE identified the ceiling fan with the maximum tested airflow from all efficiency levels. At two of the eight diameters, a ceiling fan at EL 2 produces the largest airflow, and at the other six diameters, a ceiling fan at EL 3 produces the maximum airflow. At three of the eight diameters, the fan with the highest airflow achieves the efficiency level established in this final rule.
For the other five diameters, where the highest airflow ceiling fan does not meet the established standard level, DOE identified the ceiling fan with the highest airflow that achieves the standard level and compared it to the ceiling fan with the maximum airflow at that diameter. DOE calculated the percentage of maximum airflow for these ceiling fans to determine whether the EL 3 standard is still achievable with an EL 3 ceiling fan, without eliminating ceiling fans with high maximum airflows. DOE further investigated any diameter where the maximum airflow ceiling fan did not achieve the standard level, in order to see if the maximum airflow or a close alternative could be achieved. At two of the remaining five diameters, the ceiling fan with the highest airflow that achieved the standard level produced 99
For the reasons mentioned, DOE believes that the high efficiency, high airflow ceiling fans will not be eliminated from the market when using the shifted best fit equation. Therefore, DOE continued with the methodology outlined in the NOPR by adopting a standard equation that is only a function of diameter, and not airflow.
BAS commented that the repair costs should be separated for the geared and gearless versions for DC motors used in the large-diameter analysis. BAS stated that the gearless DC motor will take more hours to service than the geared motor because the entire fan assembly has to be removed to repair the gearless motor. (BAS, Public Meeting Transcript, No. 133 at p. 99) BAS also stated that efficiency losses resulting from gearboxes are generally less than 5 percent, not 20 percent. (BAS, Public Meeting Transcript, No. 133 at p. 31)
In the final rule, DOE replaced the geared brushless DC motor with the premium AC motor for efficiency level 3. Therefore, these comments do not affect the large-diameter analysis in the final rule.
In the NOPR analysis, DOE had requested comments on what an acceptable reduction of fan speed may be to improve ceiling fan efficiency such that it does not affect consumer utility for each of the proposed product classes. DOE received several comments regarding this topic.
CBE stated that, based on CBE laboratory tests, at least one ceiling fan tested is more efficient at lower speed. However, limiting the maximum air speed would not satisfy human comfort at higher temperatures. CBE suggested that one way to avoid this may be setting a limit for the maximum air speed for a ceiling fan, while requiring that the energy efficiency standard be met as well. (CBE, No. 143 at p. 1) BAS commented that a decrease of 50% in airflow nets an approximate gain of 220% on efficiency, but would result in a dramatic reduction in cooling effect and consumer utility. BAS stated that the impact of the reduced performance will likely not be known to the consumer because there are no guidelines, equations or standards that allow consumers to translate CFM into cooling effect. BAS felt this would be especially true if the labeling requirements do not prominently display the maximum CFM of the fan. (BAS, No. 138 at p. 7) ALA stated they do not believe that reducing fan speeds available to a consumer is a viable way to improve efficiency because reducing fan speed directly impairs consumer utility. ALA therefore agreed with DOE's statement in the NOPR, that “manufacturers will not reduce airflow to levels that are unacceptable when other cost-justified pathways to compliance are available.” (ALA, No. 137 at p. 7) CA IOUs asked whether companies may simply reduce their fans' RPMs in order to meet the efficiency standard, and ASAP suggested that in such a case, consumers may run their fans at higher speeds, thereby reducing the energy savings from the standard. (CA IOUs, Public Meeting Transcript, No. 133 at p. 159; ASAP, Public Meeting Transcript, No. 133 at pp. 154-155) Westinghouse responded by suggesting that manufacturers that try to meet the standard by reducing the utility (
DOE understands that slowing down a fan can significantly reduce energy consumption. However, DOE also recognizes that airflow, which diminishes at lower fan speeds, factors heavily into consumer utility. DOE observes that the airflow produced by commercially available fans of the same diameter varies. While DOE interprets this to mean that some variation in airflow at a given diameter is acceptable to the market and does not represent a reduction in utility, DOE did not include slowing down the fan as a design option to avoid setting standards that may result in reduced utility. Leaving out reducing fan speed as a design option ensures that manufacturers can meet the level adopted by this final rule in a cost-justified manner without reducing fan speed. While manufacturers may opt to do so, it is unlikely that many will due to the market pressures identified by Westinghouse. In addition, the FTC is primarily responsible for labeling, and issued amendments to the ceiling fan label for all ceiling fans except large-diameter and HSSD ceiling fans on September 15, 2016. 81 FR 63634. The ceiling fan label includes a prominent display of the CFM based on typical use of a ceiling fan. The FTC is planning to seek comments on the need for, and content of, fan labels for large-diameter and HSSD ceiling fans in a separate notice. 81 FR 63634, 63637.
In the ceiling fans NOPR, DOE proposed best-fit linear standard level equations in terms of ceiling fan diameter, based on the efficiency results for the representative sizes analyzed for each product classes. The linear standard level equations were established so that the proposed minimum efficiencies could be calculated for all ceiling fan diameters within a product class. DOE received a comment regarding the standard level equations proposed.
In general, ALA commented that DOE should, in adopting final efficiency standards for ceiling fans, clarify that the efficiency equation found in the table in proposed 10 CFR § 430.32(s)(2) represents minimum ceiling fan efficiency. (ALA, No. 137 at p. 3) DOE appreciates the comment from ALA, and has updated references to the standard level equations in this final rule to clarify that it represents minimum ceiling fan efficiency.
In this final rule, DOE continues to develop standard level equations based on diameter for all product classes. As discussed in the ceiling fans NOPR, DOE believes that blade diameter is a better proxy for utility than airflow. The size of a fan determines the cooling area, impacts room aesthetics, and determines if a fan physically fits into a room. Literature published by manufacturers clearly indicates that blade span is an important criterion for consumer fan selection. Manufacturers include sizing guides in published product literature to instruct consumers on how to properly size a fan for a given room size. These fan sizing guides specify the affected square footage of a room based on fan blade diameter. DOE did not find such guides for other ceiling fan characteristics such as airflow.
Therefore, based on the updates to the engineering analyses described in sections IV.C.1 through IV.C.3 for all product classes, DOE also updated the best-fit linear standard level equations.
DOE is not aware of commercially available VSD fan models below 12 inches in diameter. However, extending a best-fit linear equation below 12 inches for VSD would result in minimum ceiling fan efficiency standards below 0 CFM/Watt at near 0 inch diameters. In this final rule, DOE is continuing to use a best-fit linear equation for VSD fans 12 inches in diameter and above (the range in which all known commercially-available VSD models currently exist). However, DOE is extending the minimum ceiling fan efficiency required at 12 inches to all VSD fans below 12 inches in diameter to avoid standards 0 CFM/Watt and below for any VSD models that may exist in this range.
The markups analysis develops appropriate markups (
DOE characterized four distribution channels to describe how standard, hugger and VSD ceiling fans pass from manufacturers to consumers. These four distribution channels can be characterized as follows:
DOE developed separate markups for home improvement centers that have their in-store label ceiling fans and for those that sell independent-label ceiling fans. As indicated in the market assessment, two of the top three ceiling fan brands in the market are the in-store brands for two home improvement centers. These home improvement centers therefore serve as both in-store brand manufacturers and home improvement centers that carry both store-brand and independent-brand ceiling fans. For in-store label ceiling fans, DOE developed an overall markup that encompasses the margins for manufacturing as well as selling the product. For the independent-label ceiling fans sold through home centers, separate markups were developed for the brand manufacturer and for the home improvement centers which serve only as a retailer.
For large-diameter and HSSD ceiling fans, the two distribution channels that DOE considered can be characterized as follows:
The second distribution channel for large-diameter and HSSD ceiling fans is a direct sale channel where the manufacturer sells the product directly to a customer through its in-house dealer. DOE assumed the markup for in-house dealers is the same as the conventional dealer markup; therefore, the overall markup for these two distribution channels is the same.
To account for manufacturers' non-production costs and profit margin, DOE applied the manufacturer markup to the full MPC derived in the engineering analysis. The resulting manufacturing selling price (MSP) is the price at which the manufacturer can recover all production and non-production costs and earn a profit. To meet new or amended energy conservation standards, manufacturers typically introduce design changes to their product lines, which increase manufacturer production costs. As production costs increase, manufacturers typically incur additional overhead.
To calculate the manufacturer markups, DOE reviewed 10-K reports
To develop markups for the market participants involved in the distribution of ceiling fans, DOE utilized several sources, including: (1) The SEC 10-K reports and U.S. Census Bureau's annual retail trade survey for building material and supplier dealer industry
To develop the markups when home centers serve as both brand manufacturer and retailer, DOE relied upon input from an industry expert.
For each of the market participants, DOE developed baseline and incremental markups based on the product markups at each step in the distribution chain. The baseline markup relates the change in the MSP of baseline models to the change in the consumer purchase price. The incremental markup relates the change in the MSP of higher-efficiency models (the incremental cost increase) to the change in the consumer purchase price.
In addition to the markups, DOE derived state and local taxes from data provided by the Sales Tax Clearinghouse.
Chapter 6 of the final rule TSD provides details on DOE's development of markups for ceiling fans.
The purpose of the energy use analysis is to determine the annual energy consumption of ceiling fans at different efficiency levels in
As in the NOPR analysis, DOE has included only residential applications in the energy use analysis of standard, hugger, and VSD ceiling fans. DOE used the Energy Information Administration (EIA) 2009 Residential Energy Consumption Survey (RECS)
In creating the sample of RECS households, DOE used the subset of RECS records that met the criterion that the household had at least one ceiling fan. DOE chose a sample of 10,000 households from RECS to estimate annual energy use for standard, hugger, and VSD ceiling fans. Because RECS provides no means of determining the type of ceiling fan in a given household, DOE used the same sample for the standard, hugger, and VSD product classes.
As in the NOPR analysis, DOE used data from an LBNL study
As in the NOPR analyses, DOE estimated that the average fraction of time that standard, hugger, and VSD ceiling fans were operated at each speed was equal to the simple average of the fractions reported by the LBNL survey and an AcuPOLL
For the final rule, DOE refined the NOPR approach by accounting for a distribution in operating hours spent at each speed.
DOE determined the power consumption at high, medium, and low speed for each representative fan size in the engineering analysis. These values are shown in chapter 5 of the final rule TSD. DOE estimated that all ceiling fans with brushless DC motors expend standby power, and that 7 percent of standard, hugger, and VSD ceiling fans with AC motors come with a remote, and therefore consume power while in standby mode. DOE further estimated 0.7 watts as the power consumption value for standby for all representative fans belonging to the standard, hugger, and VSD product classes, based on testing conducted in association with developing the engineering analysis.
BAS commented that the percentage energy savings for ceiling fans with occupancy sensors will be similar to that of lighting systems with occupancy sensors and that this similarity could be used to estimate savings from ceiling fans with occupancy sensors. (BAS, No. 138 at p. 5) DOE acknowledges that occupancy sensors have the potential to have an impact on the energy consumption of ceiling fans. However, available data is insufficient for DOE to determine what impact occupancy sensors may have on energy use in practice. In the absence of supporting data or evidence to substantiate energy savings, DOE does not believe it is appropriate to assume ceiling fans and lighting systems to have similar percentage energy savings. Furthermore, occupancy sensors have been screened out of the final rule analysis (see section IV.B.1), and it is unclear if fans with occupancy sensors will make up a non-negligible portion of the market in the future, especially in the residential sector.
The CA IOUs indicated that many hugger, standard, and VSD ceiling fans with brushless DC motors have six speeds, not three speeds. Therefore, the CA IOUs recommended that DOE consider incorporating the advantages of six-speed ceiling fans by averaging the performance characteristics at the lowest two speeds, the middle two speeds, and the highest two speeds as proxies for the currently-proposed low-speed setting, middle-speed setting, and high-speed setting, respectively. (CA IOUs, No. 144 at p. 3) As previously mentioned, in the energy use analysis, DOE used the power consumption estimates developed for each representative fan in the engineering analysis. In the engineering analysis, power consumption estimates at high, medium, and low speed were developed based on the test method set forth in the test procedure final rule (CITE). Consistent with the test procedure final rule, testing was conducted at the lowest and highest speed for fans for with brushless DC motors. Testing was not conducted at the other four fan
As in the NOPR analysis, DOE has included only commercial and industrial applications in the energy use analysis of large-diameter and HSSD ceiling fans. Although some large-diameter and HSSD fans are used in residential applications, they represent a very small portion of the total market for large-diameter and HSSD ceiling fans. Similar to standard, hugger, and VSD ceiling fans, DOE developed a sample of 10,000 fans to represent the range of large-diameter and HSSD ceiling fan energy use. The sample captured variations in operating hours.
In the NOPR analysis, DOE used feedback from manufacturers to estimate total hours of operation for HSSD ceiling fans. Manufacturers suggested a range of possible hours of operation, depending on industry and application, with 12 hours per day as a representative value. To represent a range of possible operating hours around this representative value, DOE drew 10,000 samples from a uniform distribution between 6 hours per day and 18 hours per day when calculating the energy use of HSSD fans. DOE also used manufacturer feedback to determine the proportion of operating time spent at each speed, estimating that, on average, HSSD fans spend approximately 10 percent of the time at high or low speed, and the rest of their time (approximately 80 percent) at a medium speed.
Westinghouse and ALA agreed with the average hours of use estimate for HSSD fans in the NOPR analysis, and no stakeholders expressed disagreement. (Westinghouse, Public Meeting Transcript, No. 133 at p. 79; ALA, No. 137 at p. 8) Accordingly, DOE assumed for this final rule that HSSD fans operate for 12 hours a day on average when conducting analysis for the final rule, and has maintained its assumptions regarding the operating hours distribution.
In the energy conservation standards NOPR analysis, DOE's estimate of the daily total hours of operation for large-diameter fans was consistent with total hours of operation estimate from the test procedure SNOPR. (80 FR 31487 (Jun. 3, 2015)) In the test procedure SNOPR, to weight the performance results of the ceiling fans at each of the five speeds, DOE took a simple average of the total daily hours-of-use estimate of 18 hours per day provided by MacroAir and an example of the fraction of time spent at each speed from BAS that DOE assumed implicitly agreed with the 12 hours per day estimate from the October 2014 test procedure NOPR, which yielded an average value of 15 hours per day. Id. BAS took issue with DOE's assumption and, therefore, disagreed with DOE's estimate of 15 hours of use per day (BAS, No. 138 at p. 6)
To estimate the energy consumption of large-diameter ceiling fans, DOE must make an estimate of average operating hours for such fans. Based on the available data on daily operating hours, for the final rule DOE estimated 12 hours of use per day in active mode for large-diameter ceiling fans, consistent with the hours of use estimate for HSSD fans, which are also used in commercial and industrial applications, and also consistent with estimate from the test procedure final rule (CITE).
In the NOPR analysis, DOE also modeled the fraction of time spent at each of five speeds by large-diameter ceiling fans in an approach aligned with the ceiling fans test procedure SNOPR, which proposed to test all large-diameter ceiling fans at maximum speed, 80% speed, 60% speed, 40% speed, and 20% speed. 80 FR 31487 (June 3, 2015). Taking the average of manufacturer inputs yielded the following hours of use distribution for the NOPR analysis: 1.8 hours at maximum speed, 3.5 hours at 80% speed, 3.6 hours at 60% speed, 2 hours at 40% speed, and 4.1 hours at 20% speed. BAS clarified that the input on distribution of time at different speeds was intended as an example and not as an estimate to be used in calculations. (BAS, No. 138 at p. 8) BAS further commented that there is insufficient data to assign operating hours or estimate percentages of operation. (BAS, Public Meeting Transcript, No. 133 at pp. 83-84) BAS recommended against the use of an average of two sets of operating hours in deriving operating hours for large-diameter ceiling fans and recommended measuring at high speed only or using a metric that includes equal weighting at the five proposed operating speeds. (BAS, No. 138 at p. 6)
For the final rule, based on lack of available data to suggest otherwise, DOE gave equal weighting to each of the five speeds from the test procedure, consistent with BAS's suggestion and consistent with the approach in the test procedure final rule. (CITE)
For the large-diameter ceiling fan product class, the power consumption for a given representative fan was determined by the weighted average of power consumption at the five speeds discussed previously, where each speed was weighted by an equal fraction of time spent at that speed, as detailed in chapter 5 of the final rule TSD.
For the HSSD ceiling fan product class, as in the NOPR analysis, DOE determined power consumption at high speed for each representative fan in the engineering analysis. To estimate the power consumption at medium speed, DOE multiplied the high-speed power by the average ratio between high-speed power and medium-speed power in the standard, hugger, and VSD fans engineering analysis. DOE used the same approach for low-speed power, using the average ratio between high-speed power and low-speed power from the standard, hugger, and VSD fans engineering analysis.
As in the NOPR analysis, in this final rule DOE considered all HSSD fans at the efficiency levels with a brushless DC motor to have standby power, assuming a remote control was included for all such fans. DOE estimated 0.7 watts as the standby power value for all representative fans in the HSSD product class. Because these fans also have standby power as a result of a remote control receiver, this is the same value used for standard, hugger and VSD fans, as discussed in section IV.E.1.c.
DOE also considered large-diameter fans to have standby power, because available information indicated that the majority of large-diameter ceiling fans in the market use a variable-frequency drive and/or are operated by remote control, which consumes standby power. The standby power for large-diameter ceiling fans was estimated to be 7 watts in the engineering analysis (see chapter 5 of the final rule TSD).
For HSSD and large-diameter ceiling fans with standby power consumption, DOE assumed that all hours not spent in active mode were in standby mode.
DOE did not account for any interaction between ceiling fans and air conditioning or heating equipment in
ASAP, et al. and the CA IOUs agree that the interaction between ceiling fan and air conditioning use would be negligible on a national level. (ASAP, et al., No. 142 at p. 5) The CA IOUs also agreed with DOE's decision not to include the air conditioning interaction in its analyses for this rule, based on the lack of available data. (CA IOUs, No. 144 at p. 2) ALA suggested that DOE's proposed ceiling fan efficiency standards could result in increased air conditioning use, because many ceiling fan consumers already have air conditioning units—which provide substitutionary cooling at no additional cost—and will therefore be more price sensitive to the price of ceiling fans. (ALA, No. 137 at p. 8) BAS pointed out that shipments projections do not directly reflect the possibility of consumers increasing their air conditioning set point and using the ceiling fan at high speeds. (BAS, Public Meeting Transcript, No. 133 at pp. 77-78)
As noted in the NOPR, DOE agrees that ceiling fans have the theoretical potential to be an inexpensive and effective replacement for air conditioning use; however, the interaction between ceiling fan use and air conditioning use is unlikely to be different in the case of amended standards than it would be in the no-new-standards case. The shipments analysis projects a modest change of shipments for standard, hugger, and VSD fans of less than 1% under the adopted standard level, and it is unclear what would motivate consumers to change their air conditioner's set point or otherwise change their air-conditioning behavior if they own a ceiling fan regardless of whether there is a new or amended standard. DOE did not account for such interaction in the final rule analyses.
The Center for the Built Environment at the University of California, Berkeley (CBE) agreed with DOE that a modest increase in ceiling fan price is unlikely to increase air conditioning use, but suggested that DOE conduct analyses on the building level rather than only considering ceiling fan cost savings. (CBE, No. 143 at p. 2) BAS cited three projects using building automation systems to vary ceiling fan speed that resulted in a reduction or elimination of air conditioning use. (BAS, No. 138 at p. 10) It was reported in one of the projects cited by BAS that the use of ceiling fans in a school can provide up to 4 °F of “additional effective” or “perceived” cooling. In the other two projects, the use of ceiling fans resulted in expanded temperature ranges in buildings, such as from a 72 °F to 75 °F range to a 68 °F to 82 °F range.
While DOE appreciates the provision of quantifiable outcomes, it is not clear if and how such cooling translates to applications beyond the specific cases cited, which may not be representative of ceiling fan usage in general. Moreover, as discussed previously, the interaction between ceiling fan use and air conditioning use is unlikely to be significantly different in the case of amended standards than it would be in the no-new-standards case. Customers who would purchase ceiling fans as a cost-effective substitute are for air-conditioning or heating equipment are free to do so regardless of whether there is any amended standard.
DOE conducts LCC and PBP analyses to evaluate the economic impacts on individual consumers of potential energy conservation standards. The effect of new or amended energy conservation standards on individual consumers usually involves a reduction in operating cost and an increase in purchase cost. DOE uses the following two metrics to measure consumer impacts:
• The LCC (life-cycle cost) is the total consumer expense of an appliance or product over the life of that product, consisting of total installed cost (manufacturer selling price, distribution chain markups, sales tax, and installation costs) plus operating costs (expenses for energy use, maintenance, and repair). To compute the operating costs, DOE discounts future operating costs to the time of purchase and sums them over the lifetime of the product.
• The PBP (payback period) is the estimated amount of time (in years) it takes consumers to recover the increased purchase cost (including installation) of a more-efficient product through lower operating costs. DOE calculates the PBP by dividing the change in purchase cost at higher efficiency levels by the change in annual operating cost for the year that amended or new standards are assumed to take effect.
For any given efficiency level, DOE measures the change in LCC relative to the LCC in the no-new-standards case, which reflects the estimated efficiency distribution of ceiling fans in the absence of new or amended energy conservation standards. In contrast, the PBP for a given efficiency level is measured relative to the baseline product.
DOE calculated the LCC and PBP for each considered efficiency level for a nationally representative consumer sample for each of the product classes. DOE developed consumer samples that account for variation in factors such as geographic location. Two types of consumer samples were created: one for the standard, hugger and VSD group of fans and another for the HSSD and large-diameter group. This was done to capture the variability in energy consumption, discount rates and energy prices associated with the different groups of ceiling fans.
For VSD, hugger, and standard ceiling fans, DOE created a sample in a manner similar to that outlined in section IV.E.1. Due to a lack of data on the location of HSSD and large- diameter fans, DOE assumed that the geographic distribution of HSSD and large- diameter fan purchasers is similar to that of standard, hugger, and VSD ceiling fan purchasers. Therefore, DOE chose the location of HSSD and large-diameter fan purchasers according to the geographic distribution of households in RECS. For each consumer in the sample used for HSSD and large-diameter fans, DOE determined the energy consumption of ceiling fans and the appropriate electricity price for the location and sector.
The calculation of the total installed cost includes MPCs, manufacturer markups, retailer and distributor markups, and sales taxes. Installation costs were assumed not to vary by efficiency level, and therefore were not considered in the analysis.
Inputs to the calculation of operating expenses include annual energy consumption, energy prices and price projections, repair and maintenance costs, product lifetimes, and discount rates.
DOE created distributions of values for product lifetime, discount rates, and sales taxes, with probabilities attached to each value, to account for their uncertainty and variability.
The computer model DOE uses to calculate the LCC and PBP relies on a Monte Carlo simulation to incorporate uncertainty and variability into the analysis. The Monte Carlo simulations randomly sample input values from the probability distributions and ceiling fan
DOE calculated the LCC and PBP for all consumers as if each were to purchase a new product in the expected first full year of compliance with amended standards. The final rule is expected to publish in late 2016, with a compliance date in late 2019. For this final rule, DOE analyzes LCC results for 2020, the first full year of compliance with final rule.
Table IV.2 summarizes the approach and data DOE used to derive inputs to the LCC and PBP calculations. The subsections that follow provide further discussion. Details of the spreadsheet model, and of all the inputs to the LCC and PBP analyses, are contained in chapter 8 and its appendices of the final rule TSD.
DOE estimates the purchase price by combining manufacturing and production cost, manufacturer markups, tariffs, import costs, retail markups, and sales tax. Section IV.D provides the details of the markups analysis.
DOE used a price trend to account for changes in the incremental brushless DC motor price that are expected to occur between the time for which DOE has data for brushless DC motor prices (2014) and the first full year after the assumed compliance date of the rulemaking (2020). DOE estimated a 6 percent price decline rate associated with the electronics used to control brushless DC motor fans based on an analysis of the Producer Price Index (PPI) of semiconductor components.
DOE applied sales tax, which varies by geographic location, to the total product cost. DOE collected sales tax data from the Sales Tax Clearinghouse
In the final rule analyses, as in the NOPR analysis, DOE assumed that installation costs are the same regardless of efficiency level and do not affect the LCC or PBP. Westinghouse, ALA, and BAS agreed that installation costs are not based on efficiency level of fan technology. (Westinghouse, Public Meeting Transcript, No. 133 at p. 96; ALA, No. 137 at p. 8; BAS, No. 138 at p. 10)
Lutron estimated that, conservatively, there are approximately 20 million ceiling fan speed controls installed in the U.S. that generally work well with AC-motor ceiling fans. Because controls for DC-motor ceiling fans are more complicated, requiring brushless DC motors for standard, hugger, and VSD ceiling fans would unintentionally force consumers with high-cost, integrated control systems (
Regarding the estimate of 20 million installed speed controls for ceiling fans with AC motors, DOE notes that brushless DC-motor ceiling fans are assumed to be sold with a remote control and that the cost of the associated control is included in DOE's analyses. Therefore, consumer ability to control fan speed is preserved for ceiling fans with brushless DC motors. Regarding high-cost integrated control systems, DOE acknowledges that there may be a higher installation cost for consumers who purchase a DC-motor ceiling fan and need to upgrade from an existing integrated control system that only works with AC-motor ceiling fans to an integrated control system that works with DC-motor ceiling fans; however it is unclear what fraction of AC-motor standard, hugger, and VSD ceiling fans are currently operated by high-cost integrated control systems. DOE's best estimate is that this fraction
The CA IOUs suggested that DOE remove the remote control cost from the installed cost, as the remote control is not an essential component for a ceiling fan. Alternatively, if DOE decides to include the cost of remote controls, the CA IOUs encourage DOE to consider adding the cost for wall mount controls for AC ceiling fans. (CA IOUs, No. 144 at p. 4)
DOE clarifies that in the final rule analysis, the cost of the basic means of control has been accounted for in the engineering analysis at all efficiency levels for all product classes (see section IV.C). For standard, hugger and VSD fans with an AC motor, the means of control are assumed to be electromechanical,
In the final rule analysis, as in the NOPR analysis, DOE used average electricity prices to characterize energy costs associated with the baseline efficiency level and marginal electricity prices to characterize incremental energy costs associated with the other efficiency levels considered. Marginal electricity prices are used to characterize incremental energy costs because they capture more accurately the small, incremental cost or savings associated with a change in energy use relative to the consumer's bill in the reference case, and may provide a better representation of consumer costs than average electricity prices. In the LCC analysis, the marginal electricity prices vary by season, region, and baseline household electricity consumption level. DOE estimated these prices using data published with the Edison Electric Institute (EEI) Typical Bills and Average Rates reports for summer and winter 2014.
To arrive at average and marginal electricity prices in future years, DOE multiplied the average and marginal electricity prices in the reference year (2014) by the forecast of annual residential or commercial electricity price changes for each Census division from EIA's
For each fan purchase sampled, DOE applied the projection for the Census division in which the purchase was located. The AEO electricity price trends do not distinguish between marginal and average prices, so DOE used the
DOE used the electricity price trends associated with the AEO Reference case scenarios for the nine Census divisions. The Reference case is a business-as-usual estimate, given expected market, demographic, and technological trends. DOE also included prices from AEO high-growth and AEO low-growth scenarios in the analysis. The high- and low-growth cases show the projected effects of alternative economic growth assumptions on energy markets.
In the NOPR analysis, DOE used information on repairs and installation from manufacturer interviews to estimate the cost to consumers of repairing a ceiling fan. DOE also assumed that 2.5 percent and 9 percent of AC-motor and DC-motor ceiling fans incurred repair costs, respectively. DOE based these assumptions on repair rate estimates provided by a ceiling fan technical expert.
CA IOUs and ASAP commented that the repair rate for brushless DC motors in ceiling fans may actually be lower than the repair rate for AC motors. (CA IOUs, Public Meeting Transcript, No. 133 at p. 98; ASAP, Public Meeting Transcript, No. 133 at p. 98) The CA IOUs and ASAP disagreed with the repair cost increase for brushless DC motor ceiling fans due to a lack of supporting data, and ASAP further noted that this may have caused the economic results presented in the NOPR to be underestimated. (CA IOUs, No. 144 at p. 5; ASAP, Public Meeting Transcript, No. 133 at pp. 12-13; ASAP, No. 142 at p. 4)
DOE reexamined this issue and found no suitable data with which to update its assumption that the excess rate of failure for brushless DC motors, above the repair rate for AC motors, is 6.5 percent of purchases. Because brushless DC motors incorporate electronics that AC motors do not have, the reliability of AC motors is likely to exceed brushless DC motors. Hence, DOE has continued to use the same assumptions in the final rule analyses.
DOE estimated ceiling fan lifetimes by fitting a survival probability function to data of historical shipments and the 2012 age distributions of installed stock. Data on the age distribution for the installed standard, hugger, and VSD ceiling fan stock in 2012 was available from the LBNL study.
Westinghouse and ALA agreed with the ceiling fan survival function used by DOE in the NOPR analysis, but Westinghouse commented that commercial building “turning” (i.e., where a building is repurposed for a new business) can shorten the service life of commercial fans. (Westinghouse, Public Meeting Transcript, No. 133 at p. 101; ALA, No. 137 at p. 8) CA IOUs added that there is qualitative online information suggesting that ceiling fans with brushless DC motors last longer than ceiling fans with AC motors. (CA IOUs, Public Meeting Transcript, No. 133 at p. 102) The CA IOUs also indicated that DC-motor ceiling fans may last longer than AC-motor ceiling fans, and that consumers are less likely to discard DC-motor ceiling fans prior to the end of their useful life when compared to AC-motor ceiling fans. (CA IOUs, No. 144 at p. 3) BAS added that the average lifetime for large-diameter fans is on the order of 15-20 years, with a large spread in the distribution of expected lifetimes. (BAS, No. 138 at p. 11) Finally, HKC commented that the service life of ceiling fans can be shortened by changing design trends. (HKC, Public Meeting Transcript, No. 133 at pp. 103-104)
DOE acknowledges that ceiling fans that use different technologies and belong to product classes may have different technical lifetimes. However, in its analyses, DOE considers the service lifetime of ceiling fans, including the types of effects mentioned by HKC and Westinghouse. The survival function used in the NOPR and final rule analyses inherently incorporates factors other than product failure, such as home renovation rates or design trend changes, by virtue of its derivation from the actual age distribution of installed ceiling fans in the stock. Therefore, the technical possibility of ceiling fans with brushless DC motors lasting longer than ceiling fans with AC motors should not significantly alter the survival function.
With respect to large-diameter ceiling fans, given that the general survival function DOE used results in and a median lifetime of 13 years and an average lifetime of 13.8 years—which does not drastically differ from the average lifetime suggested by BAS—and that DOE is unaware of any data to support an increase in average lifetime for large-diameter ceiling fans, in this final rule DOE used the same survival function proposed in the NOPR for all product classes.
In calculating the LCC, DOE applies discount rates appropriate to consumers to estimate the present value of future operating costs. To identify appropriate discount rates for purchasers, DOE estimated the percentage of HSSD and large-diameter fan purchasers in the commercial and industrial sectors. For HSSD fans, DOE estimated the ratio in floor space between likely building types where a fan would be installed in commercial settings to that in industrial settings. Manufacturer interviews informed DOE of the likely locations of CF installations. Floor space estimates by building type were taken from the 2010 U.S. Lighting Market Characterization,
For residential consumers, DOE estimated a distribution of discount rates for ceiling fans based on consumer financing costs and opportunity cost of funds related to appliance energy cost savings and maintenance costs. First, DOE identified all relevant household debt or asset classes to approximate a consumer's opportunity cost of funds related to appliance energy cost savings. It estimated the average percentage shares of the various types of debt and equity by household income group using data from the Federal Reserve Board's Survey of Consumer Finances
To establish discount rates for commercial and industrial users, DOE estimated the cost of capital for companies that purchase ceiling fans. The weighted average cost of capital is commonly used to estimate the present value of cash flows to be derived from a typical company project or investment. Most companies use both debt and equity capital to fund investments, so their cost of capital is the weighted average of the cost to the firm of equity and debt financing, as estimated from financial data for publicly traded firms in the sectors that purchase ceiling fans. For this analysis, DOE used Damodaran online
To estimate the share of consumers that would be affected by a potential energy conservation standard at a particular efficiency level, DOE's LCC analysis considered the projected distribution (market shares) of product efficiencies in the no-new-standards case (
Shipments data for ceiling fans disaggregated by efficiency level are not available, so it is not possible to derive the current shipments-weighted efficiency distribution. Instead, for the NOPR analysis, DOE developed the current efficiency market share distributions for the standard, hugger, and VSD product classes using online data from a ceiling fan retailer
Westinghouse commented at the NOPR public meeting that the fraction of hugger fans currently estimated to meet EL 3 appeared to be too high. Westinghouse and ALA also commented that model counts of ceiling fans are not representative of market share. (Westinghouse, Public Meeting Transcript, No. 133 at p. 107-110; ALA, No. 139 at pp. 2-3) ALA estimated that approximately 70 percent of standard and hugger ceiling fan models do not meet the standard level proposed in the NOPR based on test results of sample products, and added that higher sales-volume ceiling fan models are less likely to meet that standard than lower sales-volume models. For certain manufacturers, ALA estimated that over 90 percent of shipments would not comply with the proposed standards (ALA, No. 139 at pp. 2-3)
DOE understands that model counts are not necessarily representative of market share. With respect to the estimate that 90 percent of shipments would not comply with the proposed standards for certain manufacturers, DOE notes that any given manufacturer's efficiency distribution may differ from the efficiency distribution of the entire market. For the 70 percent of standard and hugger sample products that did not meet the proposed standard level based on recent testing results, it is unclear how representative these sample products are of the entire ceiling fan market without corresponding shipments data. However, in the absence of a shipments-weighted efficiency distribution, for this final rule DOE has adopted an updated 2015 efficiency distribution with 70 percent of shipments of standard and hugger ceiling fans below the proposed standard level in the NOPR. Because no market share distribution was suggested by ALA amongst the three efficiency levels below the proposed standard level, market shares were assumed to be split evenly between EL0, EL1, and EL2. The efficiency distribution for 2020 was then projected using the consumer-choice model described in section IV.G.3.
No comments were received regarding the efficiency distribution for VSD ceiling fans, so DOE has maintained its approach from the NOPR analysis for the VSD product class.
For HSSD and large-diameter ceiling fans, DOE developed the current efficiency distributions using model counts available on HSSD and large-diameter fan manufacturer websites. DOE assumed the current distribution observed in 2015 would also be representative of the efficiency distribution in 2020.
The estimated market shares for the no-new-standards case for all ceiling fans are shown in Table IV.3. See chapter 8 of the final rule TSD for further information on the derivation of the efficiency distributions.
DOE also developed size distributions within each product class to determine the likelihood that a given purchaser would select each of the representative fan sizes from the engineering analysis. For the NOPR, DOE estimated the distribution of diameters for standard, hugger, HSSD and large-diameter ceiling fans using the distribution of models currently seen on the market. In particular, DOE estimated that the current market share for 36-inch and 56-inch HSSD ceiling fans are 7 percent and 93 percent, respectively. A limited pool of available VSD fan models indicated a rough split of market share between the two representative blade spans, so DOE assumed that the VSD market was evenly split between the two blade spans.
Westinghouse agreed with the proposed market shares for 36″ and 56″ high-speed small-diameter ceiling fans in the NOPR, as well as the market shares by diameter for hugger, standard, and very-small diameter low-volume ceiling fans. (Westinghouse, Public Meeting Transcript, No. 133 at p. 91, 117) In the absence of additional data or comments to support an alternative approach, DOE retained the same methodology for the final rule analysis to estimate the blade span distribution for all the product classes. DOE estimated the blade span distribution by using the distribution of models currently seen on the market for the final rule. Table IV.4 presents the blade span distribution of each of the product classes. (For the NIA, DOE assumed that blade size distribution remains constant over the years considered in the analysis.)
The payback period is the amount of time it takes the consumer to recover the additional installed cost of more-efficient products, compared to baseline products, through energy cost savings. Payback periods are expressed in years. Payback periods that exceed the life of the product mean that the increased
The inputs to the PBP calculation for each efficiency level are the change in total installed cost of the product and the change in the first-year annual operating expenditures relative to the baseline. The PBP calculation uses the same inputs as the LCC analysis, except that discount rates are not needed.
EPCA, as amended, establishes a rebuttable presumption that a standard is economically justified if the Secretary finds that the additional cost to the consumer of purchasing a product complying with an energy conservation standard level will be less than three times the value of the first year's energy savings resulting from the standard, as calculated under the applicable test procedure. (42 U.S.C. 6295(o)(2)(B)(iii)) For each considered efficiency level, DOE determined the value of the first year's energy savings by calculating the energy savings in accordance with the applicable DOE test procedure, and multiplying those savings by the average energy price forecast for the year in which compliance with the amended standards would be required.
DOE uses projections of product shipments to calculate the national impacts of potential amended energy conservation standards on energy use, NPV, and future manufacturer cash flows. Historical shipments data are used to build up an equipment stock, and to calibrate the shipments model to project shipments over the course of the analysis period based on the estimated future demand for ceiling fans. Details of the shipments analysis are described in chapter 9 of the final rule TSD.
The shipments model projects total shipments and market-share efficiency distributions in each year of the 30-year analysis period for the no-new-standards case and each of the standards cases, calibrated using historical shipments. This final rule is expected to publish in late 2016 with a compliance date in late 2019. DOE begins its shipments analysis for the final rule in 2020, the first full year of compliance, and extends over 30 years until 2049. The shipments model consists of three main components: (1) A shipments demand model that determines the total demand for new ceiling fans in each year of the analysis period, (2) a stock model that tracks the age distribution of the stock over the analysis period, and (3) a model that determines the market shares of purchased ceiling fans across efficiency levels. For standard, hugger, and VSD ceiling fans, DOE used a consumer-choice model sensitive to ceiling fan first cost to estimate market shares across efficiency level. For HSSD and large-diameter ceiling fans, DOE used a roll-up approach to estimate the efficiency distribution in each standards case.
DOE used historical shipment data of hugger, standard, and VSD fans from Appliance Magazine's Statistical Review from 1991 to 2006,
As the data were not disaggregated by product class, DOE estimated the relative split between standard, hugger, and VSD product classes. In the NOPR analysis, DOE used online and in-store ceiling fan data and applied a price-weighting approach based on market share data as a function of retail price for ceiling fans collected by the NPD Group from 2007 to 2011. These data inform the price-weighting scheme, which apportions more market share to ceiling fans with lower first costs. DOE calculated 48.7 percent and 51.3 percent current market shares for hugger and standard ceiling fans, respectively. DOE's calculation assumed that multi-mount ceiling fan installations are split 27 percent/73 percent as hugger and standard ceiling fans, respectively.
Westinghouse agreed with DOE's estimates for the market split between standard, hugger, and VSD ceiling fans in the NOPR analyses. (Westinghouse, Public Meeting Transcript, No. 133 at p. 91, 117) DOE retains this methodology for estimating market share by product class for the final rule.
DOE's estimate for HSSD historical shipments is based on scaling historical shipments of standard, hugger, and VSD ceiling fans using a scaling factor estimated from feedback from manufacturer interviews. DOE's estimate for large-diameter fans is based on matching a linear shipments trend to an estimate of 2013 installed stock assuming large-diameter fans were introduced to the market in 2000.
Shipments for standard, hugger, and VSD ceiling fans are calculated for the residential sector. Shipments for HSSD and large-diameter fans are calculated for the commercial and industrial sectors. As all of the inputs used in the downstream analyses are the same for both sectors, DOE does not distinguish between shipments to the commercial or industrial sector.
The ceiling fan shipments demand model considers four market segments that affect the net demand for total shipments: replacements for retired stock, additions due to new building construction, additions due to expanding demand in existing buildings, and reductions due to building demolitions, which erodes demand from replacements and existing buildings.
The stock accounting model tracks the age (vintage) distribution of the installed ceiling fan stock. The age distribution of the stock impacts both the national energy savings (NES) and NPV calculations, because the operating costs for any year depend on the age distribution of the stock. Older, less efficient units may have higher operating costs, while newer, more efficient units have lower operating costs. The stock accounting model is initialized using historical shipments data and accounts for additions to the stock (
The consumer-choice model used for standard, hugger, and VSD ceiling fans estimates the market shares of purchases in each year in the analysis period for each efficiency level presented in the engineering analysis. DOE assumed that each of these product classes provides a specific utility and consumers do not choose between options in different product classes. The consumer-choice module selects which ceiling fans are purchased within a product class in any given year based on consumer sensitivity to first cost, as well as on the ceiling fan options available, which were determined in the engineering analysis. Deviations from purely cost-driven behavior are accounted for using factors found by calibrating the model to observed historical data.
Westinghouse agreed with DOE's NOPR assumption that consumers of standard, hugger, and VSD ceiling fans
In the NOPR analysis, DOE assumed the no-new-standards case efficiency distribution for HSSD and large-diameter ceiling fans remained fixed at the estimated 2015 efficiency distribution over the shipments analysis period. In the standards cases, market shares for those levels that do not meet the standard roll up to the standard level, and shares above the standard level are unchanged. In the NOPR analysis, DOE assumed no product class switching between the HSSD and large-diameter product classes.
Westinghouse and BAS agreed with the roll-up approach DOE used in its NOPR analysis, but BAS added that large-diameter ceiling fan manufacturers are likely to meet the minimum efficiency by reducing the utility of their fans (i.e., by reducing the maximum airflow). (Westinghouse, Public Meeting Transcript, No. 133 at pp. 123-124; BAS, Public Meeting Transcript, No. 133 at p. 126)
For this final rule, DOE continues to use the roll-up approach for HSSD and large-diameter ceiling fans. As discussed in section IV.C.3, DOE adjusted the efficiency equation associated with the considered standard levels to ensure that high airflow ceiling fans would be preserved under the standard level in this final rule.
The consumer-choice model uses ceiling fan prices, which change over time in some cases. There is considerable evidence of learning-by-doing lowering the cost of new technologies along with increases in production of the new technology. The concept behind this empirical phenomenon is that as the new technology is produced in greater numbers, employees and firms will find ways to lower costs. Brushless DC motors are a relatively new technology for use in ceiling fans, and thus DOE expects price declines. Given the absence of data on cumulative shipments of brushless DC motors, DOE models learning lowering costs, and thus prices, with time. In the NOPR analysis, DOE adopted a price decline rate of 6 percent applied to the incremental (not total) cost associated with a brushless DC motor, based on information from a technical expert for standard, hugger, and VSD ceiling fans.
DOE assumes that any increase in the average price of a ceiling fan due to a standard would result in a decrease in shipments. For this final rule analysis, DOE uses a relative price elasticity of demand of -0.34, which is the value DOE has typically used for residential appliances.
DOE notes that an increase in the price of ceiling fan light kits due to the adopted ceiling fan light kit standard will also impact the shipments of ceiling fans sold with ceiling fan light kits. The ceiling fan final rule analysis included the impact on ceiling fan shipments from the estimated ceiling fan light kit price change due to the adopted ceiling fan light kit standard. (81 FR 580 (Jan. 6, 2016)) The impact from a ceiling fan light kit standard to ceiling fan shipments is applied to both the no ceiling fan standards case and the ceiling fan standards case shipments.
The NIA assesses the national energy savings (NES) and the net present value (NPV) from a national perspective of total consumer costs and savings that would be expected to result from new or amended standards at specific efficiency levels. (“Consumer” in this context refers to consumers of the product being regulated.) DOE calculates the NES and NPV based on projections of annual product shipments, along with the annual energy consumption, total installed cost, and repair costs. For the final rule analysis, DOE projected the energy savings, operating cost savings, product costs, and NPV of consumer benefits over the lifetime of ceiling fans shipped from 2020 through 2049, beginning with the first full year of compliance with a potential standard.
DOE evaluates the impacts of new and amended standards by comparing a case without such standards with standards-case projections. The no-new-standards case projection characterizes energy use and consumer costs for each product class in the absence of new or amended energy conservation standards. For this projection, DOE considers historical trends in efficiency and various forces that are likely to affect the mix of efficiencies over time. DOE compares the no-new-standards case with projections characterizing the market for each product class if DOE adopted new or amended standards at specific energy efficiency levels (
DOE uses a spreadsheet model to calculate the energy savings and the national consumer costs and savings from each TSL. Interested parties can review DOE's analyses by changing various input quantities within the spreadsheet. The NIA spreadsheet model uses typical values (as opposed to probability distributions) as inputs.
Table IV.5 summarizes the inputs and methods DOE used for the NIA analysis for the final rule. Discussion of these inputs and methods follows the table. See chapter 10 of the final rule TSD for further details.
The national energy savings analysis involves a comparison of national energy consumption of the considered products between each potential standards case and the case with no new or amended energy conservation standards. DOE calculated the national energy consumption by multiplying the number of units (stock) of each product (by vintage or age) by the unit energy consumption (also by vintage). DOE calculated annual NES based on the difference in national energy consumption for the no-new-standards case and for the case where a standard is set at each TSL. DOE estimated energy consumption and savings based on site energy and converted the electricity consumption and savings to primary energy (
In 2011, in response to the recommendations of a committee on “Point-of-Use and Full-Fuel-Cycle Measurement Approaches to Energy Efficiency Standards” appointed by the National Academy of Sciences, DOE announced its intention to use full-fuel-cycle (FFC) measures of energy use and greenhouse gas and other emissions in the national impact analyses and emissions analyses included in future energy conservation standards rulemakings. 76 FR 51281 (Aug. 18, 2011). After evaluating the approaches discussed in the August 18, 2011 notice, DOE published a statement of amended policy in which DOE explained its determination that EIA's National Energy Modeling System (NEMS) is the most appropriate tool for its FFC analysis and its intention to use NEMS for that purpose. 77 FR 49701 (Aug. 17, 2012). NEMS is a public domain, multi-sector, partial equilibrium model of the U.S. energy sector
The rebound effect accounts for increased usage of an appliance by consumers after the implementation of a standard, reducing the energy savings attributed to a standard. DOE generally accounts for the direct rebound effect in its estimates of the national energy savings when available data suggest consumers may increase product usage in the event of a standard which acts to decrease the average power associated with the product. In the case of ceiling fans, DOE found no data pertaining to a rebound effect associated with more efficient products and also received comments in response to the Framework document from ALA indicating that they did not believe a rebound effect due to a ceiling fan standard was likely. (ALA, No 39, at pg. 39) In this final rule, DOE assumes no rebound effect in its reference scenario. Nevertheless, DOE performed a sensitivity scenario assuming a rebound of 3-percent to examine the implications of rebound. The rebound sensitivity reduces national energy savings at each TSL by 3 percent without impacting NPV results. The full results of this sensitivity analysis can be found in appendix 10C of this final rule TSD. The rebound effect explored in this sensitivity analysis can reduce expected savings in energy costs to consumers in the standards case.
The inputs for determining the NPV of the total costs and benefits experienced by consumers are (1) total annual installed cost, (2) total annual operating costs savings, and (3) a discount factor to calculate the present value of costs and savings. DOE calculates net savings each year as the difference between the no-new-standards case and each standards case in terms of total savings in operating costs versus total increases in installed costs. DOE calculates operating cost savings over the lifetime of each product shipped during the forecast period.
The operating cost savings are primarily energy cost savings, which are calculated using the estimated energy savings in each year and the projected price of electricity. To estimate electricity prices in future years, DOE multiplied the average regional energy prices by the forecast of annual national-average residential energy price changes in the Reference case from
DOE estimated the range of potential impacts of amended standards by considering four sensitivity scenarios: a high-benefit scenario, a low-benefit scenario, and a scenario that includes a 3-percent rebound effect. In the high benefits scenario, DOE used the
In calculating the NPV, DOE multiplies the net savings in future years by a discount factor to determine their present value. For this final rule, DOE estimated the NPV of consumer benefits using both a 3-percent and a 7-percent real discount rate. DOE uses these discount rates in accordance with guidance provided by the Office of Management and Budget (OMB) to Federal agencies on the development of regulatory analysis.
In analyzing the potential impact of new or amended energy conservation standards on consumers, DOE evaluates the impact on identifiable subgroups of consumers that may be disproportionately affected by a new or amended national standard. The purpose of a subgroup analysis is to determine the extent of any such disproportional impacts. DOE evaluates impacts on particular subgroups of consumers by analyzing the LCC impacts and PBP for those particular consumers from alternative standard levels. For this final rule, DOE analyzed the impacts of the considered standard levels on low-income households and small businesses that purchase ceiling fans. DOE used the LCC and PBP spreadsheet model to estimate the impacts of the considered efficiency levels on these subgroups.
DOE calculated the LCC and PBP results for standard, hugger, and VSD fans based on a sample of low-income households or consumers who were identified in the RECS 2009 survey as being at or below the “poverty line.” The poverty line varies with household size, head of household age, and family income.
In the case of the HSSD and large-diameter fans, DOE conducted a subgroup analysis based on small businesses that purchase ceiling fans by applying the small company discount rate distributions for each sector in the LCC and PBP calculation, instead of the discount rate associated with the entire industry.
Chapter 11 in the final rule TSD describes the consumer subgroup analysis.
DOE conducted an MIA for ceiling fans to estimate the financial impact of amended standards on manufacturers of ceiling fans. The MIA has both quantitative and qualitative aspects. The quantitative part of the MIA relies on the GRIM, an industry cash-flow model customized for the ceiling fans covered in this rulemaking. The key GRIM inputs are data on the industry cost structure, MPCs, shipments, and assumptions about manufacturer markups, and conversion costs. The key MIA output is INPV. DOE used the GRIM to calculate cash flows using standard accounting principles and to compare changes in INPV between the no-new-standards case and various TSLs (the standards cases). The difference in INPV between the no-new-standards case and the standards cases represents the financial impact of amended energy conservation standards on ceiling fan manufacturers. Different sets of assumptions (scenarios) produce different INPV results. The qualitative part of the MIA addresses factors such as manufacturing capacity; characteristics of, and impacts on, any particular subgroup of manufacturers, including small manufacturers; and impacts on competition.
DOE conducted the MIA for this rulemaking in three phases. In the first phase, DOE prepared an industry characterization based on the market and technology assessment, preliminary manufacturer interviews, and publicly available information. In the second phase, DOE estimated industry cash flows in the GRIM using industry financial parameters derived in the first phase and the shipments derived in the shipment analysis. In the third phase, DOE conducted interviews with a variety of ceiling fan manufacturers that account for more than 30 percent of domestic ceiling fan sales covered by this rulemaking. During these interviews, DOE discussed engineering, manufacturing, procurement, and financial topics specific to each company, and obtained each manufacturer's view of the ceiling fan industry as a whole. The interviews provided information that DOE used to evaluate the impacts of amended standards on manufacturers' cash flows, manufacturing capacities, and direct domestic manufacturing employment levels. See section V.B.2.b of this final rule for the discussion on the estimated changes in the number of domestic employees involved in manufacturing ceiling fans covered by standards.
During the third phase, DOE used the results of the industry characterization analysis in the first phase and feedback from manufacturer interviews to group manufacturers that exhibit similar production and cost structure characteristics. DOE identified one manufacturer subgroup for a separate impact analysis; small businesses. DOE determined that ceiling fan manufacturing falls under the North American Industry Classification System (NAICS) code 335210, small electrical appliance manufacturing. The U.S. Small Business Administration (SBA) defines a small business as having less than 1,500 total employees for manufacturing operating under this NAICS code. This threshold includes all employees in a business' parent company and any other subsidiaries. Based on this classification, DOE identified six domestic ceiling fan businesses that manufacturer ceiling fans in the United States and qualify as small businesses per the SBA threshold. DOE analyzed the impact on the small business subgroup in the complete MIA, which is presented in chapter 12 of the final rule TSD, and in the Regulatory Flexibility analysis required by the Regulatory Flexibility Act, 5 U.S.C. 601, et. seq., presented in section VI.B of this final rule.
DOE uses the GRIM to quantify the changes in cash flows over time due to amended energy conservation standards. These changes in cash flows result in either a higher or lower INPV for the standards case compared to the no-new-standards case. The GRIM uses standard annual cash-flow analysis that incorporates MPCs, manufacturer
DOE expects amended ceiling fan energy conservation standards to cause manufacturers to incur conversion costs by bringing their tooling and product designs into compliance with amended standards. For the MIA, DOE classified these conversion costs into two major groups: (1) Capital conversion costs and (2) product conversion costs. Capital conversion costs are investments in property, plant, and equipment necessary to adapt or change existing tooling equipment so new product designs can be fabricated and assembled. Product conversion costs are investments in research, development, testing, marketing, certification, and other non-capitalized costs necessary to make product designs comply with amended standards.
ALA commented that DOE underestimated conversion costs due to an understated percentage of shipments that will meet the standard in the compliance year (ALA, No. 139, p. 2-4). ALA maintains that conversion costs would be doubled had DOE used the efficiency distribution estimated by ALA.
For the final rule, DOE revised the shipment efficiency distribution in the shipment analysis for standard and hugger ceiling fans based on feedback from ALA. The MIA used the shipment efficiency distribution when calculating the industry conversion costs. Conversion costs significantly increased from the NOPR to the final rule due to these changes in the efficiency distribution.
ALA went on to comment that conversion costs are further understated due to their exclusion of additional financing costs that could be incurred by some manufacturers to purchase manufacturing equipment needed to produce ceiling fans that comply with the standard (ALA, No. 139, p. 4). Also, Westinghouse commented that they were concerned DOE's analysis may not be fully calculating or capturing what the true cost increase for manufacturers will be. (Westinghouse, Public Meeting Transcript, No. 133 at p. 92)
DOE increased the per model capital and product conversion costs associated with converting a failing ceiling fan model into a compliant model, based on ALA and Westinghouse's comments. This per model conversion cost increase resulted in higher overall conversion costs from the NOPR to the final rule. This increase in per model conversion costs was in addition to the increase in the number of models needed to be converted due to the changes in the efficiency distribution previously described.
Manufacturing a more efficient product is typically more expensive than manufacturing a lower efficient product due to the use of more complex components, which are typically more costly than less efficient components. The increases in the MPCs of the analyzed products can affect the revenues, gross margins, and cash flow of the industry, making these product costs key inputs for the GRIM and the MIA.
In the MIA, DOE used the MPCs calculated in the engineering analysis, as described in section IV.C and further detailed in chapter 5 of the final rule TSD. To calculate MPCs for ceiling fans. DOE updated the MPCs used in the NOPR analysis based on manufacturer feedback for the final rule analysis. The MIA used these updated MPCs for the final rule analysis.
INPV, which is the key GRIM output, depends on industry revenue, which depends on the quantity and prices of ceiling fans shipped in each year of the analysis period. Industry revenue calculations require forecasts of: (1) Total annual shipment volume of ceiling fans; (2) the distribution of shipments across the product class (because prices vary by product class); and, (3) the distribution of shipments across ELs (because prices vary with ceiling fan efficiency).
DOE modeled the no-new-standards case ceiling fan shipments and the growth of ceiling fan shipments using replacement shipments of failed ceiling fan units, new construction starts as projected by
DOE updated the initial 2015 efficiency distribution for the final rule analysis for standard and hugger fans based on feedback from manufacturers. To estimate the distribution of shipments across ELs over the analysis period for standard, hugger, and VSD ceiling fans, a consumer-choice model was used to project consumer purchases based on consumer sensitivity to first cost. For HSSD and large-diameter ceiling fans, a roll-up approach was used, in which consumers who would have purchased ceiling fans that fail to meet the new standards in the no-new-standards case purchase the least efficient, compliant ceiling fans in the standards cases. Consumers that would have purchased compliant ceiling fans in the no-new-standards case continue to purchase the exact same ceiling fans in the standards cases.
For all ceiling fans, DOE also included price elasticity in the shipments analysis for all standards cases. When price elasticity is included in the shipment analysis, the total number of ceiling fans declines as the average price of a ceiling fan increases due to standards. For a complete description of the shipments, see the shipments analysis discussion in section IV.G of this final rule.
As discussed in section IV.J.2.b, the MPCs for ceiling fans are the manufacturers' costs for those units. These costs include materials, labor, depreciation, and overhead, which are collectively referred to as the cost of goods sold (COGS). The MSP is the price received by ceiling fan manufacturers from the first sale, typically to a distributor, regardless of the downstream distribution channel through which the ceiling fans are ultimately sold. The MSP is not the cost the end-user pays for ceiling fans, because there are typically multiple sales along the distribution chain and various markups applied to each sale. The MSP equals the MPC multiplied by the manufacturer markup. The manufacturer markup covers all the ceiling fan manufacturer's non-production costs (
Modifying these manufacturer markups in the standards cases yields a different set of impacts on ceiling fan manufacturers than in the no-new-standards case. For the MIA, DOE modeled three standards case markup scenarios for ceiling fans to represent the uncertainty regarding the potential impacts on prices and profitability for ceiling fan manufacturers following the implementation of amended standards. The three scenarios are: (1) A preservation of gross margin markup scenario; (2) a preservation of operating profit markup scenario; and (3) a two-tiered markup scenario. Each scenario leads to different manufacturer markup values, which, when applied to the inputted MPCs, result in varying revenue and cash-flow impacts on ceiling fan manufacturers.
The manufacturer markups for the preservation of operating profit and two-tiered markup scenarios depend on the efficiency distribution of shipments calculated in the shipment analysis. Therefore, the manufacturer markups for the preservation of operating profit and two-tiered markup scenarios are slightly different in the final rule that those in the NOPR analysis.
Only ALA and Westinghouse commented on the assumptions and results of the NOPR MIA. These comments addressed the capital and product conversion costs and are addressed in section IV.J.2.a. No further comments on the NOPR were submitted regarding the MIA.
DOE conducted additional interviews with manufacturers following the preliminary analysis as part of the NOPR analysis. DOE outlined the key issues for ceiling fan manufacturers in the NOPR. 81 FR 1689 (January 13, 2016). DOE considered the information received during these interviews in the development of the NOPR and this final rule. DOE did not receive any comments regarding the key issues described in the NOPR analysis.
Several manufacturers stated that ceiling fan energy conservation standards could cause residential consumers to forgo the purchase of a ceiling fan in lieu of an air conditioner due to the price increase, or could cause residential ceiling fan owners to run their air conditioners more frequently instead of using their ceiling fan. Manufacturers assert that if residential consumers instead use their air conditioner to cool their homes, this could result in more energy use, as ceiling fans tend to be more efficient at cooling rooms than air conditioners.
Manufacturers also stated that overly stringent ceiling fan standards could force manufacturers to reduce the aesthetic quality of some ceiling fans to comply with energy conservation standards. This could cause some residential consumers to forgo the purchase of these ceiling fans because the aesthetic appearance of ceiling fans is an important factor when residential consumers purchase ceiling fans. Manufacturers claim this reduction in aesthetic quality could again result in more energy use, because residential consumers who do not purchase ceiling fans would need to use air conditioners to cool their homes. DOE addresses this issue in section IV.E.3 of this final rule.
Manufacturers are concerned about the additional testing burden associated with complying with amended energy conservation standards. Most manufacturers use third-party testing facilities for testing and reporting purposes, which can be expensive. Manufacturers stated that ceiling fan standards would significantly increase the amount that they already invest in testing each year. DOE includes the additional testing and certification costs that manufacturers must make due to standards as part of the MIA. DOE calculates the total industry conversion costs for manufacturers, which includes the additional testing and certification costs of complying with amended standards. These conversion costs impact the INPV at each TSL. Industry cash flow analysis results are discussed in detail in section V.B.2.a.
Manufacturers stated that amended energy conservation standards that required the use of brushless DC motors in residential ceiling fans would limit the overall utility of the fan and increase maintenance costs. Manufacturers claim that brushless DC motors require significantly more maintenance and have a higher warranty factor compared to ceiling fans with AC motors. Additionally, ceiling fans with brushless DC motors require the use of a handheld remote, which manufacturers claim is not preferred by many residential consumers. Therefore, manufacturers stated any ceiling fan standard that required the use of a brushless DC motor would significantly reduce the overall utility of ceiling fans to residential consumers.
For the HSSD and large-diameter product classes, which are expected to represent less than three percent of all covered ceiling fan shipments in 2020, manufacturers stated that the use of brushless DC motors in HSSD ceiling fans and gearless DC motors in large-diameter ceiling fans will not significantly impact consumer utility. HSSD and large-diameter ceiling fans are typically used in commercial and industrial applications as opposed to in residential applications. Most manufacturers indicated that commercial and industrial consumers do not dislike using a handheld remote that is required when operating a ceiling fan with a brushless or gearless DC motor, and in some applications it is preferable. Also, these commercial and industrial consumers tend to be better equipped to respond to the increased maintenance costs associated with owning and operating ceiling fans with brushless or gearless DC motors because these consumers are more likely to repair their own products and equipment than residential consumers are.
DOE conducted a screening analysis as part of this final rule analysis and concluded that brushless or gearless DC motors should be considered as a viable technology for all respective product classes of covered ceiling fans for the engineering analysis. See section IV.B of this final rule for a detailed discussion of the screening analysis. Additionally, DOE did include the additional repair costs of ceiling fans using brushless or gearless DC motors as part of the LCC analysis. See section IV.F.4 for a complete description of the repair cost assumptions of brushless and gearless DC motors.
The emissions analysis consists of two components. The first component estimates the effect of potential energy conservation standards on power sector and site (where applicable) combustion emissions of CO
The analysis of power sector emissions uses marginal emissions factors that were derived from data in
Combustion emissions of CH
The emissions intensity factors are expressed in terms of physical units per MWh or MMBtu of site energy savings. Total emissions reductions are estimated using the energy savings calculated in the national impact analysis.
For CH
The
SO
EIA was not able to incorporate CSAPR into
The attainment of emissions caps is typically flexible among EGUs and is enforced through the use of emissions allowances and tradable permits. Under existing EPA regulations, any excess SO
Beginning in 2016, however, SO
CAIR established a cap on NO
The MATS limit mercury emissions from power plants, but they do not include emissions caps and, as such, DOE's energy conservation standards would likely reduce Hg emissions. DOE estimated mercury emissions reduction using emissions factors based on
As part of the development of this rule, DOE considered the estimated monetary benefits from the reduced emissions of CO
For this final rule, DOE relied on a set of values for the social cost of carbon (SCC) that was developed by a Federal interagency process. The basis for these values is summarized in the next section, and a more detailed description of the methodologies used is provided as an appendix to chapter 14 of the final rule TSD.
The SCC is an estimate of the monetized damages associated with an incremental increase in carbon emissions in a given year. It is intended to include (but is not limited to) climate-change-related changes in net agricultural productivity, human health, property damages from increased flood risk, and the value of ecosystem services. Estimates of the SCC are provided in dollars per metric ton of CO
Under section 1(b)(6) of Executive Order 12866, “Regulatory Planning and Review,” 58 FR 51735 (Oct. 4, 1993), agencies must, to the extent permitted by law, “assess both the costs and the benefits of the intended regulation and, recognizing that some costs and benefits are difficult to quantify, propose or adopt a regulation only upon a reasoned determination that the benefits of the intended regulation justify its costs.” The purpose of the SCC estimates presented here is to allow agencies to incorporate the monetized social benefits of reducing CO
As part of the interagency process that developed these SCC estimates, technical experts from numerous agencies met on a regular basis to consider public comments, explore the technical literature in relevant fields, and discuss key model inputs and assumptions. The main objective of this process was to develop a range of SCC values using a defensible set of input assumptions grounded in the existing scientific and economic literatures. In this way, key uncertainties and model differences transparently and consistently inform the range of SCC estimates used in the rulemaking process.
When attempting to assess the incremental economic impacts of CO
Despite the limits of both quantification and monetization, SCC estimates can be useful in estimating the social benefits of reducing CO
It is important to emphasize that the interagency group is committed to updating these estimates as the science and economic understanding of climate change and its impacts on society improves over time. In the meantime, the interagency group will continue to explore the issues raised by this analysis and consider public comments as part of the ongoing interagency process.
In 2009, an interagency process was initiated to offer a preliminary assessment of how best to quantify the benefits from reducing carbon dioxide emissions. To ensure consistency in how benefits are evaluated across Federal agencies, the Administration sought to develop a transparent and defensible method, specifically designed for the rulemaking process, to quantify avoided climate change damages from reduced CO
After the release of the interim values, the interagency group reconvened on a regular basis to generate improved SCC estimates. Specially, the group considered public comments and further explored the technical literature in relevant fields. The interagency group relied on three integrated assessment models commonly used to estimate the SCC: The FUND, DICE, and PAGE models. These models are frequently cited in the peer-reviewed literature and were used in the last assessment of the Intergovernmental Panel on Climate Change (IPCC). Each model was given equal weight in the SCC values that were developed.
Each model takes a slightly different approach to model how changes in emissions result in changes in economic damages. A key objective of the interagency process was to enable a consistent exploration of the three models, while respecting the different approaches to quantifying damages
In 2010, the interagency group selected four sets of SCC values for use in regulatory analyses. Three sets of values are based on the average SCC from the three integrated assessment models, at discount rates of 2.5, 3, and 5 percent. The fourth set, which represents the 95th percentile SCC estimate across all three models at a 3-percent discount rate, was included to represent higher-than-expected impacts from climate change further out in the tails of the SCC distribution. The values grow in real terms over time. Additionally, the interagency group determined that a range of values from 7 percent to 23 percent should be used to adjust the global SCC to calculate domestic effects,
The SCC values used for this document were generated using the most recent versions of the three integrated assessment models that have been published in the peer-reviewed literature, as described in the 2013 update from the interagency working group (revised July 2015).
It is important to recognize that a number of key uncertainties remain, and that current SCC estimates should be treated as provisional and revisable because they will evolve with improved scientific and economic understanding. The interagency group also recognizes that the existing models are imperfect and incomplete. The National Research Council report mentioned previously points out that there is tension between the goal of producing quantified estimates of the economic damages from an incremental ton of carbon and the limits of existing efforts to model these effects. There are a number of analytical challenges that are being addressed by the research community, including research programs housed in many of the Federal agencies participating in the interagency process to estimate the SCC. The interagency group intends to periodically review and reconsider those estimates to reflect increasing knowledge of the science and economics of climate impacts, as well as improvements in modeling.
In summary, in considering the potential global benefits resulting from reduced CO
DOE multiplied the CO
As noted previously, DOE has estimated how the considered energy conservation standards would reduce site NO
DOE estimated the monetized value of NO
DOE multiplied the emissions reduction (in tons) in each year by the associated $/ton values, and then discounted each series using discount rates of 3 percent and 7 percent as appropriate.
DOE is evaluating appropriate monetization of avoided SO
The utility impact analysis estimates several effects on the electric power generation industry that would result from the adoption of new or amended energy conservation standards. The utility impact analysis estimates the changes in installed electrical capacity and generation that would result for each TSL. The analysis is based on published output from the NEMS associated with
The output of this analysis is a set of time-dependent coefficients that capture the change in electricity generation, primary fuel consumption, installed capacity and power sector emissions due to a unit reduction in demand for a given end use. These coefficients are multiplied by the stream of electricity savings calculated in the NIA to provide estimates of selected utility impacts of new or amended energy conservation standards.
DOE considers employment impacts in the domestic economy as one factor in selecting a standard. Employment impacts from new or amended energy conservation standards include both direct and indirect impacts. Direct employment impacts are any changes in the number of employees of manufacturers of the products subject to standards, their suppliers, and related service firms. The MIA addresses those impacts. Indirect employment impacts are changes in national employment that occur due to the shift in expenditures and capital investment caused by the purchase and operation of more-efficient appliances. Indirect employment impacts from standards consist of the net jobs created or eliminated in the national economy, other than in the manufacturing sector being regulated, caused by (1) reduced spending by end users on energy, (2) reduced spending on new energy supply by the utility industry, (3) increased consumer spending on new products to which the new standards apply, and (4) the effects of those three factors throughout the economy.
One method for assessing the possible effects on the demand for labor of such shifts in economic activity is to compare sector employment statistics developed by the Labor Department's Bureau of Labor Statistics (BLS). BLS regularly
DOE estimated indirect national employment impacts for the standard levels considered in this final rule using an input/output model of the U.S. economy called Impact of Sector Energy Technologies version 3.1.1 (ImSET).
DOE notes that ImSET is not a general equilibrium forecasting model, and understands the uncertainties involved in projecting employment impacts, especially changes in the later years of the analysis. Because ImSET does not incorporate price changes, the employment effects predicted by ImSET may over-estimate actual job impacts over the long run for this rule. Therefore, DOE generated results for near-term timeframes (2020 and 2025), where these uncertainties are reduced. For more details on the employment impact analysis, see chapter 16 of the final rule TSD.
The following section addresses the results from DOE's analyses with respect to the considered energy conservation standards for ceiling fans. It addresses the TSLs examined by DOE, the projected impacts of each of these levels if adopted as energy conservation standards for ceiling fans, and the standards levels that DOE is adopting in this final rule. Additional details regarding DOE's analyses are contained in the final rule TSD supporting this rulemaking.
In the NOPR analysis, DOE had six TSLs with TSL 6 corresponding to maximum technologically feasible (max tech) efficiency level, TSL 5 corresponding to maximum NPV (at a 7 percent discount rate), and TSL 4 corresponding to maximum NPV (at a 7 percent discount rate) with positive LCC savings. For the final rule, DOE now has five TSLs with TSL 5 corresponding to both max tech and maximum NPV, and TSL 4 corresponding to maximum NPV with an AC motor for all product classes other than HSSD fans, and maximum NPV for HSSD fans. The criteria for TSLs 1-3 remains unchanged.
The TSLs for the final rule were developed by combining specific efficiency levels for each of the product classes analyzed by DOE. DOE presents the results for the TSLs in this document, while the results for all efficiency levels that DOE analyzed are in the final rule TSD.
Table V.1 presents the TSLs and the corresponding efficiency levels for ceiling fans. TSL 5 represents the max-tech energy efficiency for all product classes.
TSL 4 corresponds to maximum NPV with an AC motor for all product classes other than HSSD fans, and maximum NPV for HSSD fans. In addition, at this TSL, less than 50 percent of consumers experience a net cost, and large-diameter ceiling fans that provide high levels of airflow are not disproportionally impacted. Specifically, for large-diameter ceiling fans, while max-tech provides LCC savings and NPV that are both positive, max-tech has potential unintended consequence of disproportionately impacting large diameter fans that provide high levels of airflow. DOE does not have enough data to be certain that large-diameter ceiling fans at the current max CFM levels offered on the market at all diameters can meet the max-tech level, even when using brushless DC motors. Therefore, if large-diameter ceiling fans that provide the highest levels of airflow in today's market cannot meet the max tech level even when using brushless DC motors, these fans could be unintentionally eliminated from the market, diminishing product availability and utility.
TSL 3 corresponds to the highest efficiency level that can be met with a standard (AC) motor for all product classes. TSL 2 corresponds to the fan-optimization design-option efficiency level. TSL 1 corresponds to the first non-baseline efficiency level (i.e., EL 1).
DOE analyzed the economic impacts on ceiling fans consumers by looking at the effects potential amended standards at each TSL would have on the LCC and PBP. DOE also examined the impacts of potential standards on consumer subgroups. These analyses are discussed below.
In general, higher-efficiency products affect consumers in two ways: (1) Purchase price increases and (2) annual operating costs decrease. Inputs used for calculating the LCC and PBP include total installed costs (
Table V.2 through Table V.11 show the LCC and PBP results for the TSL efficiency levels considered for each product class. In the first of each pair of tables, the simple payback is measured relative to the baseline product. In the second table, the impacts are measured relative to the efficiency distribution in the in the no-new-standards case in the compliance year (see section IV.F.7 of this notice). Because some consumers purchase products with higher efficiency in the no-new-standards case, the average savings are less than the difference between the average LCC of EL 0 and the average LCC at each TSL. The savings refer only to consumers who are affected by a standard at a given TSL. Those who already purchase a product with efficiency at or above a given TSL are not affected. Consumers for whom the LCC increases at a given TSL experience a net cost.
DOE conducted a sensitivity analysis to determine the potential impacts to consumers for a scenario in which manufacturers increase their manufacturer selling price in order to pass through to consumers their conversion costs at TSL 1 and TSL 2. At TSL 1 and TSL 2, DOE estimates no incremental installed costs to consumers because the assumed design options (
In the consumer subgroup analysis, DOE estimated the impact of the considered TSLs on low-income households and small businesses. Table V.12 through
Table V.16 compare the average LCC savings and PBP at each efficiency level for the two consumer subgroups, along with the average LCC savings for the entire sample for all the product classes. For standard, hugger, and VSD ceiling fans, the average LCC savings and PBP for low-income households at the considered efficiency levels are not substantially different from the averages for all households. For HSSD and large-diameter ceiling fans, the average savings and PBP for small businesses at the considered efficiency levels show moderate differences from the averages for all businesses, but the differences are not significant enough to recommend a different standard level be adopted. Chapter 11 of the final rule TSD presents the complete LCC and PBP results for the subgroups.
As discussed in section IV.F.8, EPCA establishes a rebuttable presumption that an energy conservation standard is economically justified if the increased purchase cost for a product that meets the standard is less than three times the value of the first-year energy savings resulting from the standard. In calculating a rebuttable presumption payback period for each of the considered TSLs, DOE used discrete values, and, as required by EPCA, based the energy use calculation on the DOE test procedures for ceiling fans. In contrast, the PBPs presented in section V.B.1.a were calculated using distributions that reflect the range of energy use in the field.
Table V.17 presents the rebuttable-presumption payback periods for the considered TSLs for ceiling fans. While DOE examined the rebuttable-presumption criterion, it considered whether the standard levels considered for this rule are economically justified through a more detailed analysis of the economic impacts of those levels, pursuant to 42 U.S.C. 6295(o)(2)(B)(i), that considers the full range of impacts to the consumer, manufacturer, Nation, and environment. The results of that analysis serve as the basis for DOE to evaluate the economic justification for a potential standard level, thereby supporting or rebutting the results of any preliminary determination of economic justification.
DOE performed an MIA to estimate the impact of amended energy conservation standards on manufacturers of ceiling fans. This section describes the expected impacts on manufacturers at each TSL. Chapter 12 of the final rule TSD explains the analysis in further detail.
Table V.18 through Table V.20 present the financial impacts, represented by changes in INPV, of amended standards on ceiling fan manufacturers as well as the conversion costs that DOE estimates ceiling fan manufacturers would incur at each TSL. To evaluate the range of cash-flow impacts on the ceiling fan industry, DOE modeled three manufacturer markup scenarios that correspond to the range of anticipated market responses to amended standards. Each scenario results in a unique set of cash flows and corresponding industry values at each TSL.
In the following discussion, the INPV results refer to the difference in industry value between the no-new-standards case and each TSL in the standards cases. INPV is calculated by summing the discounted cash flows from the reference year (2016) through the end of the analysis period (2049). INPV values vary by the manufacturer markup scenario modeled to produce them. DOE believes that these manufacturer markup scenarios are most likely to capture the range of impacts on ceiling fan manufacturers as a result of the amended energy conservation standards. The results also discuss the difference in cash flows between the no-new-standards case and the standards cases in the year before the compliance date of amended standards. This difference in cash flow represents the size of the required conversion costs at each TSL relative to the cash flow generated by the ceiling fan industry in the absence of amended energy conservation standards.
To assess the upper (less severe) bound on the range of potential impacts on ceiling fan manufacturers, DOE modeled a preservation of gross margin, or flat, markup scenario. This scenario assumes that in the standards cases, manufacturers would be able to pass along the higher production costs required for more efficient products to their consumers. Specifically, the industry would be able to maintain its average no-new-standards case gross margin (as a percentage of revenue) despite the higher product costs in the standards cases. In general, the larger the product price increases, the less likely manufacturers are to achieve the cash flow from operations calculated in this manufacturer markup scenario because it is less likely that manufacturers would be able to fully mark up these larger cost increases.
To assess the lower (more severe) bound on the range of potential impacts on ceiling fan manufacturers, DOE modeled two additional manufacturer markup scenarios; a preservation of operating profit markup scenario and a two-tiered markup scenario. In the preservation of operating profit markup scenario manufacturers are not able to yield additional operating profit from higher production costs and the investments that are required to comply with amended ceiling fan energy conservation standards, but instead are only able to maintain the same operating profit in the standards cases that was earned in the no-new-standards case. This scenario represents a potential lower bound on the range of impacts on manufacturers because manufacturers are only able to maintain the operating profit that they would have earned in the no-new-standards case despite higher production costs and investments. Manufacturers must therefore, reduce margins as a result of this manufacturer markup scenario, which reduces profitability.
DOE also modeled a two-tiered markup scenario as a potential lower (more severe) bound on the range of potential impacts on ceiling fan manufacturers. In this manufacturer markup scenario, manufacturers have two tiers of markups that are differentiated, in part, by efficiency level. The higher efficiency tiers typically earn premiums (for the manufacturer) over the baseline efficiency tier. Several manufacturers suggested that amended standards would lead to a reduction in premium markups and reduce the profitability of higher efficiency products. During the MIA interviews, manufacturers provided information on the range of typical efficiency levels in those tiers and the change in profitability at each level. DOE used this information to estimate markups for ceiling fans under a two-tiered pricing strategy in the no-new-standards case. In the standards cases, DOE modeled the situation in which standards result in less product
TSL 1 sets the efficiency level at EL 1 for all ceiling fans. At TSL 1, DOE estimates that impacts on INPV range from −$10.7 million to $21.2 million, or changes in INPV of −0.9 percent to 1.8 percent. At TSL 1, industry free cash flow (operating cash flow minus capital expenditures) is expected to decrease by approximately 6.3 percent to $69.9 million, compared to the no-new-standards case value of $74.6 million in 2019, the year leading up to the standards.
Percentage impacts on INPV are slightly negative to slightly positive at TSL 1. DOE estimates that 77 percent of standard and hugger ceiling fan shipments, 96 percent of VSD ceiling fan shipments, 55 percent of HSSD ceiling fan shipments, and 95 percent of large-diameter ceiling fan shipments would meet or exceed the efficiency levels required at TSL 1.
DOE expects conversion costs to be small at TSL 1 because most of the ceiling fan shipments, on a total volume basis, already meet or exceed the efficiency levels required at TSL 1. DOE estimates that ceiling fan manufacturers will incur a total of $12.3 million in conversion costs at TSL 1 based on estimates for product conversion costs and capital conversion costs. DOE estimates that ceiling fan manufacturers will incur $5.1 million in product conversion costs as they must develop and redesign any ceiling fan models that do not meet the efficiency levels required at TSL 1. DOE estimates that manufacturers will incur $7.1 million in capital conversion costs at TSL 1, as ceiling fan manufacturers most likely will need to purchase new tooling for any redesigned models.
At TSL 1, the shipment-weighted average MPC for all ceiling fans increases by approximately 1.5 percent relative to the no-new-standards case shipment-weighted average MPC for all ceiling fans in 2020, the year of compliance for amended ceiling fan energy conservation standards. In the preservation of gross margin markup scenario, manufacturers are able to fully pass on this slight cost increase to consumers. The slight increase in the shipment-weighted average MPC for all ceiling fans outweighs the $12.3 million in conversion costs, causing a slightly positive change in INPV at TSL 1 under the preservation of gross margin markup scenario.
Under the preservation of operating profit markup scenario, manufacturers earn the same operating profit as would be earned in the no-new-standards case, but manufacturers do not earn additional profit from their investments. The average manufacturer markup for both the preservation of operating profit and two-tiered markup scenarios is calculated by averaging the ceiling fan industry manufacturer markup, for all ceiling fan product classes in aggregate, from the year of compliance (2020) until
Under the two-tiered markup scenario, where manufacturers earn different markups for more efficient products, the average manufacturer markup increases from 1.370 in the no-new-standards case to 1.373 at TSL 1 as more shipments are purchased at the higher markup efficiency tiers. The increase in the average manufacturer markup and the increase in the shipment-weighted average MPC for all ceiling fans outweigh the $12.3 million in conversion costs, causing a slightly positive change in INPV at TSL 1 under the two-tiered markup scenario.
TSL 2 sets the efficiency level at EL 1 for VSD, HSSD, and large-diameter ceiling fans and EL 2 for standard and hugger ceiling fans. At TSL 2, DOE estimates that impacts on INPV range from −$23.0 million to $64.3 million, or changes in INPV of −1.9 percent to 5.3 percent. At this TSL, industry free cash flow is estimated to decrease by approximately 11.5 percent to $66.0 million, compared to the no-new-standards case value of $74.6 million in 2019.
Percentage impacts on INPV range from slightly negative to slightly positive at TSL 2. DOE projects that in 2020, 55 percent of standard and hugger ceiling fan shipments, 96 percent of VSD ceiling fan shipments, 55 percent of HSSD ceiling fan shipments, and 95 percent of large-diameter ceiling fan shipments would meet or exceed the efficiency levels required at TSL 2.
DOE expects conversion costs to be moderate at TSL 2 because most of the ceiling fan shipments, on a total volume basis, currently meet or exceed the efficiency levels analyzed at TSL 2. DOE estimates that manufacturers will incur a total of $22.5 million in conversion costs at TSL 2. DOE estimates that manufacturers will incur $9.4 million in product conversion costs at TSL 2 as manufacturers must develop and redesign any ceiling fan models that do not meet the efficiency levels required at TSL 2. Capital conversion costs are estimated to be $13.1 million at TSL 2. Capital conversion costs at TSL 2 are driven by investments in tooling needed to further optimize standard and hugger ceiling fans to meet the efficiency levels required at TSL 2.
At TSL 2, the shipment-weighted average MPC for all ceiling fans increases by approximately 4.2 percent relative to the no-new-standards case shipment-weighted average MPC for all ceiling fans in 2020. In the preservation of gross margin markup scenario, manufacturers are able to recover their $22.5 million in conversion costs over the course of the analysis period through the increase in the shipment-weighted MPC for all ceiling fans, causing a slightly positive change in INPV at TSL 2 under the preservation of gross margin markup scenario.
Under the preservation of operating profit markup scenario, the 4.2 percent increase in the shipment-weighted average MPC for all ceiling fans results in a slight reduction in the average manufacturer markup, from 1.370 in the no-new-standards case to 1.365 at TSL 2. The slight reduction in the average manufacturer markup and $22.5 million in conversion costs cause a slightly negative change in INPV at TSL 2 under the preservation of operating profit scenario.
Under the two-tiered markup scenario, the average manufacturer markup increases from 1.370 in the no-new-standards case to 1.377 at TSL 2 as more shipments are purchased at the higher markup efficiency tiers. The increase in the average manufacturer markup and the increase in the shipment-weighted average MPC for all ceiling fans outweigh the $22.5 million in conversion costs, causing a slightly positive change in INPV at TSL 2 under the two-tiered markup scenario.
TSL 3 sets the efficiency level at EL 2 for VSD ceiling fans and EL 3 for standard, hugger, HSSD, and large-diameter ceiling fans. At TSL 3, DOE estimates that impacts on INPV range from −$103.7 million to $1.6 million, or changes in INPV of −8.6 percent to 0.1 percent. At this level, industry free cash flow is estimated to decrease by approximately 50.1 percent to $37.2 million, compared to the no-new-standards case value of $74.6 million in 2019.
Percentage impacts on INPV range from moderately negative to slightly positive at TSL 3. DOE projects that in 2020, 32 percent of standard and hugger ceiling fan shipments, 96 percent of VSD ceiling fan shipments, 11 percent of HSSD ceiling fan shipments, and 31 percent of large-diameter ceiling fan shipments would meet or exceed the efficiency levels analyzed at TSL 3.
DOE expects higher conversion costs at TSL 3 than at lower TSLs because manufacturers will be required to redesign and retest a significant portion of their ceiling fan models that do not meet the efficiency levels required at this TSL. DOE estimates that manufacturers will incur $31.7 million in product conversion costs at TSL 3 as manufacturers must research, develop, and redesign numerous ceiling fan models to meet the efficiency levels required at TSL 3. Capital conversion costs are estimated to be $63.0 million at TSL 3. Capital conversion costs at TSL 3 are driven by retooling costs associated with producing redesigned standard, hugger, and VSD ceiling fans with larger direct drive motors; HSSD ceiling fans with air foil blades; and large-diameter ceiling fans with premium AC motors and airfoil blades.
At TSL 3, the shipment-weighted average MPC increases by approximately 11.5 percent for all ceiling fans relative to the no-new-standards case MPC in 2020. In the preservation of gross margin markup scenario, manufacturers are able to recover their $94.7 million in conversion costs through the moderate increase in MPC over the course of the analysis period causing a slightly positive change in INPV at TSL 3 under the preservation of gross margin markup scenario.
Under the preservation of operating profit markup, the 11.5 percent MPC increase for all ceiling fans results in a reduction in manufacturer markup after the compliance year, from 1.370 in the no-new-standards case to 1.356 at TSL 3. This reduction in manufacturer markup and $94.7 million in conversion costs incurred by manufacturers cause a moderately negative change in INPV at TSL 3 under the preservation of operating profit scenario.
Under the two-tiered markup scenario, the average manufacturer markup decreases from 1.370 in the no-new-standards case to 1.359 at TSL 3. At TSL 3 under the two-tiered markup scenario, manufacturers reduce their markups on their more efficient shipments, as these premium products are no longer able to earn higher markups as they become the baseline due to standards. The decrease in the average manufacturer markup and the $94.7 million in conversion costs incurred by manufacturers outweighs the moderate increase in the shipment-weighted average MPC for all ceiling fans, causing a moderately negative change in INPV at TSL 3 under the two-tiered markup scenario.
TSL 4 sets the efficiency level at EL 2 for VSD ceiling fans; EL 3 for standard, hugger, and large-diameter ceiling fans; and EL 4 for HSSD ceiling fans. At TSL 4, DOE estimates impacts
Percentage impacts on INPV range from moderately negative to slightly negative at TSL 4. DOE projects that in 2020, 32 percent of standard and hugger ceiling fan shipments, 96 percent of VSD ceiling fan shipments, 8 percent of HSSD ceiling fan shipments, and 31 percent of large-diameter ceiling fan shipments would meet or exceed efficiency levels analyzed at TSL 4.
For TSL 4, DOE concluded that manufacturers would likely use DC motors in the HSSD ceiling fan product class. DOE estimates that manufacturers will incur a total of $99.9 million in conversion costs at TSL 4. DOE estimates that manufacturers will incur $33.2 million in product conversion costs at TSL 4 as manufacturers must research, develop, and redesign numerous ceiling fan models to meet the efficiency levels required at TSL 4. Capital conversion costs are estimated to be $66.7 million at TSL 4. Capital conversion costs at TSL 4 are driven by retooling costs associated with producing redesigned standard, hugger, and VSD ceiling fans with larger direct drive motors; HSSD ceiling fans with DC motors and airfoil blades; and large-diameter ceiling fans with premium AC motors and airfoil blades.
At TSL 4, the shipment-weighted average MPC for all ceiling fans increases by approximately 12.8 percent relative to the no-new-standards case shipment-weighted average MPC for all ceiling fans in 2020. In the preservation of gross margin markup scenario, manufacturers are not able to recover their $99.9 million in conversion costs over the course of the analysis period through the moderate increase in the shipment-weighted average MPC for all ceiling fans, causing a slightly negative change in INPV at TSL 4 under the preservation of gross margin markup scenario.
Under the preservation of operating profit markup scenario, the 12.8 percent increase in the shipment-weighted average MPC for all ceiling fans results in a reduction of the average manufacturer markup, from 1.370 in the no-new-standards case to 1.355 at TSL 4. The reduction of the average manufacturer markup and $99.9 million in conversion costs cause a moderately negative change in INPV at TSL 4 under the preservation of operating profit scenario.
Under the two-tiered markup scenario, the increase in the shipment-weighted average MPC for all ceiling fans results in a reduction of the average manufacturer markup, from 1.370 in the no-new-standards case to 1.359 at TSL 4. At TSL 4 under the two-tiered markup scenario, manufacturers reduce their markups on their more efficient shipments, as these premium products are no longer able to earn higher markups as they become the baseline due to standards. The decrease in the average manufacturer markup and the $99.9 million in conversion costs outweigh the increase in the shipment-weighted average MPC for all ceiling fans, causing a moderately negative change in INPV at TSL 4 under the two-tiered markup scenario.
TSL 5 represents max-tech for all ceiling fan product classes. This TSL sets the efficiency level at EL 3 for VSD ceiling fans and EL 4 for standard, hugger, HSSD, and large-diameter ceiling fans. At TSL 5, DOE estimates that impacts on INPV range from −$284.8 million to $53.8 million, or changes in INPV of −23.5 percent to 4.4 percent. At this level, industry free cash flow is estimated to decrease by approximately 83.4 percent to $12.4 million, compared to the no-new-standards case value of $74.6 million in 2019.
Percentage impacts on INPV range from significantly negative to slightly positive at TSL 5. DOE projects that in 2020, 3 percent of standard ceiling fan shipments, 4 percent of hugger ceiling fan shipments, no VSD ceiling fan shipments, 8 percent of HSSD ceiling fan shipments, and 17 percent of large-diameter ceiling fan shipments would meet the efficiency levels analyzed at TSL 5.
DOE estimates that manufacturers will incur a total of $155.9 million in conversion costs at TSL 5. DOE estimates that manufacturer will incur $46.5 million in product conversion costs at TSL 5 as manufacturers must research, develop, and redesign the vast majority of their ceiling fan models to meet the efficiency levels required at TSL 5. Capital conversion costs are estimated to be $109.5 million at TSL 5, driven by retooling costs associated with producing redesigned, max-tech standard, hugger, and VSD ceiling fans with DC motors; and HSSD and large-diameter ceiling fans with DC motors and airfoil blades.
At TSL 5, the shipment-weighted average MPC for all ceiling fans significantly increases by approximately 45.1 percent relative to the no-new-standards case shipment-weighted average MPC for all ceiling fans in 2020. In the preservation of gross margin markup scenario, manufacturers are able to recover their $155.9 million in conversion costs over the course of the analysis period through the significant increase in the shipment-weighted average MPC for all ceiling fans, causing a positive change in INPV at TSL 5 under the preservation of gross margin markup scenario.
Under the preservation of operating profit markup scenario, the 45.1 percent increase in the shipment-weighted MPC for all ceiling fans results in a reduction of the average manufacturer markup, from 1.370 in the no-new-standards case to 1.332 at TSL 5. The reduction of the average manufacturer markup and $155.9 million in conversion costs cause a significantly negative change in INPV at TSL 5 under the preservation of operating profit markup scenario.
Under the two-tiered markup scenario, the 45.1 percent increase in the shipment-weighted average MPC for all ceiling fans results in a reduction of the average manufacturer markup, from 1.370 in the no-new-standards case to 1.359 at TSL 5. At TSL 5 under the two-tiered markup scenario, manufacturers reduce their markups on their more efficient shipments, as these premium products are no longer able to earn higher markups as they become the baseline due to standards. The decrease in the average manufacturer markup and $155.9 million in conversion costs outweigh the increase in the shipment-weighted average MPC for all ceiling fans, causing a slightly negative change in INPV at TSL 5 under the two-tiered markup scenario.
DOE quantitatively assessed the impacts of amended energy conservation standards on direct employment in the ceiling fan industry. DOE used the GRIM to estimate the domestic labor expenditures and number of domestic production workers in the no-new-standards case and at each TSL from 2016 to 2049. DOE used statistical data from the U.S. Census Bureau's 2014 Annual Survey of Manufacturers, the results of the engineering analysis, and interviews with manufacturers to determine the inputs necessary to calculate industry-wide labor expenditures and domestic employment levels. Labor expenditures involved with the manufacturing of the product are a function of the labor intensity of the product, the sales volume, and an assumption that wages remain fixed in real terms over time.
In the GRIM, DOE used the labor content of ceiling fans and the MPCs to estimate the annual labor expenditures
The production worker estimates in this section only cover workers up to the line-supervisor level directly involved in fabricating and assembling a product within a manufacturing facility. Workers performing services that are closely associated with production operations, such as material handing with a forklift, are also included as production labor. DOE's estimates account for production workers who manufacture only the specific products covered by this rulemaking.
Table V.21 represents the potential impacts the amended standards could have on domestic production employment. The upper bound of the results estimates the maximum change in the number of production workers that could occur after compliance with amended energy conservation standards when assuming that manufacturers continue to produce the same scope of covered products in the same production facilities. It also assumes that domestic production does not shift to lower labor-cost countries. Because there is a real risk of manufacturers evaluating sourcing and production facility location decisions in response to amended energy conservation standards, the lower bound of the employment results estimate the maximum decrease in domestic production workers in the industry if some or all existing production was moved outside of the United States. While the results present a range of estimates, the following sections also include qualitative discussions of the employment impacts at the various TSLs. Finally, the domestic production employment impacts shown are independent of the employment impacts from the broader U.S. economy, documented in chapter 17 of the final rule TSD.
DOE estimates that in the absence of amended energy conservation standards, there would be approximately 33 domestic production workers involved in manufacturing ceiling fans in 2020. Table V.21 presents the range of potential impacts of amended energy conservation standards on U.S. production workers in the ceiling fan industry.
At the upper end of the employment impact range, DOE expects there to be slight or no negative impacts on domestic production employment at each of the TSLs. Slight negative impacts on domestic production employment at higher TSLs are driven by the reduction in total ceiling fan shipments. DOE included price elasticity as part of the shipments analysis, so as the average price of ceiling fans increases due to amended standards, fewer ceiling fans would be sold. Therefore, the amount of labor associated with these fewer shipments also decreases. It is important to note that while the average total MPC increases for more efficient ceiling fans, the increase in MPC is almost entirely attributed to the increase in the material costs used to produce more efficient fans. The amount of labor associated with producing more efficient ceiling fans remains virtually the same even as the total MPC of a ceiling fan increases at higher efficiency levels.
At the lower end of the range, DOE models a situation where all domestic employment associated with ceiling fan production moves abroad as a result of energy conservation standards. The majority of manufacturers that have domestic production produce large-diameter ceiling fans. Moving production of large-diameter fans abroad would result in significantly high shipping costs. Based on the prohibitive shipping costs and manufacturer feedback, DOE does not expect the impacts on domestic production employment to approach the lower bound at any TSL.
At TSL 4, the TSL adopted in today's final rule, DOE concludes that, based on the shipment analysis, manufacturer interviews, and the results of the direct domestic employment analysis, manufacturers could face a slight negative impact on domestic production employment due to a slight reduction in overall ceiling fan shipments in 2020.
Ceiling fan manufacturers stated that they anticipate manufacturing capacity constraints if all ceiling fans are required to use DC motors to comply with the amended energy conservation standards. DOE learned during interviews that manufacturers primarily source motors for ceiling fans from either ceiling fan original equipment manufacturers or directly from motor manufacturers and then insert them into their ceiling fan models. During interviews, manufacturers stated that demand for DC motors may outpace supply if DC motors are required for all ceiling fans to comply with amended standards. Manufacturers expressed concern during interviews that currently only a few ceiling fan shipments incorporate DC motors, and there would be major sourcing concerns if all ceiling fan were required to use DC motors.
Manufacturers would most likely meet the standard required at TSL 4 for the HSSD ceiling fans by using DC motors, HSSD ceiling fans only account for less than 3 percent of all ceiling fan shipments. Therefore, DOE does not anticipate a manufacturer capacity constraint on the supply of DC motors for this small portion of the overall ceiling fan market. DOE expects that the motor manufacturers that supply ceiling fan manufacturers with DC motors would be able to increase production of DC motors in the 3 years from the publication of the final rule to the compliance date of the final rule to meet demand for ceiling fans that require DC motors due to amended standards. DOE does not anticipate any significant impact on the manufacturing capacity as a result of the adopted amended energy conservation standards in this final rule. See section V.C.1 for more details on the standard adopted in this rulemaking.
Using average cost assumptions to develop an industry cash-flow estimate may not be adequate for assessing
While any one regulation may not impose a significant burden on manufacturers, the combined effects of recent or impending regulations may have serious consequences for some manufacturers, groups of manufacturers, or an entire industry. Assessing the impact of a single regulation may overlook this cumulative regulatory burden. Multiple regulations affecting the same manufacturer can strain profits and lead companies to abandon product lines or markets with lower expected future returns than competing products. For these reasons, DOE conducts a cumulative regulatory burden analysis as part of its rulemaking for ceiling fans.
DOE identified a number of requirements, in addition to amended energy conservation standards for ceiling fans, that ceiling fan manufacturers will face for products they manufacture approximately three years leading up to and three years following the compliance date of these amended standards. The following section addresses key related concerns that manufacturers raised during interviews regarding cumulative regulatory burden.
Manufacturers raised concerns about existing regulations and certifications separate from DOE's energy conservation standards that ceiling fan manufacturers must meet. These include California Title 20, which has the same energy conservation standards to DOE's existing ceiling fan standards, but requires an additional certification, and California Air Resources Board Standards limiting the amount of formaldehyde in composite wood used to make fan blades, among others.
DOE discusses these and other requirements in chapter 12 of the final rule TSD, which lists the estimated compliance costs of those requirements when available. In considering the cumulative regulatory burden, DOE evaluates the timing of regulations that affect the same product, because the coincident requirements could strain financial resources in the same profit center and consequently affect capacity. DOE also identified the ceiling fan light kit standards rulemaking as a source of additional cumulative regulatory burden on ceiling fan manufacturers.
DOE has published a final rule pertaining to energy conservation standards for ceiling fan light kits. 81 FR 581 The ceiling fan light kit standard affects the majority of ceiling fan manufacturers and will require manufacturers impacted by both standards to make investments to bring both ceiling fan light kits and ceiling fans into compliance during the same time period. Additionally, redesigned ceiling fan light kits could potentially require adjustments to ceiling fan redesigns that are separate from those potentially required by the amended ceiling fan rule.
In addition to the amended energy conservation standards on ceiling fans, several other existing and pending Federal regulations may apply to other products produced by ceiling fan manufacturers. DOE acknowledges that each regulation can affect a manufacturer's financial operations. Multiple regulations affecting the same manufacturer can strain manufacturers' profit and possibly cause them to exit particular markets. Table V.22 presents other DOE energy conservation standards that could also affect ceiling fan manufacturers in the three years leading up to and after the compliance date of amended energy conservation standards for these products.
DOE did not receive any data on other regulatory costs that affect the industry modeled in the cash-flow analysis.
To estimate the energy savings attributable to potential standards for ceiling fans, DOE compared their energy consumption under the no-new-standards case to their anticipated energy consumption under each TSL. The savings are measured over the entire lifetime of products purchased in the 30-year period that begins in the first full year of anticipated compliance with amended standards (2020-2049). Table V.23 presents DOE's projections of the national energy savings for each TSL considered for ceiling fans. The savings were calculated using the approach described in section IV.H.1 of this notice.
OMB Circular A-4
DOE estimated the cumulative NPV of the total costs and savings for consumers that would result from the TSLs considered for ceiling fans. In accordance with OMB's guidelines on regulatory analysis,
The NPV results based on the aforementioned 9-year analytical period are presented in Table V.26. The impacts are counted over the lifetime of products purchased in 2020-2028. As mentioned previously, such results are presented for informational purposes only and are not indicative of any change in DOE's analytical methodology or decision criteria.
The above results reflect the use of a default trend to estimate the change in price for ceiling fans over the analysis period (see section IV.G of this document). DOE also conducted a sensitivity analysis that considered one scenario with no price decline. The results of these alternative cases are presented in appendix 10C of the NOPR TSD.
DOE expects energy conservation standards for ceiling fans to reduce energy bills for consumers of those products, with the resulting net savings being redirected to other forms of economic activity. These expected shifts in spending and economic activity could affect the demand for labor. As described in section IV.N of this document, DOE used an input/output model of the U.S. economy to estimate indirect employment impacts of the TSLs that DOE considered in this rulemaking. DOE understands that there are uncertainties involved in projecting employment impacts, especially changes in the later years of the analysis. Therefore, DOE generated results for near-term timeframes (2020-2025), where these uncertainties are reduced.
The results suggest that the adopted standards are likely to have a negligible impact on the net demand for labor in the economy. The net change in jobs is so small that it would be imperceptible in national labor statistics and might be offset by other, unanticipated effects on employment. Chapter 16 of the final rule TSD presents detailed results regarding anticipated indirect employment impacts.
Based on testing and teardowns conducted in support of this rule as discussed in section IV.C of this notice, DOE has concluded that the standards adopted in this final rule would not reduce the utility or performance of the ceiling fans under consideration in this rulemaking. Manufacturers of these products currently offer units that meet or exceed the adopted standards.
DOE considered any lessening of competition that would be likely to result from new or amended standards. As discussed in section III.E.1.e, the Attorney General of the United States (Attorney General) to determine the impact, if any, of any lessening of competition likely to result from a proposed standard and to transmit such determination in writing to the Secretary within 60 days of the publication of a proposed rule, together with an analysis of the nature and extent of the impact. To assist the Attorney General in making this determination, DOE provided the Department of Justice (DOJ) with copies of the NOPR and the TSD for review. In its assessment letter responding to DOE, DOJ concluded that the proposed energy conservation standards for ceiling fans are unlikely to have a significant adverse impact on competition. DOE is publishing the Attorney General's assessment at the end of this final rule.
Enhanced energy efficiency, where economically justified, improves the Nation's energy security, strengthens the economy, and reduces the environmental impacts (costs) of energy production. Reduced electricity demand due to energy conservation standards is also likely to reduce the cost of maintaining the reliability of the electricity system, particularly during peak-load periods. As a measure of this reduced demand, chapter 15 in the final rule TSD presents the estimated reduction in generating capacity, relative to the no-new-standards case, for the TSLs that DOE considered in this rulemaking.
Energy conservation resulting from amended standards for ceiling fans is expected to yield environmental benefits in the form of reduced emissions of air pollutants and greenhouse gases. Table V.27 provides DOE's estimate of cumulative emissions reductions expected to result from the TSLs considered in this rulemaking. The table includes both power sector emissions and upstream emissions. The emissions were calculated using the multipliers discussed in section IV.K. DOE reports annual emissions reductions for each TSL in chapter 13 of the final rule TSD.
As part of the analysis for this rule, DOE estimated monetary benefits likely to result from the reduced emissions of CO
Table V.28 presents the global value of CO
DOE is well aware that scientific and economic knowledge about the contribution of CO
DOE also estimated the cumulative monetary value of the economic benefits associated with NO
The Secretary of Energy, in determining whether a standard is economically justified, may consider any other factors that the Secretary deems to be relevant. (42 U.S.C. 6295(o)(2)(B)(i)(VII)) No other factors were considered in this analysis.
The NPV of the monetized benefits associated with emissions reductions can be viewed as a complement to the NPV of the consumer savings calculated for each TSL considered in this rulemaking. Table V.30 presents the NPV values that result from adding the estimates of the potential economic benefits resulting from reduced CO
In considering the above results, two issues are relevant. First, the national operating cost savings are domestic U.S. monetary savings that occur as a result of market transactions, while the value of CO
When considering new or amended energy conservation standards, the standards that DOE adopts for any type (or class) of covered product must be designed to achieve the maximum improvement in energy efficiency that the Secretary determines is technologically feasible and economically justified. (42 U.S.C. 6295(o)(2)(A)) In determining whether a standard is economically justified, the Secretary must determine whether the benefits of the standard exceed its burdens by, to the greatest extent practicable, considering the seven statutory factors discussed previously. (42 U.S.C. 6295(o)(2)(B)(i)) The new or amended standard must also result in significant conservation of energy. (42 U.S.C. 6295(o)(3)(B))
For this final rule, DOE considered the impacts of amended standards for ceiling fans at each TSL, beginning with the maximum technologically feasible level, to determine whether that level was economically justified. Where the max-tech level was not justified, DOE then considered the next most efficient level and undertook the same evaluation until it reached the highest efficiency level that is both technologically feasible and economically justified and saves a significant amount of energy.
To aid the reader as DOE discusses the benefits and/or burdens of each TSL, tables in this section present a summary of the results of DOE's quantitative analysis for each TSL. In addition to the quantitative results presented in the tables, DOE also considers other burdens and benefits that affect economic justification. These include the impacts on identifiable subgroups of consumers who may be disproportionately affected by a national standard and impacts on employment.
DOE also notes that the economics literature provides a wide-ranging discussion of how consumers trade off upfront costs and energy savings in the absence of government intervention. Much of this literature attempts to explain why consumers appear to undervalue energy efficiency improvements. There is evidence that consumers undervalue future energy savings (or appear to do so) as a result of (1) a lack of information; (2) a lack of sufficient salience of the long-term or aggregate benefits; (3) a lack of sufficient savings to warrant delaying or altering purchases; (4) excessive focus on the short term, in the form of inconsistent weighting of future energy cost savings relative to available returns on other investments; (5) computational or other difficulties associated with the evaluation of relevant tradeoffs; and (6) a divergence in incentives (for example, between renters and owners, or builders and purchasers). Having less than perfect foresight and a high degree of uncertainty about the future, consumers may trade off these types of investments at a higher than expected rate between current consumption and uncertain future energy cost savings.
In DOE's current regulatory analysis, potential changes in the benefits and costs of a regulation due to changes in consumer purchase decisions are included in two ways. First, if consumers forego the purchase of a
While DOE is not prepared at present to provide a fuller quantifiable framework for estimating the benefits and costs of changes in consumer purchase decisions due to an energy conservation standard, DOE is committed to developing a framework that can support empirical quantitative tools for improved assessment of the consumer welfare impacts of appliance standards. DOE has posted a paper that discusses the issue of consumer welfare impacts of appliance energy conservation standards, and potential enhancements to the methodology by which these impacts are defined and estimated in the regulatory process.
Table V.31 and Table V.32 summarize the quantitative impacts estimated for each TSL for ceiling fans. The national impacts are measured over the lifetime of ceiling fans purchased in the 30-year period that begins in the anticipated first full year of compliance with amended standards (2020-2049). The energy savings, emissions reductions, and value of emissions reductions refer to full-fuel-cycle results. The efficiency levels contained in each TSL are described in section V.A of this notice.
DOE first considered TSL 5, which represents the max-tech efficiency levels. TSL 5 would save 3.738 quads of energy, an amount DOE considers significant. Under TSL 5, the NPV of consumer benefit would be $7.454 billion using a discount rate of 7 percent, and $21.006 billion using a discount rate of 3 percent.
The cumulative emissions reductions at TSL 5 are 224.66 Mt of CO
At TSL 5, the average LCC impact for affected consumers is a cost of $25.94 for VSD ceiling fans and a savings of $19.20, $26.80, $19.80, and $347.93 for hugger, standard, HSSD and large-diameter ceiling fans, respectively. The simple payback period is 13.4 years for VSD ceiling fans, 4.1 years for hugger ceiling fans, 4.0 years for standard ceiling fans, 6.9 years for HSSD ceiling fans, and 4.3 years for large-diameter ceiling fans. The fraction of consumers experiencing a net LCC cost is 76 percent for VSD ceiling fans, 51 percent for hugger ceiling fans, 50 percent for standard ceiling fans, 39 percent for HSSD ceiling fans, and 16 percent for large-diameter ceiling fans.
At TSL 5, the projected change in INPV ranges from a decrease of $284.8 million to an increase of $53.8 million, which represents a decrease of 23.5 percent and an increase of 4.4 percent.
At TSL 5, the corresponding efficiency levels for all product classes are the max-tech efficiency levels. Specifically for the VSD, hugger, and standard ceiling fan product classes, the percentages of consumers that experience net cost are greater than 50 percent. Additionally, specific to the VSD ceiling fan product class, the average LCC savings in 2015$ for all consumers, and affected consumers relative to no standards case is negative. Manufacturers may experience a loss in INPV of up to 23.5 percent.
The Secretary concludes that at TSL 5, the benefits of energy savings, positive NPV of consumer benefits, emission reductions, and the estimated monetary value of the emissions reductions would be outweighed by the percentage of consumers that experience net cost for the VSD, hugger, and standard ceiling fan product classes, the negative average LCC savings for the VSD ceiling fan product class, and the potential reduction in manufacturer industry value. Consequently, the Secretary has tentatively concluded that TSL 5 is not economically justified.
DOE then considered TSL 4, which corresponds to the maximum NPV with an AC motor for all product classes other than HSSD fans, and maximum NPV for HSSD fans. At this TSL, less than 50 percent of consumers experience a net cost, and large-diameter ceiling fans that provide high levels of airflow are not disproportionally impacted. TSL 4 would save 2.008 quads of energy, an amount DOE considers significant. Under TSL 4, the NPV of consumer benefit would be $4.488 billion using a discount rate of 7 percent, and $12.123 billion using a discount rate of 3 percent.
The cumulative emissions reductions at TSL 4 are 120.24 Mt of CO
At TSL 4, the average LCC impact for affected consumers is a savings of $4.29 for VSD ceiling fans, $21.50 for hugger ceiling fans, $25.78 for standard ceiling fans, $19.80 for HSSD ceiling fans, and $128.90 for large-diameter ceiling fans. The simple payback period is 9.3 years for VSD ceiling fans, 1.8 years for hugger ceiling fans, 1.7 years for standard ceiling fans, 6.9 years for HSSD ceiling fans, and 4.1 years for large-diameter ceiling fans. The fraction of consumers experiencing a net LCC cost is 2 percent for VSD ceiling fans, 28 percent for hugger ceiling fans, 27 percent for standard ceiling fans, 39 percent for HSSD ceiling fans, and 23 percent for large-diameter ceiling fans.
At TSL 4, the projected change in INPV ranges from decreases of $119.4 million to $4.8 million, which represent decreases of 9.9 percent and 0.4 percent, respectively.
For TSL 4, the efficiency levels for each product class correspond to the following: max-tech for HSSD ceiling fan product class, EL 3 for the hugger, standard, and large-diameter ceiling fan product classes, and EL 2 for the very-small diameter ceiling fan product class. Within large-diameter ceiling fans, TSL 4 does not disproportionately impact fans that provide high levels of airflow. At TSL 4, the average LCC savings in 2015$ are positive for all product classes. Also, the fraction of consumers that experience net savings at TSL 4 is greater than the fraction of consumers that experience a net cost. Manufacturers may experience a loss in INPV of up to 9.9 percent.
After considering the analysis and weighing the benefits and burdens, the Secretary has concluded that at TSL 4 for ceiling fans, the benefits of energy savings, positive NPV of consumer benefits, emission reductions, the estimated monetary value of the emissions reductions, and positive average LCC savings would outweigh the negative impacts on some
Therefore, based on the above considerations, DOE adopts the energy conservation standards for ceiling fans at TSL 4. The amended energy conservation standards for ceiling fans, which are expressed as minimum CFM/W, are shown in Table V.33.
The benefits and costs of the adopted standards can also be expressed in terms of annualized values. The annualized net benefit is the sum of (1) the annualized national economic value (expressed in 2015$) of the benefits from operating products that meet the adopted standards (consisting primarily of operating cost savings from using less energy, minus increases in product purchase costs, and (2) the annualized monetary value of the benefits of CO
Table V.34 shows the annualized values for ceiling fans under TSL 4, expressed in 2015$. The results under the primary estimate are as follows.
Using a 7-percent discount rate for benefits and costs other than CO
Using a 3-percent discount rate for all benefits and costs and the average SCC series corresponding to a value of $40.6/t in 2015 (in 2015$), the estimated cost of the adopted standards for ceiling fans is $243.2 million per year in increased equipment costs, while the estimated annual benefits are $919.0 million in reduced operating costs, $214.1 million in CO
Section 1(b)(1) of Executive Order 12866, “Regulatory Planning and Review,” 58 FR 51735 (Oct. 4, 1993), requires each agency to identify the problem that it intends to address, including, where applicable, the failures of private markets or public institutions that warrant new agency action, as well as to assess the significance of that problem. The problems that the adopted standards for ceiling fans are intended to address are as follows:
(1) Insufficient information and the high costs of gathering and analyzing relevant information leads some consumers to miss opportunities to make cost-effective investments in energy efficiency.
(2) In some cases the benefits of more efficient equipment are not realized due to misaligned incentives between purchasers and users. An example of such a case is when the equipment purchase decision is made by a building contractor or building owner who does not pay the energy costs.
(3) There are external benefits resulting from improved energy efficiency of appliances that are not captured by the users of such equipment. These benefits include externalities related to public health, environmental protection and national energy security that are not reflected in energy prices, such as reduced emissions of air pollutants and greenhouse gases that impact human health and global warming. DOE attempts to qualify some of the external benefits through use of social cost of carbon values.
The Administrator of the Office of Information and Regulatory Affairs (OIRA) in the OMB has determined that the regulatory action in this document is a significant regulatory action under section (3)(f) of Executive Order 12866. Accordingly, pursuant to section 6(a)(3)(B) of the Order, DOE has provided to OIRA: (i) The text of the draft regulatory action, together with a reasonably detailed description of the need for the regulatory action and an explanation of how the regulatory action will meet that need; and (ii) an assessment of the potential costs and benefits of the regulatory action, including an explanation of the manner in which the regulatory action is consistent with a statutory mandate. DOE has included these documents in the rulemaking record.
In addition, the Administrator of OIRA has determined that the regulatory action is an “economically” significant regulatory action under section (3)(f)(1) of Executive Order 12866. Accordingly, pursuant to section 6(a)(3)(C) of the Order, DOE has provided to OIRA an assessment, including the underlying analysis, of benefits and costs anticipated from the regulatory action, together with, to the extent feasible, a quantification of those costs; and an assessment, including the underlying analysis, of costs and benefits of potentially effective and reasonably feasible alternatives to the planned regulation, and an explanation why the planned regulatory action is preferable to the identified potential alternatives. These assessments can be found in the technical support document for this rulemaking.
DOE has also reviewed this regulation pursuant to Executive Order 13563, issued on January 18, 2011. 76 FR 3281, Jan. 21, 2011. EO 13563 is supplemental to and explicitly reaffirms the principles, structures, and definitions governing regulatory review established in Executive Order 12866. To the extent permitted by law, agencies are required by Executive Order 13563 to (1) propose or adopt a regulation only upon a reasoned determination that its benefits justify its costs (recognizing that some benefits and costs are difficult to quantify); (2) tailor regulations to impose the least burden on society, consistent with obtaining regulatory objectives, taking into account, among other things, and to the extent practicable, the costs of cumulative regulations; (3) select, in choosing among alternative regulatory approaches, those approaches that maximize net benefits (including
DOE emphasizes as well that Executive Order 13563 requires agencies to use the best available techniques to quantify anticipated present and future benefits and costs as accurately as possible. In its guidance, OIRA has emphasized that such techniques may include identifying changing future compliance costs that might result from technological innovation or anticipated behavioral changes. For the reasons stated in the preamble, DOE believes that this final rule is consistent with these principles, including the requirement that, to the extent permitted by law, benefits justify costs.
The Regulatory Flexibility Act (5 U.S.C. 601
A description of the need for, and objectives of, this rule is set forth elsewhere in the preamble and not repeated here.
DOE did not receive comments in response to the IRFA. Comments on the economic impacts of amended standards are addressed in section IV.J.2.a and section IV.J.3 and did not result in significant changes to the FRFA.
The SBA's Chief Counsel for Advocacy did not submit comments on this rulemaking.
For manufacturers of ceiling fans, the SBA has set a size threshold, which defines those entities classified as “small businesses” for the purposes of the statute. DOE used the SBA's small business size standards to determine whether any small entities would be subject to the requirements of the rule. See 13 CFR part 121. The size standards are listed by North American Industry Classification System (NAICS) code and industry description available at:
To estimate the number of companies that manufacture ceiling fans covered by this rulemaking, DOE conducted a market survey using publicly available information. DOE first attempted to identify all ceiling fan manufacturers by researching industry trade associations (
For ceiling fans, DOE identified 66 companies that sell ceiling fans covered by this rulemaking. 25 of these companies are large businesses with more than 1,500 total employees or are foreign-owned and operated. DOE determined that of the remaining 41 companies with less than 1,500 employees, only six companies are small businesses that maintain domestic production facilities.
There are six small domestic ceiling fan manufacturers identified. Four small businesses manufacture HSSD ceiling fans and three small businesses manufacture large-diameter ceiling fans (one of these small businesses manufactures both HSSD and large-diameter ceiling fans and are therefore counted in each of these small business counts). To estimate conversion costs for small manufacturers, DOE multiplied an estimate of the number of platforms that would need to be redesigned at TSL 4 by the per-platform conversion cost estimated for the respective type of conversion cost, efficiency level, and product class for each manufacturer. Additionally, DOE obtained company revenue information from publicly available databases such as Hoovers
Leveraging these assumptions, DOE estimated total conversion costs and conversion costs relative to small ceiling fan manufacturers' annual revenues. DOE presents the estimated total conversion costs incurred by small domestic ceiling fan manufacturers at TSL 4 in Table VI.1.
There are four small manufacturers that make HSSD fans. For one of these small manufacturers, their entire HSSD product offerings use DC motors and they should be able to meet the HSSD standard without any modifications to their product offerings. For the other three HSSD small manufacturer, two only offer one HSSD ceiling fan and one only offers five HSSD ceiling fans. These small manufacturers primarily sell commercial, industrial, and/or agricultural fans not covered by this rulemaking. DOE does not believe that HSSD ceiling fan sales significantly contribute to these companies' revenue. HSSD small manufacturers either make compliant HSSD ceiling fans or these HSSD ceiling fans do not comprise a significant portion of their company's revenue. If these manufacturers decide not to invest in making compliant HSSD ceiling fans, DOE does not believe their revenue will be significantly reduced.
There are three small manufacturers that make large-diameter fans. Two of these small manufacturers primarily make ceiling fans that have DC motors and exceed the efficiency levels required for large-diameter ceiling fans at the adopted standard. The last small manufacturer has eight large-diameter ceiling fans that would have to be converted to comply with the adopted standards for this product class. This would require replacing the motor on these eight large-diameter ceiling fans with a more efficient AC motor.
The discussion in section VI.B.5 analyzes impacts on small businesses that would result from DOE's adopted final rule, TSL 4. In reviewing alternatives to the adopted rule, DOE examined energy conservation standards set at higher and lower efficiency levels; TSL 1, TSL 2, TSL 3, and TSL 5.
DOE considered TSL 5, but determined that the 86 percent increase in the energy savings and 66 percent increase in NPV compared to TSL 4 did not justify the total industry conversion costs of $155.9 million, the potential loss of up to 23.5 percent of INPV, and increased burden on small manufacturers.
DOE also considered TSLs lower than the TSL adopted. At TSL 1, the energy savings was reduced by 60 percent and consumer NPV was reduced by 40 percent compared to TSL 4. At TSL 2, the energy savings was reduced by 37 percent and consumer NPV was reduced by 17 percent compared to TSL 4. At TSL 3, the energy savings was reduced by 8 percent and consumer NPV was reduced by 6 percent compared to TSL 4. DOE concludes that establishing standards at TSL 4 balances the benefits of the energy savings and consumer NPV with the potential burdens placed on ceiling fan manufacturers, including small businesses. Accordingly, DOE is declining to adopt one of the other TSLs, or the other policy alternatives detailed as part of the regulatory impacts analysis included in chapter 17 of the final rule TSD.
Additional compliance flexibilities may be available through other means. For example, individual manufacturers may petition for a waiver of the applicable test procedure (see 10 CFR 430.27). Further, EPCA provides that a manufacturer whose annual gross revenue from all of its operations does not exceed $8 million may apply for an exemption from all or part of an energy conservation standard for a period not longer than 24 months after the effective date of a final rule establishing the standard. Additionally, Section 504 of the Department of Energy Organization Act, 42 U.S.C. 7194, provides authority for the Secretary to adjust a rule issued under EPCA in order to prevent “special hardship, inequity, or unfair distribution of burdens” that may be imposed on that manufacturer as a result of such rule. Manufacturers should refer to 10 CFR part 430, subpart E, and 10 CFR part 1003 for additional details.
Manufacturers of ceiling fans must certify to DOE that their products comply with any applicable energy conservation standards. In certifying compliance, manufacturers must test their products according to the DOE test procedures for ceiling fans, including any amendments adopted for those test procedures. DOE has established regulations for the certification and recordkeeping requirements for all covered consumer products and commercial equipment, including ceiling fans. 76 FR 12422 (March 7, 2011); 80 FR 5099 (Jan. 30, 2015). The collection-of-information requirement for the certification and recordkeeping is subject to review and approval by OMB under the Paperwork Reduction Act (PRA). This requirement has been approved by OMB under OMB control number 1910-1400. Public reporting burden for the certification is estimated to average 30 hours per response, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information.
Notwithstanding any other provision of the law, no person is required to respond to, nor shall any person be subject to a penalty for failure to comply with, a collection of information subject to the requirements of the PRA, unless that collection of information displays a currently valid OMB Control Number.
Pursuant to the National Environmental Policy Act (NEPA) of 1969, DOE has determined that the rule fits within the category of actions included in Categorical Exclusion (CX) B5.1 and otherwise meets the requirements for application of a CX. (See 10 CFR part 1021, App. B, B5.1(b); 1021.410(b) and App. B, B(1)-(5).) The rule fits within this category of actions because it is a rulemaking that establishes energy conservation standards for consumer products or industrial equipment, and for which none of the exceptions identified in CX B5.1(b) apply. Therefore, DOE has made a CX determination for this rulemaking, and DOE does not need to prepare an Environmental Assessment or Environmental Impact Statement for this rule. DOE's CX determination for this rule is available at
Executive Order 13132, “Federalism,” 64 FR 43255 (Aug. 10, 1999) imposes
With respect to the review of existing regulations and the promulgation of new regulations, section 3(a) of Executive Order 12988, “Civil Justice Reform,” imposes on Federal agencies the general duty to adhere to the following requirements: (1) Eliminate drafting errors and ambiguity, (2) write regulations to minimize litigation, (3) provide a clear legal standard for affected conduct rather than a general standard, and (4) promote simplification and burden reduction. 61 FR 4729 (Feb. 7, 1996). Regarding the review required by section 3(a), section 3(b) of Executive Order 12988 specifically requires that Executive agencies make every reasonable effort to ensure that the regulation (1) clearly specifies the preemptive effect, if any, (2) clearly specifies any effect on existing Federal law or regulation, (3) provides a clear legal standard for affected conduct while promoting simplification and burden reduction, (4) specifies the retroactive effect, if any, (5) adequately defines key terms, and (6) addresses other important issues affecting clarity and general draftsmanship under any guidelines issued by the Attorney General. Section 3(c) of Executive Order 12988 requires Executive agencies to review regulations in light of applicable standards in section 3(a) and section 3(b) to determine whether they are met or it is unreasonable to meet one or more of them. DOE has completed the required review and determined that, to the extent permitted by law, this final rule meets the relevant standards of Executive Order 12988.
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) requires each Federal agency to assess the effects of Federal regulatory actions on State, local, and Tribal governments and the private sector. Public Law 104-4, sec. 201 (codified at 2 U.S.C. 1531). For a regulatory action likely to result in a rule that may cause 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 (adjusted annually for inflation), section 202 of UMRA requires a Federal agency to publish a written statement that estimates the resulting costs, benefits, and other effects on the national economy. (2 U.S.C. 1532(a), (b)) The UMRA also requires a Federal agency to develop an effective process to permit timely input by elected officers of State, local, and Tribal governments on a “significant intergovernmental mandate,” and requires an agency plan for giving notice and opportunity for timely input to potentially affected small governments before establishing any requirements that might significantly or uniquely affect them. On March 18, 1997, DOE published a statement of policy on its process for intergovernmental consultation under UMRA. 62 FR 12820. DOE's policy statement is also available at
DOE has concluded that this final rule may require expenditures of $100 million or more in any one year by the private sector. Such expenditures may include (1) investment in research and development and in capital expenditures by ceiling fans manufacturers in the years between the final rule and the compliance date for the new standards and (2) incremental additional expenditures by consumers to purchase higher-efficiency ceiling fans, starting at the compliance date for the applicable standard.
Section 202 of UMRA authorizes a Federal agency to respond to the content requirements of UMRA in any other statement or analysis that accompanies the final rule. (2 U.S.C. 1532(c)) The content requirements of section 202(b) of UMRA relevant to a private sector mandate substantially overlap the economic analysis requirements that apply under section 325(o) of EPCA and Executive Order 12866. The
Under section 205 of UMRA, the Department is obligated to identify and consider a reasonable number of regulatory alternatives before promulgating a rule for which a written statement under section 202 is required. (2 U.S.C. 1535(a)) DOE is required to select from those alternatives the most cost-effective and least burdensome alternative that achieves the objectives of the rule unless DOE publishes an explanation for doing otherwise, or the selection of such an alternative is inconsistent with law. As required by 42 U.S.C. 6295(d), (f), and (o), 6313(e), and 6316(a), In accordance with the statutory provisions discussed in this document, this final rule establishes amended energy conservation standards for ceiling fans that are designed to achieve the maximum improvement in energy efficiency that DOE has determined to be both technologically feasible and economically justified. A full discussion of the alternatives considered by DOE is presented in chapter 17 of the TSD for this final rule.
Section 654 of the Treasury and General Government Appropriations Act, 1999 (Pub. L. 105-277) requires Federal agencies to issue a Family Policymaking Assessment for any rule that may affect family well-being. This rule would not have any impact on the autonomy or integrity of the family as an institution. Accordingly, DOE has concluded that it is not necessary to prepare a Family Policymaking Assessment.
Pursuant to Executive Order 12630, “Governmental Actions and Interference with Constitutionally Protected Property Rights,” 53 FR 8859 (March 18, 1988), DOE has determined that this rule would not result in any takings that might require compensation under the Fifth Amendment to the U.S. Constitution.
Section 515 of the Treasury and General Government Appropriations Act, 2001 (44 U.S.C. 3516, note) provides for Federal agencies to review most disseminations of information to the public under information quality guidelines established by each agency pursuant to general guidelines issued by OMB. OMB's guidelines were published at 67 FR 8452 (Feb. 22, 2002), and DOE's guidelines were published at 67 FR 62446 (Oct. 7, 2002). DOE has reviewed this final rule under the OMB and DOE guidelines and has concluded that it is consistent with applicable policies in those guidelines.
Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use,” 66 FR 28355 (May 22, 2001), requires Federal agencies to prepare and submit to OIRA at OMB, a Statement of Energy Effects for any significant energy action. A “significant energy action” is defined as any action by an agency that promulgates or is expected to lead to promulgation of a final rule, and that (1) is a significant regulatory action under Executive Order 12866, or any successor order; and (2) is likely to have a significant adverse effect on the supply, distribution, or use of energy, or (3) is designated by the Administrator of OIRA as a significant energy action. For any significant energy action, the agency must give a detailed statement of any adverse effects on energy supply, distribution, or use should the proposal be implemented, and of reasonable alternatives to the action and their expected benefits on energy supply, distribution, and use.
DOE has concluded that this regulatory action, which sets forth amended energy conservation standards for ceiling fans, is not a significant energy action because the standards are not likely to have a significant adverse effect on the supply, distribution, or use of energy, nor has it been designated as such by the Administrator at OIRA. Accordingly, DOE has not prepared a Statement of Energy Effects on this final rule.
On December 16, 2004, OMB, in consultation with the Office of Science and Technology Policy (OSTP), issued its Final Information Quality Bulletin for Peer Review (the Bulletin). 70 FR 2664 (Jan. 14, 2005). The Bulletin establishes that certain scientific information shall be peer reviewed by qualified specialists before it is disseminated by the Federal Government, including influential scientific information related to agency regulatory actions. The purpose of the bulletin is to enhance the quality and credibility of the Government's scientific information. Under the Bulletin, the energy conservation standards rulemaking analyses are “influential scientific information,” which the Bulletin defines as “scientific information the agency reasonably can determine will have, or does have, a clear and substantial impact on important public policies or private sector decisions.” Id at FR 2667.
In response to OMB's Bulletin, DOE conducted formal in-progress peer reviews of the energy conservation standards development process and analyses and has prepared a Peer Review Report pertaining to the energy conservation standards rulemaking analyses. Generation of this report involved a rigorous, formal, and documented evaluation using objective criteria and qualified and independent reviewers to make a judgment as to the technical/scientific/business merit, the actual or anticipated results, and the productivity and management effectiveness of programs and/or projects. The “Energy Conservation Standards Rulemaking Peer Review Report” dated February 2007 has been disseminated and is available at the following Web site:
As required by 5 U.S.C. 801, DOE will report to Congress on the promulgation of this rule prior to its effective date. The report will state that it has been determined that the rule is a “major rule” as defined by 5 U.S.C. 804(2).
The Secretary of Energy has approved publication of this final rule.
Administrative practice and procedure, Confidential business information, Energy conservation, Household appliances, Imports, Intergovernmental relations, Reporting and recordkeeping requirements, and Small businesses.
For the reasons set forth in the preamble, DOE amends part 430 of chapter II, subchapter D, of title 10 of the Code of Federal Regulations, as set forth below:
42 U.S.C. 6291-6309; 28 U.S.C. 2461 note.
(s) * * *
(2)(i) Ceiling fans manufactured on or after January 21, 2020 shall meet the requirements shown in the table:
(ii) The provisions in this appendix apply to ceiling fans except:
(A) Ceiling fans where the plane of rotation of a ceiling fan's blades is not less than or equal to 45 degrees from horizontal, or cannot be adjusted based on the manufacturer's specifications to be less than or equal to 45 degrees from horizontal;
(B) Centrifugal ceiling fans, as defined in Appendix U of this part;
(C) Belt-driven ceiling fans, as defined in Appendix U of this part;
(D) Oscillating ceiling fans, as defined in Appendix U of this part; and
(E) Highly-decorative ceiling fans, as defined in Appendix U of this part.
The following letter will not appear in the Code of Federal Regulations.
I am responding to your January 21, 2016, letter seeking the views of the Attorney General about the potential impact on competition of proposed energy conservation standards for ceiling fans.
Your request was submitted under Section 325(o)(2)(B)(i)(V) of the Energy Policy and Conservation Act, as amended, 42 U.S.C. 6295(o)(2)(B)(i)(V), which requires the Attorney General to make a determination of the impact of any lessening of competition that is likely to result from the imposition of proposed energy conservation standards. The Attorney General's responsibility for responding to requests from other departments about the effect of a program on competition has been delegated to the Assistant Attorney General for the Antitrust Division in 28 CFR 0.40(g).
In conducting its analysis, the Antitrust Division examines whether a proposed standard may lessen competition, for example, by substantially limiting consumer choice or increasing industry concentration. A lessening of competition could result in higher prices to consumers.
We have reviewed the proposed standards contained in the Notice of Proposed Rulemaking (81 FR. 1688, January 13, 2016) and the related Technical Support Document. We have also reviewed supplementary information submitted to the Attorney General by the Department of Energy, as well as materials presented at the public meeting held on the proposed standards on February 3, 2016, and have conducted interviews with industry representatives.
Based on the information currently available, we do not believe that the proposed energy conservation standards for ceiling fans are likely to have a significant adverse effect on competition. Our opinion is subject to some uncertainty, in part because manufacturers indicated to us that they cannot reliably determine which of their products will be able to comply with the new standards. The manufacturers understand that a new test procedure will likely be used to determine ceiling fan efficiency performance, and believe that there is insufficient test data using this new test procedure for the manufacturers to be able to predict their ceiling fans' compliance with the proposed standards, particularly in the popular “Standard” and “Hugger” categories.
Sincerely,
Centers for Disease Control and Prevention (CDC), Department of Health and Human Services (HHS).
Final rule.
The Centers for Disease Control and Prevention (CDC), within the Department of Health and Human Services (HHS), is issuing this final rule (FR) to amend its regulations governing its domestic (interstate) and foreign quarantine regulations to best protect the public health of the United States. These amendments have been made to aid public health responses to outbreaks of new or re-emerging communicable diseases and to accord due process to individuals subject to Federal public health orders. In response to public comment received, the updated provisions in this final rule clarify various safeguards to prevent the importation and spread of communicable diseases affecting human health into the United States and interstate.
This rule is effective February 21, 2017.
Director, Division of Global Migration and Quarantine, Centers for Disease Control and Prevention, 1600 Clifton Road NE., MS-E03, Atlanta, GA 30329, or email
Based on public comment received to the Notice of Proposed Rulemaking (NPRM) (81 FR 54230) this final rule, among other things: Withdraws a provision regarding “Agreements” as proposed in the NPRM, requires CDC to issue a federal order within 72 hours after apprehending an individual, increases the threshold for those who may be considered “indigent” to 200% of the applicable poverty guideline, adds a definition for “Secretary,” adds a requirement for CDC to provide legal counsel for isolated or quarantined individuals qualifying as indigent who request a medical review, modifies the definition of “non-invasive,” includes “known or possible exposure” in the list of information that may be collected during a public health risk assessment, and strengthens due process protections by ensuring that CDC will arrange for translation or interpretation services for public health orders and medical reviews as needed. In implementing quarantine, isolation, or other public health measures under this Final Rule, HHS/CDC will seek to use the least restrictive means necessary to prevent the spread of communicable disease.
HHS/CDC has statutory authority (42 U.S.C. 264, 265) to promulgate regulations that protect U.S. public health from communicable diseases, including quarantinable communicable diseases as specified in an Executive Order of the President.
Both the domestic and foreign portions of this regulation include new proposed public health definitions; new regulatory language implementing HHS/CDC's activities concerning non-invasive public health prevention measures (
The domestic portion of this final rule includes a requirement that commercial passenger flights report deaths or illnesses to the CDC. It also includes a provision requiring that individuals apply for a travel permit if they are under a Federal quarantine, isolation, or conditional release order (unless the specific travel is authorized by the Federal conditional release order) or if a State or local public health department requests CDC assistance in enforcing a State or local quarantine or isolation order. Additionally, the domestic portion of this final rule includes new regulatory language clarifying when an individual who is moving between U.S. states is “reasonably believed to be infected” with a quarantinable communicable disease in a “qualifying stage.” These determinations are made when the CDC considers the need to apprehend or examine an individual for potential infection with a quarantinable communicable disease. The foreign portion of this final rule includes new regulatory authority permitting the CDC Director to prohibit the importation of animals or products that pose a threat to public health.
HHS/CDC has also changed the text of the regulation to reflect modern terminology, technology, and plain language used by private industry, public health partners, and the public. The final rule also authorizes public health monitoring through electronic or internet-based means of communication for individuals under a Federal conditional release order who are reasonably believed to be exposed to or infected with a quarantinable communicable disease. This would include communication through email and webcam application tools. Finally, while neither modifying nor authorizing additional criminal penalties for violations of quarantine rules and regulations, this final rule updates regulatory language to align with existing criminal penalties set forth in statute.
The regulatory impact analysis quantitatively addresses the costs and benefits associated with this final rule. The economic impact analysis of this final rule is subdivided into two sections.
The first analysis summarizes the economic impact of changes to 42 CFR 70.1, 42 CFR 71.1/71.4/71.5 for which the primary costs for submitting passenger and crew information to HHS/CDC are incurred by airlines and vessel operators and the primary benefit is improved public health responsiveness to assess and offer post-exposure prophylaxis to travelers potentially exposed to communicable diseases of public health concern. The most likely estimates of annual costs to airlines, vessel operators, the United States government, and public health departments are low ($32,622, range $10,959 to $430,839) because the final rule primarily codifies existing practice or improves alignment between existing regulatory text and the International Civil Aviation Organization (ICAO)'s guidelines for symptoms to report. The cost estimates in this final rule are based on (1) an anticipated small increase in the number of illness reports delivered by airlines and processed by HHS/CDC and (2) increased costs for airlines and vessel operators to comply with HHS/CDC orders for traveler and crew contact data, to the extent that such information is readily available and already maintained, and not already transmitted to the U.S. Customs and Border Protection (CBP). The cost estimate also includes an increase in costs for public health departments to contact more exposed travelers due to the availability of improved contact data.
The best estimate of the annual quantified benefits of the final rule are $110,045 (range $26,337 to $297,393) and mostly result from increased efficiencies for HHS/CDC and State and local public health departments to conduct contact investigations among travelers on an aircraft exposed to communicable diseases of public health concern, especially for measles and tuberculosis. To the extent that improved responsiveness of airlines to HHS/CDC traveler data orders may result from the implementation of the provisions in this final rule, HHS/CDC may become better able to respond to infectious diseases threats and (1) reduce case-loads during infectious disease outbreaks, (2) reduce public anxiety during disease outbreaks, (3) mitigate economic impacts on businesses as a consequence of reduced public anxiety associated with quarantinable communicable disease outbreaks initiated by international travelers (such as have been observed during outbreak of severe acute respiratory syndrome in Canada or Middle East respiratory syndrome in South Korea), and (4) reduce the amount of personnel labor time to conduct large-scale contact investigations in response to a new infectious disease or one with larger scale public health and medical consequences like Ebola.
The second analysis in this final rule is of a number of provisions that aim to improve transparency of how HHS/CDC uses its regulatory authorities to protect public health. HHS/CDC believes that improving the quality of its regulations by providing clearer explanations of its policies and procedures is an important public benefit. However, HHS/CDC is not able to attach a dollar value to this added benefit in a significant way.
On August 15, 2016, HHS/CDC published a notice of proposed rulemaking (NPRM) (81 FR 54299) to amend 42 CFR part 70 (interstate) and 42 CFR part 71 (foreign) quarantine regulations. The public was invited to comment on these amendments. The comment period ended October 14, 2016. In the NPRM, HHS/CDC specifically requested public comment on the following:
• Whether the use of the standard definition of “indigent” is an appropriate threshold to determine whether an individual cannot afford representation and therefore should be appointed a medical representative at the government's expense and whether the public believes that there may be non-indigent individuals, as defined in the NPRM, who may have difficulty affording a representative;
• The definition of
• Requirements relating to travelers under a Federal order of isolation, quarantine, or conditional release; specifically, on whether stakeholders
• Public health prevention measures and whether the public has any concerns regarding the mandatory health screening of passengers using non-invasive means as defined in the proposal or the collection of personal information from screened individuals for the purposes of contact tracing;
• Payment for care and treatment, and whether there are any concerns that all third party payments be exhausted prior to the Federal reimbursement of medical care or treatment for individuals placed under a Federal order for quarantine, isolation, or conditional surveillance;
• The application of requirements relating to issuance of a Federal order for quarantine, isolation or conditional release as it applies to groups and whether this provision sufficiently informs the public of the important details concerning circumstances during which HHS/CDC would issue to groups or individuals Federal orders for quarantine, isolation, and conditional release and the duration and conditions of such orders;
• Whether 72 hours is the necessary amount of time to conduct a reassessment after a Federal order is first issued, or if the reassessment should take place earlier or later;
• Whether or not the public sees a role for the Federal government to ensure that basic living conditions, amenities, and standards are satisfactory when placing individuals under Federal orders;
• Whether the definition of “non-invasive” aligns with common perceptions of what constitutes non-invasive procedures that may be conducted outside of a traditional clinical setting;
• Whether the penalties proposed, and the circumstances under which such penalties may be imposed, were clearly explained;
• The applicability of the December 13, 2007 system of records notice (SORN) to the activities proposed (72 FR 70867), and whether the SORN sufficiently addresses the public's concerns related to maintenance and protection of the data elements proposed;
• The request for a passenger and crew manifest within 24 hours and whether the provision grants operators of airlines sufficient time for operators to respond to manifests orders;
• The likelihood that the passenger and crew data elements requested are already collected and maintained by airline operators for transmission to CDC;
• Any industry concerns regarding whether proposed section 71.63 sufficiently details the circumstances under which HHS/CDC may impose an embargo on the importation of animals, articles, or things, including how such an embargo would be implemented, as well as any concerns regarding coordination with other Federal agencies.
The public comment period for the proposed rule ended on October 14, 2016 and HHS/CDC received 15,800 comments from individuals, stakeholders, and groups. A summary of those comments and responses to those comments are found at Section IV, below.
The primary legal authorities supporting this rulemaking are sections 361 and 362
On August 15, 2016, HHS/CDC published a Notice of Proposed Rulemaking to update 42 CFR 70 (domestic) and 42 CFR 71 (foreign) quarantine regulations. These amendments were proposed to aid public health responses to outbreaks of communicable disease, such as the largest outbreak of Ebola virus disease (Ebola) on record, Middle East Respiratory Syndrome (MERS), both quarantinable communicable diseases, and repeated outbreaks of measles in the United States, a non-quarantinable communicable disease of public health concern. (81 FR 54299). Communicable diseases of public health concern are those diseases that because of their potential for spread, particularly during travel, may require a public health intervention. The provisions contained within the proposal were designed to enhance HHS/CDC's ability to prevent the further importation and spread of communicable diseases into the United States and interstate by clarifying HHS/CDC's response capabilities, practices, and making them more transparent.
Upon consideration of public comment, the following is a section-by-section summary of the changes from the proposed text that HHS/CDC made to parts 70 and 71:
Throughout the regulatory text in parts 70 and 71, references to “CDC” or “HHS/CDC” have been replaced with “Director.” This is in keeping with the common practice that federal agencies act through employees and officials to whom the authority involved has been delegated.
• The definition of
• The definition of
• The definition of
• The definition of
• The definition of
• The definition of
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• A definition for
This provision is has been finalized as proposed, with the exception that references to CDC have been replaced with Director throughout this section. HHS/CDC has also added a requirement that the Director arrange for adequate food and water, appropriate accommodation, appropriate medical treatment, and means of necessary communication, for individuals who are apprehended or held in quarantine or isolation. Similar language has been added to an analogous provision at Section 71.33(a).
These provisions are finalized as proposed, with the exception that references to CDC have been replaced with Director throughout this section. HHS/CDC has also added a requirement that the Director, as part of the Federal order, advise the individual that the medical examination shall be conducted by an authorized and licensed health worker with prior informed consent.
Paragraphs (a)(5) and (a)(4) of these provisions have been modified, respectively, to require that the Federal order include an explanation that the Federal order will be reassessed no later than 72 hours after it has been served and an explanation of the right to request a medical review, present witnesses and testimony at the medical review, and to be represented at the medical review by either an advocate (
These provisions have been modified to include paragraph (g) which states that the Director shall arrange for translation or interpretation services of the Federal order as needed. References to CDC have been replaced with Director throughout this section.
Paragraph (f) of these provisions has been modified to reference “Representatives,” consistent with the change in definition. Paragraph (f) of these provisions has also been modified to remove, “and cannot afford a medical representative” because this language is duplicative and unnecessary if the individual has already qualified as indigent. Paragraph (k) of these provisions has been modified to state: “The medical review shall be conducted by telephone, audio or video conference, or through other means that the medical reviewer determines in his/her discretion are practicable for allowing the individual under quarantine, isolation, or conditional release to participate in the medical review.” These provisions have also been modified to include paragraph (q) which states that the Director shall arrange for translation or interpretation services as needed for purposes of this section. References to CDC have been replaced with Director throughout this section.
These sections have been modified to remove paragraphs (5) regarding agreements between CDC and the individual.
These provisions have been finalized as proposed, with the exception that references to CDC have been replaced with Director throughout this section.
These provisions have been removed.
The content of these provisions has been finalized as proposed. Proposed § 70.19
Paragraph (b) has been modified to include “known or possible exposure” information to the list of information that may be collected. References to CDC have been replaced with Director throughout this section.
Paragraph (a), (a)(4), (b)(1), (b)(2), and (c) of this provision have been modified to remove “agreements.” Paragraph (d) has been modified to add “to individuals traveling entirely intrastate and to conveyances that may transport such individuals.” The language in paragraph (d) was discussed in the NPRM at 81 FR 54243 and public comment concerning intrastate application of this provision was explicitly solicited. The language, however, was inadvertently omitted from the regulatory text. References to CDC have also been replaced with Director throughout this section. In response to public comments, HHS/CDC
This provision has been finalized as proposed, with the exception that references to CDC have been replaced with Director throughout this section.
These provisions have been finalized as proposed, with the exception that the title has been modified to remove references to collection and storage of information to more accurately reflect the requirements under this section and references to CDC have been replaced with Director throughout this section.
This provision has been finalized as proposed with the exception that references to CDC have been replaced with Director throughout this section.
The title of this provision has been finalized as proposed, to remove the word “Radio.”
On August 15, 2016 HHS/CDC published a Notice of Proposed Rulemaking proposing to amend the current interstate (domestic) and foreign quarantine regulations for the control of communicable diseases. The NPRM included a 60-day public comment period and during this time, HHS/CDC received 15,800 comments from individuals, groups, organizations, industry, and unions. Comments were both in support of and in opposition to the regulation. Many public comments expressed concern that these updated regulations sought to compel medical treatment or vaccination without patient consent. One association stated its strong objection “to the coercive imposition of treatment, including vaccination, without the genuine consent of the patient.”
HHS/CDC begins this section by stating that these regulations do not compel vaccination or involuntary medical treatment. In keeping with current practice, HHS/CDC will continue to recommend care and treatment, including post-exposure prophylaxis when indicated, to individuals who are either sick with or at risk of disease following exposure to a communicable disease of public health concern.
HHS/CDC also received comments relating to immigration policy and regulations, issues of citizenship, border security, religion, personal testimony regarding adverse vaccine events, and requests to apply these regulations only to individuals who are not citizens of the United States. These comments are beyond the scope of this final rule and have not been included in this discussion. However, HHS/CDC notes that it will continue to apply communicable disease control and prevention measures uniformly to all individuals in the United States, regardless of citizenship, religion, race, or country of residency.
HHS/CDC also received public comment regarding disinsection (
The following is a discussion of public comments received that are applicable and within the scope of the regulation. Topics including: Accountability, Administrative Records, Agreements, Apprehension, Authority (including Scope), Conditional Release, Constitutional Issues (including Amendments, Court Cases, and Habeas Corpus), Data Collection, Definitions, Detention, Due Process, Economic Impact, Electronic Monitoring, Exposure, Informed Consent, Least Restrictive Means, Minors, Medical Assessments, Examination, Notice, Penalties, Privacy, Qualifying Stage, Quarantine, Quarantinable Communicable Diseases List, and others are discussed.
A summary of comments and a response to those comments are found below, organized by general and specific comments that apply to both parts 70 and 71, comments that only apply to part 70 (interstate), and comments that only apply to part 71 (foreign).
Since posting the proposed regulation on August 15, 2016, HHS/CDC received 15,800 public comments. HHS/CDC received several comments from individuals, groups, or industry requesting to extend the 60-day comment period. In light of the number of comments submitted, HHS/CDC has determined that a 60-day comment period was both fair and sufficient to adequately inform the public of the contents of this rulemaking, allow the public to carefully consider the rulemaking, and receive informed public feedback. Thus, HHS/CDC declines to reopen the comment period.
Several commenters requested that HHS/CDC withdraw the NPRM in its entirety. A non-profit organization stated that the “NPRM would be, if adopted, a direct and onerous infringement of the personal liberties of Americans and an unnecessary aggressive method of assisting in the control of communicable disease.” Another commenter said that the “NPRM is premature.” HHS/CDC disagrees and declines to withdraw the proposal in its entirety because it contains important measures that will aid the public health response to prevent the introduction, transmission, and spread of communicable diseases into and within the United States. Moreover, in the spirit of transparency, these measures, which are largely current practice, are being published and codified to make the public aware of their use.
HHS/CDC received a comment from a partnership of public health legal scholars and organizations stating that it should promulgate a separate rule guaranteeing humane conditions of confinement. HHS/CDC disagrees that such a separate rule is needed and believes that the current final rule adequately addresses these concerns, as discussed in detail below.
HHS/CDC received a comment that the proposed rule does not comply with Executive Order 12866 because there is no public need for the rule and it did not adequately assess the costs and benefits of the rule, including the alternative of not regulating. HHS/CDC disagrees. As discussed in detail below, this rule describes the public health measures that may be used in response to outbreaks of communicable diseases, such as the recent largest recorded outbreak of Ebola. The economic impact analysis has been clarified to more clearly differentiate quarantinable and non-quarantinable diseases. The
A public health research center commented that there is no evidence that measures employed at points of entry were effective during the response to the 2014-2016 Ebola outbreak and that HHS/CDC is attempting to codify these ineffective practices for use in future disease outbreaks. They further noted that despite greater than 99% complete monitoring, zero cases of Ebola were detected among those monitored. HHS/CDC appreciates this comment and recognizes the challenges presented by measuring the benefits of prevention in public health.
HHS/CDC disagrees that the measures employed in response to the 2014-16 Ebola outbreak were ineffective and that it is seeking to codify ineffective measures. HHS/CDC considers more than 99% complete monitoring a successful effort in State and Federal cooperation in response to an unprecedented outbreak of Ebola. Second, rather than the number of cases detected, HHS/CDC considers the key metrics of effectiveness to be the number of people who were able to continue to travel safely without fear of disease spread and the ability to facilitate rapid isolation and evaluation of the approximately 1400 individuals who developed illness compatible with Ebola during the 21-day monitoring period. Finally, we note that this commenter limited his or her statement to HHS/CDC measures put into place at U.S. ports of entry during the Ebola response.
The enhanced public health risk assessment protocol put into place at U.S. ports of entry in response to the Ebola outbreak was one part of a layered risk mitigation program to prevent the importation and spread of Ebola within the United States, which included exit screening in the affected countries as recommended by the World Health Organization (WHO) (see Statement on the 1st meeting of the International Health Regulations [IHR] Emergency Committee on the 2014 Ebola outbreak in West Africa 8/8/2014) and a reliance on air industry partners for detection and reporting of potentially ill travelers prior to arrival.
The enhanced entry risk assessment process was instituted after an individual infected with Ebola entered the United States and transmitted the disease. This case demonstrated that the processes then in place to prevent departure of individuals exposed to or infected with Ebola in affected West African countries could not detect persons who were exposed but were unaware of or denied such exposure and were potentially incubating the infection. To further reduce the risk of introduction and spread, HHS/CDC recommended monitoring of all potentially exposed individuals by a public health authority through the 21-day risk period after potential exposure, rather than relying on previously recommended self-monitoring. Monitoring was viewed as the least restrictive alternative to widespread quarantine and travel bans demanded by some members of the public that would ultimately have hampered the response efforts in West Africa and domestically. HHS/CDC, along with its Federal and State partners, implemented an entry process by which individuals identified as having recently traveled to, from, or through an affected country entered through five ports of entry where public health staff and partners were stationed, submitted accurate and complete contact information, were checked for symptoms, and were provided answers to Ebola risk assessment questions.
This was done for several reasons:
• To ensure that any individual entering the United States who could have been exposed to or infected with Ebola in a country experiencing an Ebola outbreak was identified and reported to the State and local health department of final destination so that, if the individual became ill, State or local health departments could rapidly notify healthcare providers prior to the individual's arriving at a hospital. This process was designed specifically to prevent unknowing individuals from exposing others such as occurred in Texas when a patient exposed two healthcare workers.
• While HHS/CDC acknowledges that a public health worker may be unlikely to encounter someone with symptoms at the moment of entry because of the 21-day incubation period, individuals coming from the outbreak countries frequently traveled for well over 24 hours and in many cases had itineraries that involved interstate movement within the United States. The odds of developing symptoms during that travel, and potential onward travel, were considered non-trivial, and public health measures to detect symptoms upon entry were considered warranted given the serious morbidity and costs associated with Ebola.
• The risk assessment at the limited ports of entry provided an important opportunity for HHS/CDC to stratify the risk of developing Ebola for every individual who entered from the affected countries. It allowed HHS/CDC to work with State and local health departments in implementing the least restrictive means of monitoring individuals for development of symptoms. HHS/CDC notes that there were no Federal quarantine orders issued because of the availability of monitoring options provided by State and local authorities under the
• The encounter also provided an opportunity to provide travelers with educational materials, orientate them to the monitoring program (Check and Report Ebola (CARE)), and facilitate reporting of the traveler's health status to State and local health departments.
The enhanced entry risk assessment and monitoring process described above was developed in response to the epidemiological profile of Ebola and the complexities of a 21-day incubation period. However, in the event of an outbreak of a different communicable disease requiring enhanced assessment or monitoring of travelers (whether quarantinable or non-quarantinable), HHS/CDC, in concert with Federal and State partners, may implement a different system of risk assessment and monitoring. HHS/CDC would tailor the program in accordance with the scientific evidence of the situation and the utility and feasibility of the program given the availability of resources.
The same public health research center commented that employing non-evidence-based measures is contrary to the United States' international legal agreements, specifically mentioning the public health measures implemented during the response to Ebola as they pertain to the International Health Regulations (IHR 2005). The commenter further stated that given the absence of evidence to support the use of travel monitoring and quarantine, HHS/CDC should proceed cautiously before employing these measures in the future.
Having addressed the commenter's concern regarding the evidence of the effectiveness of public health measures at ports of entry above, HHS/CDC concurs with the commenter that the use of quarantine and travel restrictions, in the absence of evidence of their utility, is detrimental to efforts to combat the spread of communicable disease. However, HHS/CDC disagrees that it used non-evidence based measures in contravention of the IHR.
Furthermore, the measures did not unduly affect travel or trade beyond the voluntary changes made by industry and travelers. HHS/CDC believes that CDC's entry risk assessment and management program was appropriate, commensurate with the risk, and consistent with the following WHO recommendation: “[Member] States should be prepared to detect, investigate, and manage Ebola cases; this should include assured access to a qualified diagnostic laboratory for Ebola and, where appropriate, the capacity to manage travelers originating from known Ebola-infected areas who arrive at international airports or major land crossing points with unexplained febrile illness.”
Future outbreaks may necessitate a different combination of public health measures at ports of entry. In those circumstances, HHS/CDC will use the best available science to assess the risk of importation and spread within the United States.
One commenter suggested that if HHS/CDC were to apply the “Precautionary Principle,” it would not promulgate these regulations. HHS/CDC notes first that the “precautionary principle,” often described as the avoidance of harm when there is scientific uncertainty about risks, originated in environmental contexts and remains largely associated with environmental issues. Invoking the precautionary principle in an environmental context, for instance, places the onus on those considering a potentially harmful action, such as drilling or mining near a watershed, to prove its safety in advance. The principle may be used by policy makers to justify discretionary decisions in situations where there is the possibility of harm from making a certain decision (
HHS/CDC disagrees that this regulation will have harmful effect or that these measures lack a scientific basis for protecting public health. In fact, as described above regarding the response efforts to the 2014-2016 Ebola response, HHS/CDC has successfully employed the measures outlined in this regulation for many years. Again, the provisions outlined through this regulation are not new practices, nor new authorities, but a codification of HHS/CDC practice to protect public health.
One commenter suggested that education on healthy practices would be more effective than regulatory provisions. Another commenter stated that our immune systems would ward off communicable disease if we encourage clean water, adequate shelter, effective sewage treatment, and nutritious food. HHS/CDC agrees that these necessities are important to public health, and we rely on health communication often to educate the public on how to protect themselves and others from certain communicable diseases. For example, HHS/CDC routinely advises people with seasonal influenza to stay home from work and school, to cover their coughs and sneezes, and to wash their hands. HHS/CDC also works with State, local, and airport authorities in posting health education materials for the public. However, in certain circumstances, when a communicable disease poses a severe health threat to others, additional measures may be needed to protect the public's health. This is particularly important in situations when the infectious individual has disregarded public health recommendations by, for example, refusing to take prescribed medications to treat infectious tuberculosis or traveling while infectious. In such situations, it may be necessary to use public health authorities to require the individual to remain in isolation or to prevent travel to protect the public's health.
HHS/CDC received a few comments suggesting that publication of the NPRM in the
HHS/CDC received a comment stating that HHS/CDC should, by regulation, provide sufficient public health justification for screening practices to support its proposed public health prevention measures at ports of entry. While HHS/CDC agrees that it should provide sufficient public health justification for large-scale screening practices, HHS/CDC disagrees that this justification should be formalized in regulations. During the 2014-2016 Ebola epidemic, HHS/CDC issued
HHS/CDC received several comments suggesting that the proposed regulations were not written in plain language and were therefore difficult to understand. One commenter also noted errors in the document such as hyperlinks, references, and footnotes. This commenter also reviewed the NPRM for inconsistencies, conflicts, missing definitions, misleading language, and ambiguities. HHS/CDC thanks these commenters for the input. We have developed communication materials and published them to our Web site to help facilitate the review and comprehension of these documents. Interested persons should see
One commenter opposed the rule because of a perceived negative social impact upon individuals placed under a public health order. We respond that one compelling reason for the publication of this final rule is to make the public aware of these measures so that the words, purposes, and meanings of “quarantine” and “isolation” become more familiar and less likely to cause public anxiety and stigmatization.
HHS/CDC received comments suggesting that, to best prevent the introduction of communicable diseases into the U.S., individuals who travel to or originate in countries with high risk of communicable disease should not be allowed to enter (or return to) the United States. On March 27, 2015, HHS/CDC published a Notice in the
A few commenters expressed concern, as parents or guardians, about their rights with respect to children or minors. Specifically, these commenters wondered whether children/minors would be separated from parents/guardians during a public health risk assessment. HHS/CDC thanks the commenters for these questions and appreciates the opportunity to respond. In response, HHS/CDC notes that these regulations do not limit the rights that parents or guardians may have over minor children, including the right to make medical decisions. Notwithstanding, children are included in the definition of “individuals” as used in these regulations and thus minor children may be subject to apprehension, detention, examination, and conditional release for quarantinable communicable diseases to the same extent as adults. In such rare circumstances, HHS/CDC will work with the child's parent or guardian to ensure that the rights accorded to any individual subject to Federal isolation or quarantine, such as the opportunity for an administrative medical review, are adequately protected.
In addition, and in keeping with standard public health practice, parents or guardians while in the presence of infected minor children may be required to adhere to infection control precautions for their own protection. Such protections may include wearing personal protective equipment (such as a mask) while in close proximity to the child/minor to avoid further transmission of the illness. In extremely rare circumstances, such as a child infected with Ebola, the risk may be too great to allow a parent to remain with a child; however, every effort will be made to facilitate communication between a parent and a minor child through the least restrictive means, for example, through the use of technology.
One commenter asked about HHS/CDC obtaining the consent of a parent or legal guardian prior to the medical examination, quarantine, or treatment of minors. We respond that HHS/CDC will adhere to all applicable laws regarding the medical examination or treatment of minors. If minors are traveling unaccompanied by a parent or legal guardian and are believed to be infected with or exposed to a quarantinable communicable disease, HHS/CDC will use its best efforts to contact a parent or guardian to obtain consent prior to medical examination. In addition, HHS/CDC will not restrict a minor's ability to communicate with family or legal counsel hired by the minor's parent or legal guardian. As explained further below, HHS/CDC will appoint representatives, including a medical representative and an attorney, if the individual (including a minor's parent or legal guardian) is indigent and requests a medical review. HHS/CDC clarifies, however, that the public health measures included in this final rule, including apprehension, examination, quarantine, and isolation, do not require a parent or legal guardian's consent as a prerequisite to their application. However, in response to concerns about informed consent, HHS/CDC has added regulatory language requiring that the Director advise the individual that if a medical examination is required as part of a Federal order that the examination will be conducted by an authorized and licensed health worker with prior informed consent.
HHS/CDC received comments from the public questioning whether HHS/CDC is a part of the Federal government and has the authority to propose and promulgate regulations, or whether the Agency is a private entity. The “Communicable Disease Center” became part of the U.S. Public Health Service on July 1, 1946 and is an Agency within the U.S. Department of Health and Human Services. For more information on the history of CDC, please see
HHS/CDC received numerous comments from the public seeking clarity on the scope of authority the Agency has to take actions described in this regulation. Specifically, HHS/CDC received comments questioning whether the authority to detain an individual may be exercised by a Federal agency of government, instead of the U.S. President or Congress. Several commenters specifically questioned whether the wording of the regulation was too “general” and expressed concern over its potential for abuse. A public health organization recommended that HHS/CDC's authority should be limited only to those diseases listed by Executive Order as quarantinable communicable diseases. An association suggested that the proposed rule would vastly increase the authority of HHS/CDC. One individual stated that this regulation is an attempt by HHS/CDC to evade Congress. One organization speculated that HHS/CDC plans to request that the list of quarantinable communicable diseases be expanded “to include measles and other vaccine targeted diseases for the purpose of
In response, HHS/CDC first notes that it cannot—and will not—act beyond the scope of authority granted by Congress in statute; HHS/CDC offers the following clarifications. Under section 361(a) of the Public Health Service Act (42 U.S.C. 264(a)), the HHS Secretary is authorized to make and enforce regulations as in the Secretary's judgment are necessary to prevent the introduction, transmission, or spread of all communicable diseases from foreign countries into the States or possessions of the United States and from one State or possession into any other State or possession. Under section 361(b)(42 U.S.C. 264(b)), the authority to issue regulations authorizing the apprehension, examination, detention, and conditional release of individuals is limited to those communicable diseases specified in an Executive Order of the President,
One commenter supported the international proposals (part 71), but urged HHS/CDC to remove the domestic portion (part 70) of this regulation. We disagree. HHS/CDC's authorities apply to all travelers in the United States, regardless of citizenship or residency, and are intended to complement State authorities within their jurisdictions by providing a mechanism to prevent importation of communicable disease from other countries as well as spread of communicable disease between States and between States and territories. Thus, HHS/CDC's and States' authorities together create a comprehensive system to protect the public from communicable disease threats including in situations such as interstate travel when a single State's authorities may be inadequate to address the communicable disease threat.
Several commenters suggested that HHS/CDC has the authority to unilaterally change or update the list of quarantinable communicable diseases. Other commenters requested that the list be narrowed to only those diseases with a “high mortality rate.” HHS/CDC reemphasizes that, as prescribed by statute, the list of quarantinable communicable diseases may only be changed by Executive Order of the President and that such suggestions are beyond the scope of this final rule.
HHS/CDC received several comments on the Agency's accountability system, encouraging that a “strong system of checks and balances” should be in place for this regulation to be implemented. HHS/CDC agrees that there should be accountability and oversight regarding the agency's activities. We note that these regulations do not affect the ability of Congress to conduct its oversight activities or affect the jurisdiction of federal courts to review federal agency actions under the Administrative Procedure Act (5 U.S.C. 704).
HHS/CDC received a comment that there is no court supervision of HHS/CDC activities. We disagree. These regulations do not affect the jurisdiction of the Federal courts or the statutory rights of individuals to obtain judicial review of CDC's actions and decisions through appropriate mechanisms such as the habeas corpus statute (28 U.S.C. 2241) or the Administrative Procedure Act (5 U.S.C. 704).
Some commenters questioned the need for HHS/CDC to use its authorities if the threat of death is minimal compared with the size of the population, listing illnesses such as chickenpox, pertussis, Zika, the common cold and flu, and leprosy. One organization suggested that, through the language of the NPRM, HHS/CDC was “equating” non-quarantinable diseases with quarantinable diseases. Another commenter suggested that HHS/CDC's authority to act should be based on the mortality of the illness, rather than whether or not it appears on the list of quarantinable communicable diseases. HHS/CDC thanks the commenters for consideration of the proposal as well as the input provided.
First, we note that HHS/CDC only has authority to quarantine or isolate individuals who have illnesses that are listed by Executive Order of the President as quarantinable communicable diseases. HHS/CDC does not have the ability or authority to unilaterally modify the list of quarantinable communicable diseases. Second, because HHS/CDC also has statutory authority to prevent the “introduction, transmission, and spread” of communicable diseases, HHS/CDC may take actions other than quarantine or isolation to protect the public's health. These other actions may include contact tracing investigations to notify individuals to seek proper treatment if they have been exposed to a communicable disease, even if the disease is not listed by Executive Order as quarantinable. HHS/CDC does not seek to compel vaccination or medical treatment. In keeping with current practice, HHS/CDC recommends certain vaccines for post-exposure prophylaxis and individuals may choose to follow these recommendations as they deem appropriate.
Other commenters questioned why diseases such as Ebola, measles, and Zika—three very different diseases with three very different effects on individuals—are used to support the same regulatory provisions. One organization quoted the NPRM, citing correctly that while measles is not a quarantinable communicable disease, it was used in the NPRM to support the need for this updated regulation. HHS/CDC welcomes the opportunity to provide further clarification.
The proposed rule provides HHS/CDC with a number of options for public health interventions based on a public health risk assessment of the communicable disease in question and the situation at hand. These interventions could include conducting a contact investigation on an airplane or vessel if a person with a serious communicable disease was known to have traveled on the airplane or vessel. These contact investigations are similar to those conducted by health departments in community settings. In addition to these interventions, for the nine communicable diseases currently designated by Executive Order as quarantinable communicable diseases, HHS/CDC may apprehend, detain, examine, quarantine, isolate, or conditionally release individuals for purposes of preventing communicable disease spread. Ebola and infectious tuberculosis are examples of quarantinable communicable diseases.
HHS/CDC also provides the public with recommendations to address other communicable diseases of public health concern. Zika is a good example of a disease of public health concern because of the ways it can be spread,
One commenter questioned why HHS/CDC was not able to currently control all communicable diseases, specifically leprosy. While HHS/CDC works regularly and continuously with other Federal, State, local and tribal health departments to eliminate the introduction, transmission and spread of all communicable disease, outbreaks can and do still occur. HHS/CDC staff have experienced first-hand the impact of globalization on public health. The rapid speed and tremendous volume of international and transcontinental travel, commerce, and human migration enable microbial threats to disperse worldwide in 24 hours—less time than the incubation period of most communicable diseases. These and other forces intrinsic to modern technology and ways of life favor the emergence of new communicable diseases and the reemergence or increased transmission of known communicable diseases.
HHS/CDC received many comments regarding measles and the need to apply public health measures to prevent the transmission and spread of the disease. We note also that while measles may be transmissible during travel, it is not one of the quarantinable communicable diseases listed by Executive Order of the President. Therefore, while HHS/CDC may recommend post-exposure prophylaxis, or other ways to manage and prevent spread, we do not have the authority to apprehend, examine, detain, or conditionally release individuals who may have measles, nor those who may have been exposed.
HHS/CDC believes that requesting that DHS restrict the air travel of persons with measles is warranted because measles is a serious and highly contagious communicable disease that would pose a public health threat during travel. People exposed to measles who are not immune to the infection and have not been vaccinated following the exposure are advised to delay their travel voluntarily until they are no longer at risk of becoming infectious.
A number of commenters suggested that the proposed regulations are unconstitutional or in violation of the “Nuremberg Code,” the United Nations Educational, Scientific and Cultural Organization (UNESCO), the Universal Declaration on Bioethics and Human Rights, the Geneva Convention, human rights in general, and/or civil liberties in general because they ostensibly authorize compulsory medical treatment without informed consent. Commenters also cited numerous Supreme Court cases purportedly in support of these claims, such as
These regulations do not violate or take away any recognized rights guaranteed by the U.S. Constitution or applicable international agreements. While HHS/CDC has successfully responded to outbreaks of communicable diseases, such as Ebola, these regulations will improve HHS/CDC's future ability to prevent the introduction, transmission, and spread of communicable diseases, through such mechanisms as improved reporting of illnesses and public health prevention measures at airports. While many of these activities have been carried out in the past through internal operating procedures, these regulations improve the public's awareness and understanding of HHS/CDC's activities to protect the public's health.
One commenter expressed concerns about religious exemptions for mandatory vaccination or treatment. In response, HHS/CDC notes that these regulations do not authorize compulsory vaccinations or medical treatment. While HHS/CDC will implement these regulations in a manner consistent with respecting the religious rights of individuals, religion is not a basis for exempting individuals from the provisions of these regulations, including those provisions relating to quarantine and isolation.
One commenter raised similar concerns that the regulations may lead to apprehensions based on factors unrelated to public health such as wearing of religious garb or reading of certain newspapers. HHS/CDC agrees that public health actions should not be taken based on factors unrelated to protecting the public's health and these regulations do not authorize such actions. Additionally, these regulations strike the appropriate balance between individual liberties and public health protection.
Several commenters questioned whether quarantine and isolation may be carried out consistent with the Fourth Amendment to the U.S. Constitution. One commenter also suggested that implementation of public health prevention measures at airports would lead to “unreasonable searches and seizures” under the Fourth Amendment. HHS/CDC disagrees with these assertions. The Fourth Amendment protects the rights of persons to be free in their persons, houses, papers, and effects, against unreasonable government searches and seizures. HHS/CDC notes that at ports of entry, routine apprehensions and examinations related to quarantine and isolation may fall under the border-search doctrine, which provides that, in general, searches conducted by CBP officers at the border are not subject to the requirements of first establishing probable cause or obtaining a warrant.
HHS/CDC received a comment citing
Several commenters also questioned whether the regulations are consistent with the requirements of the Fifth and Sixth Amendments to the U.S. Constitution. We note at the outset that the Sixth Amendment only applies to criminal proceedings and thus would be inapplicable to isolation and quarantine decisions which are public health protection measures unrelated to the normal needs of law enforcement. Furthermore, HHS/CDC asserts that this final rule is consistent with the requirements of due process embodied in the Fifth Amendment to the U.S. Constitution. Specifically, procedural safeguards contained in the final rule include: (1) A requirement for written orders of quarantine, isolation, or conditional release, including translation or interpretation services as needed; (2) mandatory review of the Federal order after the first 72 hours; (3) notifying individuals through the written order of their right to request a medical review; (4) an opportunity at the medical review for the detained individual to be heard through an attorney or other advocate hired at their own expense, present experts or other witnesses, submit documentary or other evidence; and confront and cross-examine any government witnesses; (5) a decision-maker independent of those who authorized the original isolation, quarantine, or conditional release; (6) a written statement by the fact-finder of the evidence relied upon and the reasons for the decision; (7) appointment of representatives, including a medical representative and an attorney, if the individual is indigent and requests a medical review; and (8) timely notice of the preceding rights.
HHS/CDC also received a comment that quarantine violates the guarantees of substantive due process under the 5th Amendment to the U.S. Constitution. HHS/CDC disagrees. In addition to a guarantee of fair procedures, the U.S. Supreme Court has interpreted the Fifth Amendment's Due Process Clause as containing a substantive component barring certain arbitrary, wrongful government actions regardless of the fairness of the procedures used to implement them.
HHS/CDC received a comment that quarantine and isolation are State police powers that should not be exercised at the Federal level. While HHS/CDC acknowledges that the States have primary authority for quarantine and isolation within their borders, the Federal government has an important and longstanding role in preventing communicable disease spread at ports of entry and interstate. This authority is reflected in 42 U.S.C. 264 and consistent with principles of Federalism.
HHS/CDC received one comment stating that it should conduct a Federalism analysis because implementing the rule will require working with State health officials and resources. Under Executive Order 13132, a Federalism analysis is required if a rulemaking has federalism implications, would limit or preempt State or local law, or imposes substantial direct compliance costs on State or local governments. Under such circumstances, a Federal agency must consult with State and local officials. Federalism implications is defined as having substantial direct effects on State or local governments, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. Under 42 U.S.C. 264(e), Federal public health regulations do not preempt State or local public health regulations, except in the event of a conflict with the exercise of Federal authority. Other than to restate this statutory provision, this rulemaking does not alter the relationship between the Federal government and State/local governments as set forth in 42 U.S.C. 264. While HHS/CDC acknowledges that portions of this rule may involve HHS/CDC “working with State health officials” to better coordinate public health responses, the rule is consistent with 42 U.S.C. 264(e) and there are no provisions that impose direct compliance costs on State and local governments. The longstanding provision on preemption in the event of a conflict with Federal authority (42 CFR 70.2) is left unchanged by this rulemaking. Therefore, HHS/CDC believes that the rule does not warrant additional consultation under Executive Order 13132.
HHS/CDC received several questions asking who would be responsible for the enforcement of these regulations. One commenter questioned whether HHS/CDC would use “militarized police or create [an] armed Federal police force to carry out these actions.” As explained elsewhere, in keeping with current practice and existing law, law enforcement support for quarantine or isolation orders will generally be provided by U.S. Customs and Border Protection, U.S. Coast Guard, or other Federal law enforcement programs, but
HHS/CDC received many comments on the definition of
HHS/CDC did not receive public comment on the proposed definition of
HHS/CDC received many comments on the proposed definition and provision regarding
HHS/CDC did not receive public comment on the proposed definition of
HHS/CDC received a comment seeking clarity regarding the definition of
HHS/CDC received many comments on the proposed definition and provision regarding
HHS/CDC is modifying the definition of
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HHS/CDC did not receive public comment on the proposed definition of
HHS/CDC did not receive public comment on the proposed definition of
HHS/CDC received many comments on the proposed definition and provision regarding
Several commenters expressed privacy concerns because conditional release of exposed or ill individuals may be accomplished over the internet or through electronic monitoring. Other commenters expressed concerns about privacy, having misunderstood the proposed rule as authorizing HHS/CDC to conduct invasive surveillance of personal communications such as emails, text messages, and telephone calls. Commenters also expressed concerns related to the use of webcams and wearable tracking technologies as an option for monitoring of exposed people. One association viewed this proposed provision as an expansion of CDC's “electronic monitoring of personal information, under the guise of protecting the public against rare, isolated outbreaks of disease.”
HHS/CDC appreciates the opportunity to address these concerns. CDC's intent was to describe mechanisms that HHS/CDC or other public health authorities can use to communicate with individuals for the purpose of conducting monitoring following exposure to a quarantinable communicable disease. These mechanisms are intended as alternatives to in-person interviews because of the inconvenience and logistical problems that may arise when meeting in-person.
During the 2014-2016 Ebola response, HHS/CDC recommended “active monitoring” defined as daily communication between public health authorities and the individuals being monitored. HHS/CDC did not specify how this communication should occur, and health departments used a variety of electronic technologies for this purpose including those listed in the regulation. HHS/CDC also recommended “direct active monitoring” for people with certain higher levels of exposure. This involved having a public health official check in with the person through direct observation rather than relying on phone calls or electronic communications. Webcams were used by some health departments as an alternative to in-person visits to observe the person taking his or her temperature. The webcam was only operational during this scheduled public health “visit.” The use of webcams proved convenient for both
One commenter asked whether HHS/CDC would “assist with payment for internet services” if webcam communications was required. In keeping with current practice, if an individual does not have access to internet services, HHS/CDC may use alternative methods to assist with communication, such as the issuance of a cellular phone. Some organizations also expressed concerns about the use of technologies such as cellular phones or wearable tracking technologies for the purpose of electronic monitoring. HHS/CDC acknowledges that the use of wearable tracking technology may be necessary in rare situations when a person does not comply with the required monitoring or when it is necessary to know the physical whereabouts of the person to ensure that they are not in a public place. While HHS/CDC acknowledges that public health surveillance of ill or exposed individuals through electronic monitoring may raise some privacy concerns, HHS/CDC believes that protecting the public's health outweighs these concerns.
HHS/CDC is committed to protecting the privacy of personally identifiable information collected and maintained under the Privacy Act of 1974. As detailed in the preamble of the proposed rule, on December 13, 2007, HHS/CDC published a notice of a new system of records under the Privacy Act of 1974 for its conduct of activities under this final rule (72 FR 70867). HHS/CDC accepted public comment on its proposed new system of records at that time. As required under the Privacy Act, HHS/CDC described in its notice the proposed system of records, the purpose for the collection of the system data, the proposed routine uses (
Under this system of records, CDC will only release data collected under this rule and subject to the Privacy Act to authorized users as legally permitted. HHS/CDC will take precautionary measures including implementing the necessary administrative, technical and physical controls to minimize the risks of unauthorized access to medical and other private records. In addition, HHS/CDC will make disclosures from the system only with the consent of the subject individual or, in accordance with the routine uses published at 72 FR 70867, or as allowed under an exception to the Privacy Act. Furthermore, HHS/CDC will apply the protections of the SORN to all travelers regardless of citizenship or nationality. Finally, such records will be stored and maintained in keeping with the official Records Control Schedule as set forth by the National Archives and Records Administration. For more information, please see
We have modified the definition of
HHS/CDC received comments regarding the updated definition of
HHS/CDC clarifies that the purpose of the
HHS/CDC also does not intend to apprehend individuals based solely on their meeting the definition of an
Several commenters noted that the symptoms listed in HHS/CDC's definition of an
A few commenters stated that the definition of
A public health association suggested that any changes to the list of signs and symptoms within the definition of
A number of commenters noted that symptoms listed in HHS/CDC's definition of an
One public health organization commented that the definition of
One public health organization commented on the different definitions of
One public health organization provided a recommendation to modify the description of the “rash” component in the definition of ill person to ensure that the term fully encompassed the range of potential skin rash symptoms. The organization's recommendation for revisions was as follows: “The individual has areas on the skin that are red or purple, flat or bumps; with multiple red bumps; red, flat spots; or blister-like bumps filled with fluid or pus that are intact, draining, or partly crusted over; or dry and scaling patches. The rash may be discrete or run together, and may include one area of the body, such as the face, or more than one area.”
HHS/CDC responds that it will not change the regulatory text of the ill person definition with this language because we are concerned that this might add too much complexity to the regulatory definition. However, consistent with the regulatory definition of “ill person,” HHS/CDC will update its reporting guidance for aircraft and vessels to include this revised description. Current guidance may be found at:
An air industry commenter suggested another change to the ill person definition. The proposed definition included “headache with stiff neck,” and the commenter suggested that this be modified to “severe headache of recent onset with stiff neck.” While HHS/CDC will not change the regulatory definition of ill person to accommodate this change, HHS/CDC believes this is a useful modification to make in ill person reporting guidance to aircraft and vessels.
HHS/CDC did not receive any comments on the proposed definition of
Accordingly, we have modified the definition of
HHS/CDC received comments relating to the proposed definition of
One commenter opposed including a definition for indigents and indicated that HHS/CDC should assume all costs whenever an individual is placed into Federal isolation or quarantine. HHS/CDC disagrees that assuming such costs without regard to indigence is necessary or appropriate.
Other substantive comments relating to the appointment at government expense of representatives to assist detained indigent individuals during a medical review are discussed below.
HHS/CDC did not receive any comments on the definition of
In response to comments received regarding medical examinations under sections 70.12 and 71.36, we have modified the definition of
HHS/CDC received a comment regarding the definition of
HHS/CDC received several comments relating to the proposed definitions of
HHS/CDC received a comment that the “definition of medical exemption is not apparent.” In response, HHS/CDC notes that no clarification of what is meant by “medical exemption” is provided by the commenter and that HHS/CDC did not propose adding such a definition. While these regulations do not authorize compulsory vaccination or medical treatment, there is no recognized “medical exemption” from quarantine, isolation, or conditional release and HHS/CDC declines to create one.
HHS/CDC received several comments concerning the definition of
One commenter mentioned that the new definition of
HHS/CDC received comments relating to the definition of
Several public health organizations additionally expressed concerns regarding the use of the “precommunicable stage” definition to justify quarantine of healthcare workers caring for patients with quarantinable communicable diseases such as Ebola or severe acute respiratory syndromes, including healthcare workers providing care in the United States or in other countries. One such organization further requested clarification of whether the rule provides for the needs and protection of healthcare workers who voluntarily self-quarantine while providing care for patients with the quarantinable communicable diseases noted above.
In response, HHS/CDC states that it does not recommend quarantine or occupational restrictions of healthcare workers who follow recommended infection control precautions while providing care for patients with quarantinable communicable diseases. Healthcare workers who do not follow infection control precautions or who have had unprotected exposures to patients with a quarantinable communicable disease may be subject to quarantine or occupational restrictions; these individuals would be afforded the same due process protections as other exposed individuals.
Several commenters also questioned CDC's proposed definition for
The definition of
HHS/CDC received several comments relating to the definition of
This commenter also suggested that the definition of public health emergency contains an oversight because it does not mention the potential for an infectious condition being highly likely to cause “short- or long-term disability.” HHS/CDC disagrees because the definition includes infectious diseases that are highly likely to cause “serious illness” if not properly controlled. HHS/CDC clarifies that “short- or long-term disability” caused by an infectious agent would be considered a “serious illness.”
This commenter further suggested that in addition to referencing a public health emergency declaration by the HHS Secretary, the definition should also include similar declarations by the President under the Stafford Act or under the National Emergencies Act. HHS/CDC disagrees. We note first that the definition of public health emergency is not limited to those emergencies declared by the HHS Secretary. Second, in the event of a man-made or natural disaster that also affects public health, the HHS Secretary may issue a separate declaration under the Public Health Service Act as was done in response to the terrorist attacks of September 11, 2001 and in response to Hurricane Katrina. Thus, HHS/CDC does not see a need to also reference Presidential declarations as suggested by the commenter.
This commenter also requested clarification concerning whether the World Health Organization's (WHO) declaration of a Public Health Emergency of International Concern (PHEIC) could continue to serve as the basis for a “public health emergency” if the President or HHS Secretary disagreed with the declaration of a PHEIC on legal, epidemiologic, or policy grounds. In response, HHS/CDC notes that the scenario proposed by the commenter is unlikely, but that CDC remains a component of HHS, subject to the authority and supervision of the HHS Secretary and President of the United States.
HHS/CDC also received a comment objecting to referencing the WHO's declaration of a Public Health Emergency of International Concern (PHEIC) in the definition of “public health emergency” because this ostensibly relinquishes U.S. sovereignty. HHS/CDC disagrees. By including references to a PHEIC, HHS/CDC is not constraining its actions or makings its actions subject to the dictates of the WHO. Rather, the declaration or notification of a PHEIC is only one way for HHS/CDC to define when the precommunicable stage of a quarantinable communicable disease may be likely to cause a public health emergency if transmitted to other individuals. While HHS/CDC will give consideration to the WHO's declaration of a PHEIC or the circumstances under which a PHEIC may be notified to the
The International Health Regulations are an international legal instrument that sets out the roles of WHO and State parties in identifying, responding to, and sharing information about public health emergencies of international concern. HHS/CDC believes that it would be unlikely for the United States to formally object to the WHO's declaration of a PHEIC, but that CDC remains a component of HHS, subject to the authority and supervision of the HHS Secretary and President of the United States.
Also regarding the definition of “public health emergency,” one public health association expressed concern that
HHS/CDC received one comment relating to the definition of
HHS/CDC received several comments relating to
One public health organization recommended that HHS/CDC policy implementing the
Public health organizations and other commenters cautioned against apprehending individuals or issuing public health orders when the risk of communicable disease spread during the precommunicable period is low. HHS/CDC agrees and further adds that it will typically conduct a public health risk assessment in coordination with State and local public health officials to ensure that any restrictions imposed on an individual are commensurate with the degree of risk and using the least restrictive means available.
The definition of
HHS/CDC received several comments regarding the definition of
One commenter stated that the
HHS/CDC received a comment from a public health agency expressing concern that travel to other countries where transmission of a quarantinable
The definition of
HHS/CDC has added a definition for
After consideration of comments regarding
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HHS/CDC received support from commenters on screening individuals entering the U.S. from parts of the world where highly infectious diseases are common. One such commenter requested to know the criteria HHS/CDC uses when deciding whether to detain an individual. Another commenter stated that travel history “should be a prerequisite for Federal orders to quarantine” and “medical exam should be a prerequisite for Federal orders to isolate.” HHS/CDC thanks these commenters and welcomes the opportunity to explain this process.
HHS/CDC's decision to detain an individual is based on several criteria, including: Clinical manifestations: Signs and symptoms consistent with those of a quarantinable communicable disease; known or suspected contact with cases,
HHS/CDC has modified paragraph (b) of the provisions relating to public health prevention measures to detect communicable disease (§§ 70.10 and 71.20) to include information about “known or possible exposure,” in response to comments requesting further clarity of CDC's criteria.
One organization from the airline industry was generally supportive of 70.10 and 71.20,
Another airline organization requested that HHS/CDC ensure wait-times in lines are not impacted by screening, and encouraged HHS/CDC to take into account the needs of all stakeholders. HHS/CDC feels strongly that in these rare circumstances, which would only occur should a threat to public health exist, preventing airline employees and other passengers from being exposed to a detained or delayed individual provides a greater benefit than the monetary loss of airfare. In keeping with current practice, HHS/CDC will work together with public health partners, carriers, and all who have equities, to ensure insofar as possible that the least restrictive and time-consuming measures are implemented. Finally, commenters requested that individuals who refuse to undergo a public health risk assessment prior to travel be denied boarding of an aircraft. In response, HHS/CDC notes that individuals may be denied boarding for public health reasons pursuant to the criteria published at 80 FR 16,400 (Mar. 27, 2015) titled
HHS/CDC received a comment expressing concern about conducting public health prevention measures at “other locations” besides U.S. ports of entry because the commenter found this language vague. HHS/CDC clarifies that this term is meant to include all locations where individuals may enter the United States from a foreign country (
One public health organization requested clarification regarding what information or event would justify triggering the screening of travelers. CDC's response is that, while specific triggers cannot be defined at this time, screening of travelers may generally be conducted during a public health emergency if HHS/CDC determined that monitoring of potentially exposed travelers was needed to protect the public's health.
One public health organization and many individual commenters asserted that people exposed to measles should not be “tracked” through the use of Federal public health orders. First, we reiterate that because measles is not a quarantinable communicable disease, HHS/CDC does not have the authority to issue a public health order for this illness. Second, it is not HHS/CDC's policy to monitor people following measles exposures. Rather, HHS/CDC notifies State or local health departments regarding people in their jurisdictions who may have been exposed to measles. The State or local health departments, in turn, choose to notify people regarding their measles exposure, assess their immunity to measles and, if they are not immune, offer vaccination with MMR vaccine to prevent infection. State or local health authorities may choose to monitor people following exposures to measles based on their own criteria.
One commenter asked whether mandatory health screenings at airports would be conducted privately, whether processes would comply with HIPAA, and how data would be protected at airports. In response, HHS/CDC states that, in all situations, HHS/CDC strives to protect the privacy of individuals subject to screening, collection of information, or the issuance of Federal public health orders under HHS/CDC's authority. While some aspects of the entry risk assessment process conducted during the 2014-2016 Ebola epidemic were performed in areas of the airport that are not considered private, these were limited to collection of contact information, noncontact temperature measurement, observation for visible signs of illness, and superficial screening questions that did not collect sensitive information. Any more detailed public health assessment would be done in a private area.
HHS/CDC is bound by the Privacy Act to protect personally identifiable data collected and maintained in accordance with that Act. Furthermore, HHS/CDC will apply the protections of the SORN to all travelers regardless of citizenship or nationality. Personally identifiable data collected by HHS/CDC at airports are maintained in a secure database and shared only for official purposes on a need to know basis using secure methods as described in CDC's System of Records Notice published at 72 FR 70867. HHS is also a hybrid entity under HIPAA, but only those parts of HHS that have been determined to be health care components are subject to the HIPAA Privacy Rule. CDC is generally not a health care component treated as a “covered entity” under the HIPAA Privacy Rule. However, certain specific offices of HHS, CDC, and the National Institute for Occupational Safety and Health (NIOSH) performing activities related to the World Trade Center Health Program are considered health care components of HHS and must comply with HIPAA and the Privacy Rule.
One public health organization recommended that the rulemaking specify that individuals undergoing a public health risk assessment only be asked to provide contact tracing information if the risk assessment leads to a reasonable belief that the individual may become infected. It is CDC's policy to conduct conveyance-related contact investigations for confirmed cases of communicable diseases. In instances when confirmation cannot be obtained, HHS/CDC may investigate contacts based on reasonable belief of infection following a public health risk assessment which is typically conducted in coordination with the State or local health department of jurisdiction. Such operational details are generally defined in internal protocols. State or local authorities may conduct community-based contact investigations within their jurisdictions based on their own criteria.
After consideration of these comments, HHS/CDC has modified paragraph (b) the provisions relating to
HHS/CDC received several comments relating to the “apprehension” of an individual. One public health association and a public health department suggested that HHS/CDC not use the term “apprehension” because this may create social stigma. HHS/CDC uses this term in these regulations to align with the statutory terminology used in 42 U.S.C. 264(b) which authorizes the “apprehension, detention, or conditional release” of individuals coming into a State or possession from a foreign country or possession for purposes of preventing the introduction, transmission, and spread of quarantinable diseases. Similarly, 42 U.S.C. 264(d) authorizes the “apprehension and examination” of any individual in the qualifying stage of a quarantinable communicable disease who is moving or about to move between States or constitutes a probable source of infection to individuals moving between States. While HHS/CDC can clarify and explain this term, only Congress has the authority to change statutory language. In addition to being a term specifically used in statute under 42 U.S.C. 264, HHS/CDC has determined that this term best conveys that HHS/CDC may, based on public health grounds, assume physical custody of individuals. Furthermore, using alternative terminology, may reduce public understanding and transparency regarding HHS/CDC's legal authorities.
One commenter stated that not every social distancing technique needs to involve taking physical custody of individuals and that using more voluntary-based options would be advisable. HHS/CDC agrees that attempting to obtain voluntary compliance with public health measures is more advisable than assuming legal custody, but believes that maintaining the authority to apprehend individuals who may pose a public health risk is a necessary tool to protect the public's health. HHS/CDC received a comment regarding the “burden of proof” for an apprehension. In response, HHS/CDC notes that the applicable standard for an apprehension of an interstate traveler is “reason to believe” that the individual is in the qualifying stage of a quarantinable communicable disease. HHS/CDC notes that
Several commenters expressed concern that because the “apprehension” period is not explicitly time-limited, that HHS/CDC may “apprehend” an individual indefinitely without providing the individual with a written public health order or a medical review. One commenter noted that HHS/CDC used the term “generally” in the preamble of the NPRM and felt it was too vague, stating “setting a firm timeframe is vital.” A partnership of public health legal scholars and organizations stated that because HHS/CDC did not explicitly limit how long an individual could remain apprehended that such apprehensions could turn into the functional equivalent of a quarantine thus potentially raising Fourth and Fifth Amendment concerns. In response to these concerns, HHS/CDC has added language requiring that it serve an apprehended individual with a public health order within 72 hours of that individual's apprehension.
HHS/CDC received several other comments relating to the sections authorizing the apprehension and detention of persons with quarantinable communicable diseases. A partnership of public health legal scholars and organizations suggested two public health frameworks for apprehension and detention, one for implementation during non-exigent circumstances and a second for exigent circumstances. As described, the primary distinction between the non-exigent and exigent framework, is that in the former HHS/CDC would be required to hold a due process hearing prior to the imposition of an isolation or quarantine, while in the latter HHS/CDC may briefly detain the individual prior to holding a hearing. While HHS/CDC appreciates the input provided by this partnership, HHS/CDC declines to adopt this suggestion. Importantly, unlike State and local public health authorities who have primary responsibility for the imposition of public health measures occurring within their jurisdictions, HHS/CDC acts in time-sensitive circumstances to prevent communicable disease spread, such as at ports of entry, upon the request of a State or local public health authority of jurisdiction, or when State or local control is inadequate. Furthermore, unlike State and local public health authorities who generally have broad police-power authority to protect the public's health, HHS/CDC's statutory authority with respect to isolation and quarantine is limited to only those small, subset of communicable diseases specified through an Executive Order of the President as quarantinable. Accordingly, HHS/CDC does not foresee sufficient “non-exigent” circumstances where it would be necessary for it to issue a Federal isolation or quarantine order and thus declines to establish the suggested alternative framework on this basis.
The circumstances under which HHS/CDC may apprehend and detain individuals is limited by the terms of 42 U.S.C. 264. HHS/CDC may only isolate, quarantine, or conditionally release an individual if it reasonably believes that the individual is infected with a quarantinable communicable disease and the individual is either arriving into the U.S. from a foreign country, moving between States, or constitutes a probable source of infection to others who may then move between States.
Accordingly, the circumstances under which CDC is would issue a quarantine or isolation order are “exigent” because the individual constitutes a communicable disease risk and is actively engaged in travel or constitutes a source of infection to others engaged in travel. It is thus unnecessary and impractical to provide a “pre-deprivation” hearing prior to quarantining or isolating the individual because he/she if released from custody may be lost to public health follow-up and may expose others. HHS/CDC would not quarantine or isolate an arriving traveler from a foreign country where a single case of a communicable disease such as Ebola exists unless it reasonably believes that the traveler arriving into the U.S. is infected with a quarantinable communicable disease.
Commenters stated that individuals must receive notice of their suspected exposure and be permitted to speak with legal counsel or have legal counsel appointed to them. HHS/CDC agrees that individuals should be adequately notified of the basis for their detention and directs this commenter to sections 70.14 and 71.37, which detail the specific factual content that must be included in a Federal order for quarantine, isolation, or conditional release. We have also modified these sections to explicitly require that the federal order include an explanation of the right to request a medical review, present witnesses and testimony at the medical review, and to be represented at the medical review by either an advocate (
As previously stated, consistent with principles of preventing communicable disease spread, HHS/CDC will also take measures (such as ensuring phone access) to allow apprehended individuals to have contact with family or legal counsel whom they hire at their own expense. As explained further below, HHS/CDC will also appoint representatives, including a medical representative and an attorney, if the individual is indigent and requests a medical review. Individuals who do not qualify as indigent may also choose to be represented at the medical review by an advocate (
This commenter also requested clarity on what legal recourse may be available to apprehended individuals. While HHS/CDC does not express an opinion regarding what form of legal action an aggrieved individual should pursue, we note that these regulations do not impact the constitutional or statutory rights of individuals to seek judicial redress for detention.
HHS/CDC received comments from the public regarding HHS/CDC's authority to “arrest” individuals. One commenter stated that individuals should only be detained when a crime has been committed. One association objected to HHS/CDC's “power to detain an individual for 72 hours and longer without any Federal court order.” Some commenters also worried that any person showing signs of a “common cold” may be held. To be clear, HHS/CDC is not a law enforcement agency, it has no legal authority to “arrest” individuals, but rather has been granted the authority by Congress to “apprehend and detain” individuals for the purposes of preventing the introduction, transmission and spread of quarantinable communicable disease as specified in an Executive Order of the President. 42 U.S.C. 264(b). This provision further provides that “regulations may provide that if upon examination any such individual is found to be infected, he may be detained for such time and in such manner as may be reasonably necessary.” 42 U.S.C. 264(d)(1). HHS/CDC strongly believes that these
HHS/CDC received comments from the public inquiring about the criteria that HHS/CDC uses to determine whether an individual should be detained and assessed. As provided for in the regulation, HHS/CDC may apprehend, examine, isolate, and quarantine such individuals to protect the public's health. In determining whether an individual poses a threat to public health, HHS/CDC has developed and uses the following criteria: Clinical manifestations: Signs and symptoms consistent with those of a quarantinable disease; known or suspected contact with a case,
One commenter questioned whether, regarding the list of quarantinable communicable diseases listed by Executive Order of the President, a “common cold” would qualify as a “severe acute respiratory syndrome” and therefore subject the ill individual to a public health order. In response, we note that Executive Order 13295 (April 4, 2003), as amended by Executive Order 13375 (April 1, 2005) and Executive Order 13674 (July 31, 2014), explicitly excludes “influenza” from the definition of severe acute respiratory syndrome.
HHS/CDC received several comments from a flight attendant union relating to apprehension and detention of a flight crew. These comments include that the flight attendant's employer should be made aware of the apprehension, that HHS/CDC should limit the personal health information that is shared with the employer, that the employer should treat this information as confidential, and that those apprehended should be able to notify families and their union. In response, HHS/CDC notes that it works closely with the airline industry regarding potential occupational exposures to communicable diseases. Furthermore, HHS/CDC notes that personally identifiable health information collected and maintained under the Privacy Act will be disclosed only with the consent of the subject individual, in accordance with the routine uses published in HHS/CDC's system of records notice (72 FR 70867), or under an applicable exception to the Privacy Act. While these regulations do not mandate how employers should treat the personal health information of their employees, HHS/CDC agrees that such information should be treated as confidential. Lastly, consistent with principles of preventing communicable disease spread, HHS/CDC will allow persons detained in accordance with these regulations to communicate with family, union representatives, legal counsel whom they hire at their own expense, and others of their choosing. HHS/CDC will also appoint representatives, including a medical representative and an attorney, if the individual is indigent and requests a medical review.
One commenter asked about provisions for people detained under HHS/CDC's authority who require emergency medical care, and whether the need to conduct a public health assessment could impede such care resulting in harm to the individual. In response, HHS/CDC states that public health officers at ports of entry work closely with emergency medical service (EMS) personnel and that emergency medical care takes precedence over the public health risk assessment. When an individual suspected of being infected with a quarantinable communicable disease requires emergency care, the individual would be transported immediately by EMS to a medical facility, using appropriate infection control precautions. The public health risk assessment would be completed subsequently using information provided by the examining health care provider in coordination with the health department of jurisdiction.
After consideration of these comments, HHS/CDC has finalized the
HHS/CDC received several comments relating to medical examinations. HHS/CDC received a comment from a public health agency stating that when an individual agrees to submit to a medical examination, it may be more appropriate to medically examine the patient during the “apprehension” period. In response, HHS/CDC notes that these regulations do not prohibit voluntary compliance with public health recommendations in the absence of a public health order. Notwithstanding, HHS/CDC believes that the ability to order a medical examination as part of an order for isolation, quarantine, or conditional release is an important tool to protect the public's health. This agency also stated that the definitions of “health status” and “public health risk” should be modified to ensure that the medical examination contains the minimum requirements needed to assess the communicable disease of public health concern. In response, HHS/CDC clarifies that its sole purpose in ordering a medical examination would be to determine the presence, absence, or extent of infection with a quarantinable communicable disease. HHS/CDC notes, however, that the medical examination is conducted by clinical staff who have primary responsibility for the patient's medical care and treatment and that a medical examination would thus ordinarily include the taking of a medical history and physical examination. HHS/CDC believes that this definition is clear and that no further modifications are needed.
HHS/CDC received a comment expressing concern that an individual would not be able to choose his or her own clinical healthcare provider if
One commenter expressed concern that nonmedical personnel may be allowed to make a determination of illness resulting in actions being taken based on potential misdiagnosis. HHS/CDC appreciates the opportunity to clarify this point. Decisions to issue Federal public health orders are based on the assessment of qualified and licensed physicians. These decisions are based on all available evidence, including clinical presentation, medical and exposure history, and the results of medical evaluation and laboratory testing. Treatment decisions are made by the individual's treating physician with guidance from public health subject-matter experts.
One commenter suggested that medical examinations should be conducted only with the informed consent of the individual and should not “forcibly” be required. HHS/CDC clarifies that it may require a medical examination under 42 U.S.C. 264(d) because this section, among other things, authorizes the “apprehension and examination” of individuals reasonably believed to be infected with quarantinable communicable diseases in a qualifying stage. CDC, however, agrees that medical examinations may not be conducted “forcibly.” Furthermore, because medical examinations will typically occur in a hospital setting and be performed by clinical staff, it will be incumbent upon clinical staff to obtain the patient's informed consent consistent with established standards of medical practice.
Public health organizations provided several comments regarding medical examinations, including that they be performed promptly so as not to curtail liberty, include only minimal components necessary to establish the diagnosis of or rule out the quarantinable communicable disease of concern, and that specimens obtained during such examinations not be used for purposes other than diagnostic testing without informed consent. In response, HHS/CDC states that it agrees with all of these points and that CDC, in keeping with current practice, has a commitment to upholding the highest ethical standards for both medical care and research.
One public health organization asked for clarification of whether hospital staff would be involved in obtaining consent for medical examinations authorized under this rule. In response, HHS/CDC states that, while a public health order authorizes that a medical examination be conducted, should any invasive procedures be determined by the treating clinician to be necessary for diagnostic or treatment purposes, consent for such procedures should be obtained by medical staff in accordance with established standards.
One organization asked for clarification of the location where medical examinations would be conducted, including whether inpatient or ambulatory-care facilities would be included. HHS/CDC responds that it will coordinate with State or local health departments of jurisdiction concerning such operational details as the exact locations where medical examinations may be conducted.
Several public health organizations commented on whether the issuance of public health orders is needed prior to medical examination if individuals agree voluntarily to such examinations, noting that a requirement for the issuance of orders could impede or delay the medical examination and that the examination, itself, could determine whether such orders are needed. In response, HHS/CDC notes that it may choose not to exercise its authority to issue public health orders if an individual complies voluntarily with HHS/CDC's requirements, including the requirement of a medical examination. However, HHS/CDC retains the right to issue an order requiring a medical examination should an individual not comply voluntarily. Of note, one public health organization supported the use of Federal public health orders in requiring medical examinations, stating that such orders had been used effectively in the past to facilitate timely examination.
One public health organization requested that language be added to the rule stating that medical examinations will be performed with proper adherence to worker safety and health policies and protocols. HHS/CDC responds that such occupational health protections are beyond the scope of this regulation and are covered by regulations of the Occupational Safety and Health Administration (OSHA).
HHS/CDC received several comments from a flight attendant union relating to medical examinations. This organization stated that the regulations should mandate that an employer pay a flight attendant's salary and per diem and that no flight attendant should incur discipline as a result of being absent from work. This organization further commented that any changes in the employer-employee relationship should be addressed through joint guidance between government and industry groups. This group also commented that “promptly” should be defined in terms of the length of time that may be needed to arrange for a medical exam and that no more than five hours would be reasonable. This group further stated that “reasonably believed” should be defined to require specific, articulable facts that a trained medical professional can articulate.
HHS/CDC responds that these regulations do not alter, define, or mandate the employer-employee relationship between flight attendants and their employers. In regard to the timeframe for arranging a medical examination, HHS/CDC rejects a specific 5-hour timeframe as too prescriptive, but agrees that the medical examination should be arranged as quickly as possible based on the circumstances of the event. HHS/CDC further notes that the definition of “reasonably believed to be infected” already requires the existence of “specific articulable facts” articulated by a public health officer. Such specific, articulable facts would, for instance, include “contact with an infected person or an infected person's bodily fluids, a contaminated environment, or through an intermediate host or vector.”
HHS/CDC received a comment from a partnership of public health legal scholars and organizations expressing concern that the regulations do not appear to limit the invasiveness of a medical examination, so long as the examination itself is needed to diagnose or determine the presence or extent of infection with a quarantinable communicable disease. HHS/CDC
After consideration of these comments, HHS/CDC has finalized the provisions relating to
HHS/CDC received several comments relating to the issuance of Federal orders for isolation or quarantine. A flight attendant union commented that crew lists should not be published as part of a quarantine order posted in a conspicuous location. This group further stated that quarantine orders for flight attendants should be treated differently than those applicable to passengers or other airline personnel because flight attendants are health and safety personnel trained in how to perform CPR and operate defibrillators. In response, HHS/CDC notes that if a public health order is publicly posted, the order will be written to refer to a group of individuals, such as all individuals onboard a particular affected interstate or international flight. Under such circumstances, HHS/CDC expects that all members of the group will receive individual copies of the public health order. In some circumstances, CDC anticipates that issuance of a group federal order to an individual may not be feasible—such as when the location of the individual is unknown. Thus, HHS/CDC does not expect to publish the names of individual passengers or crew as part of a publicly posted quarantine order. Furthermore, while HHS/CDC agrees that flight attendants provide an important public health and safety role, HHS/CDC disagrees that acknowledging this role requires the issuance of different public health orders than those issued to other affected persons.
HHS/CDC received several comments requesting the “least restrictive” means with respect to quarantine and isolation. HHS/CDC agrees and clarifies that in all situations involving quarantine, isolation, or other public health measures, it seeks to use the least restrictive means necessary to prevent spread of disease. Regarding quarantine, as an example, during the 2014-2016 Ebola epidemic, HHS/CDC recommended monitoring of potentially exposed individuals rather than quarantine. Most of these people were free to travel and move about the community, as long as they maintained daily contact with their health department. For some individuals with higher levels of exposure, HHS/CDC recommended enhanced monitoring (involving direct observation) and, in some cases restrictions on travel and being in crowded places, but did not recommend quarantine. HHS/CDC has the option of “conditional release” as a less restrictive alternative to issuance of an order of quarantine or isolation. Under a conditional release order, the person would not be confined as long as the terms of the order were followed. Should a quarantine or isolation order be deemed necessary, home quarantine or isolation would be considered as a less restrictive option to confinement in a guarded facility as long as this was determined to be safe for other household members, appropriate based on the individual's ability and willingness to follow all necessary precautions, and based on the individual's history of compliance with public health recommendations.
One public health organization requested that HHS/CDC specify the types of locations of Federal quarantine and asked clarification of whether this would occur on lands or property under Federal jurisdiction, and whether Federal or State standards would apply to an individual quarantined on lands or property not under Federal control. In response, HHS/CDC notes that operational issues such as the exact location of a quarantine and whether Federal, State, and local orders would be issued separately or concurrently would depend on individual facts and circumstances unique to each case. HHS/CDC notes, however, that it is not unusual for the Federal government to exercise jurisdiction concurrently with State and local governments.
One public health organization noted the longstanding difficulties faced by Federal, State and local authorities in identifying suitable facilities for quarantining of large groups of people (approximately 350, representing the potential complement of travelers onboard an international flight), including the immediate availability of such facilities in the event of an emergency. HHS/CDC acknowledges these difficulties and affirms that it is actively working with Federal partners to identify suitable locations to accommodate large groups of people while under a Federal public health order.
One commenter stated, “If this is enacted . . . everyone who works with diseases . . . CDC, WHO, Labs, Drs., nurses etc. would have to be arrested as potential carriers.” HHS/CDC disagrees with this assertion. HHS/CDC is not a law enforcement agency and does not have authority to arrest individuals. HHS/CDC's authority to issue Federal public health orders is limited to those diseases defined by Executive Order as quarantinable communicable diseases. Furthermore, HHS/CDC does not recommend restriction of movement for healthcare workers, laboratory workers, or others whose occupations involve working with infectious pathogens as long as the recommended infection control precautions are followed. Workers who do not take the necessary precautions or have unprotected exposures to a quarantinable communicable disease may be subject to restrictions if they meet the requirements for issuance of Federal public health orders.
Some commenters indicated that vaccination or treatment should not be “conditions” under “conditional release.” HHS/CDC confirms that this final rule does not compel mandatory vaccination or medical treatment of individuals. HHS/CDC clarifies that when medically appropriate, vaccination or treatment, may be “conditions” of an individual's release from quarantine or isolation. Individuals consent to these conditions.
A public health agency commented that HHS/CDC should consider the conditions of confinement to ensure that certain minimum requirements, such as access to telephones, and reasonable accommodation of dietary restrictions, are observed. Specifically, such conditions should be considered at different stages including as part of the issuance of an order, during the mandatory reassessment, and as a part
HHS/CDC received a comment from a public health agency noting that it should assume the responsibility of providing translation and interpretation services when issuing an order for quarantine, isolation, or conditional release, or when conducting a medical review. HHS/CDC agrees and has incorporated these changes into the regulatory text.
HHS/CDC received a comment from a partnership of public health legal scholars and organizations requesting clarification as to whether personal service will occur when a quarantine order is issued on a group basis and posted in a conspicuous location. In response, HHS/CDC notes that if a public health order is publicly posted, the order will be written to refer to a group of individuals, such as all individuals onboard a particular affected interstate or international flight. Under such circumstances, HHS/CDC expects that all members of the group will receive individual copies of the public health order, thus addressing any concerns about adequacy of notice. Because HHS/CDC, however, cannot foresee all of the circumstances that may arise in an emergency situation, HHS/CDC believes that it is appropriate for these regulations to authorize service through posting or publication, but only when individual service is “impracticable.”
After consideration of these comments, HHS/CDC has modified the provisions regarding requirements relating to
A number of commenters were confused regarding the 72-hour period, believing this period referred to the period of apprehension pending the issuance of a Federal public health order and asked why 72 hours were needed. The 72-hour period proposed referred to the timeframe in which HHS/CDC must conduct a mandatory reassessment of the continued need for isolating or quarantining an individual following the service of a Federal public health order. However, in response to public comments HHS/CDC has also added in sections 70.14(b) and 71.37(b) a requirement that it serve the individual with a Federal public health order within 72 hours of that individual's apprehension.
Some commenters, including a public health association, supported the mandatory 72-hour reassessment provision guaranteed by these regulations. One of these commenters also suggested the time be re-evaluated periodically in the event that technology provides a way of speeding up the diagnosis process; another suggested the time frame be expanded to five days to account for weekends; one more commenter noted that circumstances may arise where an additional 72 hours may be needed; and another commenter stated that a second 72-hour reassessment should be required. HHS/CDC is committed to performing a reassessment within 72 hours of the federal public health order being served on the individual. If, at that time, HHS/CDC determines that the order was properly issued and that a public health risk continues to exist, the order would either be continued or HHS/CDC would work with the State and local health department to transfer custody. In the event that HHS/CDC continues the order, the individual may request a medical review at that time.
A few commenters stated that the reassessment of HHS/CDC's orders should be conducted in a shorter time period than 72 hours such as within 12 hours, performed electronically and conducted by a 3rd party. While HHS/CDC appreciates the input provided by these commenters, HHS/CDC finds these suggestions impractical. Medical examination to confirm or rule out infection with a quarantinable communicable disease may require up to 72 hours to allow for laboratory testing. While some communicable diseases (typically viral infections) may be diagnosed using molecular tests such as polymerase chain reaction (PCR) that take several hours to perform, others require that the organism be cultured to make a confirmed diagnosis or to conduct antimicrobial sensitivity testing in order to provide appropriate treatment. This is typically needed for bacterial infections, such as diphtheria or plague, and may take 48-72 hours (or longer) to complete. For some infectious tuberculosis cases, laboratory confirmation may take several weeks although preliminary molecular testing may assist in conducting an assessment of risk sufficient to continue or rescind the order. Specimen transportation time may also need to be factored in as testing for certain diseases is only available at state public health laboratories or CDC.
While HHS/CDC is required by this provision to reassess the need for a Federal public health order within 72 hours, HHS/CDC will immediately release individuals from detention if at any time it receives information confirming the absence of infection with a quarantinable communicable disease. We note that while the medical assessment is intended primarily as a review of available medical records and other relevant information, these regulations do not prohibit HHS/CDC from conducting the review electronically, for instance by relying on electronic medical records. Furthermore, HHS/CDC disagrees that relying on internal decision-makers for the reassessment is inappropriate or undesirable and thus does not consider
HHS/CDC received a comment from a public health agency requesting clarification as to whether all individuals within a group will receive individual due process when a group order is issued. This agency also questioned the feasibility of providing a mandatory reassessment and medical review for large groups. In response, HHS/CDC confirms that if a group order is issued, all individuals within that group will be accorded due process. Furthermore, HHS/CDC has provided flexibility in the regulations to allow for a mandatory reassessment of the group order and consolidation of medical reviews where appropriate.
HHS/CDC received a comment from a partnership of public health legal scholars and organizations stating that while the rule requires consideration of least restrictive means upon reassessment of an order and as part of the medical review, HHS/CDC must also consider least restrictive means prior to the issuance of a quarantine or isolation order. HHS/CDC agrees that all means short of assuming legal custody of the individual including attempting to obtain voluntary compliance with public health measures should be explored. HHS/CDC notes, however, that an isolation or quarantine order is typically issued in time-sensitive situations where because of the exigent circumstances surrounding the risk of communicable disease spread it is not immediately possible to explore all available less restrictive means, including the appropriateness of a home environment, instead of a hospital. For this reason, HHS/CDC has chosen the mandatory reassessment and medical review as the appropriate time to conduct a formal assessment of least restrictive means. To the extent that the commenters suggest that due process requires more, we disagree.
After consideration of these comments, HHS/CDC has finalized the provisions relating to
HHS/CDC received several comments arguing that its proposed medical review procedures are deficient. Specifically, one commenter stated that assessment procedures should be clearly communicated to all affected persons; that HHS/CDC should more clearly delineate “less restrictive alternatives;” that affected individuals should have a right to legal representation; and that access to independent judicial review is essential.
HHS/CDC agrees that it should clearly communicate review procedures to individuals subject to Federal isolation, quarantine, or conditional release. We note that sections 70.14 and 71.37 have been modified to require that the federal order authorizing isolation, quarantine, or conditional release include an explanation that the federal order will be reassessed 72 hours after it is served on the individual and of the right to request a medical review, present witnesses and testimony at the medical review, and to be represented at the medical review by either an advocate (
Similarly, in regard to minor children or adults with a cognitive disability, HHS/CDC will work with a competent guardian to ensure that procedures are clearly communicated. In regard to less restrictive alternatives, HHS/CDC believes that it is not possible to delineate with specificity all of the less restrictive options that may be available because such determinations will inevitably be based on the individual circumstances of each case, including the severity of the particular disease-causing agent, availability of treatment options should the disease not be adequately contained, the patient's particular level of infectivity or communicability, appropriateness of the home environment, and the individual patient's understanding, ability, and willingness to comply with less restrictive alternatives. For this reason, HHS/CDC has made consideration of less restrictive alternatives a part of the medical review proceeding where evidence may be submitted into the record, testimony obtained, and a recommendation provided by the medical reviewer. As a general matter, however, HHS/CDC clarifies that less restrictive alternatives would refer to reasonable and available alternatives that are adequate to protect the public's health other than confinement in a guarded facility, such as home quarantine, directly observed therapy, or other forms of supervised release.
In response to concerns about legal representation, HHS/CDC has amended the definition of “Medical representative” to “Representatives” and will now appoint “an attorney knowledgeable of public health practices” in addition to a “physician, nurse practitioner, or similar medical professional qualified in the diagnosis and treatment of infectious diseases.” HHS/CDC hopes that by appointing both an attorney
HHS/CDC also agrees that access to independent judicial review is essential and assures the public that this final rule does not affect the constitutional or statutory rights of individual to seek
HHS/CDC received a comment from a partnership of public health legal scholars and organizations stating that the CDC Director should not have unfettered discretion to accept or reject the medical reviewer's decision, but rather should only be allowed to reject a decision based on lack of substantial evidence. HHS/CDC believes that it would be inappropriate to mandate through regulation that the decision of a medical reviewer (which may include an HHS or CDC employee) should displace the decision of the CDC Director, particularly where the statute and delegation of authority have provided otherwise.
HHS/CDC received several comments stating that a medical representative should be appointed to anyone regardless of their ability to pay. HHS/CDC disagrees and notes that appointment of a representative at the government's expense without regard to the patient's indigence is not required. The status of “indigent” is self-reported as HHS/CDC will not require access to an individual's financial records. Those who self-identify as indigent may be required to sign an affidavit or declaration under penalty of perjury stating they meet the threshold of at least 200% of the applicable poverty guidelines.
HHS/CDC received a comment from a non-profit organization contending that the medical review does not comport with due process because there is no limit on the number of reviews that may be consolidated into a single proceeding, no access to legal counsel, no independence of the reviewer from the initial decision-maker, no confrontation or cross-examination of witnesses, no compulsory process for obtaining evidence or testimony, and no judicial review. This group contends that any detention that is non-exigent should occur only based on the “informed explicit written consent” of the patient or “utilize the existing legal procedures for involuntary commitment of persons.”
HHS/CDC disagrees that the medical review as described and set forth in the regulations does not comport with due process. While HHS/CDC acknowledges that there is no numerical limit to the number of medical reviews that may be consolidated, HHS/CDC believes that the circumstances giving rise to the need for consolidation will be exceedingly rare and that medical reviews will generally be conducted on an individual basis.
HHS/CDC also disagrees that there is no access to legal counsel because HHS/CDC will, consistent with principles of preventing communicable disease spread, allow persons subject to public health orders to communicate with family and legal counsel whom they hire at their own expense. Furthermore, as described above, the regulations have been amended to require the appointment of
HHS/CDC further believes that reliance on internal reviewers does not violate due process and notes that it is not unusual, for instance, for hospitals to rely on internal decision-makers when determining whether to commit a mental health patient on an emergency basis. The regulations, moreover, explicitly state that the medical reviewer will not be the same individual who initially authorized the quarantine or isolation order. We note further that the definition of both “representatives” and “medical reviewer” would in fact allow for the appointment of non-HHS/CDC employees in these capacities because both terms are broadly defined in terms of the professional qualifications and not employment status of these individuals. Thus, these regulations do not prohibit the CDC Director from appointing personnel from outside of the agency to assist in conducting a medical review. For individuals qualifying as indigent, HHS/CDC intends, generally, to provide independent legal counsel from outside of the agency.
HHS/CDC also clarifies that during the course of a medical review, a detained individual will be permitted to present witnesses and question any witnesses offered by HHS/CDC. Any “confrontation” of witnesses, however, will be conducted in a manner consistent with principles of preventing communicable disease spread. HHS/CDC, as a Federal agency, however lacks the legal authority to allow a detained individual to use compulsory processes, such as a subpoena, to compel the presence of witnesses. HHS/CDC will nevertheless make reasonable efforts to produce any HHS/CDC employees that would be critical to a detained individual's presentation of evidence during a medical review.
HHS/CDC also disagrees that there is no judicial review and notes that these regulations do not impact an individual's constitutional or statutory rights to contest their Federal detention through such traditional mechanisms as a petition for a writ of habeas corpus under 28 U.S.C. 2241. To the extent, however, that the commenter contends that HHS/CDC should follow legal procedures other than those set forth through the Federal quarantine statute at 42 U.S.C. 264, we disagree. HHS/CDC notes that as a Federal agency it lacks the ability to rewrite Federal statutes or grant Federal courts with legal jurisdiction that they do not already possess. HHS/CDC also rejects as impractical and as insufficient to protect public health, the notion that isolation or quarantine should only occur based upon the consent of the subject individual.
HHS/CDC received a comment from a flight attendant union that as an important “safety net” HHS/CDC should pay for “second medical opinions.” HHS/CDC declines to extend payment to medical examinations beyond those required as part of a public health order, but notes that as part of a medical review individuals may submit additional evidence into the record concerning their health status and potential public health risk to others.
One commenter noted language in the NPRM stating that the “medical review is not intended to address the concerns of individuals who take issue with amenities of their confinement . . .,” interpreting this to mean that “no provision is made for those who must use a CPAP (continuous positive airway pressure) at night or who need orthopedic appliances, or who have food allergies, to name a few.” In response, HHS/CDC states that, when confinement of an individual under Federal public health authorities is needed, HHS/CDC will ensure that such confinement will occur in a location and with necessary amenities to ensure the health and safety of the individual, including provision for medical or dietary requirements. Issues related to health and safety will be addressed at the time of the issuance of the order, or as soon as HHS/CDC is made aware of them, but are beyond the scope of the medical review which is intended to re-evaluate the continued need for the Federal public health order based on a review of the medical and other evidence submitted into the record.
HHS/CDC received a comment from a partnership of public health legal scholars and organizations stating that it should provide for an oral hearing whenever practical. HHS/CDC agrees that an oral hearing is appropriate and has modified the language to state: “The medical review shall be conducted by telephone, audio or video conference, or through other means that the medical reviewer determines in his/her discretion are practicable for allowing the individual under quarantine, isolation, or conditional release to participate in the medical review.”
HHS/CDC received a comment from a partnership of public health legal scholars and organizations that the CDC Director's written order, which constitutes final agency action, must advise individuals of their rights to appeal to Federal court. We note that the commenters specifically cite the Administrative Procedures Act (APA, 5 U.S.C. 704), which provides that “final agency action for which there is no other adequate remedy in a court are subject to judicial review.” While HHS/CDC agrees that independent judicial review of agency decisions is available, it takes no position as to whether such reviews should occur under the APA (as suggested by the commenters) or through other traditional mechanisms as a petition for a writ of habeas corpus under 28 U.S.C. 2241. For this reason, HHS/CDC believes that due process is satisfied by designating the Director's written order as “final agency action” without further speculation as to the exact form of further legal review. However, to clarify HHS/CDC's intended we have added the following language to the regulatory text: “Nothing in these regulations shall affect the constitutional or statutory rights of individuals to obtain judicial review of their federal detention.”
Accordingly, after consideration of these comments, HHS/CDC has modified paragraph (f) of the provisions regarding
HHS/CDC received a comment from a flight attendant union concerning whether an overlap existed between CDC's maintenance of administrative records relating to the issuance of Federal public health orders and an employee's access to exposure and medical records under OSHA (29 CFR 1910.1020). We note that since HHS/CDC is not a flight attendant's employer, HHS/CDC would not be covered by this particular OSHA standard under these circumstances. Furthermore, because these regulations do not alter, define, or mandate the employer-employee relationship between flight attendants and their employers, to the extent that this question seeks input regarding an employer's obligations under OSHA, HHS/CDC views the question as outside the scope of the rulemaking.
HHS/CDC received a comment from a partnership of public health legal scholars and organizations stating that the regulations should require quarterly reporting to Congress to facilitate transparency and oversight. While CDC recognizes the additional transparency that direct reporting of details related to quarantine activities may provide to the public, CDC notes that historically, the issuance of Federal orders is rare (
CDC does routinely describe its practices in published Morbidity and Mortality Weekly Reports (MMWR) when new methods, technologies, or other changes make it possible to revise and improve programs (
After consideration of comments received and as further explained below, HHS/CDC has modified the provisions regarding
HHS/CDC received many additional comments from the public concerned over whether this regulation violates rights guaranteed by the U.S. Constitution, such as Due Process and specifically during the medical review process. HHS/CDC disagrees that the regulations are insufficient to protect the constitutional rights of individuals. In regard to medical reviews, HHS/CDC asserts that allowing individuals to choose at the government's expense who will conduct the medical review is not required by due process and that there is no conflict of interest in allowing the CDC Director to appoint who will conduct the medical review on the agency's behalf. HHS/CDC asserts, however, that individuals will be allowed to submit relevant information, including information provided by outside doctors or other medical specialists during the medical review. HHS/CDC will further preserve relevant agency documents for purposes of ensuring a competent legal review in the event that the individual seeks judicial redress of their quarantine or isolation. As explained elsewhere, law enforcement support for quarantine or isolation orders will generally be provided by U.S. Customs and Border Protection, U.S. Coast Guard, or other Federal law enforcement programs, but HHS/CDC may also accept voluntary state and local assistance in enforcing its Federal orders.
HHS/CDC received public comment expressing concern with regard to potential language barriers experienced by foreign nationals during travel. HHS/CDC responds that it has revised those sections of the regulations dealing with issuance of Federal orders to require that HHS/CDC arrange for translation or interpretation services of the Federal order as needed. In circumstances where it would be impractical to provide a line-by-line translation of the order, HHS/CDC may take other steps to reasonably apprise individuals of the contents of the order, for example, by arranging for oral translation services.
One public health organization questioned the feasibility of CDC's conducting the mandatory reassessment or medical review of a group quarantine order within the specified time frame. In response, HHS/CDC states that a group quarantine order would be issued on the basis of a shared exposure for all individuals in the group; therefore, the mandatory reassessment or medical review could be conducted based on the shared exposure, unless certain individuals in the group were determined to be immune to the quarantinable communicable disease in question. Part of the reassessment would include a determination of whether the group order should be revised as individual orders.
HHS/CDC also received a comment that the duration of a quarantine, isolation, or conditional release period is not adequately defined. HHS/CDC disagrees because the regulations limit these actions to only those who would pose a public health threat, for instance, by being in the “qualifying stage” or a quarantinable communicable disease. The “qualifying stage” of the disease is defined as a communicable stage of the disease or a precommunicable stage, but only if the disease would be likely to cause a public health emergency if transmitted to other individuals. We note that HHS/CDC's “Health Information for International Travel” (also known as the Yellow Book) provides the public with general guidance regarding the expected length of communicability for many quarantinable communicable diseases. For more information, please see
HHS/CDC received a comment that the qualifications of who may issue a quarantine or isolation order are not defined leading to concerns that such orders will be issued by non-medically trained personnel. In regard to the qualifications of who may issue a Federal public health order, HHS/CDC notes that all orders are issued under the authority of the CDC Director, but that in practice such determinations are made only by personnel trained in public health and licensed to practice medicine in the United States.
One organization requested that HHS/CDC provide notification to the appropriate embassy if a foreign national is placed under a Federal order. In regard to non-resident foreign nationals, HHS/CDC clarifies that it will coordinate closely with the U.S. Department of State to ensure that all rights and obligations under the Vienna Convention on Consular Relations and bilateral agreements will be observed. Because of the complexity of this issue, including reliance on the interpretation of treaties and bilateral agreements, HHS/CDC believes that it is best to ensure compliance through operational procedures, rather than to formalize such obligations through regulatory text.
One commenter requested that HHS/CDC clarify its handling of issues relating to diplomatic immunity. HHS/CDC recognizes that under the Vienna Convention on Diplomatic Relations, diplomats are not liable to any form of “detention.” It is HHS/CDC's policy to coordinate closely with the U.S. Department of State regarding any public health issues arising in regards to diplomats and HHS/CDC will continue to do so under these regulations.
One public health organization recommended that HHS/CDC include written notification to individuals under public health orders of the duration that the order will be in effect. HHS/CDC responds that it will provide information on the incubation and communicability period of the quarantinable communicable disease, if known, but that the duration of the public health order may depend on a variety of factors, such as demonstration of non-infectiousness through repeated laboratory testing. Thus, HHS/CDC is unable to provide an exact numerical limit (in terms of days or hours) that a public health order will remain in effect.
HHS/CDC received a comment from a partnership of public health legal scholars and organizations stating that in exigent circumstances HHS/CDC may isolate or quarantine an individual, but should then be required to hold a mandatory due process hearing within 48 hours before a neutral decision-maker. At the outset, HHS/CDC agrees with the commenters that the appropriate framework for determining the adequacy of due process procedures are the factors articulated by the Supreme Court in
Regarding the use of a “neutral” decision maker, HHS/CDC restates that the definition of both “representatives” and “medical reviewer” would in fact allow for the appointment of non-HHS/CDC employees in these capacities. The regulations, moreover, explicitly state that the medical reviewer will not be the same individual who initially authorized the quarantine or isolation order. Accordingly, HHS/CDC has determined that the procedures it has adopted for medical reviews comport with due process.
Several people commented on the private nature of the doctor-patient relationship. HHS/CDC appreciates the opportunity to respond to this concern. HHS/CDC is charged with protecting the health of the public. At times, this requires obtaining private information about people's health or exposure history and taking certain actions to protect others from becoming sick with a communicable disease. HHS/CDC works closely with State and local health departments to ensure that ill people detained or isolated under Federal orders receive appropriate care and treatment. HHS/CDC is also bound by the Privacy Act to protect personally identifiable information collected and maintained under that Act. For a more detailed explanation of how such information is protected, please see
HHS/CDC received a comment from a professor of public health law and ethics stating that HHS/CDC should address how the HIPAA Privacy Rule, Americans with Disabilities Act (ADA), and Administrative Procedure Act (APA) counterbalance the powers set forth in the proposal and reflect “appropriate social distancing practices.” The commenter did not highlight which specific provisions of these laws HHS/CDC should address or the relationship that these laws have to social distancing. Notwithstanding, HHS/CDC may generally state that these regulations will be carried out consistent with Federal law.
We note that HHS is a hybrid entity under HIPAA, but only those parts of the Department that have been
CDC most often acts as a public health authority under the HIPAA Privacy Rule. During the course of a public health investigation it may seek the support of a covered entity, such as a hospital or private physician. The HIPAA Privacy Rule permits the disclosure of public health information to public health authorities, such as the CDC, and their authorized agents for public health purposes including but not limited to public health surveillance, investigations, and interventions. More information concerning the HIPAA Privacy Rule may be found here:
Similarly, we note that this final rule while formalizing administrative policies and practices, does not affect the rights of individuals under the ADA or APA, which are statutes enacted by Congress. One commenter opined that collection of contact information as part of public health prevention measures and maintenance of administrative records raise privacy concerns and that HHS/CDC should consider “super-enhanced privacy protections” consistent with the Model State Public Health Privacy Act of 1999. HHS/CDC disagrees. As a Federal agency, HHS/CDC must abide by the laws established by Congress for the protection of records, specifically the Privacy Act of 1974, 5 U.S.C. 552. On December 13, 2007, HHS/CDC published a system of records notice (72 FR 70867) under the Privacy Act describing, among other things, safeguards for preventing the unauthorized use of information collected from travelers. HHS/CDC will make disclosures from this system only with the consent of the subject individual, in accordance with routine uses published in its system notice, or in accordance with an applicable exception under the Privacy Act.
HHS/CDC received several comments relating to payment for medical expenses. One commenter stated that HHS/CDC should assume payment for all related medical expenses, housing costs, and other necessities for individuals or groups subject to deprivations of liberty and that it is “ethically unfair” for HHS/CDC to be the “payer of last resort.” Another commenter stated that “CDC must guarantee financial help after third party payments are exhausted.” While HHS/CDC acknowledges that it has an ethical, moral, and legal obligation to provide care and treatment for individuals under a Federal quarantine or isolation order, HHS/CDC disagrees that it is “ethically unfair” to excuse a medical insurer or other entity with a contractual obligation from paying for medical expenses. Accordingly, HHS/CDC has determined that it is appropriate for it to maintain and affirm its status as a “payer of last resort.”
Two public health organizations asked whether nonmedical costs such as training of staff, replenishing of personal protective equipment, managing and disposing of biological waste and contaminated supplies, etc., are also subject to HHS/CDC payment authorization. While the costs of care and treatment of individual patients under Federal public health orders are authorized by this rule, these additional costs to the extent that they are unrelated to the individual patient's treatment and care would not be covered by this rule.
HHS/CDC received a comment suggesting that the regulations allow for charging detainees the medical and hospital costs of nonconsensual treatment. HHS/CDC disagrees and first, clarifies that these regulations do not authorize compulsory medical treatment. HHS/CDC further acknowledges that constitutional principles and medical ethics require that those detained under isolation or quarantine have access to adequate nourishment, appropriate accommodation, and medical treatment. However, HHS/CDC has determined that its obligation to pay for medical care and treatment should be secondary to the obligation of any third party, such as a medical insurer that may have a pre-existing contractual obligation with the patient to pay for hospital expenses. Accordingly, HHS/CDC declines to make any changes to the provisions authorizing payment for medical care and treatment.
A flight attendant union commented that HHS/CDC should pay for any outside costs that the flight attendant would normally incur relating to medical treatment,
After consideration of these comments, HHS/CDC has finalized the provisions relating to payment for care and treatment (§§ 70.13 and 71.30) as proposed.
HHS/CDC received comments relating to the intention and use of agreements. Commenters worried that such “agreements” may be coerced, and individuals would be compelled to submit to involuntary testing or “research projects.” One commenter stated that the definition of agreement is circular and confusing because the word “agreement” appears in the definition. This commenter also suggested that what HHS/CDC proposes should more aptly be labeled as an “Affidavit” or “Affirmation” because the definition as proposed by HHS/CDC lacks bilateral obligations on both parties.
Due to the number of public comments received expressing confusion over this public health measure, HHS/CDC has removed the provisions on
Many commenters expressed concern over the penalties provisions contained within the proposed regulation. Specifically, one association objected to “CDC's proposed increase in penalties.” Another stated that “CDC is not qualified to decide upon the punishment.” HHS/CDC takes this time to better explain that the penalties listed in today's final rule, which have been codified as proposed, are set forth by Congress via statutory language and codified into regulation to reflect current practice. This regulation serves to notify the public of the existing statutory penalties for violation of quarantine regulations, which HHS/CDC has no authority to change.
One organization requested that language be added to rules regarding the issuance of penalties if an employer provides an “unsafe work or unhealthful working condition.” HHS/CDC responds that such penalties are beyond the scope of this rule and refers
HHS/CDC received a comment from a flight attendant union regarding criminal penalties stating that HHS/CDC should provide further clarification as to what constitutes a violation and clarify that flight attendants who act in accordance with their company's practices, policies, or procedures should not be held criminally liable. In response, HHS/CDC notes that while the text of the regulation is being updated, these regulations do not increase the criminal penalties that may be imposed for violations of quarantine regulations or alter the manner in which liability may be assessed. Rather, these regulations serve to inform the public of the criminal penalties that currently exist in statute (42 U.S.C. 271 and 18 U.S.C. 3571). Furthermore, HHS/CDC clarifies that criminal penalties, if any, would be assessed by a court of law based on an indictment or information filed by an Assistant U.S. Attorney based on individualized facts and circumstances, and would not be determined administratively by the CDC.
HHS/CDC offers the following explanation to inform the public regarding this section. As prescribed in section 368 (42 U.S.C. 271) and under 18 U.S.C. 3559 and 3571(c), criminal sanctions exist for violating regulations enacted under sections 361 and 362 (42 U.S.C. 264 and 265). 18 U.S.C. 3559 defines an offense (not otherwise classified by letter grade) as a “Class A misdemeanor” if the maximum term of imprisonment is “one year or less but more than six months.” 18 U.S.C. 3571 provides that individuals found guilty of an offense may be sentenced to a fine. Specifically, an individual may be fined “not more than the greatest of”—(1) the amount specified in the law setting forth the offense; or (2) for a misdemeanor resulting in death, not more than $250,000; or (3) for a Class A misdemeanor that does not result in death, not more than $100,000. Similarly, an organization, found guilty of an offense may be fined “not more than the greatest of”—(1) the amount specified in the law setting forth the offense; or (2) for a misdemeanor resulting in a death, not more than $500,000; or (3) for a Class A misdemeanor that does not result in death, not more than $200,000. 42 U.S.C. 271 sets forth statutory penalties of up to 1 year in jail and a fine of $1,000. Therefore, it is classified as a Class A misdemeanor under 18 U.S.C. 3559. Because the alternate fines set forth under 18 U.S.C. 3571 are greater than the $1,000 set forth under 42 U.S.C. 271 (which sets a maximum penalty of not more than $1,000 or one year of jail, or both for violation of quarantine laws), and because 42 U.S.C. 271 does not exempt its lower penalties from 18 U.S.C. 3571(e), HHS/CDC has chosen to codify the greater penalties of 18 U.S.C. 3571(b)(5) and (c)(5) and to remove the lower penalties as stated in 42 CFR 71.2 from the regulation.
After consideration of these comments, HHS/CDC has finalized the provisions relating to
Within the analysis published with the NPRM, HHS/CDC solicited public comment regarding the cost and benefit estimates for airlines and vessel operators associated with improved provision of traveler contact data. While HHS/CDC received support for the data collection from two public health associations, HHS/CDC received a comment from industry who misread the proposals to mean that aircraft operators would be required to develop new capacity and processes to capture and store a comprehensive set of sensitive data, archive this data, and then provide it to CDC.
HHS/CDC restates and clarifies that today's final rule does not impose any new burdens upon the airline industry but rather, codifies the current practice of receiving a passenger manifest order (if needed, as CDC currently collects passenger information from CBP via APIS and PNR) and providing HHS/CDC with any data in an airline's possession. This regulatory impact analysis has been revised to clarify that the rule does not require an airline to solicit or store additional data. Therefore, HHS/CDC does not expect that formalizing its current data collection practices will increase costs. Neither airlines nor U.S. Customs and Border Protection (CBP) will need to develop new data systems nor will travelers need to provide data as part of the “check in process.”
The same industry organization also commented that they have been complying effectively with the existing requirements, but have, on occasion found it difficult to locate, extract, compile, format and transmit available information within the timeframe specified in orders from HHS/CDC. They note that delays sometimes arise because the manifest order may contain incorrect flight or passenger information. The discussion in the regulatory impact analysis section has been revised to note that delays in compliance with manifest order requirements may result from HHS/CDC having incorrect traveler information in the manifest order.
The same industry organization also reports that all of the data available to them related to passengers are currently transmitted as Advance Passenger Information System (APIS), and potentially under Passenger Name Record (PNR), data to the Department of Homeland Security (DHS) and that there is no reason to burden airlines with an order for passenger data. HHS/CDC recognizes that industry does submit certain passenger data to DHS and it is not our intent to burden industry with duplicative requirements, but rather to effectively and efficiently protect public health. In the experience of the HHS/CDC, queries from APIS/PNR rarely result in full sets of contact information (
Airlines are contacted for the majority of contact investigations using a manifest order document. At a minimum, CDC needs to confirm the ill traveler was on the flight and where the individual sat in relation to other travelers to determine risk of exposure.
In CDC's experience the following has been true:
• Only airlines can quickly and efficiently produce a partial manifest targeting affected rows;
• only airlines can confirm identity of “babes in arms” and their co-travelers (Parent); this is important for measles cases;
• only airlines can quickly confirm whether an individual actually flew (in instances where individuals deplane and do not re-board during a layover); and
• only airlines can confirm a plane's configuration if there is a question with the provided row numbers. Different aircraft have different seating arrangements depending on carrier and layout. It is important to know if a certain seat is separated by a bulkhead or is a window seat.
In addition, HHS/CDC only requires a partial manifest,
As part of its plan for retrospective analysis under E.O. 13563, HHS/CDC intends to synthesize, analyze, and report within the next two years on strategies to reduce duplication of the collection of passenger/crew manifest information in coordination with DHS/CBP. The report will include any recommendations (
HHS/CDC received a number of comments from the general public that compared the relatively small number of measles cases in any given year to the total numbers of vaccine-associated adverse events and health department spending to contain measles outbreaks. Based on this comparison, commenters believed that HHS/CDC and health departments spend too much money on communicable disease control and that resources would be better allocated to other activities. Some commenters suggested that the costs of these adverse events should be included in a Small Business Regulatory Enforcement Fairness Act analysis. In general, this type of analysis is outside the scope of this regulatory impact analysis because this final rule does not require measles vaccination. HHS/CDC's recommended vaccine schedule will not be affected by this final rule. Although HHS/CDC recommends that health departments offer measles vaccine to non-immune individuals exposed during travel, measles is not a quarantinable communicable disease and this final rule does not require any individual to receive a measles vaccine. Because health departments offer measles vaccines to exposed, non-immune travelers, HHS/CDC estimates that the final rule will only result in a small number (6) of additional measles vaccines. The costs of procuring and administering these vaccines is included in the analysis.
As noted in the regulatory impact analysis, there are only 564 travelers exposed to measles during international travel in a given year. Most of these travelers will already have immunity to measles and the final rule is only expected to have a small impact on the ability of health departments to contact travelers. The total costs of all measles vaccine-associated adverse events is outside the scope of the analysis for this final rule as mentioned above.
One commenter suggested that the cost estimates for the NPRM were too low because the analysis did not account for reduced willingness to travel if vaccines against measles and other communicable diseases are required to travel. HHS/CDC disagrees with this suggestion because vaccination is not a requirement in this final rule. HHS/CDC has on occasion requested that DHS/TSA restrict interstate or international air travel for people known to be infectious with measles who were noncompliant with public health recommendations not to travel. However, HHS/CDC does not recommend restricting the air travel of persons who have not received the measles vaccine.
One commenter questioned whether the estimated value of statistical life ($9.4 million) should be multiplied by the total number of measles vaccine-associated adverse events in the United States. HHS/CDC appreciates this thoughtful comment. This would result in a larger estimate in the cost of measles vaccine-associated adverse events. However, this is not a correct usage of the value of statistical life, which should only be multiplied by an estimated number of deaths. The regulatory impact analysis has been revised to better explain this distinction.
Another commenter suggested that public health department measles response costs were overestimated by using a model-based approach rather than estimating the cost of hiring of additional staff to deal with measles outbreaks. HHS/CDC addressed the comment in the regulatory impact analysis by clarifying that the analysis is a published model-based analysis and that the cost estimate is based on the opportunity cost of public health personnel and is not based on the cost of hiring additional staff.
HHS/CDC received comments from the airline industry indicating that the definition of ill person under 71.1 does align with Note 1 to Standard 8.15 of ICAO's Annex 9 to the Convention on International Civil Aviation. HHS/CDC also received comments from the airline industry regarding the change to the definition of ill person under 70.1 for interstate flights contending that these changes would increase costs. Specifically, the airline industry reported that not only does the expansion of the definition of
HHS/CDC notes that there is no expectation that flight crews should perform physical examinations as part of illness reporting. HHS/CDC also notes that the non-thermometer (warm to touch or history of fever) remain in the final rule. Regarding the potential for increased costs associated with the change in illness reporting for interstate flights, HHS/CDC notes that the current illness reporting requirements for interstate travel appear in 42 CFR 70.4 and state that “The master of any vessel or person in charge of any conveyance engaged in interstate traffic, on which a case or suspected case of a communicable disease develops shall, as soon as practicable, notify the local health authority at the next port of call, station, or stop, and shall take such measures to prevent the spread of the disease as the local health authority directs.” Communicable disease is defined in current 42 CFR 70.1 as “illnesses due to infectious agents or their toxic products, which may be transmitted from a reservoir to a susceptible host either directly as from an infected person or animal or indirectly through an intermediate plant or animal host, vector, or the inanimate environment.”
The changes in this final rule will not result in substantially increased costs because airlines would either: (1) Be complying with the current regulatory requirement and report all cases or suspected cases of communicable disease to local health departments; or (2) report illnesses according to HHS/CDC guidance available at
HHS/CDC received a comment from a local health department concerning the rationale for reporting all illnesses and deaths that occur on interstate flights. This health department asked whether evaluating illnesses and deaths that occur on interstate flights may lead to an increase in costs for State and local health departments. HHS/CDC does not anticipate an increase in costs for State and local health departments because evaluating illnesses and deaths occurring on interstate flights is consistent with existing HHS/CDC guidance and represents a less restrictive alternative compared to the existing reporting requirement in 42 CFR 70.4. Furthermore, the costs to State and local health departments may decrease if HHS/CDC is able to filter out reports that do not require a public health response, which airlines would have previously reported directly to the health departments under 42 CFR 70.4. If there is an increase in the number of illness reports requiring a public health response, HHS/CDC believes the costs to health departments may decrease if the health department is notified earlier.
A public health research center questioned the value of nonmedical personnel being able to differentiate Ebola, Middle East respiratory syndrome (MERS) or measles from other medical issues. HHS/CDC appreciates the concern and notes that the final rule aligns the illness reporting requirement with international guidelines and represents a reduced burden for illness reporting on interstate flights compared to current regulatory language as mentioned above. The intent of illness reporting is not to diagnose disease during flight, but rather to identify a limited number of instances in which it would be advantageous to follow up with ill travelers for an assessment upon disembarkation. The current numbers of illness reports received are summarized in the regulatory impact analysis and the number of reports is not expected to increase significantly because the regulatory text will better align with publically available HHS/CDC guidance.
A number of comments from the public questioned whether there would be a huge cost resulting from the broad definition of
One commenter opposed the rule because of a perceived negative economic and/or social impact upon individuals placed under a public health order. Regarding the social impact of the individual who may be ostracized, HHS/CDC notes that public health measures such as quarantine and isolation are not new concepts or practices, HHS/CDC has been implementing these measures to protect public health for many years. We reemphasize that one compelling reason for the publication of this final rule is to make “quarantine” and “isolation” better understood by the public so that these terms, its purposes, and meanings become more familiar and thereby decrease public anxiety over these important protections. For the same reason, HHS/CDC does not believe the provisions in the final rule will increase or decrease the cost of isolation or quarantine. HHS/CDC does provide an estimate of traveler cost in the sections describing Ebola entry enhanced risk assessment and management and illness
One commenter suggested that the costs incurred by airlines would be passed along to the general U.S. population purchasing tickets for air travel. HHS/CDC concurs and mentions this possibility in the regulatory impact analysis. However, changes included in this final rule are a codification of a current practice and estimated total costs are only $11,000 to $431,000 per year. Thus, significant changes in ticket prices are not expected.
One commenter suggested that changes in infectious disease caseloads would not result in cost savings to public health agencies or individuals because there is already a public health workforce in place. HHS/CDC calculates such costs based on the opportunity cost of public health staff under the presumption that such staff would be involved in other productive activities if not spending time addressing outbreaks.
HHS/CDC solicited comment from the public regarding potential public willingness to pay to be contacted in the event of an exposure to a communicable disease during travel. This was done to help estimate the potential benefit to the public of HHS/CDC's efforts to work with health departments to contact travelers exposed to meningococcal disease, viral hemorrhagic fevers, MERS or other severe acute respiratory syndromes, measles, and tuberculosis, among other diseases. HHS/CDC received a number of comments from several individuals that they believe public health measures to mitigate measles transmission are unnecessary. Some individuals also noted that Ebola and MERS cases in the United States have not led to widespread transmission. These commenters either indicated or inferred that they would be unwilling to pay to be informed of potential communicable disease exposures during travel. The discussion in the regulatory impact analysis has been updated to incorporate this feedback.
HHS/CDC solicited public comment on willingness to pay to reduce Ebola risk in the United States to near zero if another international outbreak of Ebola with widespread transmission occurs in the future. HHS/CDC received comments from an organization representing flight attendants indicating that they believe it is in the public interest to reduce Ebola risk in the United States to near zero in the event of a future outbreak. They indicated that there is no reason to believe that achieving this objective would require unsustainable levels of funding. HHS/CDC incorporated this comment regarding public willingness to pay in the regulatory impact analysis.
HHS/CDC also received comments from several individuals regarding the high cost of the measures taken to reduce the risk of Ebola transmission in the United States during the 2014-2016 Ebola epidemic in West Africa. Several of these commenters indicated they had zero willingness to pay for future public health measures in the event of a large Ebola outbreak.
Many commenters stressed the need to reassess whether to implement such activities in the event of a future Ebola outbreak. An example of such comments is provided by a research center studying international response efforts to emerging infectious disease threats, who noted that despite 99% complete active monitoring by health departments, there was no evidence of incident Ebola cases among individuals traveling from Ebola-affected countries. This does not include the two incident cases that preceded active monitoring. The commenters state that given this evidence it is not advisable for HHS/CDC to recommend active monitoring in the event of future Ebola outbreaks.
In addition, a public health research center cautioned against extrapolating costs and benefits calculation methods for measles and tuberculosis to Ebola, MERS, and other rare diseases. The research center further noted that countermeasures for Ebola and MERS do not exist (other than isolation and quarantine). They suggest that this would limit the effectiveness of point of entry measures. These researchers also point to the fact that transmission of Ebola and MERS has not occurred during air travel. They noted that point of entry risk assessment programs may increase anxiety (and costs) if cases are detected in the community after the implementation of point of entry measures. Finally, the research center noted that the costs for State and local health departments to actively monitor all arriving travelers for 21 days were not included in the analysis.
In response to these comments, HHS/CDC concurs that it would not be wise to directly extrapolate approaches for measles and tuberculosis to rare diseases and has tried to provide as much information as possible around the decision to implement the Ebola risk assessment program and recommendations for active monitoring. HHS/CDC did not simply extrapolate the analysis for measles and tuberculosis to Ebola.
HHS/CDC does not have data on State and local spending to achieve the objective of the 21-day active monitoring program and concedes that the cost of active monitoring would likely exceed the costs incurred at the airports. However, HHS/CDC did provide an estimate of total Federal spending for both domestic and international efforts to attempt to quantify the cost of these efforts. Federal money was used to support State/local surveillance efforts. Federal money was also used to support improvements in laboratory capacity by States and hospital infection control efforts, which should have benefits beyond the 2014-2016 Ebola epidemic. In addition, Federal funding supported research into potential Ebola vaccines and medicines. The cost for the Ebola enhanced entry risk assessment program was just a portion of these costs and HHS/CDC acknowledges that risk assessment program at airports by itself would have limited potential to reduce risk. However, HHS/CDC also notes that the costs of Ebola entry risk assessment at points of entry included efforts to (1) stratify travelers by risk level so that health departments could focus more intense monitoring efforts on travelers at higher risk and (2) educate travelers on Ebola risk factors and symptoms and provide informational materials, a thermometer, and a telephone to all travelers to improve compliance with active monitoring efforts. This led to a higher cost, but more effective program relative to an alternative in which travelers would only be screened once at the airport, such as occurred in other countries implementing screening programs during the 2003 Severe Acute Respiratory Syndrome (SARS) epidemic.
HHS/CDC believes that the risk of Ebola infection in the U.S. population was potentially reduced because of the combination of measures to protect against Ebola transmission in the United States, including risk assessment at ports of entry. HHS/CDC acknowledges the risk was probably very low in the absence of domestic activities.
HHS/CDC further notes that it recommended active monitoring of travelers as a less restrictive alternative to more stringent measures such as quarantines that were being demanded by some members of the public. Widespread implementation of quarantine, particularly for healthcare workers crucial to the response efforts in West Africa and the United States, would have greatly hampered outbreak control measures by providing a strong disincentive to healthcare workers participating in the response.
To estimate the potential benefits of the Ebola risk assessment program at ports of entry, HHS/CDC provided a cost comparison of the incident Ebola cases
HHS/CDC also examined the recent MERS outbreak in South Korea to demonstrate that even relatively small outbreaks of rare diseases such as MERS and Ebola can have large economic costs despite a relatively small number of cases and deaths. HHS/CDC found that the number of international travelers (non-Korean citizens traveling to South Korea) decreased by 40-50% during the peak months of the 2015 MERS outbreak. HHS/CDC further notes that these declines in travel occurred in the absence of widespread travel restrictions. The costs incurred by South Korea during the outbreak were used to demonstrate the potential costs of a larger Ebola outbreak in the United States.
Given the evidence from the programs implemented to mitigate risk during the 2014-16 Ebola epidemic,
HHS/CDC emphasizes that it will continue to consider cost and work with multiple U.S. government agencies, as well as with airport authorities and health departments in U.S. States and territories, to apply the latest evidence to future decision-making. In addition, HHS/CDC will try to employ the least restrictive measures to achieve public health objectives. HHS/CDC notes that, during the period that the Ebola entry risk assessment and monitoring program was in effect, only 0.08% (29/38,344) of travelers assessed at U.S. airports were recommended for medical evaluation at hospitals and that no Federal quarantine or isolation orders were issued during the epidemic, although some States did issue such orders under their own authorities. These considerations have been added to the regulatory impact analysis in the final rule. Since this analysis concerns a codification of existing authorities, this analysis has been moved to a separate appendix after incorporating public feedback.
A number of commenters suggested that HHS/CDC did not include the cost for people participating in the Ebola enhanced risk assessment program. However, HHS/CDC did provide such an analysis of these costs. One public commenter suggested that the psychological cost of quarantine should be considered in the economic impact analysis. Although HHS/CDC generally concurs with the idea of accounting for all of the costs associated with time spent in quarantine, HHS/CDC's authority to issue quarantine orders will not change with the publication of this final rule. Thus, this final rule does not incur new psychological costs for persons under quarantine orders.
HHS/CDC notes the opportunity costs for persons undergoing risk assessment at airports and/or evaluation at hospitals during the 2014-16 Ebola entry risk assessment and management program. HHS/CDC estimates their opportunity costs based on average wage rates, but did not have additional data to estimate a marginal psychological cost. Opportunity costs were also estimated for a more restrictive option compared to the Ebola entry risk assessment and management program,
One commenter suggested that this rulemaking does not represent the “least burden on society” because HHS/CDC has failed to clearly identify a “compelling public need” for the rule. HHS/CDC appreciates the comment and responds that the regulatory impact analysis cites a specific market failure addressed by this final rule. The market failure is that the costs associated with the spread of communicable diseases impacts the entire U.S. population, not just the group of persons currently infected with communicable diseases. Since this final rule is primarily implementing current practice, HHS/CDC does not anticipate major new benefits or costs.
One commenter stated that the cost/benefit analyses was very vague, meaning that there is no accountability or way to measure whether or not the final rule will achieve its intended result of preventing the spread of quarantinable communicable diseases via travel, which the commenter stated was already an extremely low risk. HHS/CDC concurs that there is uncertainty in the regulatory impact analysis. However, HHS/CDC has tried to indicate that one of the reasons for this uncertainty is that this final rule is primarily implementing current practice. Thus, where possible, HHS/CDC tried to provide data on the current burden of the provisions that are being updated in this final rule. HHS/CDC does not expect any major changes in practice as a result of this final rule.
One commenter suggests that the cost/benefit analyses was confusing because quarantinable and non-quarantinable diseases were not clearly identified. HHS/CDC appreciates this feedback and has updated the analyses to more clearly differentiate quarantinable and non-quarantinable diseases.
One commenter suggested that HHS/CDC took an unnecessarily extreme position in analyzing an alternative of removing all enforcement of current regulations. HHS/CDC used this as an alternative because this final rule is a codification of current practice and does not impose new regulatory burdens.
HHS/CDC published notices related to modifications and a new information collection in the Notice of Proposed Rulemaking. Those information collections are as follows:
(1) Foreign Quarantine Regulations (42 CFR part 71) (OMB Control No. 0920-0134)—Nonmaterial/non-substantive change—National Center for Emerging, and Zoonotic Infectious Diseases (NCEZID), Centers for Disease Control and Prevention (CDC).
(2) Restrictions on Interstate Travel of Persons (42 CFR part 70) (OMB Control No. 0920-0488)—Nonmaterial/non-substantive change—National Center for Emerging, and Zoonotic Infectious Diseases (NCEZID), Centers for Disease Control and Prevention (CDC).
(3) Airline and Vessel and Traveler Information Collection (42 CFR part 71)—New Information Collection Request—National Center for Emerging, and Zoonotic Infectious Diseases (NCEZID), Centers for Disease Control and Prevention (CDC).
One commenter stated that there are no estimates of additional information collection requirements resulting in a clear violation of the Paperwork Reduction Act. The commenter further stated that requesting information when HHS/CDC has no idea of the impact is not a well thought out or planned rulemaking. This commenter further questioned the value of providing comment when the agency purportedly has no idea what additional burden it is imposing on the public. HHS/CDC disagrees with these assessments.
The focus of the final rule is to codify current practices and to update currently approved information collections to better align with operational procedures and other
Another commenter suggested that training in recognizing ill travelers is a burden that was not adequately considered. HHS/CDC disagrees because it does not mandate specific training for recognition of ill travelers. HHS/CDC is seeking to better align the ill person definition with the ICAO standard and thus is not the only organization that has this requirement. HHS/CDC provides specific guidance for how to recognize ill travelers and report to HHS/CDC on its Web site. HHS/CDC also believes this training is most likely already part of the training process for flight crews. An analysis of potential training costs has been added to the upper bound cost analysis in the Regulatory Impact Analysis. The upper bound annualized costs for additional training are estimated at $356,000.
Finally, HHS/CDC is re-inserting “Has a fever that has persisted for more than 48 hours” as a component in the definition of
HHS/CDC received comments from the public asserting that State and local public health regulations already in place are sufficient to protect individuals without the need for Federal involvement. HHS/CDC agrees that State and local authorities play an integral role in protecting public health, but disagrees that there is no Federal role. HHS/CDC's DGMQ maintains quarantine stations at major U.S. ports of entry that fulfill a primary purpose in preventing the introduction of communicable diseases into the United States, but also play an important role in containing the interstate spread of communicable disease. There are several broad areas of cooperation between quarantine field staff and State and local health agencies, such as contact tracing, which provide a framework for responding to communicable disease threats arising from interstate travel and at the local level. It is through these networks and established partnerships, in keeping with current practice, that the provisions of the final rule will be successfully implemented.
HHS/CDC received a comment to the effect that quarantine specifically should be left to the States. HHS/CDC received another comment stating that Federal authority should not take precedence over State authority. In contrast, a public health association suggested that these regulations should indicate that Federal public health measures “supersede activities taken by States.” We respond that while HHS/CDC works closely with State and local public health authorities, the Federal government has a traditional role in preventing introductions and spread of communicable diseases at ports of entry and interstate. HHS/CDC also disagrees with the suggestion that it should not intervene in the event of inadequate local control or lacks authority to protect the public's health within the authority granted to it by Congress. Under 42 U.S.C. 264(e), Federal public health regulations do not preempt State or local public health regulations, except in the event of a conflict with the exercise of Federal authority. Other than to restate this statutory provision, this rulemaking does not alter the relationship between the Federal government and State/local governments as set forth in 42 U.S.C. 264. Under, 42 CFR 70.2, HHS/CDC make take action to prevent the interstate spread of communicable diseases in the event that the CDC Director determines that inadequate local control exists. This longstanding provision on preemption in the event of a conflict with Federal authority is left unchanged by this rulemaking.
One public health organization requested clarification of the process to transfer an individual from Federal to State custody and further stipulated that the State authority should require an independent State assessment of risk under State law. In response, HHS/CDC notes that the issuance of Federal public health orders is coordinated with State and, when appropriate, local public health authorities. Transfer of an individual from Federal to State custody would be similarly coordinated such that the State would need to agree to assume custody and the State's order would need to be in place prior to HHS/CDC's rescinding the Federal order. When custody of an individual is transferred to a State authority, the State may choose, but would not be under a Federal mandate, to conduct an independent assessment of risk pursuant to its own policies and procedures. Furthermore, once the transfer of custody has occurred, the State's laws and standards for due process would apply.
Another public health authority asked for clarification of how jurisdictional issues regarding transfers of authority affecting more than one State would be handled for individuals under Federal quarantine. HHS/CDC responds that if more than one State is affected by the transfer of authority, HHS/CDC will work with all relevant States to determine the most appropriate State or local jurisdiction to accept custody of the individual. If it is necessary to transport the individual to another State, for example to the individual's State of residence, HHS/CDC will work with the affected States to facilitate such a transfer under Federal orders.
One public health organization requested clarification of the procedures HHS/CDC would use to rescind a public health order. HHS/CDC responds that it would issue the detained individual a written order rescinding the isolation, quarantine, or conditional release. This would be based on either one of two criteria: The individual is determined to no longer pose a public health threat or custody of the individual has been transferred to a State or local public health authority.
HHS/CDC received a comment from a public health department stating that the regulations should include language that HHS/CDC will coordinate with
Some commenters questioned HHS/CDC's authority, as well as the need, to restrict the movement of individuals who are not ill but have been exposed. HHS/CDC thanks these commenters for their review and input. Some quarantinable communicable diseases, such as novel pandemic influenza strains, may be contagious before the infected person becomes symptomatic. Therefore, in these situations, it may be necessary to restrict the movement of asymptomatic exposed people to make sure they do not expose others inadvertently while they are not aware that they are contagious. It may also be necessary to restrict movement of an exposed person if public health authorities are unable to ensure appropriate monitoring of the person, for example, if an individual is known to have a history of noncompliance with public health recommendations. Exposed people whose movement is restricted through quarantine or other means may be offered vaccination, if a vaccine is available, but only with informed consent.
One commenter noted that the regulation allows HHS/CDC to issue interstate travel permits to an infected individual conditioned upon the individual taking “precautionary measures” as prescribed by HHS/CDC. This commenter requested that HHS/CDC clarify what precautionary measures may be prescribed and stated that such conditions should not be based on factors unrelated to the individual's health condition,
This commenter also requested clarification of the legal impact of a person who is denied a permit or has had a permit revoked. We note that per the terms of the regulation persons denied a travel permit or who have had a travel permit revoked may submit a written appeal. The right to a written appeal, as well as the means by which an appeal may be requested, will be addressed in the written order denying the request for a travel permit or revoking an existing permit. The appeal will be decided by an HHS/CDC official who is senior to the employee who denied or revoked the permit. HHS/CDC declines to speculate as to what else this commenter may be referring to by the term “legal impact,” but notes that the regulation does not impair the ability of persons to seek judicial review of final agency actions through the Administrative Procedure Act.
This commenter also requested clarification of how long an individual may be restricted in his or her travel under a Federal travel permit. We note first that the restriction only applies to those under a Federal public health order or under a State or local order if the State or local health department of jurisdiction requests Federal assistance or there is inadequate local control. In further response, HHS/CDC notes that the restriction would remain in place so long as the individual is infected or capable of infecting others. This commenter further requested clarification of the impact of a disagreement between HHS/CDC and State or local public health authorities. We note that by the terms of 42 U.S.C. 264(e), Federal public health regulations do not preempt State or local public health regulations except in the event of a conflict with the exercise of Federal authority. Moreover, per the terms of 42 CFR 70.2, HHS/CDC may take action to prevent the interstate spread of communicable diseases in the event that the CDC Director determines that inadequate local control exists.
HHS/CDC received a comment from a flight attendant union requesting clarification as to whether an employee could be held criminally liable for knowingly transporting someone in violation of the terms of a travel permit as specified under section 70.5. In response, HHS/CDC clarifies that the term “operator” is defined under 70.1 consistent with 14 CFR 1.1 and with respect to an aircraft means, “any person who uses, causes to use or authorizes to use an aircraft, with or without the right of legal control (as owner, lessee, or otherwise).” We further note that criminal liability, if any, will be determined by a court of law and not administratively by HHS/CDC. Accordingly, we decline to speculate as to whether employees who knowingly violate the terms of a travel permit may be held criminally liable.
One public health organization asked for clarification of how local health departments would be engaged in conducting communicable disease screening activities or enforcing Federal public health travel restrictions for individuals traveling interstate, given that HHS/CDC staff are not present at many points of interstate travel. HHS/CDC acknowledges this limitation in their presence at some ports of entry and in regard to interstate travel and intends to address this through future guidance and discussion with stakeholders.
In regard to interstate air travel, HHS/CDC clarifies that the Federal public health Do Not Board tool will deny boarding of persons known to pose a public health risk to other air travelers. This tool is applicable to persons boarding a commercial aircraft with an origin or destination in the United States, including interstate travel.
For other modes of travel, HHS/CDC does not have a systematic mechanism
HHS/CDC received a comment contending that the extension of travel permits to intrastate travel is in violation of the Commerce Clause. HHS/CDC disagrees. We note that HHS/CDC will only require intrastate travel permits when a State or local health authority of jurisdiction requests federal assistance or in the event that State and local actions are inadequate to prevent interstate communicable disease spread. Under 42 U.S.C. 264, Congress acting pursuant to its Commerce Clause jurisdiction, has authorized HHS/CDC to take measures to prevent the foreign introduction and interstate spread of communicable diseases. It is well established that the Federal government may act to protect interstate commerce, even though the threat may come entirely from intrastate activities.
One commenter requested that HHS/CDC replace the word “traveler” with “passenger” with respect to mandatory public health assessments, as a traveler could be taken to mean “anybody in a private vehicle lined up at a toll booth.” In response, HHS/CDC states that the use of the word “traveler” with respect to conveyances is intended to include both passengers and crew. Furthermore, HHS/CDC states that its authority extends to all individuals engaging in interstate travel including those traveling by private vehicle, particularly if they are in the “qualifying stage” of a quarantinable communicable disease.
HHS/CDC received a comment from a partnership of public health legal scholars and organizations expressing concern that requiring application for a travel permit may be unduly burdensome because individuals who are served with a conditional release order at an airport would then need to apply for a separate travel permit to travel to their home State of residence. HHS/CDC disagrees because under such circumstances the conditional release order itself would include authorization for these individuals to continue travel to their home State of residence provided that they subsequently report to public health authorities as needed. For example, during the response to Ebola, CDC worked with state public health authorities to allow certain individuals who met certain risk thresholds to travel in private vehicles to their place of residence while maintaining a focus on protecting public health. This was done on a case by case basis, depending on distance of travel and risk of exposure, and distance from a health care facility with adequate capacity to treat and contain Ebola. CDC would make similar assessments in the event that conditional release orders are needed for other quarantinable communicable diseases. We note that the conditional release order itself would provide permission to travel and have added clarifying language to the text.
HHS/CDC clarifies, however, that after arriving in their home State, should the individuals wish to engage in further travel, a travel permit may be needed at that time. In response to comments from this partnership organization, HHS/CDC also clarifies that the travel permit, as provided for in the regulations, will only be required under circumstances where the individual is already under a Federal, State or local order of quarantine, isolation, or conditional release. Because the travel permit requirement is only applicable to individuals who are already under a Federal, State, or local public health order, HHS/CDC believes that this provision does not impermissibly restrict an individual's right to travel.
In response to comments regarding the time with which CDC may consider a travel permit request, the CDC Director shall respond to a request for a travel permit within 5 business days Likewise, one public health association suggested that, in the event a travel permit is denied, these regulations should state the timeframe that HHS/CDC will issue a response to the appeal; another proposed the time period for CDC's response to be 72 hours. In response to these comments, HHS/CDC has added a requirement in the regulation that in the event that a request for a travel permit is denied, it must decide an appeal from that denial within three (3) business days. HHS/CDC believes that this timeframe is appropriate because this provision only applies to individuals who already have had their travel restricted through the issuance of a public health order and deciding an appeal may involve coordination with affected state or local jurisdictions.
After consideration of comments received, HHS/CDC has modified paragraphs (a), (b)(1), (b)(2), and (c) of the provision concerning
Several commenters expressed concern that the new regulations remove the requirement for a local health authority to be notified when a passengers falls ill or dies on board a flight. The commenters insisted that this could interfere with effective local response to important communicable disease threats. They propose that local authorities should be notified in a timely manner, such as within one hour of initial reporting, and that HHS/CDC should consult with local health authorities on the necessary steps to contain the spread of communicable diseases. In contrast, one airline supported the direct reporting to HHS/CDC.
HHS/CDC carefully considered these comments and responds that it will continue its long standing partnership with local authorities. The rationale behind asking airlines to submit reports of deaths or reportable illnesses directly to HHS/CDC as opposed to local authorities is to simplify and streamline the reporting process for these airlines. Under the final rule, airlines will not be required to know the current points of contact for multiple local jurisdictions, but rather may report to HHS/CDC as a single point of contact. HHS/CDC will continue to share public health information with State and local health departments through approved electronic disease reporting networks such as the Epidemic Information Exchange (Epi-X), HHS/CDC's secure, Web-based system. HHS/CDC may also notify State or local authorities via phone calls.
Some commenters questioned whether HHS/CDC has adequate resources to be the first responder at the local level. HHS/CDC responds that it regularly coordinates with Federal, State and local agencies and other partners in the airport environment. HHS/CDC intends to continue working closely with Federal, State, and local partners,
One commenter suggested that the reporting of ill travelers “would be an invasion of our liberty and privacy.” HHS/CDC disagrees. The report of illness or death on board a carrier is a longstanding regulatory provision and practice. This final rule only changes to whom the report is made (directly to HHS/CDC), rather than to the local health department of destination. We further note that personally identifiable information collected and maintained under the Privacy Act will be handled in accordance with that Act and CDC's system of records notice published at 72 FR 70867.
Another commenter worried that “having flight reservations require health reports will significantly impede air travel.” It is not HHS/CDC practice, nor a requirement under this regulation, for individuals to submit health reports prior to or after making a flight or vessel reservation. The only instance when health documents may be required prior to travel, is if a person is known to be infectious with a communicable disease that could spread during travel and has been placed on the Federal Public Health Do Not Board described in 80 FR 16400 (Mar. 27, 2015). Because this practice is not new, HHS/CDC believes it will not impede air travel.
A flight attendant association suggested that HHS/CDC should adopt training and awareness requirements for airline employers to provide to flight attendants concerning “what entails a qualifying stage.” Industry also expressed concern that flight crews may be held responsible and penalized for missed illness identification. HHS/CDC understands that the statutory definition of “qualifying stage” may be confusing to lay persons and does not expect air or vessel crewmembers to be trained in the nuances of such language. Instead, we have crafted a definition of
HHS/CDC received comments from industry that the report of death or illness should not be limited only to the pilot in command, given the many duties already under his/her responsibility. HHS/CDC disagrees. We clarify first that this domestic provision was proposed to mirror the current foreign provision under 42 CFR 71.21(b)—which HHS/CDC did not propose to change—and which states “
One industry group commented that the role of flight attendants in identifying sick travelers on board should be addressed through guidance developed in conjunction with HHS/CDC and industry. HHS/CDC responds that it routinely issues guidance for flight crews, including standard guidance for the recognition and reporting of ill travelers and disease- or situation-specific guidance during outbreaks. Such guidance is published on HHS/CDC's Web site and disseminated through established list serves, industry associations, and any other available means. HHS/CDC will coordinate with industry partners to determine whether additional guidance may be needed and, if necessary, work with these partners to develop such guidance.
One industry organization commented that the proposed rule failed to recognize that airlines employ intermediary professional medical personnel. HHS/CDC responds that it recognizes the role of intermediary professional medical personnel in assisting flight crews in managing an ill traveler onboard and references such personnel in industry guidance issued at
It is not HHS/CDC's intent for the public health assessment conducted by HHS/CDC public health officers to replace this role in medical management. However, HHS/CDC restates that the reporting of ill travelers to HHS/CDC is the ultimate responsibility of the pilot in command as noted above.
One association requested that the report of deaths on board a carrier be modified and limited to those deaths which resulted from a possible communicable disease. HHS/CDC disagrees. In keeping with current practice, HHS/CDC will continue to require and receive the reports of
One public health organization raised concerns about replacing reporting to local health authorities with reporting to HHS/CDC. In response, HHS/CDC notes that extensive input was sought in 2012 from the Association of State and Territorial Health officers (ASTHO) and National Association of County and City Health Officials (NACCHO). Representatives from those organizations recommended that requirements and protocols should be the same for international and interstate flights and procedures should be outlined describing how this would occur. These representatives recommended that airlines should report ill persons on domestic flights to HHS/CDC and that HHS/CDC should subsequently notify State or local health departments. Subsequently, HHS/CDC posted guidance to this effect on its Web site and has continued response planning and development of standard operating procedures to implement these recommendations. Thus, this rulemaking codifies the current practice and is consistent with recommendations provided by ASTHO and NACCHO.
One commenter stated that it appears HHS/CDC is “attempting to move towards mandatory reporting by carriers and border personnel, requiring reporting of persons with signs of illness as they cross borders, as opposed to having to do large-scale individual contact interviews and investigations after an outbreak occurs.” In response, HHS/CDC states that reporting by carriers is already required under the existing regulations and that this regulation only codifies current practice and guidance. In addition, DHS notifies HHS/CDC of ill travelers detected by border personnel. HHS/CDC and DHS agreed to this notification process in a memorandum of understanding and therefore changes to this regulation are unnecessary. HHS/CDC additionally coordinates notification and investigation of contacts during exposure or outbreak situations when necessary based on a public health risk assessment. Such investigations are standard public health practice and not mutually exclusive of reporting by carriers or notifications by border personnel.
After consideration of these comments, the title of the
One commenter questioned the seriousness of communicable disease spread on aircraft and vessels. Another commenter noted an “extreme unlikeliness of contracting any communicable disease while traveling” and that, therefore, HHS/CDC failed to prove a “compelling need” for the proposed regulations. HHS/CDC appreciates the opportunity to respond to these comments. The spread of communicable diseases on aircraft and vessels is well documented. There are numerous reports in the medical and public health literature of spread of measles, tuberculosis, SARS-coronavirus, and influenza virus on aircraft. Outbreaks of varicella (chickenpox), influenza, and gastrointestinal viruses such as norovirus are common on cruise ships, and spread of other diseases such as measles, rubella (German measles), tuberculosis, and other gastrointestinal diseases has also been reported. Aircraft and vessels have people together in confined spaces for prolonged periods of time. Therefore, conducting contact investigations for certain communicable diseases identified on aircraft or vessels is standard public health practice, both in the United States and internationally, similar to public health practice in community settings.
HHS/CDC received comments from industry regarding ongoing efforts with DHS/CBP to improve passenger data collection, as announced in the NPRM. Several commenters stated that HHS/CDC should delay this final rule until DHS/CBP has published a regulation to ensure that a coordinated system is put in place. HHS/CDC thanks these commenters for their input but disagrees that this final rule should be delayed. This comprehensive regulation seeks to protect public health, by implementing, among other things, current passenger and crew data collection practices.
One commenter objected to the collection of health information prior to using public transportation. Another commenter opposed the idea of carriers being “forced to collect and report 17 data elements on American travelers.” A public health association also insisted that data elements should only be collected from people if there is a reasonable belief that the person is infected. This final rule does not require carriers to collect or transmit any data elements that are not currently collected and transmitted to CBP via APIS and PNR as a result of normal operating procedures. We also take this time to emphasize two important points. First, passengers are not required by HHS/CDC to submit specific data elements provided by passengers. Second, HHS/CDC will only seek this information from CBP or the airline in the event of a confirmed or suspected communicable disease on board a carrier which requires contacting fellow passengers to inform them of possible exposure.
While HHS/CDC received support for the data collection from two public health associations, a commenter misread the proposals to mean that aircraft operators would be required to develop new capacity and processes to capture and store a comprehensive set of sensitive data, archive this data, and then provide it to HHS/CDC. HHS/CDC takes this opportunity to restate and clarify that these final regulations do not impose any new burdens upon the airline industry but rather, codify the current practice of receiving a passenger manifest order (as needed) and providing HHS/CDC with any data in an airline's possession. This rule places no requirement on the airline to solicit or store additional data than current practices allow. Therefore, HHS/CDC does not expect this formalization of current practice to have an impact on operations, including “check-in process.” If an airline does not have in its possession the five additional data elements, it is not required to collect or submit them to CDC.
One airline industry group commented that the collection of information from screened individuals for the purpose of contact tracing should apply only to passengers because crewmember information would be provided by the employer. HHS/CDC responds that this may be the case operationally; however, HHS/CDC reserves the right to collect information directly from crew members if necessary.
HHS/CDC received a comment expressing concern that individuals may provide false contact information,
One public health organization commented on the scope of HHS/CDC's protocols for when contact investigations are conducted and how exposed contacts are defined following exposures to measles or varicella on aircraft or vessels. HHS/CDC appreciates the comment but seeks to clarify that these protocols were mentioned in the NPRM solely for the purposes of providing context for the economic analysis and that the content of the protocols themselves is beyond the scope of this rulemaking.
One public health organization commented on the fact that buses and trains typically do not maintain or have access to passenger manifests that would allow for the collection of information by HHS/CDC for the purpose of contact tracing. HHS/CDC agrees with this comment and notes that these regulations do not require operators of buses or trains to maintain passenger manifests for purposes of contact tracing. The organization also commented on the utility of the requirement that operators of buses or trains not knowingly transport individuals subject to a Federal public health order. In response, HHS/CDC notes that it is useful to prohibit conveyance operators from knowingly transporting someone under a Federal public health order without a travel permit or in violation of the terms of a permit because this may limit communicable disease spread. This prohibition, however, would only apply in circumstances where the operator would know or have reason to know that a travel permit is required, for instance, if the conveyance operator has been directly informed by the HHS/CDC or another cooperating Federal, State, or local agency.
A non-profit organization also commented that requiring airlines to disclose passenger information, upon request, but without a warrant, for purposes of notifying passengers of their potential exposure to a communicable disease violates the Fourth Amendment to the U.S. Constitution. This organization also contends that HHS/CDC lacks the legal authority to require that travelers provide certain contact information, such as information concerning their intended destination, health status, and travel history as part of a public health investigation. Specifically, this group contends that “examination” as used in 42 U.S.C. 264(d)(1) should be understood as referring only to an “inspection” not an “interrogation.” This group further contends that because HHS/CDC lacks the legal authority to collect information under 42 U.S.C. 264 it also lacks the authority to collect information under the Privacy Act of 1974. Lastly, this group contends that any compulsory questioning of travelers about “acts of
HHS/CDC disagrees with these comments. HHS/CDC notes that the requirement of a judicial warrant is not applicable to requiring passenger and crew information from air carriers. Rather, this activity is permitted without a warrant under the special-needs doctrine articulated by the Supreme Court in
HHS/CDC also rejects the suggestion that questioning of travelers violates their rights to free association under the First Amendment. The U.S. Supreme Court has recognized a “freedom of association” in only two distinct areas: (1) Choices to enter into and maintain certain personal human relationships (as an element of personal liberty); and (2) a right to associate for the purpose of engaging in other activities protected by the First Amendment,
HHS/CDC further notes that its purpose in collecting passenger information is to notify passengers who have been potentially exposed to communicable diseases of public health concern. For some of these diseases, there are preventive medications or vaccines that the individual may be made aware of and wish to obtain to keep from becoming sick. Therefore, HHS/CDC considers the collection of passenger locating information to be of benefit to these passengers and in keeping with standard public health practice to prevent further communicable disease transmission.
After considering these comments, HHS/CDC has finalized these provisions (71.4 and 71.5) as proposed, with the exception that the title has been modified to remove references to “collection” and “storage” of information to more accurately reflect the requirements under this section. References to the CDC have also been replaced with Director throughout these sections.
Regarding provision 71.63
HHS/CDC received a comment that the term “thing” as used in 71.63 authorizing the suspension of “animals, articles, or things,” based on the existence of communicable disease in a foreign country is unduly vague. In response, we explain that HHS/CDC may take public health measures in regard to animals, articles, or things, to prevent the introduction, transmission, and spread of communicable diseases into the United States and interstate. “Article” generally refers to an article of commerce, such as a specific product that someone wishes to import into the United States or move between States that poses a public health risk. In contrast, a “thing” simply refers to a material object that poses a public health risk regardless of whether there is a specific intent to import or move between States. For instance, on July 10, 2001, CDC issued an order under the authority of section 71.32(b) requiring that imports of “lucky bamboo” (a decorative plant) shipped in standing water be prohibited from entering the United States because the water (
HHS/CDC received a question regarding the fate of animals or articles denied entry under this regulation, stating that “articles might presumably be forfeited and pets will be executed,” and questioning whether this provision aligns with due process, particularly with respect to the right to appeal. In response, HHS/CDC states that the provision authorizing temporary suspension of entry of certain animals, articles and things based on the existence of a communicable disease in a foreign country and to protect the public's health is intended to prevent the arrival of these items at a U.S. port of entry. Therefore, HHS/CDC will seek to ensure travelers are informed of the restriction and will also work with carriers to prevent these animals or items from being loaded onto aircraft or vessels traveling to the United States. If such animals or items do arrive at a U.S. port of entry, HHS/CDC will take measures as needed to protect the public's health. Such measures will be determined on a case-by-case basis and may include, at the owner's expense, confinement, re-exportation, or destruction. Re-exportation may be considered if there is no public health risk during travel. HHS/CDC would also consider euthanasia of animals if there
In response to the concern expressed about an “appeal,” HHS/CDC notes that the Director's suspension order would ordinarily constitute “final agency action” under the Administrative Procedure Act, 5 U.S.C. 704. However, HHS/CDC will consider the appropriateness of offering an administrative appeal as it develops the relevant suspension order.
After considering these comments, HHS/CDC has finalized the
Under Executive Order 13563 agencies are asked to consider all feasible alternatives to current practice and the rulemaking as drafted. One less restrictive alternative would be for HHS/CDC to stop enforcing its regulations and make compliance with current regulations voluntary. Under this scenario, HHS/CDC would not obtain contact data from airlines or provide such data to health departments in order to conduct contact investigations. HHS/CDC would not require illness and death reports on aircraft or vessels, but would still follow-up with airlines and vessel operators upon request. This alternative would put travelers at greater risk of becoming infected with communicable diseases, reduce the ability of public health departments to offer post-exposure prophylaxis or other measures to prevent communicable disease spread from travelers known to have been exposed, and generally increase the risk of communicable disease transmission in the United States.
Another alternative, is to extend the scope of the regulations by closing U.S. borders and ports of entry to incoming traffic from countries experiencing widespread transmission of quarantinable communicable diseases to protect public health is also analyzed based on the 2014-16 Ebola outbreak in West Africa as well as recent importations of Middle East respiratory syndrome. HHS/CDC believes this approach is neither practicable nor is it desirable.
In a separate appendix, alternatives are considered to increase or decrease HHS/CDC's required payments for care and treatment for individuals under Federal orders as specified in 42 CFR 70.13 and 42 CFR 71.30. Also in a separate appendix, alternatives are also considered in which HHS/CDC does not implement temporary animal import embargos (less restrictive) or does not allow importation of animals under temporary embargos for science, education, and exhibition when accompanied by a special permit.
We believe the regulations described above and set forth below in text offer the best solutions for protecting U.S. public health while allowing for continued travel. HHS/CDC believes that this rulemaking complies with Executive Order 13563; all of these changes provide good alternatives to the current baseline.
HHS/CDC has examined the impacts of the final rule under Executive Order 12866, Regulatory Planning and Review (58 FR 51735, October 4, 1993)
However, there is uncertainty about the appropriate analytic baseline, and relative to some possible baselines, the effects of the rule are non-negligible. For example, if in the absence this rule, some aspects of future HHS/CDC screening or risk assessment activities are found to be legally impermissible, then the status quo baseline would not represent a reasonable approximation of the state of the world without the rule. Relative to a non-status quo baseline, the rule would lead to activities (
This Regulatory Impact Analysis (RIA) section presents the anticipated costs and benefits that are quantified where possible are relative to the status quo baseline. Where quantification is not possible, a qualitative discussion is provided of the costs and/or benefits that HHS/CDC anticipates from issuing these regulations.
The 2014-2016 Ebola response highlights the inadequacies and limitations of the current regulatory provisions on the traveler data collection process in which CDC must request traveler manifests from airlines and manually search for contact data in order to know
Airlines have been slow to respond to HHS/CDC requests for traveler manifests:
○ 30% arrive more than three days after a request,
○ 15% arrive more than six days late.
In addition, available locating information is usually incomplete: HHS/CDC receives only the name and seat number for 61% of travelers, and one or more additional pieces of information for 39% of travelers. This final rule clarifies HHS/CDC's existing authority to request any available contact data from airlines and vessel operators, which may improve the timeliness and completeness of future requests from airlines or vessel operators for data not already submitted to the Department of Homeland Security.
Some traveler contact data is available in the APIS/PNR dataset already submitted by airlines to CBP. In the experience of the HHS/CDC, queries from APIS/PNR rarely result in full sets
Airlines are contacted for the majority of contact investigations using a manifest order document. At a minimum, HHS/CDC needs to confirm the ill traveler was on the flight and where the individual sat in relation to other travelers to determine risk of exposure. Further, in HHS/CDC's experience, only airlines can:
• Quickly and efficiently produce a partial manifest targeting affected rows
• confirm identity of “babes in arms” and their co-travelers (Parent); this is important for measles cases;
• quickly confirm whether an individual actually flew (in instances where individuals deplane and do not re-board during a layover); and
• confirm a plane's configuration if there is a question with the provided row numbers. Different aircraft have different seating arrangements depending on carrier and layout. It is important to know if a certain seat is separated by a bulkhead or is a window seat.
In addition, HHS/CDC only requires a partial manifest,
Finally, CDC wishes to reiterate its desire for the above-described operations to be published in regulation to provide the public, as well as industry, with understanding of the efforts made by CDC to protect public health.
The other change to the economic baseline that may result from this final rule was the need to change the definition of an “ill person” to better match HHS/CDC guidance and the guidelines contained in Note 1 to paragraph 8.15 of Annex 9 to the Convention on International Civil Aviation. Where possible, the marginal costs and benefits of these changes relative to the status quo baseline are monetized.
In addition, HHS/CDC believes that there is a need to better communicate to the public the actions that it has taken in accordance with its regulatory authority under
Finally, HHS/CDC believes it is important to explain its regulatory authority to suspend entry of animals, articles or things from designated foreign countries and places into the United States when importation increases the risk of the introduction and/or transmission of a communicable disease within the United States.
The specific market failure addressed by these regulations is that the costs associated with the spread of communicable diseases impacts the entire U.S. population, not just the group of persons currently infected with communicable diseases or with business interests in providing interstate or international travel to persons or animals infected with communicable diseases.
The economic impact analysis of this final rule is subdivided into four sections:
1. An analysis of 42 CFR 70.1, 42 CFR 71.1/71.4/71.5, for which the primary costs may be incurred by aircraft and vessel operators and the primary benefit is improved public health responsiveness to assess and provide post-exposure prophylaxis to travelers exposed to communicable diseases of public health concern.
2. An analysis of a number of provisions that aim to improve transparency of how HHS/CDC uses regulatory authorities to protect public health. These changes are not intended to provide HHS/CDC with new regulatory authorities, but rather to clarify the agency's standard operating procedures and policies, and due process rights for individuals. HHS/CDC believes that improving the quality of its regulations by providing clearer explanations of its policies and procedures is an important public benefit. However, HHS/CDC is not able to attach a dollar value to this added benefit in a significant way. In a separate appendix, HHS/CDC analyzes the costs and benefits associated with the 2014-2016 Ebola enhanced risk assessment and management program are used to illustrate the costs and benefits of implementation of some of these authorities, and are especially relevant when analyzing the effects of the rule relative to a non-status quo baseline.
3. In a separate appendix, HHS/CDC provides an analysis of the revisions to
4. In a separate appendix, HHS/CDC provides an analysis of
Table 1 provides a summary of whether quantitative or qualitative analyses were performed for each of the provisions in the final rule.
The quantified costs and benefits of the final rule are estimated for the following stakeholders: Air and maritime conveyance operators, State and local public health departments (PHDs), individuals exposed to communicable diseases during travel and United States Government (USG). The most likely estimates of primary costs are low ($32,622, range $10,959 to $430,839) because the final rule primarily codifies existing practice or improves alignment between regulatory text and the symptoms reporting guidelines provided by the International Civil Aviation Organization (ICAO). The cost estimates are based on an increase in:
• The number of illness reports delivered by airlines and vessel operators to CDC, relay of air illness reports to CDC by the Federal Aviation Administration (FAA) when such reports are received by FAA air traffic service units, illness reports processed by HHS/CDC and time for travelers;
• increased costs for airlines and vessel operators to comply with HHS/CDC requests for traveler contact data;
• increased costs for State and local public health departments to follow up with a larger number of travelers exposed to communicable diseases during travel;
• The upper bound cost estimate also includes a substantial increase in training costs for the changes to illness reporting.
The best estimate of quantified benefits of the final rule is also relatively small $110,045 (range $26,337 to $297,393). This estimate is based on expected improvements in illness reporting and in the timeliness, completeness, and accuracy of contact data. These improvements should result in increased efficiencies for HHS/CDC and State and local public health departments in conducting contact investigations among travelers exposed to communicable diseases on aircraft and vessels and reduced illness costs associated with the reduced risk of measles and tuberculosis morbidity and mortality in exposed travelers.
Other potential but non-quantified benefits of the final rule would be associated with future outbreaks of
Section 202(a) of the Unfunded Mandates Reform Act of 1995 requires that agencies prepare a written statement, which includes an assessment of anticipated costs and benefits, before proposing “any rule that includes any Federal mandate that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of [$146,000,000 in 2015 USD] or more.” Not only will this final rule not cost State, local and tribal governments any expenditure, it is possible that these stakeholders who might be engaged in contact tracing may see a reduction in costs if the final rule is implemented and there is an improvement in airline compliance with HHS/CDC requests to provide traveler data.
Traveler contact information will only be requested by HHS/CDC after a case of serious communicable disease (index case) is reported in a person who traveled on a commercial airline or vessel while contagious. Examples of serious communicable diseases include measles, novel influenzas, and viral hemorrhagic fevers such as Ebola among others. This type of situation necessitates identifying and locating passengers seated near the index case in order to conduct a contact investigation (CI). This final rule would lead to better health outcomes if public health departments are more quickly and effectively able to contact persons potentially exposed to the index case on an aircraft or vessel. These increased efficiencies should lead to smaller infectious disease outbreaks and fewer public health resources needed to control an outbreak.
There are multiple communicable diseases including quarantinable (
The ongoing persistence of measles in the United States provides a good example of the need for this final rule. In 2000, measles was declared no longer endemic in the United States due to high vaccination rates. Cases and outbreaks of measles continue to occur, however, as a result of importation from other countries and lack of adherence to the recommendation for measles vaccination (
Among air travelers exposed to measles during flights, post-exposure prophylaxis (PEP) with measles-containing vaccine (within 72 hours) or immune globulin (within 6 days) can prevent onset of disease,
Measles outbreaks can have substantial associated costs. One model-based analysis showed that 16 outbreaks with 107 confirmed measles cases cost an estimated $2.7 million to $5.3 million U.S. dollars for public health departments to contain.
In the absence of interventions by public health departments, travelers
The Summary Table provides estimated total monetary results for stakeholders' costs and benefits of implementing the final rule. The Summary Table (Table 2) includes estimates associated with changes to the definition of `ill person' in 42 CFR 70.1/71.1 and the codification of international traveler data collection processes of aircraft and vessel contact investigations under 42 CFR 71.4/71.5. The best estimates of annual costs are $32,622 compared to the best estimate of annual benefits at $110,045. The upper bound annual quantified costs are $430,839 and the upper bound quantified benefits are $297,393. Lower bound quantified costs are $10,959 and benefits are $26,337.
The measles and tuberculosis examples should not be considered a complete estimate of non-quantified benefits associated with this final rule, because the impact of this final rule to mitigate many different types of infectious disease outbreaks cannot be quantified. It just provides examples based on the two diseases for which contact investigations are most frequently undertaken. Besides communicable diseases commonly reported in the United States (
The second analysis in this final rule is of a number of provisions that aim to improve transparency of how HHS/CDC uses its regulatory authorities to protect public health. These changes are not intended to provide HHS/CDC with new regulatory authorities, but rather to clarify the agency's standard operating procedures and policies with regard to pre-existing regulations in 42 CFR parts 70 and 71 including due process rights for individuals under Federal orders. HHS/CDC believes that improving the quality of its regulations by providing clearer explanations of its policies and procedures is an important public benefit. However, HHS/CDC is not able to attach a dollar value to this added benefit in a significant way.
The group of entities that may be affected by this final rule would include international and interstate aircraft operators, vessel operators, travelers, State or local health departments and the Federal government agencies that interact with these groups. Since this final rule primarily updates regulatory requirements to better match current practice, the economic impacts are marginal changes to current practice that result from codification of current practices.
The North American Industry Classification System (NAICS) is used by Federal statistical agencies in classifying business establishments for the purpose of collecting, analyzing, and publishing statistical data related to the U.S. business economy. A summary of the total numbers of each entity is summarized in Table 3.
According to a report by the Federal Aviation Administration, in 2012, U.S. civil aviation-related economic activity generated $1.5 trillion and supported 11.8 million jobs with $459.4 billion in earnings.
In 2011, there were approximately 11 million North American cruise ship passengers spending 71.8 million passenger nights on board vessels. The cruise ship market was highly concentrated with four firms accounting for 98% of the total market.
The domestic/international air carrier market is an ever-shifting corporate landscape. Both U.S. and foreign airlines engage in “code-sharing” arrangements, whereby the marketing carrier places its call sign (or code) on the operating carrier's flight. For purposes of this rule, reporting duty would require the operating carrier to report on
The complexity of the domestic/foreign airline-corporations' legal and financial arrangements makes it very difficult to ascertain exactly how each and every domestic and foreign airline would be affected by the implementation costs associated with this final rule; presumably, some of the costs might be passed along to the carrier putting its code on the operating carrier, pursuant to the particular terms of each applicable contract.
Under this final rule, the operator of any airline operating a flight arriving into the United States must make certain contact information described below available within 24 hours of a request by HHS/CDC, to the extent that such data are available to the operator. This requirement also applies to the operator of any vessel carrying 13 or more passengers (excluding crew) and, which is not a ferry as defined in under 46 U.S.C. 2101 and U.S. Coast Guard (USCG) regulations (46 CFR 2.10-25). This requirement is a codification of current practice, and applies to any of the data elements that the airline or vessel operator may have available and authorizes the airline or vessel operator to transmit the contact information in any format and through any system available and acceptable to both the airline and HHS/CDC. Again, because this is a codification of current practices, HHS/CDC assumes airlines and vessel operators will continue to submit data through current mechanisms, although HHS/CDC will accept others that are mutually acceptable.
To simplify the analysis and to develop conservative cost estimates, HHS/CDC assumed that all costs to airlines and vessel operators would be passed along to U.S.-based airlines, vessel operators, or U.S. consumers.
HHS/CDC has gathered statistics, or reported information on, a number of notifiable and quarantinable diseases (Table 4) that form the basis for estimates of quantitative and qualitative benefits. The final rule provides CDC with the authority to take certain actions with regard to both quarantinable and non-quarantinable diseases. For non-quarantinable diseases, efforts would be primarily limited to early identification and notification of exposed individuals and transmission of contact data to local and State health departments. For quarantinable diseases, efforts could include issuance of Federal orders for quarantine, isolation, or conditional release of exposed/infected individuals.
In addition, these diseases for which HHS/CDC currently issues manifest orders and conducts contact investigations can also be subdivided to identify those encountered with some frequency (routine diseases): Tuberculosis, measles, meningococcal disease, pertussis and rubella. Among these diseases, only tuberculosis is a quarantinable disease. The second class is a group of new or emerging diseases, or diseases with serious public health and medical consequences, that are not currently prevalent, but are foreseeable as a future threat,
The number of travelers exposed to an index case that are subject to a contact investigation (CI) varies by disease and may include only the two passengers sitting adjacent to the index case (meningococcal disease or pertussis) or as much as the entire aircraft (
The table also includes criteria to be considered a contact for persons exposed on vessels. In contrast to air contact investigations, most maritime contact investigations are undertaken before travelers disembark from vessels. Another difference between air and maritime contact investigations is that varicella contact investigations are frequently undertaken among maritime travelers on vessels, but are not pursued for air travelers. In addition, HHS/CDC has not yet had to conduct a contact investigation for Middle East Respiratory Syndrome or viral hemorrhagic fever for travelers exposed on vessels. The criteria listed in Table 5 are current as of October 2016, but may be updated in the future based on reviews of the effectiveness of contact investigations. For example, HHS/CDC stopped providing contact data to health departments for mumps investigations after reviewing evidence of the effectiveness of mumps contact investigations.
The Quarantine Activity Reporting System (QARS), which contains, among other data, information collected under OMB Control Numbers 0920-0134, 0920-0488, 0920-0821, and 0920-0900, is a web-based and secure electronic system that supports collection of data for ill persons on inbound or interstate flights and vessels and at land border crossings; infectious disease threats, and follow-up actions. Currently, HHS/CDC Quarantine Stations at U.S. ports of entry are using the system to record their daily activities. All CIs undertaken by HHS/CDC are documented in QARS.
CIs for international flights from January 2010 through December 2015 are summarized in Table 6. More than half (73.2%) were initiated as a result of tuberculosis cases. Measles is the next most common disease (20.8%). The remaining 6% are subdivided across rubella, pertussis, meningococcal
HHS/CDC also requests traveler contact data to support contact investigations for travelers exposed to infectious diseases on interstate flights. The numbers of investigations and contacts during 2010-15 are summarized in Table 7. In contrast to international flights, very few contact investigations for tuberculosis were undertaken on interstate flights, because most interstate flights do not meet the 8-hour time requirement for tuberculosis contact investigations (Table 5). The majority of contacts were investigated after exposure to measles cases (76%) followed by MERS (8.4%) and viral hemorrhagic fevers including Ebola (8.0%).
The numbers of contacts for maritime contact investigations are summarized in Table 8. For maritime investigations, the majority of contacts were investigated for varicella (~79%) followed by tuberculosis (~13%) and measles (~6%). Most of the varicella and measles contact investigations were initiated while travelers were still on vessels. Besides the investigations listed in Table 8, gastrointestinal illness cases on cruise vessels carrying 13 or more passengers are reported to HHS/CDC's Vessel Sanitation Program and cases of Legionnaires' disease are reported directly to HHS/CDC's Respiratory Diseases Branch.
Contact tracing is most effective at reducing cases of communicable disease at the early stages of a potential outbreak as soon after initial exposure as possible. Therefore, if an efficient contact system is not in place when the first ill travelers arrive, the benefits of contact tracing are greatly diminished.
Contact data requests only occur after a case of serious communicable disease (index case) is reported in a person who traveled on a commercial airline or vessel while contagious. This type of situation necessitates identifying and locating travelers seated near the index case in order to conduct a CI.
At present, HHS/CDC uses a multi-step process to obtain traveler contact information from airlines. HHS/CDC issues a written order to the airline that requires the airline to provide HHS/CDC with contact information about the index case and traveler contacts. The order cites current regulatory language in 42 CFR 71.32(b), as authorized by 42 U.S.C. 264. HHS/CDC requires that the airline provide it with the traveler's first and last name, seat number, two phone numbers and email address. HHS/CDC instructs airlines and vessel operators to provide data when available or to report when data are unavailable. The time it takes for HHS/CDC to obtain the available traveler contact data can range from a few hours to a few days. From 2010 through May 2015, about 70% of manifests from airlines arrived within 3 days of the request, 15% arrived between 3 and 6 days after a request, 15% arrived after more than six days, and nine requests took more than a month or were never received by HHS/CDC.
At present, HHS/CDC requests that airlines and vessels provide available traveler contact data within 24 hours for “urgent” manifest requests. In current practice, requests for contact data are only considered “non-urgent” for contact investigations in which travelers had rubella (for which there is no available prophylaxis) or tuberculosis or for situations in which HHS/CDC is not notified of travelers diagnosed with some communicable diseases until after a certain amount of time during which prophylaxis would be effective (
While HHS/CDC requires that all information be provided upon first order for information, HHS/CDC has consistently seen that the information provided by a majority of airlines appears limited to frequent flyer information, or other limited contact information. Overall, the completeness of data provided by airlines varied such that airlines generally fell into two categories. Some airlines always provided only the passenger name and seat number. Other airlines would provide some additional contact information for passengers. However, even among these airlines, contact data for some of the passengers only included names and seat numbers. Considering all requests from 2014, at least one additional piece of contact information was provided for only about 39% of passengers. If the sample were restricted to only flights for which any contact information was provided (1,270 out of 2,411 total passengers), the fraction of passengers with at least one piece of contact information beyond name and seat number increased from 39% to 73.9%. This contact information would include U.S. address for 41.7% of passengers and one phone number for 45% of passengers. As a result of HHS/CDC's use of available information and technology and its partnerships with other Federal agencies, contact tracing of exposed travelers can now be accomplished more rapidly than would be possible if only the contact data provided by airlines were used. However, if airlines or vessel operators have additional data relative to what is currently provided to DHS, the efficiency of contact investigations could improve.
HHS/CDC is updating the definition of “ill person” in
HHS/CDC has crafted the definition of “ill person” in such a way that it should
The current illness reporting requirements for interstate travel are summarized in 42 CFR 70.4 and state that “The master of any vessel or person in charge of any conveyance engaged in interstate traffic, on which a case or suspected case of a communicable disease develops shall, as soon as practicable, notify the local health authority at the next port of call, station, or stop, and shall take such measures to prevent the spread of the disease as the local health authority directs.” Communicable disease is defined in 42 CFR 70.1 as “illnesses due to infectious agents or their toxic products, which may be transmitted from a reservoir to a susceptible host either directly as from an infected person or animal or indirectly through the agency of an intermediate plant or animal host, vector, or the inanimate environment.”
Thus, the changes in this final rule would amount to fewer illness reports than may be anticipated under the current regulation. However, in practice, according to CDC guidance available at
This final rule would align the definition from CDC guidance with regulatory text by requiring reports of ill travelers with fever and persistent cough, persistent vomiting, difficulty breathing, headache with stiff neck, decreased consciousness, travelers appearing obviously unwell, or unexplained bleeding. In practice, the codification of such guidance may increase costs to some or all airlines and vessel operators who submit illness reports based only upon symptoms currently identified in 42 CFR 71.1 and not based on HHS/CDC guidance. For illness reports from aircraft, DOT/FAA may also incur additional costs if the number of illness reports made by aircraft pilots in command to air traffic control and reported to HHS/CDC via the Domestic Events Network increases.
For aircraft, the updated definition better aligns with symptoms reporting guidelines published by ICAO in Note 1 to paragraph 8.15 of Annex 9 to the Convention on International Civil Aviation. Therefore, HHS/CDC does not anticipate much additional burden on airlines and vessel operators to report ill travelers during travel.
Although HHS/CDC estimates the net change will be no cost to airline or vessel operators, it may be possible to examine the potential increase using simple assumptions. Table 9 shows the number of reports by pilots in command during flights and recorded in HHS/CDC's Quarantine Activity Reporting System (QARS). These include reports of illness that fit the illness definition specified in current 42 CFR 71.1, reports based on HHS/CDC's guidance for airlines and vessel operators, reports made based on the guidelines in Note 1 to paragraph 8.15 of Annex 9 to the Convention on International Civil Aviation, or illness reports unrelated to current regulation or guidance. Such reports can also be subdivided into reports requiring HHS/CDC response (“response reports”) and reports that HHS/CDC receives, but which do not require an HHS/CDC response (“info-only reports”). Info-only reports may include symptoms included in HHS/CDC guidance, but for which the underlying condition can easily be diagnosed not to be a communicable disease of public health concern (
Table 9 shows that HHS/CDC already receives a number of reports based on symptoms included in HHS/CDC guidance that will be codified with this final rule. On average, among the total 175 illness reports per year, about 78 annual reports are based on symptoms included in the final rule, but not in current regulations compared to 53 reports based on symptoms already listed in current regulations. The remaining 45 reports would include those based on fever alone or based on symptoms not included either in current regulatory text or in this final rule.
The number of illness reports from master of vessels during voyages is summarized in Table 10. Compared to the breakdown in reports for aircraft, the vast majority of illness reports during voyages are for response as opposed to info-only. There may be greater specificity in reports from cruise vessels because of the presence of medical officers onboard vessels. On average, there were about 208 reports requiring follow-up and 10.6 info-only reports each year. In contrast to reports from aircraft, most of the reporting for vessels pertains to symptoms included in the current regulation (175 per year) as opposed to those specified in this final rule (32 per year). Very few reports from vessels (3.4 per year) were based on fever only or based on symptoms not included in either current regulation or specified in this final rule.
This section reports the primary steps of CIs for routine diseases:
• A traveler (the index case) is identified as ill either during the flight or voyage with a reportable illness or after with a notifiable disease. The aircraft pilot in command or master of vessel may report the illness directly to HHS/CDC. Illnesses on aircraft may also be reported indirectly to HHS/CDC via air traffic control. The FAA then passes the report to CDC through the Domestic Event Network. If the report occurs after travel, a healthcare facility would then report the illness either to HHS/CDC or public health departments (PHDs).
• If CI criteria are met, HHS/CDC contacts the airlines for
○ a manifest to determine where the index case was seated in relation to other passengers or crew members,
HHS/CDC then requests information available from DHS' databases to verify or obtain passenger contact information not included in the manifest.
If data are not available in DHS databases, HHS/CDC will require (as part of the manifest order) for the airlines to provide any available traveler contact information. The number of travelers for which contact data will be requested is based on the disease-specific criteria listed in Table 5.
Once HHS/CDC has the traveler contact information and flight-seating chart, the CI begins. Current CI procedures are cumbersome, in part because of the difficulties associated with obtaining traveler contact information. HHS/CDC staff may contact airlines more than once to obtain traveler contact data including email address, one or two phone numbers, and address in the United States for U.S. citizens and permanent residents.
When passenger contact information is delayed or partial, State/local public health departments are delayed in starting CIs and, depending on the disease, this delay could make it impossible to prevent illness and/or the transmission of disease. Further, PHDs could have improved success contacting passengers with more accurate or timelier data.
The model for estimating the benefits of CIs is: Current number of CIs × (reduction in HHS/CDC and health department staff time/resources per contact) × value of staff time.
The rest of this section reports both the quantifiable benefits arising from streamlining the CI process and a discussion of health benefits. The differential impacts of the various diseases make it hard to summarize the final rule's effects given uncertainty around future probabilities of case(s) of multiple such notifiable disease(s). The timeliness of contact investigations could also be improved if improvements in illness reporting led to earlier diagnoses of communicable diseases.
Most air travelers with illness are not identified in flight, but rather seek medical care and are identified as an
When communicable diseases are diagnosed after travel, the medical practitioner should notify HHS/CDC or a PHD if the diagnosed disease is on either the list of quarantinable communicable diseases or the list of notifiable diseases. If HHS/CDC can draw upon improved contact information based on the codification of requests for traveler contact data to aircraft and vessel operators as set forth in this final rule, the risk of onward disease transmission can be reduced. By contacting ill travelers more quickly, HHS/CDC may slow the spread and the severity of the outbreak. The benefits therefore depend on:
• How many infected travelers are expected to enter the United States;
• How many quarantinable or notifiable diseases are detected either on-board the aircraft/vessel or reported to HHS/CDC by PHDs;
• How many exposed travelers will become ill as a result of exposure during travel;
• How the infection will be transmitted within the U.S. population;
• How effective public health agency contact tracing will be with and without the final rule.
In addition to improved efficiencies associated with more timely or more complete provision of traveler contact data by airlines and vessel operators, there may also be an increase in the number of reports of ill travelers during travel that require HHS/CDC follow-up. Under the most likely scenario, there will not be a change in these reports, since the new definition better corresponds to reporting guidelines published by ICAO in Note 1 to paragraph 8.15 of Annex 9 to the Convention on International Civil Aviation and current HHS/CDC guidance. However, there may be an increase in illness reports depending on whether airlines and vessel operators increase reporting for required rather than recommended symptoms.
The change to the definition of an “ill person” for the purposes of illness reporting and the codification of HHS/CDC requests from airlines and vessel operators for traveler contact data may improve HHS/CDC's ability to respond effectively and mitigate infectious disease outbreaks. There are a number of intermediate steps between either an illness report or receiving more complete or timelier traveler data and stopping an infectious disease outbreak. For example, the travelers exposed to the infectious disease would have to be contacted by health departments and comply with recommended public health measures, which could include some form of public health or medical follow up to mitigate their risk of becoming ill, or self-monitoring/quarantine to mitigate the risk of transmitting that disease to other individuals.
The amount of time HHS/CDC staff spend per air or maritime contact varies with the size of the CI because some tasks are CI-specific, such as filling out reports or obtaining manifests, and some are contact-specific such as determining a specific traveler's contact information. The CI-specific labor time costs less per contact when an investigation includes more contacts,
For PHD resources, HHS/CDC also estimated a cost-per-contact of $180, which is consistent with HHS/CDC costs and a recent publication adjusted to 2015 dollars.
• One State assigns 2 registered nurses (RNs) who perform 5 CIs or fewer per year for the entire State another State assigns 3 RNs, a Public Health Service Medical Officer, a physician, and a data analyst and conducts about 25 CIs a year.
• When one State receives information about passenger contacts from HHS/CDC, the State epidemiologist creates several documents to fax to the relevant county health departments, a team of an epidemiologist and RNs at the county then either call or visit the contacts if there is an address. But the State epidemiologist will make every effort to locate travelers even if their final destination is unclear.
Finally, different diseases may elicit different levels of response at the PHD level, with a more rapid response for highly infectious diseases like measles that can be prevented with timely post-exposure prophylaxis and a more measured response for less infectious diseases like TB. By using the same cost for HHS/CDC and for PHDs, HHS/CDC believes the potential reductions in cost from reduced effort for PHDs to locate infectious disease contacts are conservatively estimated.
For some diseases, there is empirical data from which onboard transmission can be estimated. According to a published analysis of the outcomes of measles contact investigations (74 case-travelers on 108 flights resulting in 3,399 contacts) in the United States between December 2008 and December 2011, HHS/CDC could not assign 9% of measles contacts (322) to a health department due to insufficient contact data. Another 12% of these contacts (397) were believed to be outside the United States.
The majority of travelers exposed to measles on aircraft (~74%) had pre-existing immunity based on past measles immunization, past measles illness, or being born prior to 1957 and thus likely to have measles immunity even if they do not recall experiencing the disease.
Intervention by public health departments mitigates the risk of measles transmission in two ways. First, exposed travelers without measles immunity may be offered voluntary post-exposure prophylaxis with measles-containing vaccine (within 72 hours) or immune globulin (within 6 days),
In summary, the potential size of a measles outbreak occurring depends on:
• The number of persons contacted by the infectious measles patient
• Background immunity among persons contacted
○ Survey estimates have shown considerable heterogeneity in background vaccination rates such that 80% of unvaccinated children live in counties comprising 40% of the total population.
For tuberculosis, it is difficult to estimate the transmission rate on an aircraft or vessel. A modeling study suggests that the risk of infection is about 1/1000 on an 8.7 hour flight and that persons seated closer to the index case are at greater risk of infection.
An analysis of the epidemiology and outcomes of HHS/CDC-led flight-related tuberculosis contact investigations conducted in the United States from January 2007 to June 2008 examined 131 case-travelers and 4,550 passenger-contacts.
The results from this investigation were used in a cost-effectiveness study to estimate the return on investment for tuberculosis CIs. The authors examined a range of latent tuberculosis prevalence rates among exposed travelers that varied between 19% and 24% for two different HHS/CDC CI protocols for flight-related TB investigations. The return on investment was calculated based on the likelihood that travelers with latent tuberculosis infection would initiate and complete a treatment regimen to clear the infection, the average cost of tuberculosis treatment, a tuberculosis case fatality rate of 5% and a conservative value of statistical life estimate of $4.2 million (in 2009 USD) to account for the value of mortality risk reduction from avoided tuberculosis disease. The return on investment depended on the probability assumed for persons with latent TB infection to develop active disease (5-10%) and variation in the costs to health departments to locate exposed travelers ($28 to $164). Using the expected latent tuberculosis prevalence rate of 19% in travelers identified for contact investigations on flights and a health department cost per contact of $164, the return on investment was estimated to
There is also empirical data for SARS infections occurring on an aircraft. A study reported that 37 infections resulted from 40 flights with infectious passengers on board. Of the 40 flights, four have documented aircraft sizes. They average 127 passengers per plane.
For the remainder of the diseases, empirical data does not exist. Like measles, immunizations are recommended to prevent pertussis, rubella, and meningococcal disease. Since meningococcal conjugate vaccine was more recently added to the United States vaccination schedule, it is likely that background immunity is much lower relative to measles, rubella or pertussis.
In the absence of data for some diseases, the infection rate of measles is used to estimate the infection rates by using the ratio of basic reproduction numbers (R
The number of potential contacts for each disease can be multiplied by the estimated transmission rate by disease in Table 12 to generate a rough estimate of the annual number of cases among traveler contacts. These numbers of contacts for each disease are summarized in Tables 6 and 7 for interstate and international CIs respectively. Contact investigations on vessels are excluded for this analysis. Based on this analysis, tuberculosis (19 to 48) and measles cases (3.6 to 10.1) are the most likely diseases that will be diagnosed among contacts exposed during travel (Table 13). Tuberculosis contact investigations only occur for international flights with the very rare exception of a domestic flight with a duration greater than 8 hours. The numbers of contacts and outcomes are much more uncertain for other diseases. The number of tuberculosis cases are adjusted from the number of contacts with tuberculosis by assuming that only 5% (lower bound) to 10% (upper bound) of infected contacts will go on to develop clinical disease.
For viral hemorrhagic fevers and MERS, there is no evidence of transmission, but there have not been very many observations.
These estimates of cases may be a lower bound, because potential cases resulting from flights in which contact investigations were not performed are not included. Especially for tuberculosis cases, many international travelers may return to their home countries before seeking treatment and such cases may not lead to contact investigations if HHS/CDC is not informed.
Since the final rule does not change the timeframe or amount of data requested from airlines or vessel operators, the most likely economic impact is a small change in the amount of effort for airlines to provide more complete and timely information. To the extent that airlines would respond more quickly or with additional data, it would require some airline information technology staff to expedite requests or to search in more depth for available data. HHS/CDC estimates this may require one hour of staff time per request. HHS/CDC has no way to predict how much more complete, timely, or accurate contact from airlines would become as a result of this final rule. On average, HHS/CDC acted upon 77 requests per year to airlines for international traveler contact data between 2010 and 2015 (Table 6). In addition, HHS/CDC made 22.5 requests per year for interstate traveler data (Table 7) over the same period. There were 45 contact investigations per year among travelers on vessels (Table 8); however, most of these were undertaken before travelers disembarked vessels in which case contact data could be collected directly from exposed travelers as part of the investigation. The number of maritime contact investigations requiring manifest requests after disembarkation is estimated to be less than 10 per year.
Overall, including international air and maritime activities, the estimated number of contact data requests after disembarkation was estimated at 100 to account for the fact that HHS/CDC sometimes requests traveler contact data for infectious disease events prior to confirmed diagnoses. On occasion, it turns out that travelers are not infected with diseases that require a public health response. This rounding up should also account for a year in which there is a significant increase in the number of contact investigations among exposed air or maritime travelers. HHS/CDC notes the manifest order process for interstate flights is not codified in the final rule. The data is provided here for completeness.
The average wages for computer and information systems managers (occupation code 11-3021) reported in the Bureau of Labor Statistics, May 2015 Occupational Employment Statistics
When reports are received, public health officers at Quarantine Stations perform case assessments, may request follow-up information, and may consult with HHS/CDC medical officers to determine if additional action such as a contact investigation, onboard response, or notification to State and local health departments is warranted. Under one assumed upper bound scenario, the change in the definition of “ill person” included in the final rule could result in a 100% increase in the number of info-only reports from airlines and a 25% increase from vessels. On average, there are 129 info-only reports for aircraft and vessels each year and these increases would correspond to an annual increase of 119 info-only reports on aircraft and 3 info-only reports on vessels (Table 15). If the average time for each report is estimated to be 2 minutes for aircraft pilots in command or masters of vessels to make the report, 10 minutes for a traveler to discuss the illness with public health officer, and 60 minutes for HHS/CDC to document the info-only report, the estimated cost of the additional reports can be estimated based on the opportunity cost of time for each type of personnel. In addition to the time required for aircraft pilots in command and masters of vessels to make reports, the personnel in the Department of Transportation's Federal Aviation Administration (DOT/FAA) may incur additional costs to relay reports of suspected cases of communicable disease received by air traffic control to CDC through the Domestic Events Network. The amount of DOT/FAA staff time is estimated at 26 minutes for a government employee at GS-level 15, step 6 based in Washington, DC. In reality, there would be three DOT/FAA employees involved including 1 GS-15/16 level employee at air traffic control (10 minutes), 1 GS-15 level employee at the Domestic Events Network (10 minutes), and 1 GS-14 level employee at DOT/FAA's Washington Operations Center Complex (6 minutes).
For aircraft pilots in command or masters of vessels (occupation codes 53-2011 and 53-5021) and travelers (average across all occupations code 00-0000), their opportunity cost is estimated from Bureau of Labor Statistics, May 2015 Occupational Employment Statistics
Besides the possible change in costs of info-only reports, the other potential change would be an increase in the number of reports that require HHS/CDC follow-up. Under the most likely scenario, there will not be a change in these reports since the new definition better corresponds to HHS/CDC guidance and to reporting guidelines published by ICAO in Note 1 to paragraph 8.15 of Annex 9 to the Convention on International Civil Aviation. However, there may be an increase in the number of reports requiring a response. Under this scenario, there may be an increase in costs for air or masters of vessels to report illnesses. The upper bound increase in reports requiring response is assumed to be 50% of the average annual illness reports from airlines and a 10% increase from vessels (refer to Tables 10 and 11 for baseline number of reports): 29 reports per year on aircraft and 21 reports per year on vessels. HHS/CDC assumes that the time required to submit illness reports and for DOT/FAA staff to relay reports requiring responses is the same as for info-only reports (2 minutes for pilots in command and masters of vessels and 26 minutes for DOT/FAA to relay reports, Table 16). Further, HHS/CDC assumes that travelers could spend up to 60 minutes talking to HHS/CDC and/or State and local public health officers for reports requiring response. The upper bound estimate of total costs associated with the increase in the number of illness reports requiring response is estimated to be $3,102.
There would likely be no change or a decrease in HHS/CDC costs because earlier reporting would lead to a more efficient HHS/CDC response relative to an alternative in which the illness was not reported during travel, but instead was later reported by a public health department to HHS/CDC. In addition, the public health response to the illness would likely be more efficient because exposed travelers could be contacted earlier. In rare situations, such travelers may potentially be informed of their potential exposure at the gate after disembarking the aircraft or vessel. Such actions should not result in significant delays by holding travelers on board.
HHS/CDC did not include any training costs because the change in the “ill person” definition in this final rule is consistent with the internationally recognized and accepted illness reporting guidelines published by ICAO for international travelers and represents a reduced burden compared to the previous illness reporting regulations for interstate travelers.
There may also be a one-time cost associated with updating training to reflect the new regulatory text. As noted above, HHS/CDC reiterates that the change to regulatory text is a codification of HHS/CDC guidance and better aligns with international guidance (Note 1 to paragraph 8.15 of Annex 9 to the Convention on International Civil Aviation). Further for interstate travel, these changes result in relaxed illness reporting compared to status quo regulatory text. Thus any airlines using either ICAO or HHS/CDC guidance to support training efforts for illness reporting should not need to change training materials. At most, it may be necessary to clarify that some symptoms that were previously requested are now required. However, for some airlines or vessel operators, it may be necessary to revise training materials.
The cost of training was estimated based on the number of pilots and flight attendants and their average wage rates as reported in the Bureau of Labor Statistics, May 2015 Occupational Employment Statistics.
The monetized annual costs resulting from the change in the definition of “ill person” are summarized in Table 18. The benefits in regard to reductions in communicable disease transmission are summarized in a subsequent section.
The total costs of the final rule are summarized in Table 19 and include the costs of the change to the definition of an “ill person” and the codification of the requirement for airlines to provide passenger contact data for the final rule.
This section reports the benefits that HHS/CDC anticipates from implementation of the final rule in avoiding the costs incurred annually for CIs of infectious diseases. The model for estimating the benefits of CIs is: Current number of CIs × (reduction in HHS/CDC and health department staff time/resources per contact) × value of staff time.
HHS/CDC obtained the total number of contacts traced (2,715 per year, Table 6) for all diseases reported on international flights. International flight data were extracted for this analysis because the codification of the requirements to provide timelier and more complete contact data is limited to international arrivals. In comparison, HHS/CDC requests contact information for approximately 664 contacts per year on interstate flights (Table 7). HHS/CDC also supports contact investigations affecting an average of 762 contacts per year for illnesses on board vessels (Table 8); however, many of these investigations occur before travelers disembark vessels. By limiting the analysis to contacts on international flights, HHS/CDC conservatively estimates the potential benefits associated with this final rule. HHS/CDC multiplied the average annual number of contacts on international flights by the cost-per-contact for HHS/CDC and PHDs (Table 11) to estimate the costs of CIs under the current baseline.
To estimate the benefits (Tables 20 and 21), HHS/CDC assumed a percent reduction in staff time for CIs at HHS/CDC (0-3%) and PHD levels (0-2%)
HHS/CDC annual costs to engage in international air, interstate air, and maritime CIs are about $745,000 or roughly the equivalent of 3.8 HHS/CDC full-time employees (FTEs) at the wage level of GS-13, step 4 plus benefits and overhead (Table 21). The final rule should have the greatest effect on the international air CIs. The annual reduction in contact tracing costs from implementing the final rule (Table 22) for HHS/CDC ranged from $0 to $14,661 based on a 0-3% reduction in effort on international CIs. For PHDs, the reduction in costs ranged from $0 at the lower bound to $9,774 at the upper bound (Table 22).
The best estimate of benefits are the midpoint of the lower bound and upper bound estimates for both HHS/CDC and PHDs ($12,218). The lower bound ($0) and upper bound estimates ($24,435) for both entities are also reported in Table 22.
The total annual monetized benefits by stakeholder from the potential reduced effort for contact investigations are summarized in Table 23.
On average, HHS/CDC identified 564 travelers exposed to measles cases on international flights during 2010-2015 (Table 6). The final rule may affect the cost for health departments to implement public health measures in two ways: (1) Health departments may contact exposed travelers more quickly and (2) health departments may be able to contact a higher percentage of exposed travelers. For the first set of travelers that are contacted earlier with the final rule than under the status quo, the cost to both the contacted travelers and to health departments should be less than under the status quo. For measles contacts, earlier follow-up with public health departments should lead to more travelers being offered voluntary measles vaccines within 72 hours. This would potentially reduce the cost of following up with exposed travelers at which time health departments could offer to administer immune globulin or health departments may monitor travelers that have been located after the 72-hour window in which measles vaccination would reduce their risk of developing symptomatic measles. At present, very few travelers receive post-exposure prophylaxis, 11/248 or 4.4%.
Among the contacts, HHS/CDC estimates that approximately 25% (141 contacts per year) cannot be located by public health departments (Table 24), either because HHS/CDC cannot assign the contacts to health departments or because the information provided by HHS/CDC is not sufficient to enable health departments to locate contacts after assignment from HHS/CDC. Among these contacts, HHS/CDC assumes that 10% of all contacts (56) are not located because HHS/CDC cannot assign contacts to State health departments due to insufficient data. For these contacts, health departments would not incur any contact tracing costs because such contacts would not be assigned. HHS/CDC assumes a 15% improvement from baseline as a result of this final rule (Table 24). This would result in 8.5 additional contacts per year assigned to health departments for contact tracing. As shown in Table 11, HHS/CDC estimates that health departments incur an estimated cost of $180 per contact. The marginal cost incurred from this final rule for additional measles contacts assigned to health departments would be $180 × 8.5 = $1,530 per year (Table 25).
In addition, HHS/CDC assumes that the final rule could improve health departments' abilities to contact 15% of those who could not be currently contacted because of insufficient contact information (21 contacts per year). HHS/CDC does not have any data to measure the magnitude of improvement and applies a range of 10% to 20% to calculate lower and upper bounds. If airlines and vessel operators do not have any additional data besides what is already transmitted to DHS, there will be very little improvement. Among the 21 additional exposed travelers that would be contacted, 70% of them (15 per year) are expected to have measles immunity because they were born before 1957, had history of measles, or received one or more doses of measles vaccine. The remaining 6 travelers per year without proven measles immunity would incur additional costs if they are vaccinated (vaccine costs + vaccine administration, Table 25).
To be conservative, HHS/CDC assumes that all 6 exposed travelers would be adults and would be vaccinated with the measles-mumps-rubella (MMR) vaccine. The vaccine price for adults is estimated from the Vaccines for Children vaccine price archives (July 2014 and July 2015)
In the absence of interventions by public health departments, travelers infected with measles during international travel would be as likely as any other individuals to spark a measles outbreak. In the absence of HHS/CDC efforts to retrieve and transmit contact data, public health departments would not be able contact travelers to offer post-exposure prophylaxis and/or to recommend self-monitoring for potential measles symptoms.
For measles in 2011, 16 outbreaks occurred leading to 107 cases. An outbreak was defined based on 3 or more cases in a cluster.
HHS/CDC assumes that the probability that a measles case resulting from exposure during travel and that is not contacted by a public health department is as likely as any other measles case to initiate a measles outbreak of 3 or more cases, which occurs at an approximate probability of 12.4% to 21.9%. The average cost to health departments is $250,000 for each of these outbreaks and the average outbreak size is about 7 cases (107 cases/16 outbreaks).
The estimated illness costs for measles are $300 ($86-$515) for outpatient cases and $24,500 ($3,900-$45,052) for inpatient cases.
The estimated number of measles cases that will occur in contacts exposed during travel (3.6 to 10.1) can be multiplied by the probability of an outbreak with 3 or more cases (12.4% to 21.7%) to estimate the expected number of outbreaks in the absence of public health intervention to conduct contact investigations in exposed travelers. For each outbreak, HHS/CDC assumes that an average of 6 additional cases occur with associated morbidity and mortality costs. The estimated costs of measles outbreaks in the absence of contact investigations for exposed travelers is presented in Table 28.
HHS/CDC has not received any reports of large measles outbreaks associated with measles cases in patients exposed during travel and contacted by State or local public health departments. As a result, HHS/CDC believes that when measles cases occur in contacts reached by health departments, the probability of an outbreak is significantly mitigated by pre-warning of exposure before disease outset. Given that HHS/CDC estimates that health departments are able to reach approximately 75% of contacts under the status quo, HHS/CDC assumes that the risk of an outbreak has been reduced by at least 60% under the status quo. Further, HHS/CDC assumes that the provisions in the final rule further improve health departments' ability to prevent measles outbreaks in cases that occur among travelers exposed during flights. A modest improvement of 15% is assumed (range 10%-20%) resulting in estimated benefits of about $45,000 ($8,000 to $159,000) in Table 29.
Although measles is not a quarantinable disease and tuberculosis is a quarantinable disease, HHS/CDC's and health departments' approaches to contact investigations are relatively similar. However, HHS/CDC may issue isolation orders for individuals with active tuberculosis in some situations, but would not have authority to issue isolation (or quarantine orders) for individuals with measles. The expected benefits associated with reduced tuberculosis morbidity and mortality of contact investigations for exposed travelers are based on a previous analysis, which estimated a return on investment of $1.01 to $3.20 for the baseline situation in which an estimated 19% of exposed contacts are found to have latent tuberculosis infection.
The estimated costs to provide testing and treatment to contacts that test positive for latent tuberculosis infection are estimated to be $1,044 for infected contacts that complete a full course of treatment and $591 for infected contacts that discontinue treatment after 30 days.
The costs to provide treatment for latent tuberculosis infections under the status quo are summarized in Table 30. In total, the costs are almost $900,000 including about $720,000 to locate contacts and about $180,000 to provide treatment to individuals with latent tuberculosis infection.
The benefits associated with tuberculosis contact investigations are estimated from a published article, which reported a range of $1.01 to $3.20. This analysis did not include the potential benefits from reduced onward transmission of tuberculosis among averted cases, potentially resulting in a conservative estimate of the return on investment. The formula used to derive estimated benefits from the return on investment (ROI) is Estimated Benefits = Estimated Costs × ROI + Estimated Costs. The estimated benefits are $2.6 million and are shown in Table 31 (range: $1.8 million to $3.8 million).
The provisions in the final rule should result in a small increase (assumed baseline of 10%, range: 5-15%) in the number of contacts reached by health departments and offered treatment for latent tuberculosis infection. This estimated improvement is less than that assumed for measles because tuberculosis usually involves a much longer period of latent infection prior to active disease; thus, tuberculosis contact investigations are less time sensitive relative to measles contact investigations. The estimated costs associated with this marginal improvement to reach more contacts can be estimated by multiplying the costs of providing latent tuberculosis ($180,000) by this range of improvement (5%-15%) as shown in Table 32. This results in marginal increased costs associated with the final rule of $18,000 (range: $9,000 to $27,000). The estimated benefits (Table 32) associated with the final rule are $52,000 (range: $18,000 to $114,000).
The total costs for measles and tuberculosis contact investigation activities are estimated by summing the costs and benefits of measles contact investigations (Table 29) and tuberculosis contact investigations (Table 32). The results are summarized in Table 33.
The total quantified benefits (Table 34) resulting from the improvement of the quality and timeliness of traveler contact data or the improvement of illness reporting is summarized by summing the improved efficiency for HHS/CDC to provide contact data to health departments and improved efficiency for health departments to contact exposed travelers (Table 23) and the reductions associated with measles and tuberculosis morbidity and mortality (Table 33).
The benefits and costs associated with improved effectiveness of contact investigations (Table 34) can be combined with the increased costs to airlines, vessel operators, DOT/FAA, and HHS/CDC to submit and respond to illness reports or to provide more timely and complete traveler contact data for manifest requests (Table 19) to estimate the total annual costs and benefits of the final rule (Table 35).
HHS/CDC does not have sufficient data to quantify the health impact of contact investigations for pertussis, rubella, varicella (vessels only), viral hemorrhagic fevers (including Ebola), MERS, or SARS. HHS/CDC attempts to continuously update its contact investigation protocols based on available evidence. In the past few years, HHS/CDC has stopped requesting data to conduct mumps contact investigations
Experience from interstate flight contact investigations suggest that travelers may want to know when they have been exposed to communicable diseases during flights. The first Ebola contact investigation conducted in the United States occurred in October, 2014, and found that 60 travelers out of 164 had no contact information on the manifest that was provided by the airline. A second request was made to the airline after it was announced to the media that the airline had contacted over 800 travelers, including travelers who had flown on the same plane subsequent to the flight with the Ebola. At that time the airline was able to provide HHS/CDC more complete information for all travelers.
It is likely that the need for CDC to put out media requests for travelers to contact the Agency created a level of fear in the general population that may not have been necessary if better contact data were available. In addition, this fear may have led to non-health costs (such as fear of airplane travel) that would have been mitigated if the Agency were able to contact all passengers without the media request. However, when HHS/CDC solicited public comment about perceived willingness to pay to be contacted in the event of an exposure to a communicable disease during, HHS/CDC only received a few public comments, all of which indicated that they had zero willingness to pay in the event of an exposure to a communicable disease.
In summary, improved alignment between regulatory text and HHS/CDC's publicly available guidance should reduce compliance costs for airlines and vessel operators while improving HHS/CDC's ability to respond to public health threats associated with international and interstate travel. To the extent that airlines and vessel operators improve responsiveness to HHS/CDC traveler data requests, HHS/CDC may become better able to respond to infectious diseases threats and (1) reduce case-loads during infectious disease outbreaks, (2) reduce public anxiety during disease outbreaks, (3) mitigate economic impacts on businesses as a consequence of reduced public anxiety, and (4) reduce the amount of personnel labor time to conduct large-scale CIs in response to a new infectious disease or one with serious public health and medical consequences like Ebola. HHS/CDC will make all reasonable efforts to work with DHS/CBP via CDC's liaison located at the National Targeting Center, as provided through internal Memorandum of Understanding, to search and obtain data collected from their APIS and PNR data sets prior to contacting airlines or vessel operators with duplicate data requests.
For the less restrictive alternative, HHS/CDC assumes that the process of requesting contact data from airlines and vessel operators would be discontinued. Thus, the cost to provide such data can be modeled as a benefit to airlines and vessel operators equal to their costs under the baseline. For the more restrictive alternative, HHS/CDC assumes that suspension of entry may be implemented for travelers from countries experiencing widespread transmission of quarantinable communicable diseases. HHS/CDC notes that suspension of entry would not be considered for non-quarantinable diseases (refer to Table 4). Specifically, HHS/CDC assumes that persons traveling from affected countries are not permitted entry to the United States unless such persons spend an amount of time equivalent to the incubation period for the target disease at a location where they are not at risk of exposure and are also screened for symptoms of the disease prior to travel to the United States. During the 2014-2016 Ebola epidemic, travelers from Liberia, Sierra Leone or Guinea would not be able to enter until 21 days in another country or within the affected country but separated from others in a manner that excludes the possibility of interaction with potentially infected individuals.
On average, HHS/CDC has conducted about 2.5 contact investigations for viral hemorrhagic fevers and MERS coronavirus over the past six years. HHS/CDC assumes that if suspensions
Thus, the cost to airlines and vessel operators to provide traveler contact data would decrease for the less restrictive alternative resulting in estimated benefits of $75,924. For the more restrictive scenario, the costs are relatively similar as for the final rule except for the reduction in cost associated with providing contact data for 2.5 investigations ($12,338 vs. $12,654) and calculating the cost reduction of doing 2.5 fewer contact investigations each year ($1,898) (Table 36).
HHS/CDC examines two alternatives: A less restrictive alternative in which HHS/CDC relaxes its regulatory authorities to make illness reporting compliance voluntary rather than compulsory. Under the more restrictive alternative HHS/CDC may enforce the current requirement that airlines report all persons with communicable diseases to local health departments in addition to reporting to HHS/CDC.
The current status quo for illness reporting is summarized in Tables 9 and 10. Reports can be subdivided by illnesses that fit (1) the ill person definition specified in current 42 CFR 71.1, (2) reports based on HHS/CDC's guidance for airlines and vessel operators, or (3) illness reports unrelated to current regulation or guidance. As shown in Table 9, only about 53 out of 175.4 (30%) illness reports during air travel appear to be based on symptoms included in the current definition of an ill person in existing 71.1. The remaining 70% of reports are based on symptoms currently requested by HHS/CDC, but not required. In addition, only 67% of illness reports during air travel require HHS/CDC response and follow-up. In comparison, illness reports from vessels are much more likely to be based on the definition of ill person as defined in current 71.1 (174.6/218.6 or 80%). In addition, a much greater proportion of reports require an HHS/CDC follow-up (>95%). This may result from differences in the types of illnesses observed on vessels relative to aircraft or because of the presence of medical officers on cruise vessels, who may be better able to identify communicable diseases of public health concern during travel relative to aircraft personnel.
If illness reporting were entirely voluntary, HHS/CDC assumes the number of reports (both info-only and reports requiring response) would decrease by 50% from both airlines and vessel operators (refer to Tables 9 and 10) from the current status quo. HHS/CDC does not have any data to estimate the magnitude of decrease in reporting. HHS/CDC believes that both HHS/CDC and DOT/FAA would continue to maintain their current infrastructure to effectively respond to public health emergencies either on aircraft or vessels. Thus, relative to the status quo, the primary impact of voluntary reporting would be reduced incremental time costs for pilots in command and masters of vessels, travelers, DOT/FAA, and HHS/CDC, especially for info-only illness reports. This 50% reduction in illness reporting would generate benefits from cost reductions for airlines and vessel operators, HHS/CDC, travelers, and DOT/FAA of approximately $14,700 (Tables 37 and 38).
The adverse impact for the less restrictive alternative relative to the baseline would be reduced capacity for HHS/CDC to respond quickly to communicable disease threats occurring during travel. This is analyzed in a subsequent section on the health impact of regulated activities.
Under the more restrictive alternative, HHS/CDC would require duplicate illness reporting both to HHS/CDC and to local health departments with jurisdiction upon arrival for interstate flights and voyages. This alternative is based upon the existing regulatory text under 42 CFR 70.4. HHS/CDC assumes that 50% of illness reports occur during interstate (relative to international) air travel and that 15% of maritime illness reports occur during interstate travel. The time required for pilots in command and masters of vessels is assumed to be about 4 minutes. This duration is greater than the amount of time estimate for reporting to HHS/CDC because pilots in command and masters of vessels may have to search for contact information for local health departments and because local health departments may have less experience dealing with illness reports than HHS/CDC. The costs to airlines and vessel operators is estimated to be $848 per year (Table 39). Since HHS/CDC would coordinate responses to illness reports with local health departments under the status quo, there are no additional costs or benefits to requiring duplicative reports to local health departments. These costs would be added to the costs of the changes resulting from the final rule.
The total costs and benefits associated with the more and less restrictive illness reporting scenarios as compared to the final rule are summarized in Table 40.
The total costs of the alternatives compared to the final rule are summarized in Table 41 and include the costs of the change to the definition of an “ill person” and the codification of the requirement for airlines to provide passenger contact data for the final rule, the less restrictive alternative, and the more restrictive alternative.
For the less restrictive alternative, the change relative to baseline is equal to the current cost of performing Cis for travelers exposed on international flights ($745,000 each for HHS/CDC and local health departments or a total of about $1.5 million, Table 20). Under the more restrictive alternative (
For this analysis, under the less restrictive alternative, HHS/CDC assumes that no contact investigations are performed for measles. As a result, the probability of onward transmission from 3.6 to 10.1 measles patients exposed each year during travel greatly increases and is modeled based on the estimated costs of measles in the absence of intervention $504,000 (range: $137,000 to $1.3 million) (Table 28). Measles outcomes for the more restrictive alternative are the same as estimated for the final rule since there is no difference in measles efforts between the final rule and the more
Under the less restrictive alternative, tuberculosis contact investigation are no longer conducted for persons exposed during travel. Relative to the baseline, there are neither costs to conduct such investigations (resulting in benefits of about $180,000 to forego providing treatment for latent tuberculosis treatment) or benefits associated with reduced tuberculosis morbidity and mortality. Relative to the baseline, the estimated cost of increased tuberculosis morbidity and mortality is estimated to be $2.6 million (range: $1.8 million to $3.8 million). Under the more restrictive alternative in which suspension of entry is enforced in response to quarantinable communicable disease outbreaks, there is no change relative to the final rule results because it is unlikely that a tuberculosis outbreak would cause suspension of entry. Results are summarized in Table 44.
The total costs and benefits of changes in health outcomes associated with the more and less restrictive alternatives compared to the provisions included in the Final Rule are summarized in Table 45. The less restrictive alternative in which contact investigations are no longer pursued shows a large increase in costs relative to the baseline and in comparison to the provisions in the final rule. In addition, there are some benefits, but not enough to offset the costs. The more restrictive alternative does not change health outcomes for tuberculosis and measles in comparison to the final rule.
The total quantified costs and benefits (Table 46) resulting from the additional data provision and timeliness of traveler contact data or the improvement of illness reporting for alternatives to the provisions included in the final rule is summarized by summing the improved efficiency for HHS/CDC to provide contact data to health departments and improved efficiency for health departments to contact exposed travelers (Table 42) and the reductions associated with measles and tuberculosis morbidity and mortality (Table 45).
The total annual costs and benefits for the alternatives compared to the final rule are summarized in Table 47. Although the benefits for the more restrictive alternative in which suspensions of entry would be implemented for countries experiencing outbreaks of quarantinable communicable diseases are greater than the quantified annual benefits of the final rule, the costs are underestimated. HHS/CDC does not have sufficient data to quantify the long term costs of implementing suspensions of entry for countries experiencing outbreaks of quarantinable diseases; however, such costs would probably exceed the $100,000 in estimated benefits associated with suspensions of entry that may result in fewer contact investigations for quarantinable diseases such as Ebola and MERS. Refer to the appendix for some details of potential costs associated with hypothetical suspensions of entry for the countries with widespread Ebola transmission during the 2014-2016 global Ebola epidemic.
HHS/CDC does not expect that most of the provisions included in the final rule will result in measurable changes relative to the economic baseline. The primary purpose of the provisions summarized in list below is to explain how HHS/CDC interprets its current statutory and regulatory authority under the Public Health Service Act (42 U.S.C. 264, 265) and regulations at 42 CFR parts 70 and 71. HHS/CDC is grouping the complementary provisions in part 70 and part 71 in the list below, when they align, to facilitate public review of the current provisions as well as those included in the final rule. These changes are intended to clarify the agency's standard operating procedures and policies, and due process rights for individuals. HHS/CDC believes that such clarity is an important qualitative benefit of the provisions in this final rule, but is not able to monetize this impact in a significant way.
• New Provisions: § 70.5 Requirements relating to travelers under a Federal order of isolation, quarantine, or conditional release.
○ Baseline and Current Regulatory Provision: § 70.5 Certain communicable disease; special requirements.
Without the final rule, HHS/CDC may issue Federal orders to restrict travel for persons infected or exposed to quarantinable communicable diseases. However, this process is less transparent and efficient than allowing travel (
○ Change relative to baseline as result of final rule
With the final rule, HHS/CDC is aligning the list of diseases for which individuals under Federal orders may be allowed to travel with the quarantinable communicable diseases specified in Executive Order. A potential future qualitative benefit would be to reduce uncertainty by the individual subject to the order, carrier operators, and cooperating health and law enforcement entities about whether HHS/CDC could issue a travel permit to an individual under a Federal order and quantifiable benefit would be the avoided cost of potential legal challenge.
○ Qualitative benefit/cost of final rule
Improved transparency for HHS/CDC's ability to allow individuals under Federal orders to issue travel permits to allow individuals to travel (interstate). HHS/CDC may allow persons under Federal orders to travel interstate for whom there is greater uncertainty regarding HHS/CDC restricting their travel.
○ Monetized benefit/cost of final rule
Increased clarity around due process may result in fewer resources and time expended by individuals under orders and HHS/CDC in disagreements over HHS/CDC's authority to issue Federal public health orders that limit an individual's movement. This includes the potential costs of litigation and associated activities.
• New provisions: § 70.6 Apprehension and detention of persons with specific diseases; § 71.32 Persons, carriers, and things (no change to title)
○ Baseline and Current Regulatory Provision:
Under current 42 CFR 70.6 and § 71.32, HHS/CDC has regulatory authority to apprehend and detain individuals with quarantinable communicable diseases.
○ Change relative to baseline as result of final rule
As a result of these new provisions, the major change would be improved transparency of HHS/CDC's regulatory authority with regard to the issuance of Federal quarantine, isolation, or conditional release orders of individuals traveling interstate.
○ Qualitative benefit/cost of final rule
;Improved transparency and compliance with Federal orders.
○ Monetized benefit/cost of final rule
Increased clarity around due process may result in fewer resources and time expended by individuals under orders, cooperating entities, and CDC in disagreements over HHS/CDC's authority to issue Federal public health orders that limit an individual's movement. This includes the potential costs of litigation and associated activities.
• New Provisions: § 70.10 Public health prevention measures to detect communicable disease; § 71.20 Public health prevention measures to detect communicable disease.
○ Baseline and Current Regulatory Provisions: No explicit regulatory provision.
In the absence of the final rule and under existing statutory authority provided in the Public Health Service Act and regulatory authority provided by 42 CFR 70.2 and 71.32(b), HHS/CDC could still implement public health measures at locations where individuals may gather for interstate travel or at U.S. ports of entry. However, without more transparent regulatory authority to require such measures, travelers may be less likely to comply, either by refusing to answer risk assessment questions or providing false information. This lack of compliance may require that HHS/CDC, if it reasonably believes that the individual is infected with or has been exposed to a quarantinable communicable disease, to quarantine, isolate, or place the individual under surveillance under 42 CFR 70.6 or 71.32 and 71.33. HHS/CDC has not implemented public health measures at locations where individuals may congregate for the purposes of interstate travel in at least 50 years and cannot predict if or how often it may implement measures in the future.
○ Change relative to baseline as result of final rule
Improved transparency and potentially improved compliance in the event that HHS/CDC implements such measures in the future.
○ Qualitative benefit/cost of final rule
Improved transparency and public understanding of HHS/CDC's rationale and authority to conduct such measures and require individuals to comply.
○ Monetized benefit/cost of final rule
Increased clarity around due process procedures may result in fewer resources and time expended by individuals under orders and HHS/CDC in disagreements over HHS/CDC's authority to issue Federal public health orders that limit an individual's movement. This includes the potential costs of litigation and associated activities.
• New Provisions: § 70.12 Medical examinations; § 71.36 Medical Examinations
○ Baseline and Current Regulatory Provisions: 71.33 Persons: Isolation and Surveillance.
This is carried out under statutory authority and under the regulatory authorities in 42 CFR 70.6 and 71.32(a), 71.33, which would allow for medical examinations of individuals under Federal orders.
○ Change to baseline as result of final rule
With the final rule, the major change would be an alignment between the statutory language in the Public Health Service Act and improved transparency of HHS/CDC's regulatory authority.
○ Qualitative benefit/cost of final rule
Improved transparency and public understanding of HHS/CDC's rationale and authority to conduct such measures and require individuals to comply.
○ Monetized benefit/cost of final rule
Increased clarity around due process procedures may result in fewer
• New Provisions: § 70.13 Payment for Care and Treatment; § 71.30 Payment for Care and Treatment
○ Baseline and Current Regulatory Provisions: No current explicit regulatory provision.
This addition is not expected to lead to a change in HHS/CDC policy under which HHS/CDC may act as the payer of last resort for individuals subject to medical examination, quarantine, isolation, and conditional release under Federal orders. The provisions included in the final rule are similar to a Memorandum of Agreement between a number of hospitals and HHS/CDC. Under the terms of the Memorandum of Agreement, the hospital can be reimbursed for incurred medical expenses subject to HHS/CDC's discretion, availability of appropriations, and limited to what a hospital would bill Medicare. The Memorandum of Agreement also indicates that HHS/CDC should be the payer of last resort.
HHS/CDC issued 12 isolation orders between Jan 1, 2005 and May 10, 2016, which would correspond to an average of about 1 order per year over the past 11.3 years. HHS/CDC has information on payments made for 3 of the 12 cases. In most cases, HHS/CDC makes payment directly to healthcare facilities, sometimes in lieu of payments that would be made by State or local health departments. Among the three instances for which HHS/CDC has some data on payments for treatment, care, and transportation of individuals under Federal orders:
HHS/CDC's expected annual payments for care and treatment are estimated to be between $0 and $1,000,000 in any given year under the current baseline. This upper bound cost would correspond to a year in which HHS/CDC would have to incur the costs of two patients at $500,000 per patient. This roughly corresponds to the average cost to treat an extremely drug-resistant tuberculosis case (XDR-TB). Alternatively, this could represent a situation in which HHS/CDC may have to pay a significant fraction of the total costs for one very complicated illness associated with a quarantinable communicable disease not endemic to the United States (
HHS/CDC has not incurred any costs for the care and treatment of any individuals besides for those under Federal isolation orders.
○ Change to baseline as result of final rule
Improved transparency around HHS/CDC's authority for, and requirements and processes related to payment for care and treatment.
○ Qualitative benefit/cost of final rule
Improved transparency and public knowledge of HHS/CDC's procedures and regulatory requirements.
○ Monetized benefit/cost of final rule
None. This is a clarification of HHS/CDC's current practice. (For more details, please refer to separate RIA Appendix)
• New Provisions: § 70.14 Requirements relating to the issuance of a Federal order for quarantine, isolation, or conditional release; § 71.37 Requirements relating to the issuance of a Federal order for quarantine, isolation, or conditional release
○ Baseline and Current Regulatory Provisions: No current explicit regulatory provision
Without the final rule, HHS/CDC can under current statutory provided by the Public Health Service Act and regulatory authority under 42 CFR 70.6 and 71.32(a), 71.33 continue to issue Federal quarantine, isolation, or condition release orders. However, the issuance of federal orders is implemented through internal policies and standard operating procedures that are not as transparent to the public as detailed regulations outlining requirements.
○ Change to baseline as result of final rule
Improved transparency around HHS/CDC's authority for, and requirements and processes related to, the issuance of Federal quarantine, isolation, and conditional release orders.
○ Qualitative benefit/cost of final rule
Improved transparency and public knowledge of HHS/CDC's procedures and regulatory requirements.
○ Monetized benefit/cost of final rule
None. This is a clarification of HHS/CDC's current practice.
• New Provisions: § 70.15 Mandatory reassessment of a Federal order for quarantine, isolation, or conditional release; § 71.38 Mandatory reassessment of a Federal order for quarantine, isolation, or conditional release
○ Baseline and Current Regulatory Provisions: No current explicit regulatory provision.
Without the final rule, HHS/CDC can under current statutory authority provided by the Public Health Service Act and regulatory authority under 42 CFR 70.6 and 71.32(a), 71.33 continue to issue Federal quarantine, isolation, or conditional release orders. However, the process for reassessing a Federal order is implemented through internal policy and standard operating procedures that are not as transparent to the public as detailed regulations outlining requirements.
○ Change to baseline as result of final rule:
With the final rule, individuals under Federal order may be more aware of the mandatory reassessment of a Federal quarantine, isolation, or conditional release order.
○ Qualitative benefit/cost of final rule
Improved transparency and understanding of due process protections under a Federal public health order.
○ Monetized benefit/cost of final rule
Increased clarity around due process protections may result in fewer resources and time expended by individuals under orders and HHS/CDC in disagreements over HHS/CDC's authority to issue Federal public health orders that limit an individual's movement. This includes the potential costs of litigation and associated activities.
• New Provisions: § 70.16 Medical review of a Federal order for quarantine, isolation, or conditional release; § 71.39 Medical review of a Federal order for quarantine, isolation, or conditional release
○ Baseline and Current Regulatory Provisions: No current explicit regulatory provision.
Without the final rule, HHS/CDC can under current statutory authority provided by the Public Health Service Act and regulatory authority under 42 CFR 70.6 and 71.32, 71.33 continue to issue Federal quarantine, isolation, or conditional release orders. However, the process for a medical review of a Federal order is outlined in internal policy and standard operating procedures that are not as transparent to the public as detailed regulations outlining requirements.
○ Change to baseline as result of final rule:
With the final rule, individuals under Federal order may become aware of their right to a medical review, and exercise that right, under this due process provision.
○ Qualitative benefit/cost of final rule
Improved transparency and understanding of due process afforded to individuals under a Federal order
○ Monetized benefit/cost of final rule
Increased clarity around due process protections may result in fewer resources and time expended by individuals under orders and HHS/CDC
One potential change that could have an economic effect is the requirements to appoint medical and legal representatives for individuals that qualify as “indigent”. The status of “indigent” is self-reported as HHS/CDC will not require access to an individual's financial records. Those who self-identify as indigent may be required to sign an affidavit or declaration under penalty of perjury stating they meet the threshold of at least 200% of the applicable poverty guidelines. HHS/CDC notes that in practice it has never denied a request for a representative. HHS/CDC estimates the cost of providing one medical representative and one legal representative based on the average hourly wage for physicians and surgeons ($97.33, occupation code 29-1060) and lawyers ($65.51, occupation code 23-1011) as reported from the Bureau of Labor Statistics' May 2015 National Occupational Employment and Wage Estimates. Assuming that it takes about 40 hours of physician time and 40 hours of lawyer time per review and an overhead cost multiplier of 100%, the expected cost is about $13,000 per review. HHS/CDC notes that public health orders are issued on average once per year. The need for HHS/CDC to pay for medical and legal representatives will depend on the income level for persons placed under federal orders, but should not exceed this $13,000 estimate in most years and will be $0 in many years. Without the new regulatory provision, as part of current practice, HHS/CDC would still attempt to appoint legal and medical representatives if requested for the medical review by individuals unable to afford the cost of such representation. Thus, relative to current practice, there should be minimal costs associated with this provision.
• New Provisions: § 70.17 Administrative records relating to Federal quarantine, isolation, or conditional release; § 71.29 Administrative records relating to Federal quarantine, isolation, or conditional release
○ Baseline and Current Regulatory Provisions: No current explicit regulatory provision.
Without the final rule, HHS/CDC can issue under current statutory provided by the Public Health Service Act and regulatory authority under 42 CFR 70.6 and 71.32(a), 71.33 continue to issue Federal quarantine, isolation, or conditional release orders. However, the process for documenting the administrative record is implemented internal policy and standard operating procedures that are not as transparent to the public as a detailed regulation outlining this requirement.
○ Change to baseline as result of final rule
The requirement, with which HHS/CDC is already complying, will clarify for the public that certain documents must be retained for the administrative record.
○ Qualitative benefit/cost of final rule
Improved transparency
○ Monetized benefit/cost of final rule
Not applicable. This is a codification of an administrative activity within HHS/CDC.
• New Provisions: § 70.18 Penalties/§ 71.2 Penalties
○ Baseline and Current Regulatory Provision: § 71.2 Penalties. Part 70 currently has no penalties provision.
Without the final rule, individuals may not be aware that 18 U.S.C. 3559 and 3571 increased the maximum penalties for violations of regulations under 42 CFR part 70 and part 71. And it may not be clear to individuals that violating quarantine regulation under 42 CFR part 70 may result in criminal penalties.
○ Change to baseline as result of final rule
With the NRPM, there will be less confusion about the maximum criminal penalties for a violation of regulations under 42 CFR 70 and 71.
○ Qualitative benefit/cost of final rule
Improved transparency and alignment with current law under 18 U.S.C. 3559 and 3571.
○ Monetized benefit/cost of final rule
• No individual or organization has been assessed criminal penalties for violating these regulations, so monetizing this benefit or cost is not feasible. This is simply an effort to align the domestic and foreign quarantine penalties provisions, and updates outdated regulatory language so that it reflects current statutory language concerning criminal penalties.
• New Provisions: § 71.63 Suspension of entry of animals, articles, or things from designated foreign countries and places into the United States
○ Baseline and Current Regulatory Provision: § 71.32(b) has previously been used to justify the temporary embargo of imported African rodents prior to the codification of this as a requirement in existing 42 CFR 71.56.
Without the final rule, individuals may not be aware that HHS/CDC's authority to temporarily suspend entry of animals, articles or things from designated foreign countries and places into the United States based on existing 42 CFR 71.32(b).
○ Change to baseline as result of final rule
With the NRPM, there will be less confusion about HHS/CDC's ability to temporarily restrict importations associated with communicable disease risks.
○ Qualitative benefit/cost of final rule
Improved transparency.
○ Monetized benefit/cost of final rule
Refer to the appendix for an analysis of the temporary embargo of African rodents implemented in 2003.
Under the Regulatory Flexibility Act, as amended by the Small Business Regulatory Enforcement Fairness Act (SBREFA), agencies are required to analyze regulatory options to minimize significant economic impact of a rule on small businesses, small governmental units, and small not-for-profit organizations. We have analyzed the costs and benefits of the final rule, as required by Executive Order 12866, and a preliminary regulatory flexibility analysis that examines the potential economic effects of this rule on small entities, as required by the Regulatory Flexibility Act. Based on the cost benefit analysis, we expect the rule to have little or no economic impact on small entities.
HHS/CDC has determined that this final rule contains proposed information collections that are subject to review by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501-3520). A description of these proposed provisions is given below with an estimate of the annual reporting and recordkeeping burden. Included in the estimate is the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing each collection of information. Comments are invited on the following subjects.
• Whether the proposed collection of information is necessary for the proper performance of the functions of HHS/CDC, including whether the information will have practical utility.
• The accuracy of HHS/CDC's estimate of the burden of the collection of information.
• Ways to enhance the quality, utility, and clarity of the information to be collected.
• Ways to minimize the burden of the collection of information on respondents, including by using information technology.
While HHS/CDC currently has approval to collect certain information concerning illnesses and travelers under OMB Control Numbers 0920-0134 (
In another information collection request associated with this final rule, CDC is also requesting approval to require that airlines and vessels provide certain data elements to CDC, as described in proposed 71.4 and 71.5, for the purposes of contact tracing. This information is used to locate individuals, both passengers and crewmembers, who may have been exposed to a communicable disease during travel and to provide them with appropriate public health follow-up.
Written comments should be received within 30 days of the publication of this final rule. Please send written comments to CDC Desk Officer, Office of Management and Budget, Washington, DC 20503 or by fax to (202) 395-5806.
(1) Foreign Quarantine Regulations (42 CFR part 71) (OMB Control No. 0920-0134)—Nonmaterial/non-substantive change—National Center for Emerging, and Zoonotic Infectious Diseases (NCEZID), Centers for Disease Control and Prevention (CDC).
(2) Restrictions on Interstate Travel of Persons (42 CFR part 70) (OMB Control No. 0920-0488)—Nonmaterial/non-substantive change—National Center for Emerging, and Zoonotic Infectious Diseases (NCEZID), Centers for Disease Control and Prevention (CDC)
(3) Airline and Vessel and Traveler Information Collection (42 CFR and 71)—New Information Collection Request—National Center for Emerging, and Zoonotic Infectious Diseases (NCEZID), Centers for Disease Control and Prevention (CDC).
Section 361 of the Public Health Service (PHS) Act (42 U.S.C. 264) authorizes the Secretary of Health and Human Services to make and enforce regulations necessary to prevent the introduction, transmission, or spread of communicable diseases from foreign countries into the United States and interstate. Legislation and existing regulations governing foreign and interstate quarantine activities (42 CFR parts 70 and 71) authorize quarantine officers and other personnel to inspect and undertake necessary control measures in order to protect the public health. Currently, with the exception of the CDC's Vessel Sanitation Program, inspections are performed only on those vessels and aircraft that report illness before arriving or when illness is discovered upon arrival. Other inspection agencies assist quarantine officers in public health risk assessment and management of persons, pets, and other importations of public health importance. These practices and procedures ensure protection against the introduction and spread of communicable diseases into the United States with a minimum of recordkeeping and reporting as well as a minimum of interference with trade and travel. The information collection burden is associated with these recordkeeping and reporting requirements.
At present, HHS/CDC has approval from OMB to collect certain information and impose recordkeeping requirements related to foreign quarantine responsibilities under OMB Control Number 0920-0134 (expiration 05/31/2019). The specific provisions within 42 CFR part 71 that include information collection under are as follows:
42 CFR 71.21(a), (b), and (c) Report of death and illness.
42 CFR 71.33(c) Report of persons held in isolation or surveillance.
42 CFR 71.35 Report of death or illness on carrier during stay in port.
42 CFR 71.51 Dogs and cats.
42 CFR 71.52 Turtles, terrapins, tortoises.
42. CFR 71.56 African Rodents
HHS/CDC has also used its authority under 42 CFR 71.32 to require importers to submit statements or documentation of non-infectiousness for those items that may constitute a public health risk if not rendered non-infectious.
Finally, HHS/CDC has approval from OMB to collect from importers/filers certain documents and data elements to identify and clear HHS/CDC regulated imports via the Automated Commercial Environment and the International Trade Data System using the Document Imaging System and Partner Government Agency Message Sets. These CDC Partner Government Agency Message Sets are currently limited to: CDC PGA Message Set for Importing Cats and Dogs, CDC PGA Message Set for Importing African Rodents, CDC PGA Message Set for Importing African Rodent and All Family
In this final rule, CDC is requesting approval from OMB for 4 non-substantive changes to OMB Control Number 0920-0134 Foreign Quarantine Regulations (42 CFR part 71):
(1) Updating the definition of “ill person,” which relates to the illness reporting requirements under 42 CFR 71.21(a), (b), and (c) for airlines and vessels arriving into the United States. CDC is updating the definition of “ill person” by implementing current practice with the anticipated effect of better facilitating identification of communicable diseases of concern and quarantinable communicable diseases aboard flights and maritime voyages to the United States, diseases such as measles, viral hemorrhagic fevers, active tuberculosis, and influenza caused by novel or re-emergent influenza viruses that are causing or have the potential to cause a pandemic. CDC is also including a provision to allow the Director to add new symptoms to the definition of ill person to respond to unknown communicable diseases that may emerge as future concerns.
The final rule updates the current definition of ill person to better focus on the signs and symptoms of communicable diseases of public health concern and quarantinable communicable diseases. The changes define an ill person in the context of the medical resources available to the operator of an airline or vessel.
CDC already requests from pilots in command of aircraft and commanders of vessels several of the symptoms included in the revised definition of ill person through publicly available guidance to airlines and vessels. Moreover, for airlines, the updated definition also better aligns with symptoms reporting guidelines published by ICAO in Note 1 to paragraph 8.15 of Annex 9 to the Convention on International Civil Aviation, and the definition of “acute gastroenteritis” is used by the WHO and is currently included in reporting guidance from CDC's Vessel Sanitation Program. Therefore, CDC does not anticipate additional burden on airlines or vessel operators to respond to these information collections.
(2) CDC is requesting a change in the title of the information collection pertaining to reports of death and illness from vessels to CDC. The former title is
(3) CDC is seeking a change in the title of a specific information collection pertaining to reports of gastro-intestinal illness to CDC. CDC is updating the definition of ill person and is replacing the term “gastro-intestinal” with “acute gastroenteritis”; therefore, the title change is requested to align with the definition.
(4) CDC is seeking a change in title of respondents from “Maritime Conveyance Operator” to “Maritime Vessel Operator” and from “Airline Commander or Operator” to “Pilot in Command.”
Table 1 below presents estimates of annual burden (in hours) associated with each reporting and recordkeeping requirement under this OMB control number, accounting for the rule changes.
There is no burden to respondents other than the time taken to complete the reports to CDC, maintain recordkeeping of illness aboard vessels and records of sickness or death in imported cats and dogs, as outlined in the table below. If a cat or dog is ill upon arrival, or dies prior to arrival, an exam is required, the initial exam fee may be between $100 and $200. Rabies testing on a dog that dies may be between $50 and $100. The expected number of ill or dead dogs arriving into the United States for which CDC may require an examination is estimated at less than 30 per year.
The estimates are based on experience to date with current recordkeeping and reporting requirements of 42 CFR part 71, with additional burden included to account for the potential for increased reports of illness during an outbreak and for reports of disease that may have been missed by airlines or vessels and are reported to CDC after travel.
Under this final rule, CDC is also requesting a nonmaterial/non-
• 42 CFR 70.4 Report by the master of a vessel or person in charge of conveyance of the incidence of a communicable disease occurring while in interstate travel.
Through this final rule, CDC is adding the provision 70.11
Under the final rule, pilots in command of an aircraft, operating on behalf of an airline, that submit the ill person or death report to HHS/CDC under new 70.11 will not be required to also submit a report to the local health authority under current 70.4. HHS/CDC will continue to share public health information with State and local health departments through electronic disease reporting networks. It is unlikely that HHS/CDC would request follow-up reports of illnesses that are reported to the local health authorities, unless there was an urgent public health need. Therefore, CDC does not anticipate any additional burden to the respondents; however, the accounting for burden in Table 2 will add 70.11
As a result of this final rule, CDC does not anticipate a change in total burden. CDC is instead allocating 95% of the reports of illness or death within the proposed 70.11
In addition to the requirement to report directly to HHS/CDC, HHS/CDC is updating the definition of “ill person” for the purposes of illness reports to HHS/CDC in 42 CFR part 70. HHS/CDC has, as a matter of agency guidance, communicated with airlines that the same current set of required and requested signs and symptoms of disease, as well as any death, apply to domestic as well as international flights. This guidance is similar to that of the guidelines issued by ICAO under
Table 2 below presents estimates of annual burden (in hours) associated with each reporting and recordkeeping requirement under this OMB control number, accounting for the rule changes.
Respondents to this data collection include masters of vessels or persons in charge of conveyance and pilots in command of aircraft.
The total requested burden hours are 23. There is no burden to respondents other than the time taken to complete the reports. The estimates are based on experience to date with current recordkeeping and reporting requirements of 42 CFR part 70, and take into account the potential for additional burden from increased reports of illness during an outbreak and for reports of disease that may have been missed by respondents during travel and are reported to CDC by other means.
Finally, under this final rule HHS/CDC is requesting approval for a new information collection, Airline and Vessel and Traveler Information Collection (42 CFR part 71). This information collection request accompanies the codification of issuing orders to airlines and vessel operators for the provision to CDC of airline and vessel and traveler information (aka manifests) in the event that a quarantinable communicable disease or a communicable disease of public health concern, or a death caused by a quarantinable communicable disease or communicable disease of public health concern, occurs during travel to the United States and public health follow-up is warranted. These proposed provisions are found in 42 CFR 71.4 for airlines and 71.5 for vessels.
The ordering of manifests from airlines and vessel operators arriving into the United States is an ongoing activity executed under CDC's broad regulatory authority found at 42 CFR 71.32
Table 3 below presents estimates of annual burden (in hours) associated with each reporting and recordkeeping requirement under this OMB control number, accounting for the final rule changes.
Respondents to this data collection include the Airline Medical Officer or Equivalent and a Computer and Information Systems Manager.
The total requested burden hours included in this final rule is 576. There is no burden to respondents other than the time taken to complete the manifest information and send to CDC. The estimates are based on experience to date with current manifest order process.
HHS/CDC has determined that the amendments to 42 CFR parts 70 and 71 will not have a significant impact on the human environment.
HHS/CDC has reviewed this rule under Executive Order 12988 on Civil Justice Reform and determines that this final rule meets the standard in the Executive Order.
Under Executive Order 13132, a Federalism analysis is required if a rulemaking has Federalism implications, would limit or preempt State or local law, or impose substantial direct compliance costs on State or local governments. Under such circumstances, a Federal agency must consult with State and local officials. Federalism implications is defined as having substantial direct effects on State or local governments, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. Under 42 U.S.C. 264(e), Federal public health regulations do not preempt State or local public health regulations, except in the event of a conflict with the exercise of Federal authority. Other than to restate this statutory provision, this rulemaking does not alter the relationship between the Federal government and State/local governments as set forth in 42 U.S.C. 264. The longstanding provision on preemption in the event of a conflict with Federal authority (42 CFR 70.2) is left unchanged by this rulemaking. Additionally, there are no provisions in these regulations that impose direct compliance costs on State and local governments. Therefore, HHS/CDC believes that the rule does not warrant additional consultation under Executive Order 13132.
Under 63 FR 31883 (June 10, 1998), Executive Departments and Agencies are required to use plain language in all proposed and final rules. HHS/CDC received several comments suggesting that the proposed regulation was not written in plain language and was therefore difficult to understand. Prior to publication, this final rule was reviewed by specialists in health communication and education to ensure the content and intention, as well as substance, were clear and accurate.
Apprehension, Communicable diseases, Conditional release, CDC, Ill person, Isolation, Non-invasive, Public health emergency, Public health prevention measures, Qualifying stage, Quarantine, Quarantinable Communicable Disease.
For the reasons discussed in the preamble, we amend 42 CFR parts 70 and 71 as follows:
Secs. 215 and 311 of the Public Health Service (PHS) Act, as amended (42 U.S.C. 216, 243) section 361-369, PHS Act, as amended (42 U.S.C. 264-272); 31 U.S.C. 9701.
The additions and revisions read as follows:
(1) Has a fever (a measured temperature of 100.4 °F [38 °C] or greater, or feels warm to the touch, or gives a history of feeling feverish) accompanied by one or more of the following: Skin rash, difficulty breathing, persistent cough, decreased consciousness or confusion of recent onset, new unexplained bruising or bleeding (without previous injury), persistent diarrhea, persistent vomiting (other than air sickness), headache with stiff neck, appears obviously unwell; or
(2) Has a fever that has persisted for more than 48 hours; or
(3) Has symptoms or other indications of communicable disease, as the CDC may announce through posting of a notice in the
(i) The movement of any conveyance or the transportation of persons or property, including any portion of such movement or transportation that is entirely within a State or possession—
(ii) From a point of origin in any State or possession to a point of destination in any other State or possession; or
(iii) Between a point of origin and a point of destination in the same State or possession but through any other State, possession, or contiguous foreign country.
(2) Interstate traffic does not include the following:
(i) The movement of any conveyance which is solely for the purpose of unloading persons or property transported from a foreign country, or loading persons or property for transportation to a foreign country.
(ii) The movement of any conveyance which is solely for the purpose of effecting its repair, reconstruction, rehabilitation, or storage.
(1) Any communicable disease event as determined by the Director with either documented or significant potential for regional, national, or international communicable disease spread or that is highly likely to cause death or serious illness if not properly controlled; or
(2) Any communicable disease event described in a declaration by the
(3) Any communicable disease event the occurrence of which is notified to the World Health Organization, in accordance with Articles 6 and 7 of the International Health Regulations, as one that may constitute a Public Health Emergency of International Concern; or
(4) Any communicable disease event the occurrence of which is determined by the Director-General of the World Health Organization, in accordance with Article 12 of the International Health Regulations, to constitute a Public Health Emergency of International Concern; or
(5) Any communicable disease event for which the Director-General of the World Health Organization, in accordance with Articles 15 or 16 of the International Health Regulations, has issued temporary or standing recommendations for purposes of preventing or promptly detecting the occurrence or reoccurrence of the communicable disease.
(1) The communicable stage of a quarantinable communicable disease; or
(2) The precommunicable stage of the quarantinable communicable disease, but only if the quarantinable communicable disease would be likely to cause a public health emergency if transmitted to other individuals.
(a) The following provisions are applicable to any individual under a Federal order of isolation, quarantine, or conditional release with regard to a quarantinable communicable disease or to any individual meeting the requirements of paragraph (d), (e), or (f) of this section:
(1) Except as specified under the terms of a Federal conditional release order, no such individual shall travel in interstate traffic or from one State or U.S. territory to another without a written travel permit issued by the Director.
(2) Requests for a travel permit must state the reasons why the travel is being requested, mode of transportation, the places or individuals to be visited, the precautions, if any, to be taken to prevent the potential transmission or spread of the communicable disease, and other information as determined necessary by the Director to assess the individual's health condition and potential for communicable disease spread to others.
(3) The Director will consider all requests for a permit and, taking into consideration the risk of introduction, transmission, or spread of the communicable disease, may condition the permit upon compliance with such precautionary measures as the Director shall prescribe. The Director shall respond to a request for a permit within 5 business days.
(4) An individual to whom a permit has been issued shall retain it in his/her possession throughout the course of his/her authorized travel and comply with all conditions prescribed therein, including presentation of the permit to the operators of conveyances, as required by its terms.
(5) An individual who has had his/her request for a permit denied, or who has had a travel permit suspended or revoked, may submit a written appeal to the Director (excluding the CDC official who denied, suspended, or revoked the permit). The appeal must be in writing, state the factual basis for the appeal, and be submitted to the Director (excluding the CDC official who denied, suspended, or revoked the permit) within 10 calendar days of the denial, suspension, or revocation of the permit. The Director (excluding the CDC official who denied, suspended, or revoked the permit) will issue a written response to the appeal within 3 business days, which shall constitute final agency action.
(b) The operator of any conveyance operating in interstate traffic shall not:
(1) Accept for transportation any individual whom the operator knows, or reasonably should know, to be under a Federal order of isolation, quarantine, or conditional release, unless such an individual presents a permit issued by the Director or a copy of the Federal conditional release order authorizing such travel;
(2) Transport any individual whom the operator knows, or reasonably should know, to be under a Federal order of isolation, quarantine, or conditional release in violation of any of the terms or conditions prescribed in the travel permit or conditional release order issued by the Director.
(c) Whenever a conveyance operating in interstate traffic transports an individual under a Federal order or travel permit, the Director may require that the operator of the conveyance submit the conveyance to inspection, sanitary measures, and other measures, as the Director deems necessary to prevent the possible spread of communicable disease.
(d) The Director may additionally apply the provisions in paragraphs (a) through (c) of this section to individuals traveling entirely intrastate and to conveyances that transport such individuals upon the request of a State or local health authority of jurisdiction. The Director shall consider the State or local health authority's request for assistance and taking into consideration the risk of introduction, transmission, or spread of the communicable disease, grant or deny, in his/her discretion, the request for assistance.
(e) The Director may additionally apply the provisions in paragraphs (a) through of this section (c) to individuals traveling interstate or entirely intrastate and to conveyances that transport such individuals whenever the Director makes a determination under 42 CFR 70.2 that based on the existence of inadequate local control such measures are needed to prevent the spread of any
(f) The Director may additionally apply the provisions in paragraphs (a) through (c) of this section to individuals under a State or local order, or written agreement, for quarantine, isolation, or conditional release and to conveyances that may transport such individuals, upon the request of a State or local health authority of jurisdiction or whenever the Director makes a determination of inadequate local control under 42 CFR 70.2. The Director shall consider the State or local health authority's request for assistance and taking into consideration the risk of introduction, transmission, or spread of the communicable disease, grant or deny, in his/her discretion, the request for assistance.
(g) The Director may exempt individuals and non-public conveyances, such as ambulances, air ambulance flights, or private vehicles, from the requirements of this section.
(a) The Director may authorize the apprehension, medical examination, quarantine, isolation, or conditional release of any individual for the purpose of preventing the introduction, transmission, and spread of quarantinable communicable diseases, as specified by Executive Order, based upon a finding that:
(1) The individual is reasonably believed to be infected with a quarantinable communicable disease in a qualifying stage and is moving or about to move from a State into another State; or
(2) The individual is reasonably believed to be infected with a quarantinable communicable disease in a qualifying stage and constitutes a probable source of infection to other individuals who may be moving from a State into another State.
(b) The Director will arrange for adequate food and water, appropriate accommodation, appropriate medical treatment, and means of necessary communication for individuals who are apprehended or held in quarantine or isolation under this part.
(a) The Director may conduct public health prevention measures at U.S. airports, seaports, railway stations, bus terminals, and other locations where individuals may gather to engage in interstate travel, through non-invasive procedures determined appropriate by the Director to detect the presence of communicable diseases.
(b) As part of the public health prevention measures, the Director may require individuals to provide contact information such as U.S. and foreign addresses, telephone numbers, email addresses, and other contact information, as well as information concerning their intended destination, health status, known or possible exposure history, and travel history.
(a) The pilot in command of an aircraft operated by an airline who is conducting a commercial passenger flight in interstate traffic under a regular schedule shall report as soon as practicable to the Director the occurrence onboard of any deaths or the presence of ill persons among passengers or crew and take such measures as the Director may direct to prevent the potential spread of the communicable disease, provided that such measures do not affect the airworthiness of the aircraft or the safety of flight operations.
(b) The pilot in command of an aircraft operated by an airline who reports in accordance with paragraph (a) of this section shall be deemed to satisfy the reporting obligation under 42 CFR 70.4.
(a) The Director may require an individual to undergo a medical examination as part of a Federal order for quarantine, isolation, or conditional release for a quarantinable communicable disease.
(b) The Director shall promptly arrange for the medical examination to be conducted when one is required under this section and shall as part of the Federal order advise the individual that the medical examination shall be conducted by an authorized and licensed health worker, and with prior informed consent.
(c) As part of the medical examination, the Director may require an individual to provide information and undergo such testing as may be reasonably necessary to diagnose or confirm the presence or extent of infection with a quarantinable communicable disease.
(d) Individuals reasonably believed to be infected based on the results of a medical examination may be isolated, or if such results are inconclusive or unavailable, individuals may be quarantined or conditionally released in accordance with this part.
(a) The Director may authorize payment for the care and treatment of individuals subject to medical examination, quarantine, isolation, and conditional release, subject to paragraphs (b) through (h) of this section.
(b) Payment for care and treatment shall be in the CDC's sole discretion and subject to the availability of appropriations.
(c) Payment shall be secondary to the obligation of the United States or any third-party (
(d) Payment may include costs for providing ambulance or other medical transportation when such services are deemed necessary by the Director for the individual's care and treatment.
(e) Payment shall be limited to those amounts the hospital, medical facility, or medical transportation service would customarily bill the Medicare system using the International Classification of Diseases, Clinical Modification (ICD-CM), and relevant regulations promulgated by the Centers for Medicare and Medicaid Services in existence at the time of billing.
(f) For quarantinable communicable diseases, payment shall be limited to costs for services and items reasonable and necessary for the care and treatment of the individual or group for the time period beginning when the Director refers the individual or group to the hospital or medical facility and ends when, as determined by the Director,
(g) For diseases other than those described in paragraph (f) of this section, such payment shall be limited to costs for services and items reasonable and necessary for care and treatment of the individual for the time period that begins when the Director refers the individual to the hospital or medical facility and ends when the individual's condition is diagnosed, as determined by the Director, as an illness other than a quarantinable communicable disease.
(h) For ambulance or other medical transportation, payment shall be limited to the costs for such services and other items reasonable and necessary for the individual's safe medical transport.
(a) A Federal order authorizing quarantine, isolation, or conditional release shall be in writing, signed by the Director, and contain the following information:
(1) The identity of the individual or group subject to the order;
(2) The location of the quarantine or isolation or, in the case of conditional release, the entity to who and means by which the individual shall report for public health supervision;
(3) An explanation of the factual basis underlying the Director's reasonable belief that the individual is in the qualifying stage of a quarantinable communicable disease;
(4) An explanation of the factual basis underlying the Director's reasonable belief that the individual is moving or about to move from one State into another or constitutes a probable source of infection to others who may be moving from one State into another;
(5) An explanation that the Federal order will be reassessed no later than 72 hours after it has been served and an explanation of the medical review of the Federal order pursuant to this part, including the right to request a medical review, present witnesses and testimony at the medical review, and to be represented at the medical review by either an advocate (
(6) An explanation of the criminal penalties for violating a Federal order of quarantine, isolation, or conditional release; and
(7) An explanation that if a medical examination is required as part of the Federal order that the examination will be conducted by an authorized and licensed health worker, and with prior informed consent.
(b) A Federal order authorizing quarantine, isolation, or conditional release shall be served on the individual no later than 72 hours after the individual has been apprehended, except that the Federal order may be published or posted in a conspicuous location if the Federal order is applicable to a group of individuals and individual service would be impracticable.
(c) The Director shall arrange for translation or interpretation services of the Federal order as needed.
(d) Nothing in this section shall affect the constitutional or statutory rights of individuals to obtain judicial review of their Federal detention.
(a) The Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) shall reassess the need to continue the quarantine, isolation, or conditional release of an individual no later than 72 hours after the service of the Federal order.
(b) As part of the reassessment, the Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) shall review all records considered in issuing the Federal order, including travel records, records evidencing exposure or infection with a quarantinable communicable disease, as well as any relevant new information.
(c) As part of the reassessment, and where applicable, the Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) shall consider and make a determination regarding whether less restrictive alternatives would adequately serve to protect the public health.
(d) At the conclusion of the reassessment, the Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) shall promptly issue and serve a written Federal order directing that the quarantine, isolation, or conditional release be continued, modified, or rescinded.
(e) In the event that the Director orders that the quarantine, isolation, or conditional release be continued or modified, the written Federal order shall explain the process for requesting a medical review under this part.
(f) The Director's written Federal order shall be promptly served on the individual, except that the Federal order may be served by publication or by posting in a conspicuous location if the Federal order is applicable to a group of individuals and individual service would be impracticable.
(g) The Director shall arrange for translation or interpretation services of the Federal order as needed.
(a) The Director shall, as soon as practicable, arrange for a medical review upon a request by an individual under Federal quarantine, isolation, or conditional release.
(b) A request for a medical review may only occur after the Director's mandatory reassessment under section 70.15 and following the service of a Federal order continuing or modifying the quarantine, isolation, or conditional release.
(c) The medical review shall be for the purpose of ascertaining whether the Director has a reasonable belief that the individual is infected with a quarantinable communicable disease in a qualifying stage.
(d) The Director shall notify the individual in writing of the time and place of the medical review.
(e) The Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) shall designate a medical reviewer to review the medical or other evidence presented at the review, make medical or other findings of fact, and issue a recommendation concerning whether the Federal order for quarantine, isolation, or conditional release should be rescinded, continued, or modified.
(f) The individual under Federal quarantine, isolation, or conditional release may authorize an advocate (
(g) Prior to the convening of the review, the individual or his/her authorized advocate or representatives shall be provided a reasonable opportunity to examine the available medical and other records involved in
(h) The Director shall take such measures that he/she determines to be reasonably necessary to allow an individual under Federal quarantine or isolation to communicate with any authorized advocate or representatives in such a manner as to prevent the possible spread of the quarantinable communicable disease.
(i) The medical reviewer may order a medical examination of an individual when, in the medical reviewer's professional judgment, such an examination would assist in assessing the individual's medical condition.
(j) As part of the review, and where applicable, the medical reviewer shall consider and accept into the record evidence concerning whether less restrictive alternatives would adequately serve to protect public health.
(k) The medical review shall be conducted by telephone, audio or video conference, or through other means that the medical reviewer determines in his/her discretion are practicable for allowing the individual under quarantine, isolation, or conditional release to participate in the medical review.
(l) At the conclusion of the review, the medical reviewer shall, based upon his or her review of the facts and other evidence made available during the medical review, issue a written report to the Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) concerning whether, in the medical reviewer's professional judgment, the Federal quarantine, isolation, or conditional release should be rescinded, continued, or modified. The written report shall include a determination regarding whether less restrictive alternatives would adequately serve to protect public health. The written report shall be served on the individual and the individual's authorized advocate or representatives.
(m) The Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) shall, as soon as practicable, review the written report and any objections that may be submitted by the individual or the individual's authorized advocate or representatives that contest the findings and recommendation contained in the medical reviewer's written report. Upon conclusion of the review, the Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) shall promptly issue a written Federal order directing that the quarantine, isolation, or conditional release be continued, modified, or rescinded. In the event that the Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) continues or modifies the Federal quarantine, isolation, or conditional release, the Director's written order shall include a statement that the individual may request that the Director rescind the Federal quarantine, isolation, or conditional release, but based only on a showing of significant, new or changed facts or medical evidence that raise a genuine issue as to whether the individual should continue to be subject to Federal quarantine, isolation, or conditional release. The written Federal order shall be promptly served on the individual and the individual's authorized advocate or representatives, except that the Federal order may be served by publication or by posting in a conspicuous location if applicable to a group of individuals and individual service would be impracticable.
(n) The Director's written order shall not constitute final agency action until it has been served on the individual and the individual's authorized advocate or representatives, or alternatively, if applicable to a group of individuals and individual service would be impracticable, it is published or posted.
(o) The Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) may order the consolidation of one or more medical reviews if the number of individuals or other factors makes the holding of individual medical reviews impracticable.
(p) The Director may issue additional instructions as may be necessary or desirable governing the conduct of medical reviews.
(q) The Director shall arrange for translation or interpretation services as needed for purposes of this section.
(a) The administrative record of an individual under Federal quarantine, isolation, or conditional release shall, where applicable, consist of the following:
(1) The Federal order authorizing quarantine, isolation, or conditional release, including any subsequent Federal orders continuing or modifying the quarantine, isolation or conditional release;
(2) Records of any available medical, laboratory, or other epidemiologic information that are in the agency's possession and that were considered in issuing the Federal quarantine, isolation, or conditional release order, or any subsequent Federal orders;
(3) Records submitted by the individual under quarantine, isolation, or conditional release, or by an authorized advocate or representatives, as part of a request for rescission of the Federal quarantine, isolation, or conditional release or as part of a medical review;
(4) The written findings and report of the medical reviewer, including any transcripts of the medical review and any written objections submitted by the individual under Federal quarantine, isolation, or conditional release, or by any authorized advocate or representatives;
(b) An individual subject to a Federal public health order shall upon request be served with a copy of his or her own administrative record in its entirety.
(a) Persons in violation of this part are subject to a fine of no more than $100,000 if the violation does not result in a death or one year in jail, or both, or a fine of no more than $250,000 if the violation results in a death or one year in jail, or both, or as otherwise provided by law.
(b) Violations by organizations are subject to a fine of no more than $200,000 per event if the violation does not result in a death or $500,000 per event if the violation results in a death or as otherwise provided by law.
Secs. 215 and 311 of the Public Health Service (PHS) Act, as amended (42 U.S.C. 216, 243) section 361-369, PHS Act, as amended (42 U.S.C. 264-272).
The additions and revisions read as follows:
(b) * * *
(i) Who if onboard an aircraft:
(A) Has a fever (a measured temperature of 100.4 °F [38 °C] or greater, or feels warm to the touch, or gives a history of feeling feverish) accompanied by one or more of the following: Skin rash, difficulty breathing, persistent cough, decreased consciousness or confusion of recent onset, new unexplained bruising or bleeding (without previous injury), persistent diarrhea, persistent vomiting (other than air sickness), headache with stiff neck, appears obviously unwell; or
(B) Has a fever that has persisted for more than 48 hours; or
(C) Has symptoms or other indications of communicable disease, as the Director may announce through posting of a notice in the
(ii) Who if onboard a vessel:
(A) Has a fever (a measured temperature of 100.4 °F [38 °C] or greater; or feels warm to the touch; or gives a history of feeling feverish) accompanied by one or more of the following: Skin rash, difficulty breathing or suspected or confirmed pneumonia, persistent cough or cough with bloody sputum, decreased consciousness or confusion of recent onset, new unexplained bruising or bleeding (without previous injury), persistent vomiting (other than sea sickness), headache with stiff neck; or
(B) Has a fever that has persisted for more than 48 hours; or
(C) Has acute gastroenteritis, which means either diarrhea, defined as three or more episodes of loose stools in a 24-hour period or what is above normal for the individual, or vomiting accompanied by one or more of the following: One or more episodes of loose stools in a 24-hour period, abdominal cramps, headache, muscle aches, or fever (temperature of 100.4 °F [38 °C] or greater); or
(D) Has symptoms or other indications of communicable disease, as the Director may announce through posting of a notice in the
(i) In the case of a carrier, a voyage between ports or airports of more than one country, or a voyage between ports or airports of the same country if the ship or aircraft stopped in any other country on its voyage; or
(ii) In the case of a person, a voyage involving entry into a country other than the country in which that person begins his/her voyage.
(a) Persons in violation of this part are subject to a fine of no more than $100,000 if the violation does not result in a death or one year in jail, or both, or a fine of no more than $250,000 if the violation results in a death or one year in jail, or both, or as otherwise provided by law. (b) Violations by organizations are subject to a fine of no more than $200,000 per event if the violation does not result in a death or $500,000 per event if the violation results in a death or as otherwise provided by law.
(a) Any airline with a flight arriving into the United States, including any intermediate stops between the flight's origin and final destination, shall make the data elements in paragraph (b) of this section available to the Director for passengers or crew who, as determined by the Director, may be at risk of exposure to a communicable disease, to the extent that such data are already available and maintained by the airline, within 24 hours of an order by the Director and in a format available and acceptable to both the airline and the Director.
(b) The data elements referred to in paragraph (a) of this section include:
(1) Full name (last, first, and, if available, middle or others);
(2) Date of birth;
(3) Sex;
(4) Country of residence;
(5) If a passport is required: Passport number, passport country of issuance, and passport expiration date;
(6) If a travel document other than a passport is required: Travel document type, travel document number, travel document country of issuance and travel document expiration date;
(7) Address while in the United States (number and street, city, State, and zip code), except that U.S. citizens and lawful permanent residents will provide address of permanent residence in the U.S. (number and street, city, State, and zip code);
(8) Primary contact phone number to include country code;
(9) Secondary contact phone number to include country code;
(10) Email address;
(11) Airline name;
(12) Flight number;
(13) City of departure;
(14) Departure date and time;
(15) City of arrival;
(16) Arrival date and time; and
(17) Seat number.
(c) No later than February 18, 2019, the Secretary or Director will publish and seek comment on a report evaluating the burden of this section on affected entities and duplication of activities in relation to mandatory passenger data submissions to DHS/CBP. The report will specifically recommend actions that streamline and facilitate use and transmission of any duplicate information collected.
(a) The operator of any vessel carrying 13 or more passengers (excluding crew) and, which is not a ferry as defined under 46 U.S.C. 2101 and U.S. Coast Guard (USCG) regulations (46 CFR 2.10-25), shall make the data elements in paragraph (b) of this section available to the Director for passengers or crew who, as determined by the Director, may be at risk of exposure to a communicable disease, to the extent that such data are already in the operator's possession, within 24 hours of an order by the Director and in a format available and acceptable to both the operator and the Director.
(b) The data elements referred to in paragraph (a) of this section include:
(1) Full name (last, first, and, if available middle or others);
(2) Date of birth;
(3) Sex;
(4) Country of residence;
(5) If a passport is required: Passport number, passport country of issuance, and passport expiration date;
(6) If a travel document other than a passport is required: Travel document type, travel document number, travel document country of issuance and travel document expiration date;
(7) Address while in the United States (number and street, city, State, and zip code), except that U.S. citizens and lawful permanent residents will provide address of permanent residence in the United States (number and street, city, State, and zip code; as applicable);
(8) Primary contact phone number to include country code;
(9) Secondary contact phone number to include country code;
(10) Email address;
(11) Vessel operator;
(12) Vessel name;
(13) Voyage number;
(14) Embarkation port and date;
(15) Disembarkation port and date;
(16) All port stops; and
(17) Cabin number.
(c) No later than February 21, 2019, the Secretary or Director will publish and seek comment on a report evaluating the burden of this section on affected entities and duplication of activities in relation to mandatory passenger data submissions to DHS/CBP. The report will specifically recommend actions that streamline and facilitate use and transmission of any duplicate information collected.
(a) The Director may conduct public health prevention measures, at U.S. ports of entry or other locations, through non-invasive procedures as defined in section 71.1 to detect the potential presence of communicable diseases.
(b) As part of the public health prevention measures, the Director may require individuals to provide contact information such as U.S. and foreign addresses, telephone numbers, email addresses, and other contact information, as well as information concerning their intended destination, health status, known or possible exposure history, and travel history.
(a) The administrative record of an individual under quarantine, isolation, or conditional release shall, where applicable, consist of the following:
(1) The Federal order authorizing quarantine, isolation, or conditional release, including any subsequent Federal orders continuing or modifying the quarantine, isolation or conditional release;
(2) Records of any available medical, laboratory, or other epidemiologic information that are in the agency's possession and that were considered in issuing the Federal quarantine, isolation, or conditional release order, or any subsequent Federal orders;
(3) Records submitted by the individual under quarantine, isolation, or conditional release, or by an authorized advocate or representatives, as part of a request for rescission of the quarantine, isolation, or conditional release or as part of a medical review;
(4) The written findings and report of the medical reviewer, including any transcripts of the medical review and any written objections submitted by the
(b) An individual subject to a Federal public health order shall, upon request, be served with a copy of his or her own administrative record in its entirety.
(a) The Director may authorize payment for the care and treatment of individuals subject to medical examination, quarantine, isolation, and conditional release, subject to paragraphs (b) through (h) of this section.
(b) Payment for care and treatment shall be in the Director's sole discretion and subject to the availability of appropriations.
(c) Payment shall be secondary to the obligation of the United States or any third-party (including any State or local governmental entity, private insurance carrier, or employer), under any other law or contractual agreement, to pay for such care and treatment, and shall be paid by the Director only after all third-party payers have made payment in satisfaction of their obligations.
(d) Payment may include costs for providing ambulance or other medical transportation when such services are deemed necessary by the Director for the individual's care and treatment.
(e) Payment shall be limited to those amounts the hospital, medical facility, or medical transportation service would customarily bill the Medicare system using the International Classification of Diseases, Clinical Modification (ICD-CM), and relevant regulations promulgated by the Centers for Medicare and Medicaid Services in existence at the time of billing.
(f) For quarantinable communicable diseases, payment shall be limited to costs for services and items reasonable and necessary for the care and treatment of the individual for the time period beginning when the Director refers the individual to the hospital or medical facility and ends when, as determined by the Director, the period of apprehension, quarantine, isolation, or conditional release expires.
(g) For diseases other than those described in paragraph (f) of this section, such payment shall be limited to costs for services and items reasonable and necessary for care and treatment of the individual for the time period that begins when the Director refers the individual to the hospital or medical facility and ends when the individual's condition is diagnosed, as determined by the Director, as an illness other than a quarantinable communicable disease.
(h) For ambulance or other medical transportation, payment shall be limited to the costs for such services and other items reasonable and necessary for the safe medical transport of the individual.
(a) The Director will arrange for adequate food and water, appropriate accommodation, appropriate medical treatment, and means of necessary communication for persons who are apprehended or held in isolation or quarantine under this subpart.
(c) Every person who is placed under surveillance by authority of this subpart shall, during the period of surveillance:
(1) Give information relative to his/her health and his/her intended destination and submit to surveillance, including electronic and internet-based monitoring as required by the Director or by the State or local health department having jurisdiction over the areas to be visited, and report for such medical examinations as may be required.
(2) Inform the Director prior to departing the United States or prior to traveling to any address other than that stated as the intended destination.
(a) The Director may require that an individual arriving into the United States undergo a medical examination as part of a Federal order for quarantine, isolation, or conditional release.
(b) The Director shall promptly arrange for the medical examination to be conducted when one is required under this section and shall as part of the Federal order advise the individual that the medical examination shall be conducted by an authorized and licensed health worker, and with prior informed consent.
(c) As part of the medical examination, the Director may require that an individual provide information and undergo such testing, as may be reasonably necessary, to diagnose or confirm the presence, absence, or extent of infection with a quarantinable communicable disease.
(d) Individuals reasonably believed to be infected, based on the results of a medical examination, may be isolated, or if such results are inconclusive or unavailable, individuals may be quarantined or conditionally released in accordance with this part.
(a) A Federal order authorizing quarantine, isolation, or conditional release shall be in writing, signed by the Director, and contain the following information:
(1) The identity of the individual or group subject to the order;
(2) The location of the quarantine or isolation or, in the case of conditional release, the entity to who and means by which the individual shall report for public health supervision;
(3) An explanation of the factual basis underlying the Director's reasonable belief that the individual is exposed to or infected with a quarantinable communicable disease;
(4) An explanation that the Federal order will be reassessed no later than 72 hours after it has been served and an explanation of the medical review of the Federal order pursuant to this part, including the right to request a medical review, present witnesses and testimony at the medical review, and to be represented at the medical review by either an advocate (
(5) An explanation of the criminal penalties for violating a Federal order of quarantine, isolation, or conditional release; and
(6) An explanation that if a medical examination is required as part of the Federal order that the examination will be conducted by an authorized and licensed health worker, and with prior informed consent.
(b) A Federal order authorizing quarantine, isolation, or conditional release shall be served on the individual no later than 72 hours after the individual has been apprehended, except that the Federal order may be published or posted in a conspicuous location if applicable to a group of individuals and individual service would be impracticable.
(c) The Director shall arrange for translation or interpretation services of the Federal order as needed.
(d) Nothing in these regulations shall affect the constitutional or statutory rights of individuals to obtain judicial review of their federal detention.
(a) The Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) shall reassess the need to continue the quarantine, isolation, or conditional release of an individual no later than 72 hours after the service of the Federal order.
(b) As part of the reassessment, the Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) shall review all records considered in issuing the Federal order, including travel records, records evidencing exposure or infection with a quarantinable communicable disease, as well as any relevant new information.
(c) As part of the reassessment, and where applicable, the Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) shall consider and make a determination regarding whether less restrictive alternatives would adequately serve to protect the public health.
(d) At the conclusion of the reassessment, the Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) shall promptly issue a written Federal order directing that the quarantine, isolation, or conditional release be continued, modified, or rescinded.
(e) In the event that the Director orders that the quarantine, isolation, or conditional release be continued or modified, the written Federal order shall explain the process for requesting a medical review under this part.
(f) The Director's written Federal order shall be promptly served on the individual, except that the Federal order may be served by publication or by posting in a conspicuous location if applicable to a group of individuals and individual service would be impracticable.
(g) The Director shall arrange for translation or interpretation services of the Federal order as needed.
(a) The Director shall, as soon as practicable, arrange for a medical review upon a request by an individual under Federal quarantine, isolation, or conditional release.
(b) A request for a medical review may only occur after the Director's mandatory reassessment under 71.38 and following the issuance and service of a Federal order continuing or modifying the quarantine, isolation, or conditional release.
(c) The medical review shall be for the purpose of ascertaining whether the Director has a reasonable belief that the individual is infected with a quarantinable communicable disease.
(d) The Director shall notify the individual in writing of the time and place of the medical review.
(e) The Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) shall designate a medical reviewer to review the medical or other evidence presented at the review, make medical or other findings of fact, and issue a recommendation concerning whether the Federal order for quarantine, isolation, or conditional release should be rescinded, continued, or modified.
(f) The individual subject to Federal quarantine, isolation, or conditional release may authorize an advocate (
(g) Prior to the convening of the review, the individual or his/her authorized advocate or representatives shall be provided a reasonable opportunity to examine the available medical and other records involved in the medical review pertaining to that individual.
(h) The Director shall take such measures that he/she determines to be reasonably necessary to allow an individual under Federal quarantine or isolation to communicate with any authorized advocate or representatives in such a manner as to prevent the possible spread of the quarantinable communicable disease.
(i) The medical reviewer may order a medical examination of an individual when, in the medical reviewer's professional judgment, such an examination would assist in assessing the individual's medical condition.
(j) As part of the review, and where applicable, the medical reviewer shall consider and accept into the record evidence concerning whether less restrictive alternatives would adequately serve to protect public health.
(k) The medical review shall be conducted by telephone, audio or video conference, or through other means that the medical reviewer determines in his/her discretion are practicable for allowing the individual under quarantine, isolation, or conditional release to participate in the medical review.
(l) At the conclusion of the review, the medical reviewer shall, based upon his or her review of the facts and other evidence made available during the medical review, issue a written report to the Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) concerning whether, in the medical reviewer's professional judgment, the Federal quarantine, isolation, or conditional release should continue. The written report shall include a determination regarding whether less restrictive alternatives would adequately serve to protect public health. The written report shall be served on the individual and the individual's authorized advocate or representatives.
(m) The Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) shall, as soon as practicable, review the written report and any objections that may be submitted by the individual or the individual's advocate or representatives that contest the findings and recommendation contained in the medical reviewer's written report. Upon conclusion of the review, the Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) shall promptly issue a written Federal order directing that the quarantine, isolation, or conditional release be continued, modified, or rescinded. In the event that the Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) continues or modifies the Federal quarantine, isolation, or conditional release, the Director's written order shall include a statement that the individual may request that the Director rescind the Federal quarantine, isolation, or conditional release, but based only on a showing of significant, new or changed facts or medical evidence that raise a genuine issue as to whether the individual should continue to be subject to Federal quarantine, isolation, or conditional release. The written Federal order shall be promptly served on the individual and the individual's authorized advocate or
(n) The Director's written order shall not constitute final agency action until it has been served on the individual or the individual's authorized advocate or representatives, or alternatively, if applicable to a group of individuals and individual service would be impracticable, it is published or posted.
(o) The Director (excluding the CDC official who issued the quarantine, isolation, or conditional release order) may order the consolidation of one or more medical reviews if the number of individuals or other factors makes the holding of individual medical reviews impracticable.
(p) The Director may issue additional instructions as may be necessary or desirable governing the conduct of medical reviews.
(q) The Director shall arrange for translation or interpretation services as needed for purposes of this section.
(a) The Director may suspend the entry into the United States of animals, articles, or things from designated foreign countries (including political subdivisions and regions thereof) or places whenever the Director determines that such an action is necessary to protect the public health and upon a finding that:
(1) There exists in a foreign country (including one or more political subdivisions and regions thereof) or place a communicable disease the introduction, transmission, or spread of which would threaten the public health of the United States; and
(2) The entry of imports from that country or place increases the risk that the communicable disease may be introduced, transmitted, or spread into the United States.
(b) The Director shall designate the foreign countries or places and the period of time or conditions under which the introduction of imports into the United States shall be suspended. The Secretary or Director will coordinate in advance with other Federal agencies that have overlapping authority in the regulation of entry of animals, articles, or other things, as may be necessary to implement and enforce this provision.
Animal and Plant Health Inspection Service, USDA.
Proposed rule; withdrawal and reproposal.
We are proposing to revise our regulations regarding the movement of plant pests. We are proposing criteria regarding the movement and environmental release of biological control organisms, and are proposing to establish regulations to allow the importation and movement in interstate commerce of certain types of plant pests without restriction by granting exceptions from permitting requirements for those pests. We are also proposing to revise our regulations regarding the movement of soil. This proposed rule replaces a previously published proposed rule, which we are withdrawing as part of this document. This proposal would clarify the factors that would be considered when assessing the risks associated with the movement of certain organisms and facilitate the movement of regulated organisms and articles in a manner that also protects U.S. agriculture.
We will consider all comments that we receive on or before March 20, 2017.
You may submit comments by either of the following methods:
•
•
Supporting documents and any comments we receive on this docket may be viewed at
Dr. Colin D. Stewart, Assistant Director; Pests, Pathogens, and Biocontrol Permits Branch, Plant Health Programs, PPQ, APHIS, 4700 River Road, Unit 133, Riverdale, MD 20737-1236; (301) 851-2237.
Under the Plant Protection Act (7 U.S.C. 7712
In addition, section 412(a) of the Act provides that the Secretary may prohibit or restrict the importation, entry, exportation, or movement in interstate commerce of, among other things, any biological control organism if the Secretary determines that the prohibition or restriction is necessary to prevent the introduction into the United States or the dissemination of a plant pest or noxious weed within the United States. The Act defines a biological control organism as “any enemy, antagonist, or competitor used to control a plant pest or noxious weed.”
The purpose of the regulations in “Subpart—Movement of Plant Pests” (7 CFR 330.200 through 330.212) and “Subpart—Movement of Soil, Stone, and Quarry Products” (7 CFR 330.300 through 330.301) is to prevent the dissemination of plant pests into the United States, or interstate, by regulating the importation and interstate movement of plant pests, soil, stone, and quarry products.
These regulations were issued by the Animal and Plant Health Inspection Service (APHIS) under the authority provided by, among other statutes, the Department of Agriculture Organic Act of 1944, as amended (7 U.S.C. 147a), and the Federal Plant Pest Act, as amended (7 U.S.C. 150aa through 150jj), both of which were superseded and repealed by the PPA. Most of the provisions of the PPA regarding the importation and movement of plant pests were modeled on or directly derived from these two Acts; thus, the enactment of the PPA did not necessitate a major revision of the subpart. However, the PPA did contain provisions that clarified the authority in the earlier Acts regarding, among other things, our ability to regulate the importation and interstate movement of biological control organisms, as well as noxious weeds and associated articles.
Accordingly, on October 9, 2001 (66 FR 51340-51358, Docket No. 95-095-2), we published in the
We solicited comments for 60 days ending December 10, 2001. We received 1,332 comments by that date. They were from State Departments of Agriculture, a State fish and wildlife agency, universities, plant societies, biocontrol organizations, USDA's Forest Service and Agricultural Research Service, the U.S. Environmental Protection Agency (EPA), zoological associations, the World Trade Organization, pharmaceutical groups and biological supply companies, wildlife protection and conservation groups, trade organizations, butterfly breeders and associations, elementary schools, and private citizens.
The majority of the comments that we received were from schools and students who requested that we continue to allow the environmental release of Monarch butterflies as part of a learning curriculum. Some of these commenters also requested that we continue to allow the environmental
We also received comments that addressed the proposed rule both generally and in regard to its specific provisions. Commenters often requested clarification regarding or suggested modification to several of the rule's provisions, but were, on the whole, generally supportive of the proposed rule. Accordingly, based on our evaluation of the comments that we received, we planned to issue a final rule.
However, the events of September 11, 2001, led to a further evaluation of our proposal to determine whether the proposed provisions had sufficient safeguards governing our permitting process. Specifically, we evaluated whether an aspect of our proposal, which would have authorized the importation of regulated organisms without prior issuance of a permit, provided that the party receiving the organisms had entered into a compliance agreement with APHIS, could serve as a potential venue for bioterrorism. We also temporarily suspended issuance of new plant pest permits.
In addition, on March 31, 2003, USDA's Office of the Inspector General (OIG) issued an audit of APHIS' permitting programs. Among other things, the audit examined APHIS' issuance of plant pest permits, and its administration of the permitting process. The audit suggested that we implement ePermits, a more thorough and technologically advanced permitting database than that used at the time, that we discontinue our practice at the time of issuing “blanket” permits to individuals or organizations to move plant pests and biological control organisms in favor of specific permits for each movement of a regulated organism, that we require more thorough documentation of an organism's intended use on each permit application, that we develop risk-based criteria for deciding whether or not to issue a permit for a particular movement, that we inspect the destinations listed on permit applications more regularly to evaluate their suitability for the organisms held onsite, and that we establish clear protocols, with an adequate degree of APHIS oversight, regarding the disposal of organisms once a permit expires. A 2007 followup OIG audit again encouraged us to fully implement ePermits, particularly at ports of entry into the United States.
Although APHIS has not substantively revised the regulations in the subpart since the promulgation of the PPA and the release of the OIG audits, these audit reports have informed Agency decisions regarding our regulation of the movement of plant pests, biological control organisms, and associated articles.
In this proposal, we are withdrawing our 2001 proposed rule and replacing it with an alternative proposal. This proposal retains several of the provisions of the 2001 proposal. For example, the conditions under which we would consider an organism a plant pest, and thus regulated by the subpart, remain similar to those of the 2001 proposal. However, this proposal also removes or modifies other provisions of the 2001 proposal. For example, we have removed provisions that would have authorized the movement of regulated organisms through a process consisting of compliance agreements and notification of movement.
Additionally, this proposal also incorporates new provisions that were not contained in the 2001 proposed rule but that would codify procedures that we have identified as best practices since that time but not yet added to the regulations.
The most significant changes in this new proposal are:
• We are proposing to establish criteria for the movement and environmental release of both biological control organisms of noxious weeds and those of plant pests; and
• We are proposing to remove “Subpart—Movement of Soil, Stone, and Quarry Products” and would instead regulate these articles in a subpart titled “Subpart—Movement of Plant Pests, Biological Control Organisms, and Associated Articles.”
The full text of the proposed regulations appears in the rule portion of this document. Our discussion of the proposed provisions follows.
In addition to our proposed revision of “Subpart—Movement Plant Pests” and removal of “Subpart—Movement of Soil, Stone, and Quarry Products,” we would also revise § 330.100, “Definitions,” of “Subpart—General Provisions,” to incorporate the applicable new definitions provided by the PPA and to update or eliminate some of the definitions currently provided in that section.
From the PPA, we would add definitions for the terms
We would also add definitions for
We would define
We would define the term
We would define the term
We would define the term
We would define the term
We would define the term
We would define the term
We would define the term
We would define the term
Historically, we have only issued permits for the movement of plant pests, biological control organisms, and associated articles to individuals. However, as provided for in the definition of
We anticipate that, if this rule is finalized, we would still issue a significant number of permits to individuals, rather than corporate entities. We expect that, for the majority of such permits, the permittee would wish to designate him or herself as the responsible individual; therefore, the definition of
Finally, Section 7734 of the PPA provides that a person will be held liable for the acts, omissions, and failures of an agent acting for that person, as long as the agent is acting within the scope of his or her office. Responsible individuals would be agents of the permittee pursuant to this section of the PPA.
We would define the term
We would define the term
Note that, for the purposes of this subpart, the term sterilization does not refer to techniques that neutralize an organism by rendering it incapable of sexual reproduction. We recognize that this alternate meaning of the term “sterilization” might be more common within the regulated community, but believe that it is clear from the manner in which we would use the term in the revised subpart that it would have a different meaning within these regulations.
We would define the term
We would define the term
In addition, we would substantively revise the definition of
We would remove the definition of
We would make nonsubstantive editorial changes to the definitions of
Finally, we would retain, without modification, the existing definitions of
Currently, the title of part 330, “Federal Plant Pest Regulations; General; Plant Pests; Soil, Stone, and Quarry Products; Garbage,” reflects the
For this reason, we would also update the title of the second subpart. As amended, it would now be titled “Subpart—Movement of Plant Pests, Biological Control Organisms, and Associated Articles.”
As a result of these proposed revisions, we would also revise the title of the part. It would now be titled: “Federal Plant Pest Regulations; General; Plant Pests, Biological Control Organisms, and Associated Articles; Garbage.”
The proposed regulations would begin by establishing the scope of the revised subpart. Paragraph (a) would state that no person shall import, move interstate, transit, or release into the environment plant pests, biological control organisms, or associated articles, unless the importation, interstate movement, transit, or release into the environment of the plant pests, biological control organisms, or associated articles is:
• Authorized under an import, interstate movement, or continued curation permit issued in accordance with proposed § 330.201;
• Authorized in accordance with other APHIS regulations in 7 CFR chapter III;
• Explicitly granted an exception or exemption in the revised subpart from permitting requirements.
• Authorized under a general permit issued by the Administrator.
By “authorized in accordance with other APHIS regulations in 7 CFR chapter III,” we mean that certain movements of plant pests or associated articles are regulated under other APHIS regulations in title 7. For example, the transit of a plant pest through the United States would require a permit issued in accordance with § 352.5 of the plant quarantine safeguard regulations in 7 CFR part 352, and the interstate movement of regulated associated articles of domestic quarantine pests (
We discuss the exemptions from permitting requirements that we are proposing to grant for certain categories of biological control organisms in the discussion under the heading “
Finally, to date, we have only issued specific permits, that is, permits issued to specific persons, for the interstate movement of plant pests. However, pursuant to section 7711 of the PPA, the Administrator may also issue general permits, that is, general authorizations, for the importation or interstate movement of plant pests.
In recent years, we have contemplated issuing a general, Web-based permit for the interstate movement of certain plant pests that we regard to be low-risk unless they are moved into certain areas of the United States, rather than specific permits for the movement of these pests. If we finalize proposed paragraph (a) of § 330.200 and decide to issue such a permit, we would announce the existence, location, and content of this general permit through a notice in the
Paragraph (b) of § 330.200 would specify the types of plant pests that we would regulate under the revised subpart. The paragraph would state that, for the purposes of the subpart, we would consider an organism to be a plant pest if the organism either directly or indirectly injures, causes damage to, or causes disease in a plant or plant product, or if the organism or part is an unknown risk to plants or plant products, but is similar to an organism known to directly or indirectly injure, cause damage to, or cause disease in a plant or plant product.
This paragraph, which is not found in the current regulations, is similar to the criteria for designating an organism a plant pest that were contained in our 2001 proposal. We have, however, made two changes to those criteria.
First, while our 2001 proposal would have designated certain organisms as plant pests if they directly or indirectly adversely affected plants, plant parts, or plant products, in this proposed rule, we would designate these organisms as plant pests if the organisms directly or indirectly injure, cause damage to, or cause disease in a plant or plant product. These latter criteria are based on the definition of
We would also expand the scope of our 2001 proposal so that we may consider organisms of an unknown risk to plants or plant products to be plant pests, provided that the organisms are similar to an organism known to directly or indirectly injure, cause damage to, or cause disease in a plant or plant product.
In our 2001 proposal, we did propose that organisms of an unknown risk to plants or plant products would require a permit, but we would have designated them regulated organisms rather than plant pests. We also stated that permitting conditions for such organisms would be aimed primarily at affording us an opportunity to identify and deal with the organisms with some initial degree of regulatory oversight, in order to prevent the dissemination of plant pests into or within the United States. We thus framed permitting requirements for such organisms as a necessary stopgap measure pending positive identification of the organism and an assessment of the organism's potential risk to plants and plant products.
However, since 2001, there have been numerous occasions when applicants have requested authorization to import organisms that cannot readily be identified to the species level for a significant portion of their lifespans, but that may be plant pests. For example, we have issued several plant pest permits for the importation of larval scarabs. Before becoming mature, all scarabs are morphologically similar to one another and exhibit similar feeding patterns, but are not plant pests. However, once mature, certain scarab species are plant pests. In order to take this potential for future effects on plants, plant parts, and plant products into consideration, in issuing a permit for any scarab grub, we have considered it to be a plant pest, and tailored permitting and containment requirements accordingly.
Paragraph (c) of § 330.200 would specify the types of biological control organisms that we would regulate under the revised subpart. Although the PPA defines a biological control organism as “any enemy, antagonist, or competitor used to control a plant pest or noxious weed,” practically speaking, we have only required permits for certain types
• Invertebrate predators and parasites (parasitoids) used to control invertebrate plant pests,
• Invertebrate competitors used to control invertebrate plant pests,
• Invertebrate herbivores used to control noxious weeds,
• Microbial pathogens used to control invertebrate plant pests,
• Microbial pathogens used to control noxious weeds, and
• Microbial parasites used to control plant pathogens.
Regarding these types of biological control organisms, we recognize that biological control organisms used to control noxious weeds are also plant pests, insofar as they injure, cause damage to, or cause disease in plants. However, since this effect is desirable and ultimately beneficial to other plants, plant parts, and plant products, it has been our policy to draft permitting conditions for the movement and environmental release of these organisms in a manner that encourages these effects, unless we have reason to believe that the organisms may also have plant pest effects on non-target plants or plant products.
As noted in the previous paragraphs, there are some types of biological control organisms for which we have not historically issued permits. However, there may be times when there would be a risk-based need to regulate the importation or interstate movement of an organism that falls within the PPA's definition of a
Paragraph (d) would exempt biological control organism products that EPA has issued experimental use permits for or that EPA has registered as microbial pesticide products having outdoor uses from regulatory oversight under the revised subpart. Under the authority of the Federal Insecticide, Fungicide and Rodenticide Act (7 U.S.C. 136
Section 330.201 would describe the types of permits that APHIS issues for plant pests, biological control organisms, and associated articles, the process for applying for a permit, and the manner in which APHIS acts on permit applications.
Paragraph (a) of § 330.201 would provide information regarding the types of permits that APHIS issues for plant pests, biological control organisms, and associated articles. It would state that we issue import permits, interstate movement permits, continued curation permits, and transit permits.
Paragraph (a)(1) would provide information regarding import permits. It would state that APHIS issues import permits to persons for secure shipment from outside the United States into the territorial limits of the United States; that, when import permits are issued to individuals, these individuals must be 18 years of age or older and have a physical address within the United States; and that, when import permits are issued to corporate persons, these persons must maintain an address or business office in the United States with a designated individual for service of process.
Paragraph (a)(2) would provide information regarding interstate movement permits. It would state that interstate movement permits are issued to persons for secure shipment from any State into or through any other State; that, when interstate movement permits are issued to individuals, these individuals must be 18 years of age or older and have a physical address within the United States; and that, when interstate movement permits are issued to corporate persons, these persons must maintain an address or business office in the United States with a designated individual for service of process.
Both import and interstate movement permits may contain conditions regarding the manner in which an organism may be moved from the destination listed on the permit. Such conditions are necessary to ensure that the organism is moved in a manner that will prevent its escape and dissemination and to ensure that the new facility to which it will be moved is capable of providing the necessary level of containment.
On a related matter, applicants for import and interstate movement permits should be aware that States and localities may have laws and regulations that restrict the movement or release of plant pests, biological control organisms, and associated articles for various reasons (for example, impact on the environment of the State or locality). We encourage applicants to consult with these authorities prior to applying for a permit.
Paragraph (a)(3) would provide information regarding continued curation permits. It would state that continued curation permits are issued in conjunction with and prior to the expiration date for an import permit or interstate movement permit, in order for the permittee to continue the actions listed on the import permit or interstate
Paragraph (a)(4) would provide information regarding transit permits. It would state that transit permits are issued for secure shipments through the United States, and that such permits are issued in accordance with 7 CFR part 352. As we mentioned above, § 352.5 of that part contains permitting requirements for transit permits.
However, part 352 currently provides for the transit of plant pests, but does not provide for the transit of biological control organisms. Therefore, we would amend part 352 to include references to biological control organisms. (For this reason, we would also amend part 352 to add definitions for the terms
Currently, part 330 contains provisions for the issuance of several additional types of permits: Permits for plant pest movement associated with national defense projects, permits for means of conveyance, and courtesy permits for organisms that are not subject to APHIS regulation. However, we no longer issue a special type of permit specifically for national defense projects; if such a permit application arises, we issue the appropriate type of movement permit, and specify as a permit condition that the use of the organism is for a national defense project. Similarly, we do not issue permits specifically for means of conveyance; if we have reason to believe the means of conveyance may be an associated article, we regulate it as such and issue the appropriate movement permit.
Until 2009, we issued courtesy permits in order to facilitate the movement of organisms that were not regulated under 7 CFR part 330, but that were similar enough to a known plant pest or biological control organism that their movement might otherwise be impeded if they were not accompanied by some sort of documentation from APHIS during transit. However, courtesy permits historically generated much confusion in the public and especially in the research community. The application form for courtesy permits was identical to the application for other types of permits, and the courtesy permit itself looked like other permits. This periodically led to the misunderstanding by some researchers that courtesy permits were required for the movement of certain organisms that were, in actuality, not subject to APHIS regulation. For these reasons, in recent years, Plant Protection and Quarantine (PPQ) has discontinued its issuance of courtesy permits for organisms that are similar to plant pests or biological control organisms, and it would not be necessary to include courtesy permits in the revised subpart.
In a related matter, § 330.207 of the current regulations states that APHIS recognizes permits issued by other Federal Agencies for the movement of regulated organisms and will issue administrative instructions or engage in correspondence with a permittee to augment the provisions of these permits through further conditions, rather than issue a duplicative permit.
We do not consider it necessary to retain those provisions in the revised subpart. First, we seldom engage in correspondence with the permittee for permits issued by another Federal agency, such as EUPs issued by EPA. Rather, if we believe that the actions authorized under the permit may place plants or plant products at risk, we discuss the matter with the issuing agency itself. Correspondingly, it is rare that we receive permit applications from applicants who have submitted a prior application to another regulatory agency. Therefore, the provisions do not reflect current Agency practices, and we believe that it is generally presupposed by the regulated community that we will recognize permits issued by other regulatory agencies for the movement of plant pests, biological control organisms, and associated articles.
Finally, we have periodically received requests from individuals to issue permits certifying organisms and associated articles that are destined for export from the United States. We note that foreign countries, rather than APHIS, set the conditions under which they will allow the importation of plant pests, biological control organisms, and associated articles from the United States. To this end, we would include a footnote stating that persons contemplating the shipment of plant pests, biological control organisms, or associated articles to places outside the United States should make arrangements directly, or through the recipient, with the country of destination for the export of the plant pests, biological control organisms, or associated articles into that country.
That being said, for certain high-risk plant pests, interstate movement permits may place conditions on the interstate movement of the organism for export purposes. This is not included in the current regulations, but reflects recent Agency policy. Such conditions are necessary to safeguard the movement of the organism to the port of export.
Paragraph (b) of § 330.201 would provide that permit applications must be submitted by the applicant in writing or electronically through one of the methods specified at
Paragraph (c) of § 330.201 would provide that a permit application must be complete before we will evaluate it in order to determine whether to issue the permit requested. Guidance regarding how to complete a permit application, including guidance specific to various information blocks on the application, would be available at
Paragraph (d) of § 330.301 would describe the actions APHIS takes on receiving a permit application. The introductory text to the paragraph
Paragraph (d)(1) would describe the first part of APHIS' formal review, consultation with States, Tribes, and other individuals. We share a copy of the permit application, and the proposed permit conditions, with the appropriate State or Tribal regulatory officials, and may share them with other persons or groups to provide comment. For instance, we may share the permit application with persons or groups other than State or Tribal regulatory officials when we lack technical expertise to evaluate certain aspects of a permit application and need to solicit the opinion of individuals or groups with such expertise.
Paragraph (d)(2) would describe the second part of our review, our initial assessment of sites and facilities where the organism or article will be held or released that are listed on the permit application. Such sites and facilities may include private residences, biocontainment facilities, and field locations. Although we may not do an onsite inspection in some cases, all sites and facilities would be subject to inspection as part of the assessment. All facilities would have to be determined by APHIS to be constructed and maintained in a manner that prevents the dissemination or dispersal of plant pests, biological control organisms, or associated articles from the facility. Finally, the applicant would have to provide all information requested by APHIS regarding this assessment, and to allow all inspections requested by APHIS during normal business hours (8 a.m. to 4:30 p.m., Monday through Friday, excluding holidays). Failure to do so would constitute grounds for denial of the permit application.
Paragraphs (d)(3) and (d)(4) would describe the two possible actions we would take upon concluding review of the permit application: Issuance or denial of the requested permit. Paragraph (d)(3) would discuss permit issuance. APHIS may issue a permit to an applicant if APHIS concludes that the actions allowed under the permit would be highly unlikely to result in the introduction or dissemination of a plant pest, biological control organism, or noxious weed within the United States in a manner that presents an unacceptable risk to plants and plant products.
We would specify that the actions allowed under the permit must be highly unlikely to result in the introduction or dissemination of a plant pest, biological control organism, or noxious weed within the United States in a manner that presents an unacceptable risk to plants and plant products because we would allow the environmental release of certain plant pests and biological control organisms under the revised subpart. The considerations that lead us to determine whether to authorize the environmental release of such organisms are discussed later in this document.
Paragraphs (d)(3)(i) through (d)(3)(iv) would describe the manner in which APHIS would issue a permit under the revised subpart. Prior to issuing the permit, APHIS would notify the applicant in writing or electronically of all proposed permit conditions. The applicant would have to agree in writing or electronically that he or she, and all his or her employees, agents, and/or officers, would comply with all permit conditions and all provisions of the regulations. If the organism or associated article will be contained in a private residence, the applicant would have to state in this agreement that he or she authorizes APHIS to conduct unscheduled assessments of the residence during normal business hours if a permit is issued.
APHIS would issue the permit after it receives and reviews the applicant's agreement. The permit would be valid for no more than 3 years. During that period, the permittee would have to abide by all permitting conditions,
We would specify that the use of the organism or article under the permit must conform to the intended use on the permit, because, on occasion, laboratories have obtained a permit for the movement of a plant pest or biological control organism into biocontainment, and then used the organism for purposes that differed from those specified as the intended use on the permit. In such instances, APHIS was not afforded an opportunity to evaluate the uses and determine whether they present a risk to plants and plant products within the United States. There have also been instances when laboratories have claimed that subsequent generations derived from a parent organism during the time period specified on a permit are distinct organisms, and thus should not be subject to the conditions specified on the permit and may be used at the laboratory's discretion. Such unregulated use of subsequent generations or progeny could present a risk of dissemination of the pest. Hence, we would require that the use of organisms derived from a regulated parent organism must conform to the intended use specified on the permit application for the parent organism.
All activities carried out under the permit would have to cease on or before the expiration date of the permit, unless, prior to that expiration date, the permittee has submitted a new permit application and a new permit has been issued to authorize continuation of the actions.
Finally, at any point following issuance of a permit but prior to its expiration date, an inspector could conduct unscheduled assessments of the site or facility in which the organisms or associated articles are held, to determine whether they are constructed and are being maintained in a manner that prevents the dissemination of organisms or associated articles from the site or facility. As with inspections associated with our initial assessment of sites or facilities prior to permit issuance, the permittee would have to allow all such assessments that we request during normal business hours. Failure to allow such assessments would constitute grounds for revocation of the permit.
Paragraph (d)(4) would set forth the conditions under which APHIS may deny an application for a permit. Currently, in § 330.204 of the regulations, APHIS will deny a permit application when such movement would involve a danger of dissemination of the pest. Danger of plant pest dissemination may be deemed to exist when any of the following five conditions occurs:
• No acceptable safeguards adequate to prevent plant pest dissemination can be arranged.
• The destructive potential of the plant pest to plants, and parts and products thereof, should it escape despite proposed safeguards, outweighs the probable benefits to be derived from
• The applicant, as a previous permittee, failed to maintain the safeguards or otherwise observe the conditions prescribed in a previous permit and failed to demonstrate his ability or intent to observe them in the future.
• The movement is adverse to the conduct of an eradication, suppression, control, or regulatory program of APHIS.
• The movement is objected to in writing by an appropriate official of a State, Territory, or possession, or the District of Columbia, on the ground it will involve a danger of dissemination of the plant pest into the State, Territory or possession, or District.
Although the current regulations set out criteria that will factor into APHIS' judgment of risk and may lead us to deny a permit application, certain of the considerations have been understood by regulated entities to be absolute, and may have dissuaded persons from submitting applications for which we would have likely issued a permit. For example, for several years, there was an erroneous but widespread interpretation that the last condition afforded States and territories the right to “veto” permit applications. From this perspective, the current criteria may appear too strict.
Conversely, the current regulations do not mention circumstances that may arise during the application process that would call into question that person's ability to comply effectively with permitting conditions, such as an applicant refusing to allow APHIS to inspect a biocontainment facility listed on the application, and would thus make it unlikely that we would issue him or her a permit.
Accordingly, we are proposing to revise the conditions under which the Administrator may deny a permit application. The revised conditions would be the following:
• APHIS concludes that the actions proposed in the permit application would present an unacceptable risk to plants and plant products because of the introduction or dissemination of a plant pest, biological control organism, or noxious weed within the United States.
This condition is intended to replace the current first condition, which does not appear to allow for environmental release of a plant pest or biological control organism, and the second condition, sometimes referred to as the “balancing” condition, which can be construed to suggest that APHIS will issue a permit for a high-risk movement or use of a regulated organism, provided that the benefits potentially derived from that movement or use may be equally great or greater. However, it is APHIS policy to base its decisions regarding permit issuance for the movement or use of plant pests, biological control organisms, and associated articles solely on an assessment of potential risk to plants and plant products associated with that movement or use.
We would retain the following two conditions drawn substantially from the current regulations:
• The actions proposed in the permit application would be adverse to the conduct of an APHIS eradication, suppression, control, or regulatory program.
• A State or Tribal executive official, or a State or Tribal plant protection official authorized to do so, objects to the movement in writing and provides specific, detailed information that there is a risk the movement will result in the dissemination of a plant pest or noxious weed into the State, APHIS evaluates the information and agrees, and APHIS determines that such plant pest or noxious weed risk cannot be adequately addressed or mitigated.
We would add the following conditions:
• The applicant does not agree to observe all of the proposed permit conditions that APHIS has determined are necessary to mitigate identified risks.
• The applicant does not provide information requested by APHIS as part of an assessment of sites or facilities, or does not allow APHIS to inspect sites or facilities associated with the actions listed on the permit application.
• APHIS determines that the applicant has not followed prior permit conditions, or has not adequately demonstrated that they can meet the requirements for the current application.
This last condition is intended to clarify the current third condition, which states that a permit application may be denied if the applicant, as a previous permittee, failed to maintain the safeguards or otherwise observe the conditions prescribed in a previous permit and failed to demonstrate his ability or intent to observe them in the future. Certain applicants have sought to interpret this current condition to suggest that actions taken under a previous permit cannot, on their own, serve as a basis for denying a future permit.
This interpretation is incorrect. In deciding to issue a permit, APHIS often relies on the previous actions of an applicant to render a judgment regarding the likelihood that the applicant can comply with the permitting conditions. As a result, this last condition would also provide a list of factors that could lead us to a determination that the applicant cannot comply with the permit conditions:
• The applicant, or a partnership, firm, corporation, or other legal entity in which the applicant has a substantial interest, financial or otherwise, has not complied with any permit that was previously issued by APHIS.
• Issuing the permit would circumvent any order denying or revoking a previous permit issued by APHIS (for example, by issuing a permit to an immediate family member of a person with a lengthy record of non-compliance with previous permits issued.)
• The applicant has previously failed to comply with any APHIS regulation.
• The applicant has previously failed to comply with any other Federal, State, or local laws, regulations, or instructions pertaining to plant health.
• The applicant has previously failed to comply with the laws or regulations of a national plant protection organization or equivalent body, as these pertain to plant health.
• APHIS has determined that the applicant has made false or fraudulent statements or provided false or fraudulent records to APHIS.
• The applicant has been convicted or has pled
Proposed paragraph (d)(5) would discuss withdrawal of a permit application. Any permit application could be withdrawn; however, applicants who wish to withdraw a permit application would have to provide this request in writing to APHIS. APHIS would provide written notification to the applicant as promptly as circumstances allow regarding reception of the request and withdrawal of the application.
Proposed paragraph (d)(6) of § 330.201 would discuss cancellation of a permit. Any permit that has been issued could be canceled at the request of the permittee. If a permittee wishes a permit to be canceled, he or she would have to provide the request in writing to APHIS-PPQ. Whenever a permit is canceled, APHIS would notify the permittee in writing regarding such cancellation.
Paragraph (d)(7) would discuss revocation of a permit. APHIS could revoke a permit for any of the following reasons:
• After issuing the permit, APHIS obtains information that would have
• APHIS determines that the actions undertaken under the permit have resulted in or are likely to result in the introduction into or dissemination within the United States of a plant pest or noxious weed in a manner that presents an unacceptable risk to plants or plant products.
• APHIS determines that the permittee, or any employee, agent, or officer of the permittee, has failed to comply with a provision of the permit or the regulations under which the permit was issued.
Paragraph (d)(8) would discuss amendment of permits. Amendments could occur at the request of the permittee, or may be initiated by APHIS. If a permittee determines that circumstances have changed since the permit was initially issued and wishes the permit to be amended accordingly, he or she would have to contact APHIS to request the amendment and may have to provide supporting information justifying the amendment.
APHIS would review the request, and may amend the permit if only minor changes are necessary. Requests for more substantive changes could require a new permit application.
Prior to issuance of an amended permit, depending on the nature of the amendments, the permittee may have to agree in writing that he or she, and his or her employees, agents, and/or officers, would comply with the amended permit and conditions.
With regard to amendments initiated by APHIS, we could amend any permit and its conditions at any time, upon determining that the amendment is needed to address newly identified considerations concerning the risks presented by the organism or the activities being conducted under the permit. We would also be able to amend a permit at any time to ensure that the permit conditions are consistent with all of the requirements of the regulations; for example, if a subsequent rulemaking prohibits certain categories or types of organisms from being moved in certain means of conveyance, and the permit lacks these specific prohibitions.
As soon as circumstances allow, APHIS would notify the permittee of the amendment to the permit and the reason(s) for it. Depending on the nature of the amendment, the permittee may have to agree in writing or electronically that he or she, and his or her employees, agents, and/or officers, will comply with the permit and conditions as amended before APHIS would issue the amended permit. If APHIS requests such an agreement, and the permittee does not agree in writing that he or she, and his or her employees, agents, and/or officers, will comply with the amended permit and conditions, the existing permit would be revoked.
Paragraph (d)(9) would discuss suspension of actions authorized under a permit. It would state that we may suspend authorization of actions authorized under a permit if we identify new factors that cause us to reevaluate the risk associated with those actions. In such instances, we would notify the permittee in writing of this suspension and the reasons for it. This notification would also state the actions for which we are suspending authorization. Depending on the results of our evaluation, we would subsequently contact the permittee to remove the suspension, amend the permit, or revoke the permit.
Paragraph (d)(10) would establish procedures in the event that a person whose application has been denied, whose permit has been revoked or amended, or whose authorization for actions authorized under a permit has been suspended, wishes to appeal the decision.
The PPA defines a biological control organism as “any enemy, antagonist, or competitor used to control a plant pest or noxious weed.”
The PPA finds that “biological control is often a desirable, low-risk means of ridding crops and other plants of plant pests, and its use should be facilitated” by APHIS and other agencies. In accordance with the PPA, APHIS authorizes the movement and environmental release of both biological control organisms through the issuance of permits.
Since the PPA was enacted, we have published several documents in the
We regulate biological control organisms pursuant to the PPA insofar as they may pose a plant pest risk. We consider it necessary to exercise a degree of regulatory oversight regarding the movement or environmental release of such biological control organisms, even when their efficacy is well established.
It is worth noting, in that regard, that biological control organisms are usually moved for eventual environmental release. This is alluded to in the PPA's definition of biological control organism, which specifies that an organism must be used, that is, actively employed to control a plant pest or noxious weed in order for it to be considered a biological control organism. Because biological control organisms are almost always intended for eventual release into the environment, it is not sufficient for us only to consider their use in controlling their target plant pest or noxious weed. We must also take into consideration the plant pest effects that the organism may pose to non-target plants or plant products.
If the organism is known to have non-target plant pest effects, it is consistent with APHIS' mission to prohibit or restrict its release. To the extent that we do not know these likely non-target plant pest effects, it is also prudent for us to place regulatory controls on its movement and release until these impacts and effects are better understood.
Paragraph (a) of proposed § 330.202 would provide, as a general condition for the importation, interstate movement, and environmental release of biological control organisms that are regulated under the proposed regulations, that no such biological control organism may be imported, moved interstate, or released into the environment unless a permit has been issued in accordance with proposed § 330.201 authorizing such importation, interstate movement, or environmental release, and the organism is moved or released in accordance with this permit and the proposed regulations.
Because applications for the movement of biological control organisms often request that we authorize the release of the organism into the environment, several regulations issued pursuant to the National Environmental Policy Act of 1969, as amended (NEPA, 42 U.S.C. 4321
In order to make such an assessment, we often have to request additional information from applicants regarding the proposed release of the organism as part of our evaluation of the permit application. The end of paragraph (a) of § 330.202 would alert interested parties to this fact, and direct them to our portal on the Internet for further information regarding the types of information that may be requested and the manner in which this information will be evaluated.
The requirements in proposed paragraph (a) of § 330.202 would apply to the importation, interstate movement, and environmental release of most biological control organisms. However, we are aware that certain taxa of biological control organisms have become established throughout their geographical or ecological range in the continental United States, such that the additional release of pure cultures derived from field populations of a taxon of these organisms into the environment of the continental United States will present no additional plant pest risk (direct or indirect) to plants or plant products. For such organisms, we do not consider there to be a sufficient basis in risk to require permits for their interstate movement or environmental release within the continental United States.
To reflect this, paragraph (b) of § 330.202 would state that APHIS has determined that certain biological control organisms have become established throughout their geographical or ecological range in the continental United States, such that the additional release of pure cultures derived from field populations of taxa of such organisms into the environment of the continental United States will present no additional plant pest risk (direct or indirect) to plants or plant products within the United States. The paragraph would direct persons to APHIS' online portal for permit applications for a list of all such organisms.
Paragraph (b)(1) of § 330.202 would provide that pure cultures of organisms on that list may be imported into or moved interstate within the continental United States without further restriction under the regulations, and paragraph (b)(2) of § 330.202 would provide that pure cultures of organisms on the list may be released into the environment of the continental United States without further restriction under the regulations.
We have made a draft list of such organisms available on
Proposed paragraph (c) of § 330.202 would establish a petition-based process by which biological control organisms would be added to the list of organisms granted exceptions from permitting requirements for their importation or interstate movement. Any person would be able to request that APHIS add a biological control organism to the list referred to in paragraph (b) of § 330.202 by submitting a petition to APHIS. We would specify that individuals should submit the petition via email to
The petition would have to include the following information:
• Evidence indicating that the organism is indigenous to the continental United States throughout its geographical or ecological range, or evidence indicating that the organism has produced self-replicating populations within the continental United States for an amount of time sufficient, based on the organism's taxon, to consider that taxon established throughout its geographical or ecological range in the continental United States.
• Results from a field study where data was collected from representative habitats occupied by the biological control organism. Studies would have to include sampling for any direct or indirect impacts on target and non-target hosts of the biological control organism in these habitats. Supporting scientific literature would have to be cited.
• Any other data, including published scientific reports, that suggest that that subsequent releases of the organism into the environment of the continental United States would present no additional plant pest risk (direct or indirect) to plants or plant products.
APHIS would review the petition to determine whether it is complete. If the petition is complete, we would conduct an evaluation of the petition to determine whether there is sufficient evidence that the organism exists throughout its geographical or ecological range in the continental United States and that subsequent releases of pure cultures of field populations the organism into the environment of the continental United States will present no additional plant pest risk (direct or indirect) to plants or plant products.
If we determine that there is sufficient evidence that that the organism exists throughout its geographical or ecological range in the continental United States and that subsequent releases of pure cultures of the organism into the environment of the continental United States will present no additional plant pest risk (direct or indirect) to plants or plant products, we would publish a notice in the
If no comments are received on the notice, or if the comments received do not lead us to reconsider our determination, we would publish a subsequent notice in the
If the comments received lead us to reconsider our determination, we would publish a subsequent notice in the
Proposed paragraph (e) of § 330.202 would provide that any biological control organism may be removed from the list referred to in paragraph (b) of the section if information emerges that would have otherwise led us to deny the petition to add the organism to the list. Whenever an organism is removed from the list, APHIS would publish a notice in the
The regulations governing the importation, interstate movement, and transit of soil and certain stone and quarry products under permit are currently found in “Subpart—Movement of Soil, Stone, and Quarry
As part of our revision to the soil regulations, we would also update the regulations in light of the current scientific understanding of soil and the spread of soil-borne pathogens within Canada.
Proposed paragraph (a) of § 330.203 would state that the Administrator has determined that, unless it has been sterilized, soil is an associated article, and is thus subject to the permitting requirements of § 330.201. It would also provide two conditions under which the movement of soil would not be subject to the permitting requirements of § 330.201: If the movement is regulated pursuant to other APHIS regulations in 7 CFR chapter III (
Proposed paragraphs (b)(1) through (b)(3) of § 330.203 would provide conditions governing the importation of soil. First, in a similar manner to our conditions for the importation of most biological control organisms, we would require an import permit to be issued in accordance with § 330.201 for the importation of soil, and the soil to be imported under the conditions specified on the permit. We are requiring a permit so that we can evaluate the risks associated with any particular importation of soil and assign the appropriate mitigation measures.
Currently, soil may be imported from Canada without a permit, unless the soil is from Newfoundland or the Land District of Central Saanich on Vancouver Island in the Province of British Columbia; these two areas are known to be infested with pale cyst nematodes (PCN). We are proposing to amend the regulations so that soil from any area of Canada regulated by the Canadian Food Inspection Agency (CFIA), the national plant protection organization of Canada, for a soil-borne plant pest would require a permit. We are doing this because there have been recent detections of soil-borne plant pests of quarantine significance in Canada (such as PCN in Quebec and potato wart disease on Prince Edward's Island) that are not reflected in the current regulations.
We would also clarify that the proposed regulations do not pertain to soil used as a growing medium for plants for planting from Canada. Plants for planting that are intended to be imported into the United States and their growing media are regulated under 7 CFR part 319, “Subpart—Plants for Planting.”
Plants for planting that can be inspected, treated, or handled to prevent them from spreading plant pests are designated in that subpart as restricted articles. Section 319.37-4 requires all restricted articles imported into the United States to be accompanied by a phytosanitary certificate of inspection, unless the section explicitly exempts the articles from this requirement. Paragraph (a)(1) of § 319.37-4 exempts greenhouse-grown plants from Canada imported in accordance with the provisions of a certification program administered by CFIA from this requirement; paragraph (c) of that section contains the provisions of CFIA's program.
Section 319.37-8 addresses the growing media in which a restricted article may be imported. Currently, paragraph (a) of the section prohibits the use of soil as a growing medium for plants for planting from all countries other than Canada. Paragraph (b) allows a restricted article from Canada to be imported in any medium, with the restriction that articles from Newfoundland or a certain portion of the Municipality of Central Saanich in the Province of British Columbia must be accompanied by a phytosanitary certificate containing an additional declaration that the plants were grown in a manner to prevent infestation with potato cyst nematode. We are proposing to revise paragraph (b) of § 319.37-8 so that articles from any area of Canada that is regulated by CFIA for a soil-borne plant pest would have to be accompanied by a phytosanitary certificate with an additional declaration that the plants were grown in a manner to prevent infestation with that soil-borne plant pest.
Proposed paragraphs (b)(2) through (b)(4) of § 330.203 would set forth additional conditions for certain types of importations of soil. Paragraph (b)(2) would provide additional conditions for the importation of soil via hand-carry. In addition to the requirements of proposed paragraph (b)(1), we would allow soil to be hand-carried into the United States only if the importation meets the conditions of § 330.205. That section, which is discussed later in this document, would contain our regulations governing the hand-carry of plant pests, biological control organisms, and soil.
Proposed paragraph (b)(3) would provide additional conditions for the importation of soil intended for the extraction of plant pests. Since this soil is imported precisely because it is known to contain plant pests, with very few exceptions, it is not rerouted for sterilization upon arrival in the United States. Therefore, to mitigate the risk that such soil could present a pathway for the introduction or dissemination of plant pests within the United States, we would require all such soil to be imported directly to an approved biocontainment facility.
On occasion, soil that presents a risk of harboring plant pests is imported into the United States for disposal; for example, this sometimes occurs when a natural disaster strikes an area quarantined for a soil-borne pathogen and emergency management personnel need to dispose of the resulting debris. Proposed paragraph (b)(4) would contain additional conditions for the importation of such soil. In addition to general conditions for the importation of soil, soil infested with plant pests and intended for disposal would have to be imported directly to an APHIS-approved disposal facility. Although all such facilities are subject to evaluation and approval by EPA, we would require independent APHIS approval of the facility because certain of these EPA-approved facilities are municipal landfills that may not provide adequate safeguards against plant pest dissemination.
Currently, § 330.301 restricts the importation into the United States of stone and quarry products from areas in Canada that are infested with gypsy moth. This section has at times led to confusion regarding the relationship between soil and stone and quarry products, as well as questions regarding the regulated status of articles, such as clay, that are similar to but fundamentally distinct from soil.
Proposed paragraph (b)(5) of § 330.203 would list certain articles that are not soil, and that, because of their composition or origin, present a negligible risk of serving as a medium for plant pests or noxious weeds, provided that they are free of organic material. The articles could be imported
• Consolidated material derived from any strata or substrata of the earth. Examples include clay (laterites, bentonite, china clay, attapulgite, tierrafino), talc, chalk, slate, iron ore, and gravel.
• Sediment, mud, or rock from saltwater bodies of water.
• Cosmetic mud and other commercial mud products.
• Stones, rocks, and quarry products.
These provisions do not mean that we would no longer restrict the movement of stone and quarry products from areas in Canada that are infested with gypsy moth. Instead, we would amend “Subpart—Gypsy Moth Host Material from Canada,” § 319.77-1 through § 319.77-5, to incorporate those restrictions. Section 319.77-2 of that subpart contains a list of articles designated regulated articles; we would amend that section by adding a new paragraph (i) that would designate stone and quarry products as regulated articles. Section 319.77-4 contains conditions for the importation of regulated articles; we would amend the section by adding a new paragraph (d) that would provide that stone and quarry products originating in a Canadian area known to be infested with gypsy moth may be imported into the United States only if they are destined for an infested area of the United States and will not be moved through any noninfested areas of the United States, and may be moved through the United States if they are moved only through infested areas. We consider this subpart a more appropriate location for the restrictions.
Proposed paragraph (c) of § 330.203 would provide general conditions governing the interstate movement of soil. Most soil could be moved interstate without prior issuance of an interstate movement permit in accordance with § 330.201, or further restriction under the regulations. However, all soil moved interstate within the United States would still be subject to any movement restrictions and remedial measures specified for such movement in 7 CFR part 301.
As we mentioned earlier in this document, part 301 contains our regulations that designate certain areas of the United States as quarantined areas for a particular plant pest, and that prohibit or restrict the movement in interstate commerce of certain host articles of that pest. The provisions currently in our regulations in § 330.302 mention certain sections of part 301 in which soil is considered a regulated article, such as our Japanese beetle and gypsy moth regulations, but omit others, such as our golden nematode and PCN regulations, and do not take into consideration the possibility that outbreaks of new plant pests within the United States may lead us to regulate the interstate movement of soil from areas quarantined for those or other pests.
Proposed paragraph (c)(2) would provide conditions for the interstate movement within the continental United States of soil intended for the extraction of plant pests. Again, since such soil is moved precisely because it is known to contain plant pests, it is, by definition, an associated article, and therefore would require an interstate movement permit issued in accordance with § 330.201 in order to be moved. Moreover, because of the intended use of the soil, in order to mitigate the risk of the dissemination of plant pests, the soil would have to be moved directly to an approved biocontainment facility, and in a secure manner that prevents its dissemination into the outside environment.
Proposed paragraph (c)(3) would contain additional conditions for the interstate movement within the continental United States of soil infested with plant pests and intended for disposal. We would require issuance of an interstate movement permit prior to movement, and would require that all such soil to be moved directly to an APHIS-approved disposal facility, and in a secure manner that prevents its dissemination into the outside environment.
Proposed paragraph (c)(4) would contain additional conditions for the interstate movement of soil samples from an area quarantined in accordance with 7 CFR part 301 for chemical or compositional testing or analysis. Such soil could be moved without prior issuance of an interstate movement permit in accordance with § 330.201 or further restriction under 7 CFR chapter III, provided that the soil is moved to a laboratory that has entered into and is operating under a compliance agreement with APHIS, is abiding by all terms and conditions of the compliance agreement, and is approved by APHIS to test and/or analyze such samples.
Proposed paragraph (c)(5) would contain additional conditions for the interstate movement of soil to, from, or between Hawaii, the territories, and the continental United States. In addition to all general conditions for interstate movement of soil, soil could be moved interstate to, from, or between Hawaii, the territories, and the continental United States only if an interstate movement permit has been issued for its movement in accordance with § 330.201. This condition would apply to all soil moved to, from, or between Hawaii, the territories, and the continental United States. In addition to this provision, soil moved to, from, or between Hawaii, the territories, and the continental United States with the intent of extracting plant pests would still be subject to the conditions of proposed paragraph (c)(2) of the section, and would therefore have to be moved directly to an approved biocontainment facility. Similarly, soil infested with plant pests and intended for disposal would be subject to the conditions of proposed paragraph (c)(3) of the section, and would therefore have to be moved directly to an APHIS-approved disposal facility.
Proposed paragraph (d) would contain conditions regarding the transit of soil. Such movement would require a transit permit issued in accordance with 7 CFR part 352.
The regulations in § 330.300 currently exempt movements of soil governed by § 318.60 or § 319.69 from permitting requirements. Section 318.60 currently prohibits the movement of sand (other than clean ocean sand), soil, or earth around the roots of plants from Hawaii, Puerto Rico, or the Virgin Islands into or through any other State, Territory, or District of the United States, unless the movement is in either direction between Puerto Rico and the Virgin Islands, or the soil is intended for experimental or scientific use by USDA. We would amend § 318.60 to clarify that it pertains only to the movement of soil around the roots of plants, and that all other movement of soil from Hawaii, Puerto Rico, or the Virgin Islands, other than that soil around the roots of plants, is regulated under 7 CFR part 330. We consider this amendment necessary primarily so that we would not regulate the movement of such soil in two different subparts, and secondarily so that the section may not be used to circumvent the regulations in part 330.
“Subpart—Packing Materials,” § 319.69 through § 319.69-5, contains
After reviewing this section in light of the current scientific understanding of soil, as reflected in our proposed revision to the definition of
Therefore, we would amend the existing prohibition in § 319.69 on the use of soil as a packing material so that it instead prohibits the use of organic decaying vegetative matter as a packing material. We would remove § 319.69-1(b), which considers matter containing decaying vegetation or plant remains to be soil. We would establish an exemption for any organic decaying vegetative matter expressly authorized to be used as a packing material elsewhere in part 319. Finally, we would revise the heading of § 319.69-5 to make it clear that it does not pertain to the use of soil as a packing material, but organic decaying vegetative matter.
Section 7711 of the PPA provides that the Secretary of Agriculture may issue regulations to allow the importation and the movement in interstate commerce of plant pests without further restriction, if the Secretary finds that a permit for such movement is not necessary. The section further states that if the Secretary does issue such regulations, any person may petition him or her to add a plant pest or remove a plant pest from this list of pests. Finally, the section provides that if a petition is submitted, the Secretary will act on the petition and notify the petitioner of the action he or she will take on the petition.
Section 330.204 would establish such regulations and petition process. The introductory paragraph would state that, pursuant to section 7711 of the PPA, the Administrator has determined that certain plant pests may be imported into or may move in interstate commerce within the continental United States without restriction. The list of all such plant pests would be on the PPQ Web site.
Paragraph (a) of the section would describe the three categories of plant pests that comprise the list. In order to be included on the list, a plant pest would have to:
• Be from field populations or lab cultures derived from field populations of a taxon that is established throughout its entire geographical or ecological range within the continental United States; or
• Be sufficiently attenuated so that it no longer poses a risk to plants or plant products; or
• Be commercially available and raised under the regulatory purview of other Federal agencies.
In our 2001 proposed rule, paragraph (c) of § 330.202 would have established a “no permit necessary” list for certain indigenous plant pest species that were already distributed throughout the continental United States and are known to commonly accompany plants or plant products moved in commerce. The first category aligns with the criterion for that 2001 list. We would not require permits for plant pests from a field population or lab culture derived from a field population of a taxon that is established throughout its entire geographical or ecological range within the United States because such pests are ubiquitous within the continental United States.
The second category reflects the fact that
(In order to avoid confusion and the possible unregulated movement of the virulent strains of the plant pest, the list would specify the strains of the plant pest that APHIS considers attenuated of their pathogenicity.)
The third category of plant pests is intended to avoid duplicative or conflicting regulatory oversight of certain plant pests. For example, although it is a plant pest,
We have made a draft list of plant pests that may be imported or move in interstate commerce within the continental United States without restriction available on
Paragraph (b) of § 330.204 would contain a petition process to add a plant pest to the list. Any person would be able to petition to have an additional plant pest added to the list. To submit a petition, the person would have to provide, in writing, information supporting the placement of a particular pest in one of the categories listed in paragraph (a) of § 330.204.
Information that the plant pest belongs to a taxon that is established throughout its entire geographical or ecological range within the United States would have to include scientific literature, unpublished studies, or data regarding:
• The biology of the plant pest, including characteristics that allow it to be identified, known hosts, and virulence;
• The geographical or ecological range of the plant pest within the continental United States; and
• The areas of the continental United States within which the plant pest is established.
The first category of information is intended to provide us with basic information regarding the plant pest for which unrestricted movement is sought. The second and third categories would aid our determination regarding whether the plant pest is established throughout its ecological or geographical range within the continental United States.
Information that the plant pest has been attenuated of its pathogenicity would have to include experimental data, published references, or scientific information regarding such attenuation.
Information that the plant pest is commercially available and raised under the regulatory purview of another Federal agency would have to include a citation to the relevant law, regulation,
APHIS would review the information contained in the petition to determine whether it is complete. In order to consider the petition complete, APHIS may require additional information to determine whether the plant pest belongs to one of the categories listed in paragraph (a) of § 330.204. When it is determined that the information is complete, we would commence review of the petition.
If, after review of the petition, we determine that there is insufficient evidence that the plant pest belongs to one of the three categories listed in paragraph (a) of § 330.204—for example, the plant pest is known to exist throughout its entire geographical range in the continental United States, but population densities in certain areas are not sufficient to consider it established throughout its range—we would deny the petition, and notify the petitioner in writing regarding this denial.
Conversely, if, after review of the petition, we determine that the plant pest belongs to one of the categories in paragraph (a), we would publish a notice in the
If no comments are received on the notice, or if, based on the comments received, we determine that our conclusions regarding the petition have not been affected, we will publish in the
Under paragraph (c) of § 330.204, any person could submit, in writing, a petition to have a plant pest removed from the list. The petition would have to contain independently verifiable information demonstrating that our initial determination that the plant pest belongs to one of the categories in paragraph (a) of the section should be changed, or that additional information is now available that would have caused us to change the initial decision.
APHIS would review the information contained in the petition to determine whether it is complete. In order to consider the petition complete, we may require additional information supporting the petitioner's claim. When it is determined that the information is complete, we would commence review of the petition.
If, after review of the petition, we determine that there is insufficient evidence to suggest that our initial determination should be changed, we would deny the petition, and notify the petitioner in writing regarding this denial.
If, after review of the petition, we determine that there is a sufficient basis to suggest that our initial determination should be changed, we would publish a notice in the
If no comments are received on the notice, or if the comments received do not affect our conclusions regarding the petition, we would publish in the
Paragraph (d) of § 330.204 would provide for APHIS-initiated changes to the list. It would provide that APHIS may propose to add a plant pest to or remove a pest from the list without a petition, if we determine that there is sufficient evidence that the plant pest belongs to one of the categories listed in paragraph (a) of the section, or if evidence emerges that leads us to reconsider our initial determination that the plant pest was or was not in one of the categories listed in paragraph (a) of the section. We would publish a notice in the
If no comments are received on the notice, or if the comments received do not affect our conclusions, we will publish a subsequent notice in the
Currently, we authorize the importation of plant pests in personal baggage (referred to as “hand-carry”) under § 330.212 of the regulations. The regulations provide that the person importing the plant pest must show the permit authorizing the importation to an inspector at the port of arrival where the baggage will be inspected, that the conditions specified on the permit must be observed, that an inspector will oversee the movement of the plant pest, that the owner of the plant pest will be responsible for all costs incidental to forwarding the plant pest prior to clearance, and that an inspector may specify and supervise the application of safeguards to prevent the dissemination of the pest until it is forwarded.
The 2003 OIG audit referenced at the beginning of this document pointed out that the hand-carry process in place at the time did not provide guidance regarding what materials may be hand-carried or who may hand-carry, and that APHIS did not track hand-carried materials to ensure that they arrive at the point of destination listed on the permit. For these reasons, the audit strongly suggested that we issue regulations to prohibit hand-carry of regulated organisms into the United States, and to explicitly state that all organisms must be imported into the United States via a bonded commercial carrier.
However, certain plant pests and biological control organisms are highly perishable, and may remain viable only if they are imported into the United States directly and without rerouting. We have also found that it is often useful, from a safeguarding perspective, to authorize hand-carry in order to have an expert regarding the organism or article exercise direct and continuous oversight of its importation.
Therefore, we would include provisions for hand-carry in this proposed rule. These provisions, which would be contained in § 330.205, would reflect current Agency processes regarding hand-carry.
The introductory text of § 330.205 would state that plant pests, biological control organisms, and soil may be hand-carried into the United States only in accordance with the provisions of the section.
Proposed paragraph (a) of § 330.205 would discuss the first such provision, authorization to hand-carry. In order to obtain such authorization, a person would have to apply for an import permit for the plant pest, biological control organism, or soil, in accordance with § 330.201, and specify hand-carry of the organism or article as the method of proposed movement.
The application would also have to specify the individual or individuals who would hand-carry the plant pest, biological control organism, or soil into the United States. If we authorize this individual or these individuals to hand-carry, this authorization could not be transferred to, nor actions under it performed by, individuals other than those identified on the permit application.
Under proposed paragraph (b) of § 330.205, the permittee would have to notify APHIS through our online portal for permit applications or by fax after the permittee has obtained an import permit but no less than 20 days prior to movement and provide the following information in order to receive a hand-carry authorization:
• A copy of the face page of the passport for the individual or individuals who will hand-carry the plant pest, biological control organism, or soil.
• A description of the means of conveyance in which the individual or individuals will travel, including flight number and airline name for air travel, or vehicle license number or other identifying number for other modes of transportation.
• Expected date and time of first arrival.
• Expected port of first arrival.
• Travel itinerary from port of first arrival to final destination.
We would require authorized identification, the description of the means of conveyance, and the expected date, time, and port of first arrival because, pursuant to the regulations in § 330.105, hand-carried organisms or soil, like all other imported articles, must be presented for inspection at the port of first arrival, and this information would help us ensure that the inspection takes place as expeditiously as possible. We would require the travel itinerary from the port of first arrival to the final destination in order to ensure that the individual does not intend to make prolonged stops en route that could result in breach of safeguarding and increase the risk of accidental dissemination of the organism or soil. The information also would help us respond promptly to accidental dissemination of the organism or soil en route to the final destination.
Under proposed paragraph (c) of § 330.205, the permittee or his or her designee would have to notify APHIS within 24 hours of arrival of the hand-carried plant pest, biological control organism, or soil at the biocontainment facility or other authorized point of destination. This notification would have to state that the plant pest, biological control organism, or soil has arrived at its destination and that the package in which it was hand-carried has remained sealed until arrival. Notification could be by fax or email, or via APHIS' permitting Web site.
Proposed paragraph (d) of § 330.205 would discuss denial, amendment, or cancellation of authorization to hand-carry. It would state that APHIS may deny a request to hand-carry, or amend or cancel any hand-carry authorization at any time, if we deem such action necessary to prevent the introduction or dissemination of plant pests or noxious weeds within the United States.
In a similar manner, proposed paragraph (e) of § 330.205 would state that any person whose request to hand-carry has been denied, or whose hand-carry authorization has been amended or canceled, would be able to appeal the decision in writing to APHIS.
We are proposing to revise the packaging requirements for the movement of plant pests, currently found in § 330.210. The revised requirements would be contained in proposed § 330.206.
The introductory text of the section would state that shipments in which plant pests, biological control organisms, and associated articles are imported into, moved interstate, or transited through the United States must meet the general packaging requirements of the section, as well as all specific packaging requirements on the permit itself.
Proposed paragraph (a) would contain general packaging requirements. All shipments would have to consist of an outer shipping container and at least two packages within the container. Both the container and the inner packages would have to be securely sealed to prevent the dissemination of the enclosed plant pests, biological control organisms, or associated articles.
Paragraph (a)(1) would contain general requirements for the outer shipping container. The outer shipping container would have to be rigid, impenetrable, and durable enough to remain sealed and structurally intact in the event of dropping, lateral impact with other objects, and other shocks incidental to handling.
Paragraph (a)(2) would contain requirements for inner packages. The innermost package or packages within the shipping container would have to contain all of the organisms or articles that will be moved. As a safeguard, the innermost package would have to be placed within another, larger package, for example, bagged and sealed petri samples placed within a sealed cooler. All packages within the shipping container would have to be constructed or safeguarded so that they will remain sealed and structurally intact throughout transit. The packages would also have to be able to withstand changes in pressure, temperature, and other climatic conditions incidental to shipment.
Paragraph (b) would contain general requirements for packing material. It would specify that packing material must be free of plant pests, noxious weeds, or associated articles, and must be new, or must have been sterilized or disinfected prior to reuse. Packing material would also have to be suited for the enclosed organism or article, as well as any medium in which the organism or article will be maintained, and should not be capable of harboring or being a means of the dissemination of the organism or article.
We would provide guidance regarding suitable outer shipping containers, inner packages, and packaging on the PPQ Web site.
Paragraph (c) would provide that packing materials, including media and substrates, would have to be destroyed by incineration, be decontaminated using autoclaving or another approved method, or otherwise be disposed of in a manner specified in the permit itself. It would also provide that shipping containers could not be reused, except those that have been sterilized or disinfected prior to reuse.
Proposed paragraph (d) would state that permittees who fail to meet the requirements of the section may be held responsible for all costs incident to inspection, rerouting, repackaging, subsequent movement, and any treatments.
Proposed § 330.207 would state that the inspection services of APHIS inspectors during regularly assigned hours of duty and at the usual places of duty would be furnished without cost. It would also state that APHIS would not be responsible for any costs or charges incidental to inspections or compliance with the provisions of this subpart, other than for the inspection services of the inspector.
This proposed rule has been determined to be significant for the purposes of Executive Order 12866 and, therefore, has been reviewed by the Office of Management and Budget.
We have prepared an economic analysis for this rule. The economic analysis provides a cost-benefit analysis, as required by Executive Orders 12866 and 13563, which direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and equity). Executive Order
Based on the information we have, there is no reason to conclude that adoption of this proposed rule would result in any significant economic effect on a substantial number of small entities. However, we do not currently have all of the data necessary for a comprehensive analysis of the effects of this proposed rule on small entities. Therefore, we are inviting comments on potential effects. In particular, we are interested in determining the number and kind of small entities that may incur benefits or costs from the implementation of this proposed rule.
APHIS is proposing to revise its regulations regarding the importation, interstate movement, and environmental release of plant pests to incorporate provisions regarding biological control organisms (BCOs) and the movement of soils from which plant pests and BCOs are extracted. The proposed rule would revise and add definitions, streamline the permitting and compliance processes, and provide APHIS with increased flexibility in the regulation of plant pests. Parts 318, 319, and 352 of 7 CFR chapter III would also be updated to reflect the proposed changes in part 330.
A principal consequence of the proposed rule would be a streamlining of our permitting process and possible reduction in the number of permits issued under part 330, which numbered 6,538 in 2015. Approximately 33 percent of these permits (2,158) authorized the movement or environmental release of a plant pest or BCO that APHIS is proposing to exempt from permitting. While we do not expect the proposed rule would result in one-third fewer permits as one permit may list multiple BCOs or plant pests, we can say with confidence that the permitting burden would be reduced for applicants and that the permitting process could be expedited. We expect that affected entities would benefit from a 10 to 30 percent reduction in the overall time spent applying for and receiving permits under part 330. Assuming the time required to submit an application is 1 hour and assuming an average hourly wage of $45.50 per hour, then for the 6,538 permits issued in 2015, the time savings expected under the proposed rule would have totaled between 654 and 1,961 hours, which equates to a cost savings of between about $29,748 and $89,244.
The proposed rule would codify existing practices by allowing entities requesting permits to apply electronically rather than by using the mail only. Expanded use of online permit applications through APHIS' portal would result in time and cost savings as compared to applying by mail using paper applications.
Listing of exempted organisms on an APHIS-PPQ Web site, transparent procedures for petitioning for exceptions or exemptions to permitting, and provision for a notice-based process for adding and removing listed organisms would also combine to make an efficient, transparent, and user-responsive system that would facilitate the movement and environmental release of plant pests and BCOs.
Regulated entities would continue to incur time costs associated with providing information during the permitting application process, and with meeting somewhat more robust recordkeeping (maintaining records) requirements in certain instances such as with soil imports and risk based permits. The time required overall for permitting would be reduced, however, because of the newly excepted organisms.
The proposed revisions to 7 CFR part 330 would benefit entities, large and small, by increasing the efficiency of the permitting and compliance processes for plant pests, BCOs, and soils from which plant pests and BCOs are extracted, and by improving the general clarity and transparency of these regulations. The proposed rule also would facilitate the Agency's coordination with other Federal and State agencies in regulating the movement and environmental release of plant pests and BCOs. The majority of entities that would benefit from this rule are small entities, based on information obtained from the Economic Census.
To provide the public with documentation of APHIS' review and analysis of any potential environmental impacts associated with the processes established by this proposed rule, we have prepared a draft environmental impact statement (EIS). The EIS was prepared in accordance with: (1) The National Environmental Policy Act of 1969 (NEPA), as amended (42 U.S.C. 4321
The draft EIS is available on
A notice of availability regarding the draft EIS will also be published by the Environmental Protection Agency in the
In accordance with section 3507(d) of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
Please send comments on the information collection request to OMB's Office of Information and Regulatory Affairs via email to
Under the PPA, the Secretary of Agriculture has authority to carry out operations or measures to detect, control, eradicate, suppress, prevent, or retard the spread of plant pests. Section 7711(a) of the Act provides that “no person shall import, enter, export, or move in interstate commerce any plant pest, unless the importation, entry, exportation, or movement is authorized under general or specific permit and in accordance with such regulations as the Secretary may issue to prevent the introduction of plant pests into the United States or the dissemination of plant pests within the United States.” The Act gives USDA the flexibility to respond appropriately to a wide range of needs and circumstances to protect American agriculture against plant pests.
In addition, section 412(a) of the Act provides that the Secretary may prohibit or restrict the importation, entry, exportation, or movement in interstate commerce of, among other things, any biological control organism if the Secretary determines that the prohibition or restriction is necessary to prevent the introduction into the United States or the dissemination of a plant pest or noxious weed within the United States. The Act defines a biological control organism as “any enemy, antagonist, or competitor used to control a plant pest or noxious weed.”
APHIS regulations implementing these aspects of the Plant Protection Act are contained (in part) in 7 CFR part 330.
APHIS is proposing to revise: (1) Regulations regarding the movement of plant pests; (2) criteria regarding the movement and environmental release of biological control organisms, and proposing to establish regulations to allow the importation and movement in interstate commerce of certain types of plant pests without restriction by granting exceptions from permitting requirements for those pests; and (3) regulations regarding the movement of soil. This proposal would clarify the factors that would be considered when assessing the risks associated with the movement of certain organisms and facilitate the movement of regulated organisms and articles in a manner that also protects U.S. agriculture.
This proposed rule replaces a previously published proposed rule, which APHIS is withdrawing as part of this document. This proposal would clarify the factors that would be considered when assessing the risks associated with the movement of certain organisms and facilitate the movement of regulated organisms and articles in a manner that also protects U.S. agriculture.
Implementing this rule will require respondents to complete a new petition process to remove permitting requirements for the interstate movement of certain plant pests or biological control organisms.
We are soliciting comments from the public (as well as affected agencies) concerning our proposed information collection and recordkeeping requirements. These comments will help us:
(1) Evaluate whether the proposed information collection is necessary for the proper performance of our agency's functions, including whether the information will have practical utility;
(2) Evaluate the accuracy of our estimate of the burden of the proposed information collection, including the validity of the methodology and assumptions used;
(3) Enhance the quality, utility, and clarity of the information to be collected; and
(4) Minimize the burden of the information collection on those who are to respond (such as through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology;
A copy of the information collection may be viewed on the
The Animal and Plant Health Inspection Service is committed to compliance with the E-Government Act to promote the use of the Internet and other information technologies, to provide increased opportunities for citizen access to Government information and services, and for other purposes. For information pertinent to E-Government Act compliance related to this proposed rule, please contact Ms. Kimberly Hardy, APHIS' Information Collection Coordinator, at (301) 851-2483.
Cotton, Cottonseeds, Fruits, Guam, Hawaii, Plant diseases and pests, Puerto Rico, Quarantine, Transportation, Vegetables, Virgin Islands.
Coffee, Cotton, Fruits, Imports, Logs, Nursery stock, Plant diseases and pests, Quarantine, Reporting and recordkeeping requirements, Rice, Vegetables.
Customs duties and inspection, Imports, Plant diseases and pests, Quarantine, Reporting and recordkeeping requirements, Transportation.
Customs duties and inspection, Imports, Plant diseases and pests, Quarantine, Reporting and recordkeeping requirements, Transportation.
Accordingly, we propose to amend 7 CFR parts 318, 319, 330, and 352 as follows:
7 U.S.C. 7701-7772 and 7781-7786; 7 CFR 2.22, 2.80, and 371.3.
7 U.S.C. 450, 7701-7772, and 7781-7786; 21 U.S.C. 136 and 136a; 7 CFR 2.22, 2.80, and 371.3.
(b) * * *
(2) A restricted article from an area of Canada regulated by the national plant
The revision to read as follows:
(a) * * *
(8) Organic decaying vegetative matter from all countries, unless the matter is expressly authorized to be used as a packing material in this part. Exceptions to the above prohibitions may be authorized in the case of specific materials which has been so prepared, manufactured, or processed that in the judgment of the inspector no pest risk is involved in their entry.
The addition and revision to read as follows:
(h) Mobile homes and their associated equipment; and
(i) Stone and quarry products.
(d)
7 U.S.C. 450, 7701-7772, 7781-7786, and 8301-8317; 21 U.S.C. 136 and 136a; 31 U.S.C. 9701; 7 CFR 2.22, 2.80, and 371.3.
The following terms, when used in this part, shall be construed, respectively, to mean:
(a) No person shall import, move interstate, transit, or release into the environment plant pests, biological control organisms, or associated articles, unless the importation, interstate movement, transit, or release into the environment of the plant pests, biological control organisms, or plant pests is:
(1) Authorized under an import, interstate movement, or continued curation permit issued in accordance with § 330.201; or
(2) Authorized in accordance with other APHIS regulations in this chapter; or
(3) Explicitly granted an exception or exemption in this subpart from permitting requirements; or
(4) Authorized under a general permit issued by the Administrator.
(b)
(c)
(1) Invertebrate predators and parasites (parasitoids) used to control invertebrate plant pests,
(2) Invertebrate competitors used to control invertebrate plant pests,
(3) Invertebrate herbivores used to control noxious weeds,
(4) Microbial pathogens used to control invertebrate plant pests,
(5) Microbial pathogens used to control noxious weeds,
(6) Microbial parasites used to control plant pathogens, and
(7) Any other types of biological control organisms, as determined by APHIS.
(d)
(a)
(1)
(2)
(3)
(4)
(b)
(c)
(d)
(1)
(2)
(3)
(i) Prior to issuing the permit, APHIS will notify the applicant in writing or electronically of all proposed permit conditions. The applicant must agree in writing or electronically that he or she, and all his or her employees, agents, and/or officers, will comply with all permit conditions and all provisions of this subpart. If the organism or associated article will be contained in a private residence, the applicant must state in this agreement that he or she authorizes APHIS to conduct unscheduled assessments of the residence during normal business hours if a permit is issued.
(ii) APHIS will issue the permit after it receives and reviews the applicant's agreement. The permit will be valid for no more than 3 years. During that period, the permittee must abide by all permitting conditions, and the use of the organism or article must conform to the intended use on the permit. Moreover, the use of organisms derived from a regulated parent organism during that period must conform to the intended use specified on the permit for the parent organism.
(iii) All activities carried out under the permit must cease on or before the expiration date for the permit, unless, prior to that expiration date, the permittee has submitted a new permit application and a new permit has been issued to authorize continuation of those actions.
(iv) At any point following issuance of a permit but prior to its expiration date, an inspector may conduct unscheduled assessments of the site or facility in which the organisms or associated articles are held, to determine whether they are constructed and are being maintained in a manner that prevents the dissemination of organisms or associated articles from the site or facility. The permittee must allow all such assessments requested by APHIS during normal business hours. Failure to allow such assessments constitutes grounds for revocation of the permit.
(4)
(i) APHIS concludes that the actions proposed in the permit application would present an unacceptable risk to plants and plant products because of the introduction or dissemination of a plant
(ii) The actions proposed in the permit application would be adverse to the conduct of an APHIS eradication, suppression, control, or regulatory program; or
(iii) A State or Tribal executive official, or a State or Tribal plant protection official authorized to do so, objects to the movement in writing and provides specific, detailed information that there is a risk the movement will result in the dissemination of a plant pest or noxious weed into the State, APHIS evaluates the information and agrees, and APHIS determines that such plant pest or noxious weed risk cannot be adequately addressed or mitigated; or
(iv) The applicant does not agree to observe all of the proposed permit conditions that APHIS has determined are necessary to mitigate identified risks; or
(v) The applicant does not provide information requested by APHIS as part of an assessment of sites or facilities, or does not allow APHIS to inspect sites or facilities associated with the actions listed on the permit application; or
(vi) APHIS determines that the applicant has not followed prior permit conditions, or has not adequately demonstrated that they can meet the requirements for the current application. Factors that may contribute to such a determination include, but are not limited to:
(A) The applicant, or a partnership, firm, corporation, or other legal entity in which the applicant has a substantial interest, financial or otherwise, has not complied with any permit that was previously issued by APHIS.
(B) Issuing the permit would circumvent any order denying or revoking a previous permit issued by APHIS.
(C) The applicant has previously failed to comply with any APHIS regulation.
(D) The applicant has previously failed to comply with any other Federal, State, or local laws, regulations, or instructions pertaining to plant health.
(E) The applicant has previously failed to comply with the laws or regulations of a national plant protection organization or equivalent body, as these pertain to plant health.
(F) APHIS has determined that the applicant has made false or fraudulent statements or provided false or fraudulent records to APHIS.
(G) The applicant has been convicted or has pled
(5)
(6)
(7)
(i) After issuing the permit, APHIS obtains information that would have otherwise provided grounds for it to deny the permit application; or
(ii) APHIS determines that the actions undertaken under the permit have resulted in or are likely to result in the introduction into or dissemination within the United States of a plant pest or noxious weed in a manner that presents an unacceptable risk to plants or plant products; or
(iii) APHIS determines that the permittee, or any employee, agent, or officer of the permittee, has failed to comply with a provision of the permit or the regulations under which the permit was issued.
(8)
(ii)
(9)
(10)
(a)
(b)
(1)
(2)
(c)
(1) Evidence indicating that the organism is indigenous to the continental United States throughout its geographical or ecological range, or evidence indicating that the organism has produced self-replicating populations within the continental United States for an amount of time sufficient, based on the organism's taxon, to consider that taxon established throughout its geographical or ecological range in the continental United States.
(2) Results from a field study where data was collected from representative habitats occupied by the biological control organism. Studies must include sampling for any direct or indirect impacts on target and non-target hosts of the biological control organism in these habitats. Supporting scientific literature must be cited.
(3) Any other data, including published scientific reports, that suggest that subsequent releases of the organism into the environment of the continental United States will present no additional plant pest risk (direct or indirect) to plants or plant products.
(d)
(2)
(3)
(ii) If the comments received lead APHIS to reconsider its determination, APHIS will publish in the
(e)
(a) The Administrator has determined that, unless it has been sterilized, soil is an associated article, and is thus subject to the permitting requirements of § 330.201, unless its movement:
(1) Is regulated pursuant to other APHIS regulations in this chapter; or
(2) Does not require such a permit under the provisions of paragraphs (b)(1) or (c)(1) of this section.
(b)
(1)
(2)
(3)
(4)
(5)
(i) Consolidated material derived from any strata or substrata of the earth. Examples include clay (laterites, bentonite, china clay, attapulgite, tierrafino), talc, chalk, slate, iron ore, and gravel.
(ii) Sediment, mud, or rock from saltwater bodies of water.
(iii) Cosmetic mud and other commercial mud products.
(iv) Stones, rocks, and quarry products.
(c)
(2)
(3)
(4)
(5)
(d)
Pursuant to section 7711 of the Plant Protection Act (7 U.S.C. 7701
(a)
(1) Be from field populations or lab cultures derived from field populations of a taxon that established throughout its entire geographical or ecological range within the continental United States; or
(2) Be sufficiently attenuated so that it no longer poses a risk to plants or plant products; or
(3) Be commercially available and raised under the regulatory purview of other Federal agencies.
(b)
(i) Information that the plant pest belongs to a taxon that is established throughout its entire geographical or ecological range within the United States must include scientific literature, unpublished studies, or data regarding:
(A) The biology of the plant pest, including characteristics that allow it to be identified, known hosts, and virulence;
(B) The geographical or ecological range of the plant pest within the continental United States; and
(C) The areas of the continental United States within which the plant pest is established.
(ii) Information that the plant pest has been attenuated of its pathogenicity must include experimental data, published references, or scientific information regarding such attenuation.
(iii) Information that the plant pest is commercially available and raised under the regulatory purview of another Federal agency must include a citation to the relevant law, regulation, or order under which the agency exercises such oversight.
(2)
(3)
(ii) If, after review of the petition, APHIS determines that the plant pest belongs to one of the categories in paragraph (a) of this section, APHIS will publish a notice in the
(c)
(2)
(3)
(ii) If, after review of the petition, APHIS determines that there is a sufficient basis to suggest that its initial determination should be changed, APHIS will publish a notice in the
(d)
(2) If no comments are received on the notice or if the comments received do not affect the conclusions of the notice, APHIS will publish a subsequent notice in the
Plant pests, biological control organisms, and soil may be hand-carried into the United States only in accordance with the provisions of this section.
(a)
(1)
(2)
(b)
(1) A copy of the face page of the passport for the individual or individuals who will hand-carry the plant pest, biological control organism, or soil;
(2) A description of the means of conveyance in which the individual or individuals will travel, including flight number and airline name for air travel, or vehicle license number or other identifying number for other modes of transportation;
(3) Expected date and time of first arrival;
(4) Expected port of first arrival; and
(5) Travel itinerary from port of first arrival to final destination.
(c)
(d)
(e)
Shipments in which plant pests, biological control organisms, and associated articles are imported into, moved interstate, or transited through the United States must meet the general packaging requirements of this section, as well as all specific packaging requirements on the permit itself.
(a)
(1)
(2)
(b)
(c)
(2) Shipping containers may not be reused, except those that have been sterilized or disinfected prior to reuse.
(d)
The inspection services of APHIS inspectors during regularly assigned hours of duty and at the usual places of duty will be furnished without cost. APHIS will not be responsible for any costs or charges incidental to inspections or compliance with the provisions of this subpart, other than for the inspection services of the inspector.
7 U.S.C. 7701-7772 and 7781-7786; 21 U.S.C. 136 and 136a; 31 U.S.C. 9701; 7 CFR 2.22, 2.80, and 371.3.
(b) * * *
Animal and Plant Health Inspection Service, USDA.
Proposed rule.
APHIS is proposing to revise its regulations regarding the importation, interstate movement, and environmental release of certain genetically engineered organisms in order to update the regulations in response to advances in genetic engineering and understanding of the plant pest and noxious weed risk posed by genetically engineered (GE) organisms, thereby reducing burden for regulated entities whose organisms pose no plant pest or noxious weed risks. This would be the first comprehensive revision of the regulations since they were established in 1987.
We will consider all comments that we receive on or before May 19, 2017.
You may submit comments by either of the following methods:
•
•
Supporting documents and any comments we receive on this docket may be viewed at
Dr. Sidney Abel, Assistant Deputy Administrator, Biotechnology Regulatory Services, APHIS, 4700 River Road, Unit 147, Riverdale, MD 20737-1238; (301) 851-3896.
The Animal and Plant Health Inspection Service (APHIS) of the United States Department of Agriculture (USDA) administers regulations in 7 CFR part 340, “Introduction of Organisms and Products Altered or Produced Through Genetic Engineering Which are Plant Pests or Which There is Reason to Believe are Plant Pests” (referred to below as the regulations). The current regulations govern the introduction (importation, interstate movement, or release into the environment) of certain genetically engineered (GE) organisms that are considered “regulated articles.”
Under the current regulations, a GE organism is considered to be a regulated article if the donor organism, recipient organism, vector, or vector agent
The regulations also provide a process to petition APHIS to determine that a GE organism is nonregulated. A determination of nonregulated status means that the regulated article is no longer subject to the regulations in 7 CFR part 340 and, therefore, there is no longer any authority for APHIS to require a permit or notification for the importation, interstate movement, or environmental release of the regulated article pursuant to 7 CFR part 340. Agency Actions Following Promulgation of the Current Regulations
APHIS first issued these regulations in 1987 under the authority of the Federal Plant Pest Act of 1957 (FPPA) and the Plant Quarantine Act of 1912 (PQA), two acts that were subsumed into the Plant Protection Act (PPA, 7 U.S.C. 7701
Although, as discussed above, the current regulations have various functions, their primary function to date has been as a means for APHIS to authorize the importation, interstate movement, and introduction of certain GE organisms via the permit and notification procedures referred to above. Permits and notifications are collectively known as “authorizations.” To date, APHIS has issued more than 18,000 authorizations for the environmental release of GE organisms in multiple sites, primarily for research and development of improved crop varieties for agriculture. Additionally, APHIS has issued more than 12,000 authorizations for the importation of GE organisms, and nearly 12,000 authorizations for the interstate movement of GE organisms. APHIS has, to date, denied slightly more than 1,500 requests for permits or notifications, many of which were denied because APHIS ultimately decided the requests lacked sufficient information on which to base an Agency decision.
For authorizations under notification, the regulations require the environmental release to meet performance-based standards set forth in the regulations. These include, among other things, that, when the regulated article is a plant and is to be used for environmental release, it must be planted in such a way that it is not inadvertently mixed with non-regulated plant material that is not part of the environmental release. In addition, the environmental release must be conducted such that the regulated article will not persist in the environment, and no offspring can be produced that could persist in the environment. This latter requirement is accomplished through various measures such as required minimum isolation distances from sexually compatible
The interstate movement, importation, or environmental release of regulated articles may be authorized under permit if developers follow the permit conditions specified by the Administrator to be necessary for each activity to prevent the dissemination and establishment of the GE organism. Such conditions include, but are not limited to, maintenance of the regulated article's identity through labeling, retention of records related to the article's specified use, segregation of the regulated article from other organisms, inspection of a site or facility where regulated articles are to undergo environmental release or will be contained after their interstate movement or importation, and the maintenance and disposal of the regulated article and all packing material, shipping containers, and any other material accompanying the regulated article to prevent the dissemination and establishment of plant pests. If a permit holder has been found out of compliance with any of the permit conditions, the permit may be canceled, and if so, further movement or environmental release of GE organisms under that permit will be prohibited.
In addition to issuing permits and authorizing notifications, APHIS has responded to petitions requesting nonregulated status under these regulations. Under this petition procedure, which is described in § 340.6, a petitioner must present detailed information and scientific data regarding the regulated article indicating why the article should not be regulated. To date, APHIS has granted 124 determinations of nonregulated status, of 159 submitted for APHIS review, and all of these determinations have been for GE plants (more information about these is posted at
While the current regulations have been effective in ensuring the safe importation, interstate movement, and environmental release of GE organisms developed using genetic engineering during the past 29 years, advances in genetic engineering have occurred since they were promulgated and new challenges have emerged. Additionally, APHIS has now accumulated nearly three decades of experience in evaluating GE organisms for plant pest risk. The Agency's evaluations to date have provided evidence that most genetic engineering techniques, even those that use a plant pest as a vector, vector agent, or donor, do not result in a GE organism that presents a plant pest risk. This is discussed at greater length later in this document, under the section titled “
Advances in genetic engineering have also made the need to evaluate GE plants for noxious weed risk more pressing. When APHIS issued the current regulations under the authority of the FPPA and PQA, APHIS' authority to regulate noxious weeds was the Federal Noxious Weed Act of 1974 (7 U.S.C. 2801, FNWA). That act defined
In 1994, Congress amended the FNWA to allow APHIS to issue permits for the interstate movement of noxious weeds. This amendment, however, did not revise the definition of
In 2000, the PPA was issued; In addition to subsuming the FPPA and PQA, it also replaced the FNWA, and provided a new definition of noxious weed: “Any plant or plant product that can directly or indirectly injure or cause damage to crops (including nursery stock or plant products), livestock, poultry, or other interests of agriculture, irrigation, navigation, the natural resources of the United States, the public health, or the environment.” The PPA also provided explicit authority to issue regulations listing noxious weeds that are prohibited or restricted from entering the United States or that are subject to restrictions on interstate movement within the United States, and provided persons with the right to petition APHIS to add or remove noxious weeds from this list.
This revised noxious weed authority led APHIS in 2010 to revise the noxious weed regulations, found in 7 CFR part 360, to reflect the provisions of the PPA. It also led APHIS to revise the manner in which APHIS evaluates plants for noxious weed risk to determine whether to list them in part 360. Under the revised approach that APHIS uses for part 360, the first two considerations in determining whether a plant is a noxious weed are: (1) Identifying what direct injury or damage (physical harm) the plant causes; and (2) identifying what indirect damage the plant may cause to interests of agriculture, irrigation, navigation, the natural resources of the United States, the public health, or the environment. APHIS then evaluates how likely the plant is to become established in areas within the United States in which it was not known to exist, in the absence of Federal regulation; for example, if it can only become established in tropical climates, Federal regulation is not necessary to prevent its establishment in temperate and subarctic climates. APHIS' final consideration is whether placing the plant under Federal regulation will affect the likelihood of introduction or dissemination of the plant. In general, APHIS lists a plant as a Federal noxious weed if APHIS determines the plant to be invasive and to have significant negative impacts, if introduced or disseminated within the United States, and if APHIS determines that Federal regulation could reduce the likelihood of such introduction or
This approach means that there are certain plants that APHIS has determined to be weeds, but not to be Federal noxious weeds. This distinction between a weed and a Federal noxious weed warrants emphasis. “Weeds,” in the broadest sense of the term, could include any plant growing where and/or when it is unwanted; even plants that are desirable in some settings could be considered weeds in others. The plants that APHIS evaluates for inclusion on the Federal noxious weed list are, in general, a particular type of weed: An invasive, usually non-native plant that impacted natural and/or agronomic ecosystems, often with significant negative consequences. Of the problematic weeds APHIS evaluates, only a fraction
The regulations in part 360, while effective, continue to have a significant restriction that limits their applicability to GE organisms: They are predicated on a determination by APHIS that a taxon is a Federal noxious weed. This determination is easier for plants that have not been genetically engineered, because there are usually many reference points that are available and pertinent to this determination, including international experience with the weed, scientific literature regarding the plant's biology, published studies, and other data.
For GE plants, there is usually a great deal of data and experience with the non-GE organism. In most cases these non-GE organisms are highly domesticated and cultivated widely within the United States, and there is an extensive body of scientific literature regarding their biology. However, when a GE trait is introduced into the plant, there may in certain instances be little data or previous experience available for APHIS to rely on in evaluating the properties of the resulting GE plant. Instead, in order to determine whether the GE plant could function as a noxious weed, APHIS would have to rely on its own independent evaluation of the plant itself, based on information provided by the plant's developers.
Historically, there has not been a significant need for such a noxious weed evaluation of GE plants. Most of the GE plants that APHIS regulated in the past, such as varieties of corn and soybeans modified with common agronomic traits, do not qualify as “noxious weeds.” This is because most GE plants to date have been agricultural crops, and most agricultural crops are not biologically weeds prior to modification. Indeed, in order to domesticate a plant for crop production, farmers often had to deliberately eliminate weedy traits, such as seed shattering, thorns, and seed dormancy, from the plant using traditional breeding techniques. Moreover, the phenotypic traits that have historically been introduced into crops through genetic engineering do not confer weediness. Because the plants have not been weeds prior to genetic engineering, and genetic engineering has not introduced weediness, evaluating the plant solely for plant pest risk has not been problematic.
Additionally, the means by which most GE plants to date have been genetically engineered has brought them under APHIS' regulatory authority. To date, most GE plants have been engineered using a plant pest as either the donor or vector of genetic material. Because of this use of a plant pest as a donor, vector agent, or vector, the resulting GE organisms fall within the scope of
However, in recent years, there has been an increasing diversity of both agronomic and non-agronomic traits engineered in plants. There has also been an increased use of plants in genetic engineering that, in their unmodified state, are known to possess weedy traits. This is especially true of plants used in the production of biofuel. For example, switchgrass (
Moreover, APHIS' current regulatory structure, which entails evaluating such plants solely for plant pest risk, is not sufficient to properly identify all risks that these plants present to other plants and plant products. Indeed, under the current structure, such plants may entirely escape regulation. While, in the past, GE plants have almost always used a plant pest to vector genetic material, as we mentioned previously in this document, in recent years, GE techniques have arisen that do not use plant pests as donor organisms or vectors. Moreover, if plants are genetically engineered without the use of a plant pest as a vector or donor, this would require APHIS to consider the plant itself to be a plant pest in order to designate it as a regulated article. However, under the PPA's definition of
While APHIS discusses the nature of this proposed evaluation later in this document, it is important to delineate, in broad terms, how the Agency would consider a GE plant to be a noxious weed under the proposed regulations. For purposes of the regulations in part 340, APHIS would begin by evaluating whether the plant, in its unmodified state, has weedy characteristics, that is, a plant biologically capable of causing notable physical injury or damage. This would serve as the baseline against which to evaluate the genotype of the GE plant. In evaluating the GE plant, APHIS would assess the likelihood that the modifications made to the genome of the plant alter its ability to cause notable physical harm or injury.
For GE plants that APHIS determines to be weedy prior to genetic modification, APHIS would endeavor to determine whether the plant's weediness has been enhanced to an extent that it has been engineered into a noxious weed. For GE plants that APHIS determines not to possess weedy traits prior to modification, APHIS would endeavor to determine whether weediness had been introduced into the organism through genetic engineering. Finally, in the event that a Federal noxious weed is genetically engineered (something that has not occurred to date), APHIS would endeavor to determine whether the GE plant is still
If APHIS determines that the GE plant is a noxious weed, it would endeavor to gauge the direct or indirect injury or damage it could cause to crops, livestock, poultry, or other interests of agriculture, irrigation, navigation, the natural resources of the United States, the public health, or the environment. APHIS would make the results of this evaluation publicly available and share both the evaluation and the information on which it is based with the Environmental Protection Agency (EPA) and the U.S. Food and Drug Administration (FDA), as warranted.
Maintaining communication with EPA and FDA as we evaluate GE plants for noxious weed risks is consistent with APHIS' role in the Coordinated Federal Framework for Regulation of Biotechnology (Coordinated Framework).
The Coordinated Framework provides as a guiding principle that, “[i]n order to ensure that limited Federal oversight resources are applied where they will accomplish the greatest net beneficial protection of public health and the environment, oversight will be exercised only where the risk posed by the introduction is unreasonable.” APHIS considers this proposed rule to be entirely consistent with this principle: It will no longer consider GE organisms to be regulated articles solely because of the donor, vector, or vector agent used in genetic engineering, thereby focusing APHIS resources on those GE organisms that may present a plant pest and/or noxious weed risk. However, it is worth noting, as the Coordinated Framework itself does, that a “mosaic” of statutes have, to date, provided Agencies with authority to exercise oversight of GE organisms. APHIS acknowledges that the Agencies functioning within the Coordinated Framework oversee different aspects of risk and that, accordingly, other Federal Agencies may continue to exercise oversight over GE crops that APHIS no longer views as plant pests or noxious weeds. To that end, APHIS acknowledges that the proposed revisions to 7 CFR part 340 could have direct or indirect impacts on the manner in which FDA and EPA exercise their roles within the Coordinated Framework. To the extent that the public health impacts are due to changes in APHIS regulatory oversight, APHIS discusses them within this document. Economic impacts, in contrast, are discussed in the economic analysis prepared for this rule, while potential environmental impacts are discussed in the draft programmatic environmental impact statement prepared for the rule.
Audits conducted by USDA's Office of Inspector General (OIG) are another basis for this rule. In 2005, OIG conducted an audit of APHIS' regulatory program for GE organisms. OIG found that the use of performance-based standards in APHIS' notification process allowed for a broad spectrum of methods to meet the standards, particularly regarding how the release would be contained to its test field, but Agency practices did not require responsible persons to provide written protocols detailing the exact methods that person would use to meet the standards. OIG suggested that APHIS revise the regulations to minimize the risk of inadvertent dissemination of regulated articles from a test field. Specific recommendations were to require GPS coordinates of all test field sites; to require scientific protocols or study designs from applicants prior to authorizing a field test of a GE organism; and to seek legislative authority to require applicants to provide proof of financial responsibility in the event of an unauthorized release, as APHIS considered necessary.
OIG also suggested that APHIS develop risk-based criteria for conducting inspections and exercising oversight of field tests for the release of GE organisms, and suggested that APHIS provide more explicit guidance regarding how to terminate a field test and document this termination.
In 2015, OIG issued another audit, urging APHIS to implement the recommendations from the 2005 audit that APHIS had not yet implemented.
Finally, in 2008, The Food, Conservation, and Energy Act of 2008 (Farm Bill) was promulgated. Section 10204 of the Farm Bill requires the Secretary of Agriculture to take action on each issue identified in the APHIS document entitled “Lessons Learned and Revisions under Consideration for APHIS' Biotechnology Framework,”
On October 9, 2008, APHIS published a proposal
APHIS sought public comment on the proposal from October 9, 2008, to June 29, 2009. APHIS received more than 88,300 comments during the comment period. These were received in 5,580 submissions that included unique comments, form letters, and signatories to petitions. Many commenters expressed concerns regarding the lack of details surrounding a proposed risk-based system that would determine which organisms would fall under APHIS oversight, as well as concerns about a proposed multi-tiered permit system. Commenters also expressed concern about what they perceived to be a significant expansion of Agency regulatory authority.
Based on the breadth and nature of the comments received, APHIS published a notice in the
Based on the feedback received following the withdrawal of the proposed rule, as well as to reflect provisions of The Food, Conservation, and Energy Act of 2008 (Farm Bill) and recommendations received from the 2005 and 2015 OIG audits, APHIS is proposing to update its regulations in 7 CFR part 340. APHIS is proposing to evaluate GE organisms for noxious weed potential using a different approach
Additionally, under the new approach, APHIS would regulate a GE organism that is intended for use as a biological control (biocontrol) agent if APHIS determines that it is a plant pest or noxious weed, with a limited exception. Biocontrol involves the reduction of plant pest and weed populations through the use of natural enemies such as parasitoids, predators, pathogens, antagonists, or competitors to suppress plant pest and weed populations.
The exception would be for GE vertebrate biocontrol agents. Although such organisms could fall within the scope of the PPA's definition of
APHIS recognizes that certain plants are genetically engineered in order to produce pharmaceutical and industrial compounds, also known as plant-made pharmaceuticals and industrials (PMPIs).
When plants are genetically engineered in such a manner, the plants and the pharmaceutical and/or industrial products they produce may fall within the purview of multiple regulatory Agencies: APHIS, EPA, and/or FDA.
Under the current regulations in 7 CFR part 340, APHIS requires permits, as opposed to Notifications, for the environmental release of all GE plants that meet the definition of a regulated article and produce PMPIs. APHIS exercises oversight of all outdoor plantings of these regulated PMPI-producing plants. This oversight includes establishment of appropriate environmental release conditions, inspections, and monitoring. Products obtained from PMPI-producing plants may be regulated by FDA (authority over pharmaceuticals) or EPA (chemical substances as defined by the Toxic Substances Control Act (TSCA)), depending on their intended use. To date, producers of PMPI-producing plants, or products derived from such plants, have not intended for such plants or plant products to be used for human or animal food. However, if such a plant or plant product is used for human or animal food, the food would be subject to applicable statutory and regulatory requirements under the Federal Food, Drug, and Cosmetic Act.
To date, PMPI-producing GE plants regulated by APHIS have been genetically engineered using a plant pest as the donor, vector, or vector agent, and thus fall under the scope of regulated article in the current regulations in 7 CFR part 340. However, under the provisions of this proposed rule, as discussed at greater length later in this document, a GE plant that is developed using a plant pest as a vector, vector agent, or donor of genetic materials would not necessarily be a regulated organism. Rather, the GE plant would be a regulated organism if it had a plant/trait combination that the Agency has not yet evaluated for plant pest and/or noxious weed risk, if it has received DNA from a taxon that contains plant pests and the DNA from the donor organism is sufficient to produce an infectious entity capable of causing plant disease or encodes a compound known to be pathogenesis-related that is expected to cause plant disease symptoms, or if it was evaluated and found to represent plant pest or noxious weed risks. Additionally, APHIS' evaluations of GE plants for plant pest or noxious weed risk would generally not require data from outdoor plantings.
Even if the plant represents a new plant/trait combination not previously reviewed, there is a likelihood that most, if not all, GE PMPI-producing plants that are currently under APHIS permits could be determined not regulated under the provisions of the proposed regulations after a regulatory status evaluation because they do not represent risks as a plant pest or noxious weed. Thus, such plants could be grown outdoors without the need for permits and without APHIS oversight.
Federal oversight of outdoor plantings of PMPI-producing plants, however, could be necessary to prevent unlawful entry into the food supply of material from such plants. Establishing growing and handling conditions to confine such plants, and inspecting to ensure such conditions are followed, may enable corrective actions before material from the plants is inadvertently released and causes public health or economic impacts. One of the reasons APHIS' oversight of such crops has been an important part of the coordinated framework for oversight of GE plants is that companies are not necessarily required to notify FDA or EPA when the company plants PMPI-producing plants. For example, for PMPI-producing plants whose products fall under FDA authority, FDA has no regulations governing planting of such crops. For crops genetically engineered to produce pharmaceuticals, companies only have to come to FDA when they have reached the point that they are ready to begin clinical trials with the pharmaceutical derived from the plant. This could be years after they first started growing the pharmaceutical-producing plant in the field.
Under TSCA, EPA has requirements for new chemical substances, including industrial compounds produced in genetically engineered plants. However, given existing APHIS oversight, EPA does not currently have an oversight program nor regulations for genetically engineered plants with industrial compounds.
A gap in Federal oversight of PMPI producing-plants could result in the intentional or inadvertent introduction into the human or animal food supply of unevaluated pharmaceutical or industrial PMPI products, even when the principal purpose of the plants is not for human or animal food use. For example, a company could self-determine that the PMPI produced by the plant was generally recognized as safe (GRAS), and therefore conclude it had no legal obligation to keep surplus PMPI-producing plants out of the human or animal food supply, to keep such PMPI-producing plants from spreading pollen to plants grown for human and animal food purposes, or even to notify any Federal agency that they were planting such crops. In addition to potential food safety risks posed by such plants should they enter the food supply, a gap in Federal oversight could generate concerns from the general public regarding the safety and wholesomeness of the human or animal food supply, which could adversely impact agricultural interests.
APHIS has identified several options that have the potential for adequate Federal oversight of outdoor plantings of plants engineered to produce PMPIs. Under one option, a statute would be enacted, or existing statutory authority amended, to grant one or more Federal agencies explicit authority to provide oversight of outdoor plantings of all GE
APHIS recognizes that there are challenges associated with each of these options. For example, the first option would require legislation to be enacted, which is not within the purview of the Executive Branch of the Federal government. Additionally, all options could require Federal Agencies to incur the costs associated with setting up new regulatory programs. The second option would require time for EPA to stand up a genetically engineered industrial-producing plant oversight program for plants subject to EPA jurisdiction. The third option, in turn, would require policies, procedures, and guidance regarding APHIS' interaction with other Federal Agencies to be developed prior to implementation. To that end, it is important to note that APHIS does not prefer any of these options over the other, nor does the Agency consider the options listed above necessarily to be exhaustive. Rather, we put them forward to indicate that the Agency is aware of the implications of this rule with regard to PMPIs, and to request specific public comment regarding the best manner to address this issue.
Certain plants are genetically engineered to produce plant-incorporated protectants (PIPs), meaning that they produce pesticides. PIPs fall under the regulatory oversight of EPA. However, currently only APHIS exercises regulatory oversight of PIP plantings on 10 acres or less of land. Under the proposed rule, APHIS would only require permits for PIPs planted on 10 acres or less if they present a plant pest or noxious weed risk or have not yet been evaluated by APHIS for such risk. Under the current regulations in 7 CFR part 340, APHIS requires permits or notifications for the environmental release of all GE plants that meet the definition of a regulated article and produce PIPs. APHIS exercises oversight of all outdoor plantings of these regulated PIP-producing plants. This oversight includes establishment of appropriate environmental release conditions, inspections, and monitoring.
To date, PIP-producing GE plants regulated by APHIS have been genetically engineered using a plant pest as the donor, vector, or vector agent, and thus fall under the scope of regulated article in the current regulations in 7 CFR part 340. However, under the provisions of this proposed rule, as discussed at greater length later in this document, a GE plant that is developed using a plant pest as a vector, vector agent, or donor of genetic materials would not necessarily be a regulated organism. Rather, the GE plant would be a regulated organism if it had a plant/trait combination that the Agency has not yet evaluated for plant pest and/or noxious weed risk, or if it has received DNA from a taxon that contains plant pests and the DNA from the donor organism is sufficient to produce an infectious entity capable of causing plant disease or that encodes a compound known to be pathogenesis-related that is expected to cause plant disease symptoms. Additionally, APHIS' evaluations of GE plants for plant pest or noxious weed risk would generally not require data from outdoor plantings.
Even if the plant represents a new plant/trait combination not previously reviewed, there is a likelihood that many GE PIP-producing plants that are currently regulated under APHIS permits or notifications could be determined not regulated under the provisions of the proposed regulations after a regulatory status evaluation because they do not represent risks as a plant pest or noxious weed. Thus, such plants could be grown outdoors without the need for an APHIS permit and without undergoing APHIS oversight.
APHIS understands that this proposal would shift Federal oversight of small-scale (10 acres or less) outdoor plantings of PIPs to EPA. EPA may decide to require experimental use permits (EUP) for all, some, or none of such PIPs, and may conduct inspections of all, some, or none of those PIPs under permit. EPA would need to develop a program to oversee small-scale testing of PIPs and issue regulations if warranted. APHIS is fully committed to coordinating with EPA in this matter in order to give EPA sufficient time to stand up such a program. APHIS understands that an MOU and services agreement may be necessary to provide personnel and other resources to assist EPA during the interim period while EPA implements its own program of oversight for the oversight of outdoor planting of PIPs 10 acres or less.
APHIS recognizes that there are challenges associated with such a transition that would also require EPA to incur the costs associated with setting up a revised regulatory program. Further, such a transition would require policies, procedures, and guidance regarding APHIS' interaction with EPA. APHIS does not consider the approach listed above necessarily to be exhaustive. Rather, APHIS puts it forward to indicate that the Agency is aware of the implications of this rule with regard to small-scale testing of PIPs and to request specific public comment regarding the best manner to address this issue.
Certain plants are genetically engineered to make them resistant to herbicides. EPA registers the herbicide products used on herbicide resistant crops, but does not regulate herbicide-resistant crops themselves. APHIS has evaluated and deregulate many GE herbicide resistant plants. To date, the herbicide-resistant GE plants regulated by APHIS have been genetically engineered using a plant pest as the donor, vector, or vector agent, and thus fall under the scope of regulated article in the current regulations in 7 CFR part 340. However, under the provisions of this proposed rule, as discussed at greater length later in this document, a GE plant that is developed using a plant pest as a vector, vector agent, or donor of genetic materials would not necessarily be a regulated organism. Rather, the GE plant would be a regulated organism if it had a plant/trait combination that the Agency has not yet evaluated for plant pest and/or noxious weed risk, or if it has received DNA from a taxon that contains plant pests and the DNA from the donor organism is sufficient to produce an infectious entity capable of causing plant disease or that encodes a compound known to be pathogenesis-related that is expected to cause plant disease symptoms, or has been evaluated by APHIS in accordance with and determined to pose a risk as
Even if the plant represents a new plant/trait combination not previously reviewed, there is a likelihood that many GE herbicide-resistant plants that are currently regulated under APHIS permits or notifications could be determined not regulated under the provisions of the proposed regulations after a regulatory status evaluation because they do not represent risks as a plant pest or noxious weed. Thus, such plants could be grown outdoors without the need for permits and without APHIS oversight.
Commenters to the proposed update to the Coordinated Framework on the Regulation of Biotechnology published on September 22, 2016 (81 FR 65414-65415), expressed the need for coordination between USDA and EPA regarding the timing of deregulation/determination of nonregulated status of herbicide-resistant crops and the registration of herbicides. APHIS recognizes that the asynchronous timing of the deregulation of herbicide-resistant plants and the associated herbicide registration has led to situations where a developer could sell the herbicide-resistant plant/seed without waiting for the associated herbicide registration. In such a situation, farmers may be tempted to illegally use an unregistered herbicide on a crop.
In light of the challenges associated with the asynchronous regulatory actions on the part of APHIS and EPA, APHIS will work with EPA to explore possible solutions to better coordinate the commercial availability of seed for herbicide resistant crops concomitant with the registration of herbicides intended to be used on those crops. Furthermore, APHIS intends to limit the scope of its decisions to be on an individual/specific herbicide resistant crop basis (
APHIS does not consider the approaches listed above necessarily to be exhaustive and recognizes that one of the options listed would require legislation to be enacted, which is not within the purview of the Executive Branch of the Federal government. However, APHIS puts them forward to indicate that the Agency is aware that asynchronous timing of the deregulation of herbicide-resistant plants and the associated herbicide registrations can lead to significant problems, and to request specific public comment regarding the best manner to address this issue.
Before discussing the specifics of these proposed revisions, APHIS wishes to provide an overview of how the Agency generally envisions the various sections of the proposed rule interacting, from the perspective of a developer of a GE organism. This overview assumes that the organism falls within the scope of our proposed definition of
Until such time as the developer wishes to import the organism, move it interstate, or release it into the environment, no action would be required of the developer. However, if the developer believes that it possesses sufficient information to demonstrate that the organism presents no plant pest or noxious weed risk, and wished to release it into the environment, it would have to submit this information to APHIS and request that APHIS conduct an evaluation of such risk. The process for submitting such a request, as well as the possibilities for how APHIS would act on that request, is set forth in proposed § 340.4.
If APHIS evaluates the GE organism in accordance with § 340.4 and determines that it is unlikely to pose a risk as a plant pest and/or noxious weed, it would no longer be a regulated organism and may be imported, moved interstate, or released into the environment without further restriction under the proposed regulations. APHIS would maintain a list of such organisms on a Web site. If new information is obtained which indicates that a previously deregulated GE organism may present a plant pest and/or noxious weed risk, APHIS may reevaluate the GE organism and reconsider its regulatory decision.
If the organism is still a regulated organism following such an evaluation, with one, limited exception (the interstate movement of GE
If APHIS issues a permit to the developer for the importation, interstate movement, or release into the environment of the organism, the developer would have to comply with permitting conditions regarding such importation, interstate movement, or release into the environment. The developer would also have to comply with container and shipment requirements that pertain to the movement of regulated organisms. These requirements would also be set forth in § 340.3.
The developer would also have to retain certain records regarding permitted activities. These are set forth in proposed § 340.5. Failure to retain such records, or comply with other regulatory requirements or permitting conditions, could result in enforcement activities. These would also be set forth in § 340.5.
If, in the course of interacting with APHIS, the developer had to provide the Agency with confidential business information (CBI), the developer could denote such CBI in accordance with § 340.6.
Finally, § 340.7 would provide the developer with information regarding APHIS policy related to costs and charges incident to compliance with the regulations.
This is, again, a general overview of the proposed regulations. As such, it does not attempt to capture every nuance of the proposed regulations, nor does it apply to every scenario that may occur under those regulations.
What follows is a more in-depth discussion of the provisions of the rule.
While APHIS discusses most of its proposed definitions later in this document, the Agency considers it necessary, at the outset of discussion of the provisions of the proposed rule, to discuss two of its proposed definitions, for the terms
By
APHIS would exclude from the definition of
For the purposes of proposed 7 CFR part 340, APHIS would define
• The genetic modification to the organism is solely a deletion of any size or a single base pair substitution which could otherwise be obtained through the use of chemical- or radiation-based mutagenesis.
• The genetic modification to the organism is solely introducing only naturally occurring nucleic acid sequences from a sexually compatible relative that could otherwise cross with the recipient organism and produce viable progeny through traditional breeding (including, but not limited to, marker-assisted breeding, as well as tissue culture and protoplast, cell, or embryo fusion).
• The organism is a “null segregant.”
APHIS would exclude the first two types of organisms from the definition of
Examples from the realm of GE plants illustrate these practices. Chemical and radiation-based mutagenesis creates thousands of mutations in a single organism, and most of the plant breeders' subsequent efforts involve eliminating unwanted mutations by repeated crosses and selection, each of which can take months to years to complete. Conversely, using genetic engineering, single base pair substitutions, as well as deletions of differing sizes, can be precisely administered very quickly, avoiding this lengthy process of eliminating unwanted mutations. The resulting organism, however, remains identical to one that could otherwise have been developed using chemical or radiation-based mutagenesis.
Similarly, traditional breeding techniques may require many generations of crossing to introduce a naturally occurring trait. For example, it can take decades to introduce a disease-resistant trait to apples through traditional breeding techniques. However, genetic engineering can introduce the same trait in a fraction of the time while maintaining all other cultivar characteristics of the apple.
The second reason for the exclusions is that GE plants as a class, which constitute the vast preponderance of GE organisms to date, pose no greater plant pest or noxious weed risk than their
This is not to say that plants with undesirable phenotypes have never been bred through traditional breeding, or chemical or radiation-based mutagenesis never result it mutations that are undesirable. Indeed, as mentioned above, chemical and radiation-based mutagenesis tend to create thousands of mutations in an organism, most of which are undesirable.
However, traditional breeding techniques, in the form of deliberate selection and breeding of those plants with desirable phenotypes, have been used since the advent of sedentary agriculture, and nearly every domesticated crop has, at one point, been subject to traditional breeding techniques. Chemical and radiation-based mutagenesis, in turn, have been used for nearly a century in the development of thousands of commodities, including such commercial commodities as ruby red grapefruit and many commercial varieties of wheat and rice. If APHIS were to regulate organisms developed through traditional breeding techniques or chemical or radiation-based mutagenesis, that would entail the regulation, at least provisionally, of almost every commercially available human or animal food crop. This is impracticable.
Such regulations would also fail to take into consideration the usual purpose of applying traditional breeding techniques or chemical or radiation-based mutagenesis to a plant: To introduce desirable phenotypic traits into the organism or remove phenotypically undesirable traits from the organism. Additionally, it would fail to take into adequate consideration that phenotypic traits that could increase the plant pest or noxious weed risk posed by a plant tend to also adversely impact its vitality, uniformity, or commercial viability. For example, a mutation caused by chemical or radiation-based mutagenesis could render a plant more susceptible to certain viroids or pathogens and able to transfer this increased susceptibility to sexually compatible relatives, and thus increase the plant pest risk associated with the plant. However, it would also directly adversely affect the plant's vitality. For these reasons, farmers and developers have long bred out unwanted phenotypic traits that arise as the result of traditional breeding techniques and/or chemical or radiation-based mutagenesis, and planted and/or commercialized the most phenotypically desirable plant produced using such techniques.
In this regard, it is important to note that genetic engineering is used to create this phenotypically desirable organism, rather than the other products created through traditional breeding techniques, including chemical or radiation-based mutagenesis. In 1987, the Council of the National Academy of Sciences concluded that there is no evidence of a unique risk inherent in the use of recombinant DNA techniques or the movement of genes between unrelated organisms. This means that risks associated with the introduction of recombinant DNA engineered organisms are the same as those associated with non-genetically engineered organisms and organisms modified by other methods and that the assessment of such risks should be based on the nature of the organism and the environment into which it is introduced rather than the methods by which it was produced. Furthermore, this same conclusion is a basis of the Coordinated Framework that regulation should be based on the risks of the organism and not the process used to create it. Accordingly, because the plant pest and noxious weed risk posed by the plant is equivalent, regardless of whether it was created through genetic engineering or traditional breeding (including chemical or radiation-based mutagenesis), and such risk is likely to be low because of the purpose of applying traditional breeding techniques, including chemical or radiation-based mutagenesis to a plant,, APHIS is proposing to exclude GE plants that could have otherwise been developed through traditional breeding techniques, including chemical or radiation-based mutagenesis, from the definition of “genetically engineered organism” and hence from regulation under the revised 7 CFR part 340.
This same exclusion would apply to non-plant organisms. Non-plant organisms, which fall under the scope of the regulations as defined in § 340.0, are either plant pests, or organisms which have received genetic material sufficient to produce an infectious entity capable of causing plant disease or that encodes a compound known to be pathogenesis-related that is expected to cause plant disease symptoms. Organisms of the latter type would not qualify for the exclusion, as receipt of genetic material capable of conferring the new properties could not be achieved through traditional breeding techniques, including chemical or radiation-based mutagenesis. However, it can be envisioned that plant pests might be altered in such a way that the exclusion would apply. In these cases, since the resulting plant pest would not be defined as a genetically engineered organism under 7 CFR part 340, they would be regulated, if needed, under APHIS's plant pest regulations in7 CFR part 330. This is appropriate since these organisms are biologically analogous to non-GE plant pests with mutations. It is important to note that, to date, we have not encountered GE organisms of this type and that the GE plant pests that we do have experience with (
However, APHIS has prepared a proposed rule that would remove this exception. In its place, all plant pests would require permits issued pursuant to part 330, unless the importation, interstate movement, or environmental release of the organism is explicitly authorized in other APHIS regulations in 7 CFR. Under APHIS' proposed revision to the regulations in part 340, the importation, interstate movement, or environmental release of GE organisms that could have otherwise been developed through traditional breeding techniques or chemical or radiation-based mutagenesis would not be explicitly authorized; rather, such organisms would be exempted from the regulations in part 340, with no reference to the conditions for movement or environmental release of such organisms. Accordingly, GE organisms that could have otherwise been created through traditional breeding techniques, including chemical or irradiation-based mutagenesis, and could pose a potential plant pest risk, would now be subject to 7 CFR part 330.
This touches on several important caveats with regard to the first two proposed exemptions from the definition of
The third caveat is that APHIS is not claiming that additions, deletions, and substitutions to an organism's genome are inherently risk-free. Indeed, as discussed later in this document, the addition into an organism's genome of a sequence that encodes an infectious entity capable of causing plant disease or encodes a compound known to be pathogenesis-related that is expected to cause plant disease symptoms introduces plant pest risk into that organism, and would be one of APHIS' criteria for regulating the organism under the proposed regulations. Rather, APHIS considers such additions, deletions, or substitutions to present an acceptable plant pest and/or noxious weed risk when they are used to create an organism that could otherwise have been created through traditional breeding techniques and/or chemical or radiation-based mutagenesis; in other words, it is the product, rather than the techniques used to derive the product, that APHIS considers to present an acceptable level of risk. The Agency considers this to be consistent with the principles set forth in the Coordinated Framework.
The third proposed exclusion is for progeny of GE organisms where the only genetic modification was the insertion of donor nucleic acid into the recipient's genome, but the inserted donor nucleic acid is not passed to the recipient organism's progeny and has not altered the DNA sequence of the recipient organism's progeny. Such progeny are often referred to as null segregants. Traits can sometimes be introduced by genetic engineering into breeding lines to simplify breeding without altering the DNA sequence of progeny; the traits can be eliminated with a simple cross and are no longer present in the final organism. An example of use of such techniques to facilitate traditional breeding would be the introduction of certain genes into trees solely to reduce the time to flowering, thereby speeding up a tree-breeding program. In this example, the progeny do not contain the early flowering gene and their DNA sequence has not been altered by the early flowering gene. Because the DNA of the progeny is no different from the DNA of the recipient organism prior to the use of genetic engineering, APHIS does not consider the progeny to be GE organisms for purposes of the proposed regulations.
APHIS requests specific comment on its definition of genetically engineered organism, specifically the appropriateness of the proposed exemptions, and whether commenters can identify any scenarios in which they would exempt from APHIS regulation an organism that presents a plant pest and/or noxious weed risk. APHIS also requests specific comment on whether any other types of organisms should be excluded from the definition of
APHIS wishes to point out that its proposed definition for
Section 340.0 would set forth general restrictions regarding the movement and environmental release of GE organisms, as well as the scope of the revised regulations in part 340.
Paragraph (a) of § 340.0 would provide that no person may move any regulated GE organisms except in accordance with part 340. Movement of regulated organisms that is not in accordance with the part could present a risk of introducing or disseminating plant pests and noxious weeds within the United States.
Paragraph (b) of § 340.0 would specify the types of GE organisms APHIS would consider to be regulated organisms under the revised regulations.
Under our proposed regulations, a GE organism would be a regulated organism if:
• Prior to genetic engineering, the GE organism belonged to any taxon listed in accordance with § 340.2 and met the definition of
• The GE organism has received DNA from any taxon listed in accordance with § 340.2, the DNA from the donor organism is sufficient to produce an infectious entity capable of causing plant disease or encodes a compound known to be pathogenesis-related that is expected to cause plant disease symptoms, and the GE organism has not been evaluated by APHIS for plant pest risk in accordance with § 340.4.
• The GE organism is a plant that has a plant and trait combination that has not been evaluated by APHIS for plant pest and noxious weed risk in accordance with § 340.4
• The GE organism is any of the foregoing that has been evaluated by APHIS in accordance with § 340.4 and determined to pose a risk as a plant pest or noxious weed, or is a GE organism that has otherwise been determined by the Administrator to pose a risk as a plant pest or noxious weed.
The proposed criteria differ from the current criteria in several respects. First, the current criteria consider a GE organism to be a regulated article if the donor, vector, or vector agent is a plant pest. This reflects the concern in the 1980s that if an organism was modified using genetic material taken from a plant pest, or a plant pest was used as a vector or vector agent to carry genetic material into an organism, the resulting GE organism could also be a plant pest.
Based on APHIS' experience evaluating field trial data from thousands of permits that authorize environmental release of regulated organisms, as well as more than 150 petitions for nonregulated status, this has not proven to be the case. Although a plant pest may contribute or vector genes to a GE organism, this has not been shown in APHIS' evaluation of data to cause that GE organism, particularly if it is a plant, to become a plant pest. Indeed, experience has shown that the use of genes from donor organisms which are plant pests, as well as the use of vectors which are from plant pests, has not resulted in plant pest risks of any sort in recipient organisms.
Rather, the most common use of plant pest components in genetic engineering involve either the use of a disarmed version of the plant pathogenic bacterium
It is conceivable that a donor organism that is a plant pest could result in a GE organism that is itself a plant pest if (1) the DNA sequence that is encoded in the organism is able in itself to be expressed phenotypically or confers plant pest traits, or (2) if the inserted DNA enables the organism to produce pathogenesis-related compounds, that is, compounds that are typically produced by pathogens and involved in producing disease symptoms. Examples of such compounds would include plant degrading enzymes, plant growth regulators, phytotoxins, or compounds that can clog plant vascular systems. In either instance, APHIS would not expect phenotypic expression of plant disease unless large portions of a genome from a plant pest were introduced to a recipient organism, a practice that APHIS considers unlikely for developers to use based on their practices to date.
Likewise, based on APHIS' evaluation of field trial data to date, there is no evidence that the use of plant pests as vectors or vector agents in the production of GE organisms results in a GE organism that is itself a plant pest.
Accordingly, APHIS would regulate GE organisms that have received DNA from a taxon containing a plant pest only if the DNA from the donor organism is sufficient to produce an infectious entity or encodes a pathogenesis-related compound that is expected to cause plant disease symptoms. By “sufficient to produce an infectious entity,” APHIS means that the DNA sequence that is encoded in the organism is able in itself to be expressed phenotypically or confers traits that meets the definition of
Additionally, APHIS would no longer regulate a GE organism solely because its vector or vector agent is a plant pest. APHIS adopted this approach in 1987 because the use of plant pest vectors in recombinant DNA technologies was, at the time, a relatively recent development, and there was a corresponding need to exercise precaution in regulating such use until the plant pest risk associated with the practice was further evaluated. In twenty-nine years of regulating GE organisms because of the use a plant pest as a vector or vector agent, APHIS has no evidence that using genetic material from plant pests as vectors or vector agents for other genetic material results in a GE organism that is itself a plant pest. Accordingly, this proposed rule would change APHIS' approach, and GE organisms that were created using a plant pest as a vector or vector agent would no longer be regulated solely because of the use of such a vector or vector agent. Instead, the organisms would be regulated if they themselves presented a known or unevaluated plant pest risk. This is in keeping with the overarching aim of this proposed rule, which is to regulate the products of genetic engineering, rather than the methods by which those products are developed.
A second difference from the current criteria is that, for reasons discussed previously in this document, APHIS is proposing that APHIS may regulate a GE plant under 7 CFR part 340 if APHIS determines that it is a noxious weed.
Our proposed criteria would also attempt to clarify a current category of regulated articles, GE plants that are regulated because the Administrator has reason to believe they are a plant pest. When the current regulations were issued, APHIS had less experience regulating GE organisms, and there was corresponding uncertainty regarding the degree to which subjecting a plant to genetic engineering, without the use of a plant pest as a donor, vector, or vector agent, would cause the plant to become a plant pest. This category was intended to allow APHIS to consider such plants to be regulated articles, until APHIS had sufficient information to classify it either definitively as a plant pest, or to determine that it presented no plant pest risk. The category was especially useful when a GE plant was developed using novel genetic engineering techniques.
In the 29 years since the current regulations were issued, APHIS' evaluation of petitions for nonregulated status for more than 150 GE plants has provided a basis to help the Agency delineate the plant and trait combinations that cause a GE organism to act as a plant pest from the combinations that pose no plant pest risk.
Accordingly, APHIS now considers there to be two instances in which a GE plant should be a regulated organism. The first instance is when APHIS has reached a determination that the plant and trait combination associated with the GE plant causes it to act as a plant pest or noxious weed. APHIS is making a draft list of such combinations available along with this proposed rule, as well as a list of combinations that APHIS has determined to present no plant pest or noxious weed risk,
The second instance in which APHIS would consider it necessary to regulate a GE plant is when APHIS is presented with a GE plant with a novel plant and trait combination, and has not yet evaluated this plant and trait combination for its plant pest and noxious weed risk.
On a related matter, APHIS acknowledges that a novel GE organism could be developed that does not fall into any of the Agency's other categories of regulated organisms, but that APHIS determines poses a risk as a plant pest or noxious weed. APHIS's last criteria for regulated organisms would allow APHIS to regulate such an organism.
As stated previously, § 340.2 contains a list of taxa that are considered to be plant pests. That list has not been amended since it was established in 1987.
To improve regulatory flexibility and help ensure the list remains current, APHIS is proposing to remove the list of taxa from § 340.2 and place it on the Internet at
APHIS is not proposing any changes to the listed taxa at this time, however.
Per the definition of “plant pest” in the PPA, any organism belonging to any taxon contained within any listed genus or taxon is only considered to be a plant pest if the organism “can directly or indirectly injure, or cause disease, or damage in any plants or parts thereof, or any processed, manufactured, or other products of plants.” Thus a particular unlisted species within a listed genus would be deemed a plant pest if the scientific evidence indicates that the organism is a cause of direct or indirect injury, disease, or damage to any plants, plant parts, or products of plants.
Section 7711 of the PPA generally requires permits for the importation or interstate movement of plant pests, but allows the Secretary to create “exceptions” to this general permitting requirement when the Secretary deems that a permit is not necessary. That is, these regulated activities are allowed, under certain conditions, without seeking prior authorization via permit. The current APHIS regulations refer to these PPA exceptions as “exemptions.” Paragraph (b) of current § 340.2 contains a list of exemptions from the requirement for a permit for the interstate movement of certain GE strains of the microorganisms
Because, under § 340.0, APHIS must have determined that a GE microorganism is a plant pest in order for it to be a regulated organism, the GE microorganism strains mentioned above, which APHIS has evaluated and determined to present no plant pest risk, would not be regulated organisms. Thus APHIS would not need to retain specific permitting exemptions for them in § 340.2.
APHIS would also retain the exemption from interstate movement permits for GE organism
APHIS would propose changes to the list through publication of a
APHIS would review the comments received and publish its final decision in the
The PPA also allows for a person to petition the Secretary to add or remove a plant pest from the regulations. Currently, § 340.5 contains provisions for petitioning the Administrator to amend the list of organisms in § 340.2 by either adding or deleting any genus, species, or subspecies. The list of requirements for petitioning the Administrator include formatting and submission procedures that are currently contained in § 340.5(b).
However, these procedures have not been updated since 1994. While most of the procedures are still accurate, some of them have changed. For example, the requirements do not consider the potential for electronic submission of a petition via email. They also provide an obsolete address for postal submissions. Therefore, APHIS is proposing to remove the specific requirements related to formatting and submission procedures for petitions from the regulations. The procedures would instead be located on the Internet at
These changes would update the submission procedure, and allow for greater flexibility in revising procedures, if, for example, the address for submissions changes in the future.
Please note that, regarding the formatting procedures, APHIS is proposing to retain a requirement that the petition not contain trade secrets or CBI. APHIS often needs CBI for permit applications, particularly for those that request the release of a GE organism into the environment, in order to determine the appropriate permitting conditions, and APHIS may need CBI as part of a regulatory status evaluation in accordance with proposed § 340.4 in order to assess the plant pest and/or noxious weed risk associated with the organism submitted for evaluation. However, a determination that a taxon is or contains a plant pest will be based on a review of scientific literature, and thus, CBI is not germane to our determination.
Following the receipt of a petition to amend the list of organisms in § 340.2, APHIS would publish a notice announcing the availability of the petition in the
Finally, APHIS is proposing to add an appeals process in the event that the Administrator denies a request to amend the list of taxa that are described in § 340.2. Any person whose petition has been denied would be able to appeal the decision in writing to the Administrator within 30 days after receiving the written notification of the denial. The appeal would have to state all of the facts and reasons upon which the person relies to assert that the petition was wrongfully denied. The Administrator would then grant or deny the appeal, in writing, stating the reasons for the decision as promptly as circumstances allow.
The current regulations in § 340.3 provide criteria for a notification procedure whereby certain GE plants may be authorized for importation, interstate movement, or environmental release in lieu of a permit. As mentioned previously in this document, rather than using customized requirements, like the permitting conditions used for the permitting procedure, the notification procedure uses performance-based standards that are described in the regulations themselves. The use of the performance-based standards that do not vary from one notification to the next facilitates rapid administrative turnaround on notifications. However, in some ways, the term “notification” has been misleading to the public, since sending a notification does not mean automatic authorization by APHIS.
Rather, currently, APHIS reviews notifications to verify that the GE plants meet the eligibility criteria and also evaluates whether the proposed importation, interstate movement, or environmental release can be done in a manner that meets the performance-based standards described in the regulation. In many ways, these APHIS evaluations for notifications are very
Because the notification procedure uses only the performance-based standards in the regulations, it is more administratively streamlined, but the general nature of the standards has made it difficult for APHIS inspectors to determine if a notification holder is in compliance with the standards. This, in turn, can also make enforcement more difficult.
For example, under the current regulations, one of the performance-based standards for notifications relevant to controlled outdoor uses states that: “The field trial must be conducted such that (1) the regulated article will not persist in the environment, and (2) no offspring can be produced that could persist in the environment.” Conversely, conditions which APHIS places on permits are more specific, and do not rely as much on subjective determinations by APHIS personnel. A specific permit condition that could be used to address just part of the performance-based standard described above might read: “After final harvest of the plants covered under this environmental release permit, the site will be monitored every 4 weeks for the emergence of volunteer seedlings for 1 year, and any emerging volunteer plants will be devitalized before they produce pollen. Records of the monitoring and management of volunteers must be maintained by the permit holder and made available to APHIS upon request.”
The use of performance-based standards under the notification procedure has some benefits, such as providing the responsible person with flexibility in how the standard is met,
Because of this, APHIS has determined that it would have more risk-appropriate oversight, better regulatory enforcement, and improved transparency if all regulated movements are authorized under the permitting procedure. Therefore, APHIS is proposing to remove current notification provisions from the regulations and require that all authorizations for movement be conducted under permit.
As mentioned earlier in this document, the use of the permitting procedure in lieu of notifications is also necessary for APHIS to address some of the recommendations arising from the OIG audits and the provisions of the 2008 Farm Bill. Both the OIG audit and the Farm Bill expressed concern with the use of performance-based standards to regulate field tests of regulated organisms, and recommended that APHIS amend the regulations to exercise greater oversight and enforcement of such field tests and to require more extensive reporting and record retention regarding such tests. These requirements can be added to a permit as permitting conditions, but do not lend themselves to performance-based standards. Some permit conditions, however, are, and have always been, performance-based. APHIS acknowledges that there is more than one way to manage risks and works with the permit applicant to find a mutually acceptable way to do so. In some instances, permit conditions may allow for the flexibility inherent in performance standards, while ensuring a specific requirement is addressed, something not possible with the notification procedure.
In short, if APHIS were to retain the notification procedure, in order to be responsive to the risk factors that may be associated with certain field trials, but not others, to make it easier to assess compliance, and to be responsive to both the OIG audits and the 2008 Farm Bill, APHIS would need to significantly revise the procedure to substantially reduce its reliance on performance-based standards. However, doing so would eliminate the primary benefit of the current notification procedure, which is that it is more administratively streamlined than the permitting procedure. Indeed, a revised procedure which took into consideration all risk factors that may be associated with specific field trials would be both complex and exhaustive. For these reasons, APHIS is proposing to do away with the notification procedure, rather than revise it.
The permitting procedure found in § 340.4 of the current regulations describes types of permits, information required for permit applications, standard permit conditions, and administrative information (
APHIS proposes to reorganize the regulations to improve the clarity of the permit application and evaluation procedures. In addition, APHIS is proposing changes to the regulations to reflect certain provisions of the 2008 Farm Bill. As APHIS mentioned previously in this document, section 10204 of Title X of the Farm Bill requires the Secretary of Agriculture to take action on each issue identified in the document entitled “Lessons Learned and Revisions under Consideration for APHIS' Biotechnology Framework” and, where appropriate, promulgate regulations.
APHIS is proposing certain regulatory changes concerning permit application information requirements, permit conditions, records, and reports that address many of the considerations outlined in the “Lessons Learned and Revisions under Consideration for APHIS' Biotechnology Framework.” The permitting procedure would continue to identify and obtain information relevant to evaluating the risks associated with a proposed movement, and determine and document whether, and under what conditions, the activity should be allowed.
Paragraph (a)(1) of proposed § 340.3 would provide that, except as provided in paragraph (a)(2) of the section, APHIS must have evaluated a regulated organism in accordance with § 340.4 before APHIS will issue a permit for its importation, interstate movement, or release into the environment. As mentioned previously in this document, § 340.4 would contain our process for evaluating regulated organisms for plant pest or noxious weed risk. In order to draft permitting conditions that are commensurate with the risk a GE organism poses as a plant pest or noxious weed, it is necessary for APHIS to have evaluated this risk.
If this rule is finalized, when it is fully implemented, APHIS believes that such
However, APHIS also envisions that there could be instances in which there would be an immediate need to import a regulated organism or move it interstate, even though APHIS has not yet evaluated the risk it poses as a plant pest and/or noxious weed. This could occur when, for example, a developer consolidates research laboratories. To allow for such instances, proposed paragraph (a)(2) of § 340.3 would provide that APHIS may issue a permit pursuant to the section for the importation or interstate movement of a regulated organism that has not been evaluated in accordance with § 340.4. For the purposes of permitting conditions, APHIS would assume that the regulated organism presents a risk as a plant pest and/or noxious weed. If the regulatory status of the organism is evaluated in accordance with § 340.4 during the duration of the permit, APHIS could amend the permit, or, if the organism is determined to pose no risk as a plant pest and/or noxious weed, terminate the permit and communicate this termination to the permittee.
While APHIS could foresee the need for the Agency to issue such permits, APHIS does wish the public to be aware of some of the issues that it has identified with doing so. First, because APHIS would not have evaluated the organism for plant pest and/or noxious weed risk, the Agency would need to presume a high degree of such risk. Accordingly, permitting conditions could be significantly more stringent for such unevaluated organisms than they would be for the same organisms, following evaluation in accordance with § 340.4. Second, unlike organisms evaluated in accordance with § 340.4 prior to permitting, determining nonregulated status for such organisms would not be a category of action that is exempt under APHIS' regulations implementing the National Environmental Policy Act (43 U.S.C. 4321
For these reasons, APHIS requests specific public comment regarding whether paragraph (a)(2) of § 340.3 is necessary, or addresses a scenario that is unlikely to occur under the proposed regulations. APHIS also requests public comment regarding whether there are any instances in which there would be an immediate need to issue a permit for the environmental release of a regulated organism that had not yet been evaluated in accordance with § 340.4.
Paragraph (a)(3) of § 340.3 would state that, except as provided in paragraph (c) of § 340.3, a permit must be issued by APHIS for the importation, interstate movement, or release into the environment of all regulated organisms. Paragraph (c) would provide exemptions from interstate permitting requirements for GE
Paragraph (b) of proposed § 340.3 would outline how to submit a permit application. Applicants would have to submit a permit application through a method listed at the Web address contained in the regulations; for purposes of this proposed rule, that address is
APHIS is proposing to list the methods for submitting a permit application on the Internet, rather than in the regulations, in order to make it easier to ensure they remain up-to-date. For example, APHIS is currently developing a new electronic permitting system to replace ePermits.
APHIS is also proposing to remove the specific requirements for what should be included in a permit application from the regulations. Instead, they would be listed on an APHIS Web site; for purposes of the proposed rule, that Web site is
That Web site would first list general application requirements for all permit applications, and then break out additional requirements for specific permit applications. General information requirements that all types of permit applications would have to provide include the name, title, and contact information of the responsible person and agent, if possible; the country and locality where regulated organism was collected, developed, manufactured, reared, cultivated or cultured; the intended activity (
For interstate movement or importation, the permit application would also have to contain the origin and destination of the regulated organism, including information on the addresses and contact details of the sender and recipient, if different from the responsible person; the method of shipment, and means of ensuring the security of the shipment against unauthorized release of the regulated article, to be used in the importation or interstate movement; and the manner in which packaging material, shipping containers, and any other material accompanying the regulated organism will be disposed to prevent the unauthorized release of the regulated article.
Permit applications for release into the environment would have to address the spread, persistence risk, and potential harm of the regulated organism in the environment, including but not limited to a description of how the phenotype of the regulated organism differs from the phenotype of the recipient organism, particularly with respect to potential interactions with, and its likelihood of spread and/or persistence in, the environment; and the location and size of all proposed environmental release sites, including area, geographic coordinates, addresses, land use history of the site and adjacent areas, and name and contact information of a person at each environmental release site, if different from the responsible person. In the even that additional release sites are requested after the issuance of a permit, APHIS would continue the practice of evaluating and amending permits to add new release sites.
The categories of information listed above reflect the categories of information that APHIS considers necessary to be included in all permit applications, as well as additional basic information required for each permit type. APHIS has learned that there are certain areas that are not specified in the current regulations where APHIS routinely needs information from the applicant in order to ensure safety. These areas do not become apparent to applicants until they submit a permit application and APHIS subsequently follows up for additional information in order to assess the activities listed on each permit application for plant pest and/or noxious weed risk. This had led to two
The categories of information above also align with the recommendations of the 2005 and 2015 OIG audits, and the provisions of the 2008 Farm Bill. For example, the OIG recommendations have led to provisions that would enable APHIS to require geographic coordinates for the locations of environmental releases.
As mentioned previously, paragraph (c) of § 340.3 would continue to exempt
APHIS contemplated a Web-based list of other regulated organisms that have been granted exemptions from permitting requirements for interstate movement. However, APHIS was not able to identify any organisms that would fall within the same category as
Paragraph (d) of § 340.3 would contain specifics regarding APHIS' review of permit applications. APHIS would review permit applications to determine completeness. If the application is incomplete, APHIS would notify the applicant in writing, and the applicant would be provided an opportunity to revise the application. APHIS is proposing to institute a time limit for receiving additional information in the event that a permit application is determined to be incomplete. If the applicant does not respond to a request for more information within 30 days of receipt of APHIS' request, APHIS would deem the permit application withdrawn and return it to the applicant. This time limit would help preclude the Agency from acting on a permit application when the responsible person no longer desires a permit, and would allow APHIS to focus its review of permit applications, while also affording applicants sufficient time to provide APHIS additional information in the event that they submit incomplete applications.
Once an application is complete, APHIS would review it to determine whether to approve or deny the permit application.
Paragraph (d)(2) of proposed § 340.3 would contain provisions regarding APHIS' assignment of permit conditions. If a permit application is approved, permit conditions would be assigned to each permit commensurate with the risk of the regulated organism and activity. General permit conditions, which APHIS is proposing to list in paragraph (e) of § 340.3, would be assigned to all permits. Additional or expanded permit conditions may also be assigned that are commensurate to the risk that the activities listed on the permit application present of disseminating the regulated organism, or other plant pests or noxious weeds. Examples of such additional requirements include, but are not limited to, specific requirements for reproductive, cultural, spatial, and temporal controls; monitoring; post-termination land use; site security or access restrictions; management practices such as training of personnel involved in the movement; and practices to prevent articles associated with the movement of a regulated organism from becoming contaminated with plant pests or noxious weeds.
Under paragraph (d)(3) of proposed § 340.3, all premises associated with the permit would be subject to inspection before and after permit issuance. APHIS would require that the responsible person provide APHIS inspectors access to inspect any relevant premises, facility, location, storage area, waypoint, materials, equipment, means of conveyance, and other articles related to the movement of organisms regulated under 7 CFR part 340. While this requirement is functionally the same as current inspection requirements, it clarifies what locations and articles may be subject to inspection. Failure to allow the inspection of premises prior to the issuance of a permit would be grounds for the denial of a permit application. Failure to allow an inspection after permit issuance would be grounds for revocation of the permit.
While the current regulations provide for review of permit applications by State regulatory officials, they do not include review by Tribal officials when a permit application is submitted for the importation into, interstate movement through, or release into the environment on Tribal lands of a regulated organism. To correct this oversight, APHIS proposes to state in proposed § 340.3(d)(4) that APHIS will include relevant Tribal officials when it provides copies of permit applications to State regulatory officials.
Under the current regulations, the permitting procedure does not include a formal acknowledgement from the applicant prior to permit issuance that they are aware of and consent to the permit conditions. APHIS considers such an acknowledgement to be necessary, however, in order to verify that applicants are aware of and willing to abide by the conditions. Accordingly, APHIS is proposing to add a requirement in § 340.3(d)(5) that, prior to permit issuance, applicants must agree, in writing and in a manner prescribed by the Administrator, that they are aware of, understand, and will comply with all permit conditions. If an applicant fails to comply with this provision, their application would be denied.
The use of permits and permit conditions gives APHIS and the responsible person an understanding as to what actions must be taken for the permit holder to comply with the regulations. However, in the current regulations, APHIS also provides a list of general permitting conditions that are assigned to all permits in order to provide as much transparency and predictability as possible about permit conditions. To that end, as APHIS mentioned above, APHIS would continue to maintain general conditions that APHIS would assign to all permits issued under the regulations within the regulations themselves. Paragraph (e) of § 340.3 would contain these general conditions. APHIS would require that:
• The regulated organism must be maintained and disposed of in a manner so as to prevent the unauthorized release of the regulated organism.
• The regulated organism must be kept separate from other organisms, except as specifically allowed in the permit.
• The regulated organism must be maintained only in areas and premises specified in the permit.
• The regulated organism's identity must be maintained at all times.
• In the event of an unauthorized release, the regulated organism must undergo the application of remedial measures determined by the Administrator to be necessary to prevent the spread of regulated organism, and the responsible person must contact APHIS as described in the permit within 24 hours of discovery, and subsequently supply a statement of facts in writing no later than 5 business days after discovery.
• The duration that a permit is valid will be listed on the permit itself. During that time, the responsible person must maintain records related to permitted activities of sufficient quality and completeness to demonstrate compliance with all permit conditions and requirements under the proposed regulations. The responsible person must submit reports and notices to APHIS at the times specified in the permit and containing the information specified within the permit. Inspectors must be allowed access, during regular business hours, to the place where the regulated organism is located and to any records relating to the movement of a regulated organism. APHIS access to records includes visual inspection and reproduction (photocopying, digital reproduction, etc.) of all records required to be maintained under the proposed regulations, as requested by APHIS.
• The responsible person must notify APHIS in writing if any permitted activity associated with environmental release will not be conducted.
• Within 28 days after the initiation of any permitted activity related to environmental release, the responsible person must report to APHIS in writing the actual release site coordinates and details of the release, such as how many acres planted, how many organisms released, etc., based on permit conditions, as well as every 28 days thereafter until all releases are completed.
• A person who has been issued a permit must submit to APHIS an environmental release report within 6 months after the termination of any release into the environment. The report must include the APHIS reference number, methods of observation, resulting data, and analysis regarding all deleterious effects on plants, non-target organisms, or the environment.
Most of the conditions listed above are drawn from the conditions found in the current regulations, although APHIS has added some additional details to clarify their meaning. For example, while the existing regulations provide that APHIS inspectors shall be allowed access to records related to the permit, they do not specify what “access to records” means. APHIS would clarify that this includes visual inspection and reproduction (photocopying, digital reproduction, etc.) of all records required to be maintained under the proposed regulations. APHIS believes that these additional details will better communicate with applicants what the general permitting conditions are, and will better support administration of the permitting program, including compliance and enforcement.
APHIS is also proposing to specify that regular reporting regarding any activities associated with environmental release of a regulated organism is a general permitting condition. As APHIS mentioned previously in this document, the 2005 and 2015 OIG audits suggested that APHIS exercise greater and more coordinated oversight over field tests of GE organisms. APHIS identified regular reporting regarding actual release site coordinates and details of the release as a key means of exercising such oversight. Adding this reporting requirement as a general permitting condition will ensure that it is communicated to all permittees.
Similarly, to respond to the recommendations of the 2005 and 2015 OIG audits, APHIS would add a requirement for Agency notification if any permitted activity associated with environmental release will not be conducted as a general permitting condition. This general condition would work in tandem with the reporting requirement mentioned above, and help APHIS resolve what could otherwise be considered inconsistencies between the permit conditions and the regular reports.
In addition, while the current general permitting conditions require a field test report following termination of a field test, in recent years, APHIS has required a more extensive report, an environmental release report, through permitting conditions. Our general permitting conditions would reflect this.
APHIS recognizes that these last three general permitting conditions pertain only to activities associated with environmental release of a regulated organism. APHIS also recognizes that it is possible that certain permit applications may not request to release the regulated organism into the environment. However, the permit issued would still contain these general conditions to communicate to the permittee APHIS' general requirements regarding environmental release of regulated organisms. This will ensure that all permitees are aware of those requirements, and is consistent with the recommendations of the OIG audits. The conditions would also prove useful, should the responsible person subsequently request amendments to the permit to authorize environmental release.
While the general permitting conditions that are currently in the regulations contain a condition that pertains to packing material used to transport the regulated organism, APHIS would not retain this as a general permitting condition. This is because it would be covered by shipping requirements that APHIS is proposing to add to the regulations in paragraph (i) of § 340.3.
Under the current regulations, the Administrator may deny or cancel a permit if the applicant has not complied with one or more of the conditions listed on the permit. The Administrator will confirm the reasons for the cancellation or denial in writing within 10 days, and the applicant may appeal the decision in writing within 10 days after receiving the written notification of cancelation or denial. The Administrator may then grant or deny the appeal, in writing, stating the reason for the decision as promptly as circumstances allow.
APHIS is proposing to elaborate on the circumstances under which a permit application may be denied in § 340.3(f)(1). Such circumstances would include when the Administrator concludes that, based on the application or additional information, the actions proposed under the permit may result in the unauthorized release of a regulated organism, or another plant pest or noxious weed; or when the Administrator determines that the responsible person or any agent of the responsible person has failed to comply at any time with any APHIS regulation or the conditions of any permit that has previously been issued in accordance with the regulations.
The first condition pertains to instances in which APHIS cannot reach a conclusion that the risk of dissemination of regulated organisms, plant pests, or noxious weeds will be adequately mitigated if APHIS issued a permit authorizing the actions requested on the permit application. This could occur when, for example, a responsible person does not formally acknowledge that he or she understands the permitting conditions.
The second condition would pertain to instances in which prior actions taken by the applicant or his or her
While the current regulations contain procedures for denying a permit application, they do not detail measures for APHIS to revoke a permit. Therefore, APHIS proposes to establish explicit procedures for the revocation of permits. Procedures for revoking a permit would be contained in § 340.3(f)(2). These procedures would state that a permit may be revoked if, following issuance of the permit, the Administrator receives information that would otherwise have provided grounds for APHIS to deny the permit application; if the Administrator determines that actions taken under the permit have resulted in the unauthorized release of a regulated organism, or another plant pest or noxious weed; or if the Administrator determines that the responsible person or any agent of the responsible person has failed to comply at any time with any APHIS regulation or the conditions of any permit issued.
Paragraph (g) would contain the current procedures for appealing the denial of a permit application or revocation of a permit.
APHIS is also proposing to clarify in § 340.3(h) of the regulations the procedure to be used when amendment of existing permit conditions is sought by the responsible person or required by APHIS. Such amendments may include the transfer of the permit to a new responsible person. Currently, the administrative practices that APHIS uses to amend permits have not been explicit in the regulations, and these additions would provide increased transparency and efficiency.
Under the current regulations, notifications for environmental releases and interstate movement are valid for 1 year. Interstate movement permits are only valid for 1 year from the date of issuance, and a new import permit must be obtained for each imported shipment. These permits are referred to as “limited permits.” The duration period for a permit issued solely for an environmental release is not currently specified.
APHIS has found that it often takes considerably longer than 1 year for activities authorized under a permit to be completed. For example, with a perennial plant such as a tree, it may take much longer than a year to gather relevant data about the plant for the purpose of determining risk. Additionally, monitoring activities may be required for several years after a field test is complete. In other cases, multiyear research projects may require multiple shipments of regulated organisms for analysis. APHIS is therefore proposing to eliminate the current limits in the regulations on the duration of permits for interstate movement and importation. APHIS also would continue not to specify a duration that an environmental release permit is valid in the regulations. The duration that a permit is valid would instead be specified on the permit itself, as a permitting condition. These changes should give APHIS the flexibility to issue these permits with suitable durations to meet individual circumstances.
Paragraph (i) of § 340.3 would contain shipping requirements for regulated organisms. These would specify that all shipments of regulated organisms must be secure shipments, which APHIS would define as shipments in a container or a means of conveyance of sufficient strength and integrity to withstand leakage of contents, shocks, pressure changes, and other conditions incident to ordinary handling in transportation.
Currently, § 340.8 contains container requirements for regulated organisms. These requirements are very prescriptive. While they do allow responsible persons to request variances from the requirements, this request process, by its nature, results in a case-by-case determination that other types of containers are acceptable for the transportation of regulated organisms. The current regulations also do not clearly reflect the performance-based standard that APHIS used to develop the requirements, which was that the container should be sufficient to prevent dissemination of a regulated organism during movement. Our proposed requirements would maintain this performance-based standard, while making this standard more explicit and the requirements less prescriptive, thus eliminating the need for a request process for variances.
APHIS would, however, retain a provision in the current regulations, currently a footnote to § 340.8, that specifies that all regulated organisms must be shipped in accordance with the regulations in 49 CFR part 178. Those regulations, which are administered by the Department of Transportation (DOT), provide packaging requirements for materials, including regulated organisms that DOT has designated as hazardous materials.
Paragraph (i) of § 340.3 would also specify that the container must be accompanied by a document that includes the names and contact details for the sender and the recipient. It would also specify that, following the completion of the shipment, all packing material, shipping containers, and any other material accompanying the regulated organism would have to be treated or disposed of in such a manner so as to prevent the unauthorized dissemination and establishment of regulated organisms. As mentioned above, this latter requirement is currently a general permitting condition, but could more accurately be described as a shipping requirement.
Finally, paragraph (i) would contain container marking and identity requirements for imported GE organisms. These requirements are currently found in § 340.7.
APHIS has occasionally received inquiries from stakeholders regarding whether a permit could authorize the commercial distribution of a regulated organism. Currently, most developers of GE organisms generally have not commercialized their products until after those products were granted a determination of nonregulated status. However, APHIS does not prohibit commercializing GE organisms that have not been granted a determination of nonregulated status. APHIS currently authorizes a small number of permits for such commercial production.
Under the proposed regulations, there may be some regulated organisms that an entity wishes to commercialize or grow on a large scale, under permit. As currently occurs, APHIS would evaluate these permit applications on a case-by-case basis, to determine whether permitting conditions can be developed that adequately address the risk associated with the permitted actions.
The current regulations in § 340.4(h) provide APHIS with the ability to issue courtesy permits in order to facilitate the movement of GE organisms that are not subject to the regulations in 7 CFR part 340 but whose movement might otherwise be hindered because of their similarity to organisms or articles that are regulated by other APHIS programs. APHIS commits significant resources to the issuance of these courtesy permits for the movement of organisms that are not subject to the provisions of part 340.
Courtesy permits have been part of the regulations since their inception in 1987, and have been useful to inform shippers and State and Federal inspectors not yet fully familiar with requirements for GE organisms that the shipments in question were not regulated. However, their continued use has led to the widespread misunderstanding by some researchers that courtesy permits are actually required for the movement of certain organisms, or that issuance of a courtesy
The current regulations in § 340.6(a) provide that any person may submit a petition to APHIS seeking a determination that an article should not be regulated under 7 CFR part 340. Paragraphs (b) and (c) of § 340.6 describe the form that a petition for a determination of nonregulated status must take and the information that must be included in the petition. Those organisms which are granted nonregulated status are free of all requirements under 7 CFR part 340. This nonregulated status is different from that of certain organisms that meet the definition of regulated articles, but which are exempt from the requirement for a permit when moved interstate under the specific conditions specified in the regulations.
Published APHIS decisions made under the current regulations have used different ways to express the basic standard “unlikely to pose a plant pest risk” in determining whether to grant nonregulated status to a specific GE organism. In its determinations, APHIS has conveyed the basic standard of “unlikely to pose a plant pest risk” by concluding that the GE organism “poses no more of a plant pest risk than its non-GE counterpart,” “will not pose a plant pest risk”; or that there is “no plant pest risk,” or “no direct or indirect plant pest effects.” Regardless of the phrases used in its determination of nonregulated status to date, APHIS has applied the same basic evaluation criteria to each determination to conclude that the GE organism is unlikely to pose a plant pest risk and therefore is not subject to the part 340 regulations. Those criteria include, among other things, conclusions on the potential of the GE organism to create pest or disease problems; the potential for nontarget effects that might affect organisms beneficial to agriculture; changes in agricultural practices that might exacerbate pest or disease problems; and potential of the GE organism to transmit the introduced trait to organisms with which it does not interbreed.
The current regulations also have a provision in § 340.6(e) to extend a determination of nonregulated status to a GE organism based on its similarity to an antecedent organism that has already been granted nonregulated status. This existing “extension procedure” was designed for APHIS to take into account the previous evaluation used to grant nonregulated status conducted by APHIS and thereby afford the potential for expedited evaluations of a petition for extension.
These provisions in the current regulations are necessary because of the manner in which
APHIS does not consider it necessary to retain this process in the regulations. As mentioned in our discussion of proposed § 340.0, APHIS would no longer regulate a GE organism solely because the donor organism, recipient organism, vector, or vector agent of the organism is a plant pest. Rather, for the GE organism to be regulated, APHIS would have to determine that it is a plant pest or noxious weed, or the GE organism would have to not yet be evaluated for plant pest and/or noxious weed risk. In other words, APHIS' focal point would change from the method by which the organism is genetically engineered, to the resulting GE organism itself, and the Agency would no longer assume that the use of a plant pest within the development of the GE organism necessarily and in every instance results in a GE organism with plant pest properties.
Based on the manner in which proposed § 340.0 is structured, APHIS envisions four types of inquiries from developers of GE organisms if this rule is finalized. The first would be from developers of organisms that are uncertain of the regulatory status of their organism, but that consider it to either be outside the scope of regulated organisms or similar to an organism that APHIS has already evaluated and assigned nonregulated status. The developers would present what they consider to be the regulatory status of the organism, as well as the information on which the developers rely to support this consideration. In such instances, APHIS would review the information
The second type of inquiries that APHIS would expect to receive would come from developers of GE organisms that belonged to taxa that are listed in accordance with proposed § 340.2 prior to genetic engineering, or that have received DNA from such taxa during genetic engineering. The developers would provide information regarding the development of the GE organism, and would provide information regarding why they do, or not consider, the GE organism to be a plant pest, or to have received DNA sufficient to produce an infectious entity or encode a pathogenesis-related compound that is expected to cause plant disease symptoms. Such requests would have to be made in accordance with proposed § 340.4.
The third category of inquiries would come from developers of GE plants that APHIS has not yet evaluated for plant pest and noxious weed risk and developers of other GE organisms, such as GE insects and other invertebrates,
The fourth category of inquiries would come from developers of GE organisms that APHIS has determined to be plant pests or noxious weeds, asking for a reevaluation of this determination. Such requests would have to be made in accordance with proposed § 340.4.
Proposed § 340.4 would contain the process by which persons could request an initial evaluation or subsequent reevaluation of the regulatory status of a GE organism. The outcome of a regulatory status evaluation is a determination by the agency that a GE organism is a nonregulated organism or a regulated organism subject to permitting.
Paragraph (a) of proposed § 340.4 would state that any person may submit a request to APHIS to have a GE organism's regulatory status evaluated, or to request the reevaluation of the regulatory status of a previously evaluated regulated organism. It would provide that the information that would have to be submitted with a regulatory status request in order for APHIS to evaluate the request is on the Internet, at
• A description of the recipient organism (including common name; genus, species, and any relevant subspecies information that would distinguish the organism; and, for microorganisms, the strain).
• The genotype of the GE organism, including a detailed description of the differences in genotype between the organism subject to the request and the non-GE organism. If genetic material is inserted into the genome, the method of transformation would also have to be described and the following provided for each gene:
○ For gene sequences, the name of the sequence, donor organism(s) or source, function of sequence, nucleic acid sequence, and publicly available sequence identification. If the genes have been modified, the nature of the modification and its purpose would have to be stated, and the request would have to identify and highlight the modifications by submitting an alignment of the modified sequence with the unmodified sequence. If the gene is not naturally occurring, the request would have to state whether the sequence is based on that of a specific organism, and, if so, identify the organism and gene it was based on.
○ For regulatory sequences, the function of each regulatory sequence as it relates to the gene sequence and the source of each regulatory sequence. Promoters (sites on DNA to which the enzyme RNA polymerase can bind to initiate the transcription of DNA into RNA) would have to be identified as constitutive, inducible, developmental, or tissue-specific. If inducible, the inducer would have to be described. If developmental, stages at which the promoter is active would have to be described. If tissue-specific, the tissues in which the promoter is active would have to be described. The strength of the promoter would also have to be described. Finally, for microorganisms, descriptions of mobile genetic elements would also have to be included.
○ If the genome is edited, the following would also have to be provided: The nature of the edit(s) and the gene(s) and function(s) being modified, as well as what pathways are expected to be affected; for multiple substituted base pairs, the number of substitutions; the original unmodified sequence aligned to the modified sequence; and if the edits were created using genetic material which was integrated into the chromosome, but later eliminated through segregation, techniques used to confirm absence of the genetic material.
• A detailed description of the intended phenotype(s) of the GE organism. This would include the purpose of the new phenotype and the mechanisms of action by which the intended phenotype is conferred; any new enzymes, other gene products, or expected changes in metabolism; if applicable, the protein accession number and the enzyme commission number; and the known and potential differences from the non-GE organism that would substantiate that the GE organism is unlikely to pose a greater noxious weed risk or plant pest risk than the non-GE organism from which it was derived.
• For plants, any information that exists on known or likely changes that may affect any of the following would have to be provided: Weediness and plant pest characteristics of the plant; competitive growth ability; reproduction, spread, and persistence; stress tolerance, including a consideration of abiotic stresses such as cold and drought tolerance and biotic stresses such as herbivory (consumption of the plant) or diseases; and any other weediness or plant pest characteristics identified of the plant or other plants with which the plant can interbreed.
• For non-plant, non-vertebrate organisms, any information that exists on known or likely differences to herbivory or virulence must be provided, including: Any observed or anticipated changes due to the genetic modification that might affect the ability of the organism to cause direct or indirect damage to plants; a description of any changes to known factors of pathogenesis and virulence factors such as polysaccharides (complex sugars consisting of multiple sugar molecules bonded together) and suppressors (genes that suppress expression of another gene); a consideration of changes that might affect geographic distributions, host range, means of dissemination, horizontal gene transfer, reproductive cycle, and persistence; and a description of any characteristics introduced to mitigate harm to plants.
• Any experimental data (including field tests) and publications that the developer believes might be relevant to APHIS's evaluation of the potential of the organism to affect plant health.
APHIS considers the categories of information specified above, which are drawn from our current conditions in § 340.7 for a petition for nonregulated status for a GE organism, to be sufficient for APHIS to evaluate a GE organism and determine its appropriate regulatory status. That being said, the Agency solicits public comment on the adequacy of the requested information in proposed 340.4(a), and whether additional or alternate requirements would be more appropriate. Specifically, APHIS is interested in instances that commenters identify in which the above information may be insufficient to reach a regulatory status determination.
To that end, APHIS wishes to highlight some of the differences between the above information and the information currently required for a request for deregulated status of a GE organism. With regard to the genotype of the GE organism, APHIS would add specific information requirements for gene sequences, regulatory sequences, and genome editing. The current regulations require the petitioner to supply a detailed description of the genotype of the GE organism, but do not specify that a description of the gene sequences, regulatory sequences, or genome editing of the organism is required. Operationally, however, APHIS considers this information to be necessary in order for the petitioner to provide a detailed description of the
APHIS would also remove a current regulatory requirement that requires the petition to state the country and locality of the donor organism from which a GE organism has received genetic material in order for APHIS to evaluate the genotype of the GE organism. In the Agency's experience, this information has not proven germane to evaluating the genome of the GE organism, since it does not provide information regarding the modified genome of the GE organism, or the manner in which the genome was modified.
With regard to the phenotype of the GE organism, the proposed requirements would contain additional details that APHIS considers necessary in order to evaluate the plant pest risk of microorganisms, insects, and other invertebrates. For GE plants, it would also include information that APHIS needs in order to prepare a plant pest risk assessment and/or a weed risk assessment (WRA, discussed below).
APHIS is also proposing a significant departure from the current requirements for a petition for nonregulated status. The current requirements specify that a petition must contain field reports for all trials conducted under permit or notification procedures involving the regulated organism, including the APHIS reference number, methods of observation, resulting data, and analysis regarding all deleterious effects on plants, non-target organisms, or the environment.
Currently, most of the field data submitted by the regulated community to meet this requirement is to demonstrate that there have not been unintended deleterious effects on plants, non-target organisms, or the environment. To date, APHIS has authorized more than 100,000 field trials—a single permit or notification may authorize multiple trials—and APHIS has not received a report of plant pest or noxious weed issues. In addition, APHIS has not received any information in such reports indicating a potential for such effects. Rather, the Agency has discovered that the expressed phenotype of the regulated organism provides the most reliable indicator of the organism's potential for deleterious effects on plants and plant products. These observations are expected and are consistent with findings of several reports of the National Research Council.
NRC (National Research Council). 2004.
Accordingly, APHIS considers information from field tests to not always be necessary for a determination of regulatory status under the proposed regulations. The approach APHIS is proposing focuses primarily on evaluating the genetics and expressed phenotype of the regulated organism, and the likelihood that, based on these genetics and phenotype, the organism will act as a plant pest or noxious weed if it is released into the environment for the uses intended by the developer.
This would not preclude a developer from providing field test information, if he or she considered such information to be pertinent to our determination. For example, if a developer wished APHIS to reevaluate the status of an organism that the Agency had previously considered to be a regulated organism, field test information demonstrating a lack of adverse effects on plants and plant products could be provided in support of that request. Nor would the provisions preclude APHIS from asking for field test information if APHIS considers it necessary in order to conclude review of a particular request. However, field test information would not be a generally applicable requirement for requests for a regulatory status determination, and would only be requested rarely, and on an as-needed basis.
Paragraph (b) would outline the actions the Administrator would take in response to a regulatory status request. If the request is complete, APHIS would conduct a risk analysis that includes an evidence-based, standardized approach to analyzing plant pest and/or noxious weed risks associated with the GE organism.
Currently, when APHIS receives petitions for a determination of regulated status, APHIS conducts risk assessments. Historically, these assessments have focused on evaluating the plant pest risk of the regulated organism. However, in recent years, they have also included a weediness assessment when the regulated organism is a plant.
The proposed regulations would specify that, if APHIS receives a request to evaluate the regulatory status of a GE organism, the Agency will conduct a risk analysis. The analysis would include,
APHIS' weed risk analysis processes would use a WRA, a system developed by APHIS for the purpose of assessing noxious weed risk of GE organisms. Regulatory status decisions for GE plants would be informed based on a risk manager's evaluation and interpretation of the results of the WRA (and, for parasitic plants or plants that may otherwise fall within the scope of the definition of
While this risk analysis would be informed by APHIS's risk assessment experience with GE organisms as well as APHIS' evaluation of other existing weed risk assessment systems that have been developed, since the WRA system for GE organisms is new, APHIS is making the WRA system publicly available along with this proposed rule. (To view the WRA system or guidance, go to
Proposed paragraph (c) of § 340.4 would discuss our proposed notice-based process for making evaluation of regulatory status available to the public. APHIS would make both the request and the risk analysis available for public review through a notice published in the
If no comments are received on the notice, or if the comments do not affect the conclusions of the risk analysis or the proposed regulatory status of the organism, APHIS would provide notification through the APHIS stakeholder registry at the end of the
Alternatively, if comments lead APHIS to change its proposed regulatory status for the organism, APHIS would publish a subsequent notice in the
APHIS is proposing to consolidate all record retention, compliance, and enforcement requirements in 7 CFR part 340 into a new § 340.5. APHIS is also proposing to strengthen its program in order to manage compliance with the regulations more efficiently, to augment the approaches used to prevent or remediate potential risks to plant health, and to utilize appropriate enforcement strategies. These proposed regulatory changes also reflect certain provisions of the 2008 Farm Bill and align with recommendations of the 2005 and 2015 OIG audits.
The current regulations require a responsible person to retain records demonstrating that a regulated organism that was imported or moved interstate under a permit arrived at its intended destination for 1 year, but contain no record retention requirements related to environmental release of a regulated organism. While APHIS has frequently added this record retention requirement as a permitting condition, both the 2005 and 2015 OIG audits and the 2008 Farm Bill recommended that the Agency specify the retention requirement in the regulations themselves, recommendations that are corroborated by the Agency's own experience administering the regulations.
Therefore, APHIS is proposing that all records related to permit conditions, other than those demonstrating that a regulated organism that was imported or moved interstate arrived at its intended destination, be retained for 10 years following permit expiration, unless APHIS determines otherwise and documents an alternate record retention requirement. In the event of an investigation into the possible unauthorized environmental release of a regulated organism, or the escape of a regulated organism from a containment facility, a thorough record of activities taken under the permit is necessary in order for APHIS to assess compliance and determine whether enforcement actions are needed. When APHIS has investigated unauthorized environmental releases of regulated organisms, this has necessitated obtaining information from field trials that were conducted up to 10 years prior to the investigation. In instances in which the information was not available, this adversely impacted APHIS' ability to do an expeditious and thorough investigation.
APHIS is also proposing to extend the record retention requirement that demonstrates that a regulated organism that was imported or moved interstate arrived at its intended destination from 1 to 2 years. In the event that there is uncertainty regarding whether the organism arrived at this location, it may take APHIS more than 1 year to investigate the matter.
APHIS recognizes that, in practice, our proposed requirements would require most records associated with permitted activities to be retained 10 years, and that this is a significant duration to retain potentially a substantial number of records pertaining to permit activities. However, retaining documents for less than 10 years may impede an investigation into compliance infractions. The Agency requests specific public comment regarding whether a shorter duration is warranted for certain records pertaining to permit activities, and which activities these may be. Additionally, APHIS requests comment on any alternate means that stakeholders may identify for the Agency to obtain necessary information from developers in the event of an investigation of possible regulatory noncompliance.
The section would specify that responsible persons and their agents must comply with the proposed regulations. Failure to comply with the regulations could result in denial of a permit application or revocation of a permit, application of remedial measures in accordance with the PPA, or criminal or civil penalties.
Pursuant to sections 7714 and 7731 of the PPA, APHIS may seize, quarantine, treat, destroy, or apply other remedial measures to a regulated organism that is new to or not widely prevalent or distributed in the United States to prevent dissemination of the organism. APHIS typically issues an Emergency Action Notifications or administrative order to the owner of the regulated organism to specify these remedial measures.
If APHIS intends to issue a civil penalty, the Agency may enter into a stipulation prior to issuance of the complaint seeking the penalty. Our regulations regarding such stipulations are located in 7 CFR 380.10.
Finally, the section would specify that for purposes of enforcing the regulations, the act, omission, or failure of any agent for a responsible person may be deemed also to be the act, omission, or failure of the responsible person.
The regulations in current §§ 340.7 and 340.8 provide detailed requirements for identifying and securely shipping containers of regulated organisms. In the revised regulations, general requirements which apply to all shipments of regulated GE organisms under permit are now listed in paragraph (i) of § 340.3. Additional supplemental conditions will be used when permits are issued to add additional case-specific measures. These supplemental conditions will be listed on the permit itself as permitting conditions. This will allow the agency to take into account the widely varying types and quantities of GE organisms to be shipped and apply highly effective yet reasonable requirements.
As mentioned previously, in the current regulations, there are guidelines for denoting information on a permit application or petition for a determination of nonregulated status as CBI in different sections of the regulations. In the proposed regulations, APHIS is proposing to consolidate these guidelines for protecting CBI into a single section, § 340.6. This change would support the overall administration of the program by consolidating all relevant requirements, thereby making it easier for interested persons to find the necessary information.
APHIS proposes to retain certain definitions currently found in § 340.1 of the regulations, to change other definitions, to add some new definitions, and to remove definitions that no longer appear in the regulations.
APHIS is proposing to retain the following definitions from the current regulations, without change:
APHIS is proposing to change the definitions of the following terms from those in the current regulations:
As mentioned in the discussion of proposed § 340.0, the definition of
This would replace the current definition for
APHIS recognizes that APHIS had previously suggested this proposed rule would use the term
A number of stakeholders understood the limitations associated with the current definition of
Additionally, several stakeholders expressed concern regarding the proposed definition of
Stakeholders also encouraged APHIS to refer to other existing definitions used to define
When APHIS issued the current regulations, the Agency relied on guidelines developed by the National Institutes of Health (NIH) regarding research on genetically engineered organisms to craft the definition of “genetic engineering.” Accordingly, in light of the above stakeholder concerns, APHIS revisited NIH guidelines regarding research on genetically engineered organisms. The definition that APHIS is proposing is based on NIH's “Guidelines for Research Involving Recombinant or Synthetic Nucleic Acid Molecules,” which are located at
This change generally aligns the definition of
Additionally, while the PPA allows for the issuance of oral permits, APHIS would not. Oral permits do not provide adequate documentation that a responsible person was aware of and understood permitting conditions at the time the permit was issued.
A result of this alignment would be that APHIS would no longer consider “cellular components,” such as ribosomes, to be plants. However, cellular components are not capable of propagating to cause plant pest or noxious weed risks.
APHIS proposes to add definitions of the following new terms:
• The genetic modification to the organism is solely a deletion of any size or a single base pair substitution which could otherwise be obtained through the use of chemical- or radiation-based mutagenesis.
• The genetic modification to the organism is solely introducing only naturally occurring nucleic acid sequences from a sexually compatible relative that could otherwise cross with the recipient organism and produce viable progeny through traditional breeding (including, but not limited to, marker-assisted breeding, as well as tissue culture and protoplast, cell, or embryo fusion).
• The organism is a “null segregant,” that is, the progeny of a GE organism where the only genetic modification was the insertion of donor nucleic acid into the recipient's genome, but the donor nucleic acid is not passed to the recipient organism's progeny and the donor nucleic acid has not altered the DNA sequence of the progeny.
APHIS proposes to remove the following definitions from the regulations:
These definitions would be removed because the terms would no longer be used in the regulations. APHIS proposes to eliminate the term
APHIS also proposes to remove the definition for
Finally, based on the terms that APHIS is proposing to add or remove from the regulations, as well as the revised scope of the regulations, the Agency would revise the title of part 340 to “Movement of organisms altered or produced through genetic engineering that are noxious weeds or plant pests or that there is reason to believe are noxious weeds or plant pests.”
Section 340.7 would contain APHIS' policy regarding costs and charges for the services of inspector, which are found in the current regulations in § 340.9. Currently, the section provides that the services of an inspector during regularly assigned hours of duty are provided free of charge, but that APHIS will not be responsible for any other costs or charges incident to inspections or compliance, apart from the services of this inspector. These provisions would be unchanged.
APHIS recognizes that many aspects of our proposed rule hinge on a determination by APHIS regarding the plant pest or noxious weed risk posed by a particular GE organism or class of GE organisms. Often, APHIS will be able to make a determination of plant pest or noxious weed risk based on our collective experience regulating genetic engineering and review of relevant scientific literature.
However, as genetic engineering evolves and new genetic engineering techniques are developed, APHIS may lack technical expertise to fully evaluate certain GE organisms or classes of GE organisms. This is particularly likely when new or emerging genetic engineering techniques are applied to recipient organisms that have not previously been subject to genetic engineering.
In such instances, APHIS may rely on researchers or other Federal, State, Tribal, or industry experts to provide information to help APHIS determines the organism's appropriate regulatory status. APHIS may solicit such information through a variety of means, including, but not limited to, working groups, workshops, peer review of documents (particularly risk analyses), or webinars.
To provide the public with documentation of APHIS' review and analysis of any potential environmental impacts associated with the revision of our regulations regarding the movement of certain GE organisms, APHIS has prepared a programmatic environmental impact statement (PEIS). The PEIS was prepared in accordance with: (1) The National Environmental Policy Act of 1969 (NEPA), as amended (42 U.S.C. 4321
The PEIS may be viewed on the
This proposed rule has been determined to be significant for the purposes of Executive Order 12866 and, therefore, has been reviewed by the Office of Management and Budget.
We have prepared an economic analysis for this rule. The economic analysis provides a cost-benefit analysis, as required by Executive Orders 12866 and 13563, which direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. The economic analysis also provides an initial regulatory flexibility analysis that examines the potential economic effects of this rule on small entities, as required by the Regulatory Flexibility Act. The economic analysis is summarized below. Copies of the full analysis are available by contacting the person listed under
Under the PPA, the Secretary of Agriculture is authorized to regulate the movement into and through the United States of plants, plant products, and other articles to prevent the
The proposed revisions to 7 CFR part 340 would create the framework for more focused, risk-based regulation of the GE organisms that pose plant pest and/or noxious weed risks. They would establish a regulatory status evaluation process in which risk analysis would be used to assess whether permitting of a GE organism is necessary. Shipping standards would be less prescriptive and more generally applicable, and the rule would provide for the issuance of multi-year permits. The proposed rule would also exclude certain techniques from the definition of genetic engineering and certain organisms from the definition of genetically engineered organism. These changes would improve the efficiency and clarity of the regulations.
The proposed amendments would benefit developers, producers, and consumers of certain GE organisms, public and private research entities, and the Agency. There would not be any decrease in the level of protection provided against plant pest risks, and protection against noxious weed risks would be enhanced. The risk-based process used to determine regulatory status under the proposed rule would provide cost savings to the biotech industry and allow for reallocation of APHIS resources to Biotechnology Regulatory Services (BRS) priorities.
Based on APHIS' experience evaluating field trial data from thousands of permits that authorize environmental release of regulated organisms, as well as more than 150 petitions for non-regulated status, APHIS has determined that most of the GE organisms evaluated by the Agency do not merit regulatory oversight under the PPA. There would be both direct and indirect economic benefits of not subjecting the majority of these organisms to permitting requirements.
Direct regulatory costs to biotech developers would be reduced for those organisms that are not considered to pose plant pest and/or noxious weed risk. Savings to the regulated community would result from a reduced need to collect field data, fewer reporting requirements, and lower management costs. Petitions for non-regulated status—and the petition costs incurred—would be eliminated. There would be some new costs borne by regulated entities under the proposed rule including rule familiarization and recordkeeping. Recordkeeping cost tabulations are based on the information collection categories from the paperwork burden section of the rule, and are estimated to total about $275,000. About 1,100 distinct entities have applied for permits or notifications under part 340. APHIS estimates that those entities would spend about 8 hours becoming familiar with the provisions of this rule at a total cost of about $576,000.
Cost savings for these entities are expected to more than offset the new costs. APHIS estimated the cost savings for two regulatory oversight scenarios, based on a study of the costs encountered by private biotech developers as they pursue regulatory authorization of their innovations. When only USDA has regulatory oversight, compliance cost savings under the proposed rule could range from $1.5 million to $5.4 million for the development of a given GE trait. If EPA and/or FDA also have an oversight role in the development of a given GE trait, compliance cost savings could range from $485,000 to $861,000. Since 1992, between 2 and 14 petitions have been processed (granted non-regulated status or the petition withdrawn) in a given year, with an average of just under 6.
Because the rule is expected to spur innovation, we expect the number of new organisms developed annually to increase over time. In the following discussion, the annual number of new GE organisms developed under the proposed rule would range from 6 (the current annual average), to 12 (twice this average), with 10 as an intermediate number. For GE organisms that would have solely required USDA oversight, the annual savings could range from $8.8 million to $32.4 million (6 new organisms), from $14.7 million to $53.9 million (10 new organisms), and from $17.6 million to $64.7 million (12 new organisms). For organisms that are submitted for multi-agency evaluation, the annual savings could range from $2.9 million to $5.2 million (6 new organisms), from $4.9 million to $8.6 million (10 new organisms), and from $5.8 million to $10.3 million (12 new organisms).
APHIS costs of regulating GE organisms that may pose plant pest or noxious weed risks also are expected to change under the proposed rule. Fewer permits would be issued and notifications and petitions for non-regulated status would be eliminated, but more risk assessments for regulatory determination would be performed. Current annual personnel costs of conducting GE activities (costs of activities that would be affected by the proposed rule) are estimated to total about $5.6 million. With the proposed rule, annual costs are expected to range from $2.5 million to $7.8 million, depending on the volume of permits, weed risk assessments, inspections, and NEPA activities. In addition, costs to APHIS of implementing the proposed rule would include outreach activities, developing guidance documents, training, and adjusting the current permit system. APHIS estimates that the public outreach, guidance and training would cost about $88,000. Requests for regulatory status and response letters under the proposed rule could be handled in a manner similar to the current “Am I Regulated” process outside the electronic permitting system without incurring new costs.
A quicker USDA evaluation process and related reduction to firms' regulatory uncertainty may facilitate small companies' ability to raise venture capital. Reduced regulatory requirements may also lead to greater participation by the public sector in GE research. These indirect benefits of the proposed rule may spur GE innovations, particularly in small acreage crops where genetic engineering has not been widely utilized due to the expense of regulation. While the proposed rule may help promote biotech innovations, the pace of commercialization and volume of GE products commercialized are not expected to change dramatically from current levels. Nor is control over the development process expected to be materially altered by the proposed rule. It would be in a biotech developer's own best interest to maintain the same level of supervision and control over the development process as at present to prevent undesired cross-pollination or commingling with non-GE crops.
GE crop varieties, in general, are not required to be reviewed or approved for safety by the FDA before going to market. However, the developer is responsible for ensuring product safety and developers consider voluntary consultations with FDA on food safety to be an absolute necessity for applicable GE products.
Certain plants are genetically engineered in order to produce pharmaceutical or industrial compounds (plant-made pharmaceuticals or industrials), or PMPIs. Under the provisions of the proposed rule, there is a possibility that APHIS could reach a determination that a GE plant that produces PMPIs is not a regulated organism. Such a plant would not be subject to field trial oversight by USDA, and could be planted before or without an evaluation by FDA or EPA. Several options have been identified for addressing this potential gap in oversight. APHIS estimates that current PMPI inspections cost roughly $35,000 in total annually or about $800 each on average. Assuming that oversight continues in the same manner as APHIS oversight, a similar government expenditure could be expected under any of the PMPI oversight scenarios.
Certain plants are genetically engineered to produce PIPs. PIPs fall under the regulatory oversight of EPA. However, APHIS exercises regulatory oversight of all PIP plantings on 10 acres or less of land. Under the proposed rule, APHIS would only require permits for PIPs planted on 10 acres or less if they present a plant pest or noxious weed risk or have not yet been evaluated by APHIS for such risk. This proposal would shift Federal oversight of small-scale (10 acres or less) outdoor plantings of PIPs to EPA. EPA may decide to require EUPs for all, some, or none of such PIPs, and may conduct inspections of all, some, or none of those PIPs under permit. EPA would need to develop a program to oversee small-scale testing of PIPs and issue regulations if warranted. APHIS is fully committed to coordinating with EPA in this matter in order to give EPA time to stand up such a program. APHIS understands that a memorandum of understanding (MOU) and services agreement may be necessary to provide personnel and other resources to assist EPA during the interim period while EPA implements its own program of oversight of outdoor planting of PIPs on 10 acres or less. APHIS recognizes that there are challenges associated with such a transition that also would require EPA to incur the costs associated with setting up a revised regulatory program. Further, it would require policies, procedures, and guidance regarding APHIS' interaction with EPA.
Farmers who adopt GE crops also may indirectly benefit from the proposed rule. The adoption of GE crops in the United States has generally reduced costs and improved profitability at the farm level. As mentioned, under the proposed rule, regulatory costs are expected to be lower, thereby potentially spurring developer innovation, especially among small companies and universities. Farmers may benefit by having access to a wider variety of traits as well as a greater number of new GE crop species, affording them a broader selection of crops to suit their particular management needs. Among the types of innovations expected are crops with greater resistance to disease and insect pests, greater tolerance of stress conditions such as drought, high temperature, low temperature, and salt, and more efficient use of fertilizer. These types of traits can lower farmer input costs (water, fertilizer, pesticide) and increase yields during times of adverse growing conditions.
On the other hand, some farmers (
Entities potentially affected by the proposed rule fall under various categories of the North American Industry Classification System. While economic data are not available on business size for some entities, based on industry data obtained from the Economic Census and the Census of Agriculture we can assume that the majority of the businesses affected by the proposed rule would be small. APHIS welcomes public comment on the proposed rule's possible impacts.
The following table provides a summary statement of the expected direct benefits and costs of the proposed rule:
This program/activity is listed in the Catalog of Federal Domestic Assistance under No. 10.025 and is subject to Executive Order 12372, which requires intergovernmental consultation with State and local officials. (See 2 CFR chapter IV.)
This proposed rule has been reviewed under Executive Order 12988, Civil Justice Reform. If this proposed rule is adopted: (1) All State and local laws and regulations that are inconsistent with this rule will be preempted; (2) no retroactive effect will be given to this rule; and (3) administrative proceedings will not be required before parties may file suit in court.
This rule has been reviewed in accordance with the requirements of Executive Order 13175, “Consultation and Coordination with Indian Tribal Governments.” Executive Order 13175 requires Federal agencies to consult and coordinate with Tribes on a government-to-government basis on policies that have Tribal implications, including regulations, legislative comments or proposed legislation, and other policy statements that have substantial direct effects on one or more Indian Tribes, on the relationship between the Federal Government and Indian Tribes, or on the distribution of power and responsibilities between the Federal Government and Indian Tribes.
The Animal and Plant Health Inspection Service has assessed the impact of this rule on Indian Tribes and determined that this rule does have Tribal implications that require Tribal consultation under E.O. 13175. If a Tribe requests consultation, the Animal and Plant Health Inspection Service will work with the Office of Tribal Relations to ensure meaningful consultation is provided where changes, additions, and modifications identified herein are not expressly mandated by Congress.
In accordance with section 3507(d) of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
Please send comments on the Information Collection Request (ICR) to OMB's Office of Information and Regulatory Affairs via email to
APHIS is proposing to revise its regulations governing the importation, interstate movement, and release into the environment of organisms developed using genetic engineering. Organisms would be regulated because APHIS has determined them to present a plant pest or noxious weed risk, or has not yet evaluated them for such risk.
Persons would be able to submit a request for APHIS to evaluate the regulatory status of a GE organism. They would also be able to petition APHIS to add a genus, species, or subspecies to a list of taxa that are or contain plant pests. Finally, permits would be required for the importation, interstate movement, and environmental release of all regulated GE organisms. Responsible persons who are issued permits would be required to retain records, and would have to submit reports if they conduct field testing.
APHIS is soliciting comments from the public (as well as affected agencies) concerning our proposed information collection and recordkeeping requirements. These comments will help APHIS:
(1) Evaluate whether the proposed information collection is necessary for the proper performance of our agency's functions, including whether the information will have practical utility;
(2) Evaluate the accuracy of our estimate of the burden of the proposed information collection, including the validity of the methodology and assumptions used;
(3) Enhance the quality, utility, and clarity of the information to be collected; and
(4) Minimize the burden of the information collection on those who are to respond (such as through the use of appropriate automated, electronic, mechanical, or other technological
A copy of the information collection may be viewed on the
The Animal and Plant Health Inspection Service is committed to compliance with the E-Government Act to promote the use of the Internet and other information technologies, to provide increased opportunities for citizen access to Government information and services, and for other purposes. For information pertinent to E-Government Act compliance related to this proposed rule, please contact Ms. Kimberly Hardy, APHIS' Information Collection Coordinator, at (301) 851-2483.
Administrative practice and procedure, Biotechnology, Genetic engineering, Imports, Packaging and containers, Plant diseases and pests, Transportation.
Accordingly, we are proposing to revise 7 CFR part 340 to read as follows:
7 U.S.C. 7701-7772 and 7781-7786; 31 U.S.C. 9701; 7 CFR 2.22, 2.80, and 371.3.
(a) No person may move any regulated organism except in accordance with this part.
(b) A regulated organism is any GE organism that either:
(1) Prior to genetic engineering, belonged to any taxon listed in accordance with § 340.2 and met the definition of
(2) Has received deoxyribonucleic acid (DNA) from any taxon listed in accordance with § 340.2, the DNA from the donor organism is sufficient to produce an infectious entity capable of causing plant disease or encodes a compound known to be pathogenesis-related that is expected to cause plant disease symptoms, and the organism has not been evaluated by APHIS for plant pest risk in accordance with § 340.4; or
(3) Is a plant that has a plant and trait combination that has not been evaluated by APHIS for plant pest and noxious weed risk in accordance with § 340.4; or
(4) Is any of the foregoing that has been evaluated by APHIS in accordance with § 340.4 and determined to pose a risk as a plant pest and/or noxious weed or is a GE organism that has otherwise been determined by the Administrator to pose a risk as a plant pest or noxious weed.
Terms used in the singular form in this part shall be construed as the plural, and vice versa, as the case may demand. The following terms, when used in this part, shall be construed, respectively, to mean:
(1) The genetic modification to the organism is solely a deletion of any size or a single base pair substitution which could otherwise be obtained through the use of chemical- or radiation-based mutagenesis; or
(2) The genetic modification to the organism is solely introducing only naturally occurring nucleic acid sequences from a sexually compatible relative that could otherwise cross with the recipient organism and produce viable progeny through traditional breeding (including, but not limited to, marker-assisted breeding, as well as
(3) The organism is a “null segregant,” that is, the progeny of a GE organism where the only genetic modification was the insertion of donor nucleic acid into the recipient's genome, but the donor nucleic acid is not passed to the recipient organism's progeny and the donor nucleic acid has not altered the DNA sequence of the progeny.
(a) Taxa that are or contain plant pests are listed on the APHIS Web site at
(b)
(c)
(d)
(2) APHIS will publish in the
(e)
(a)(1) Except as provided in paragraph (a)(2) of this section, APHIS must have evaluated a regulated organism in accordance with § 340.4 before it will issue permits for importation, interstate movement, or release into the environment of the organism pursuant to this section.
(2) APHIS may issue a permit pursuant to this section for the importation or interstate movement of a regulated organism that has not been evaluated in accordance with § 340.4, at the request of an applicant. For the purposes of permitting conditions, APHIS will assume the regulated organism presents a risk as a plant pest and/or noxious weed. If the regulatory status of the organism is evaluated in accordance with § 340.4 during the duration of the permit, APHIS may amend or terminate the permit accordingly.
(3) Except as provided in paragraph (c) of this section, a permit must be issued by APHIS for the importation, interstate movement, or release into the environment of all regulated organisms.
(b) A responsible person must apply for and obtain a permit through a method listed at
(c) A permit for interstate movement is not required for genetically engineered
(d)
(2)
(3)
(4)
(5)
(e)
(1) The regulated organism must be maintained and disposed of in a manner so as to prevent the unauthorized release of the regulated organism.
(2) The regulated organism must be kept separate from other organisms, except as specifically allowed in the permit.
(3) The regulated organism must be maintained only in areas and premises specified in the permit.
(4) The regulated organism's identity must be maintained at all times.
(5) In the event of an unauthorized release:
(i) The regulated organism must undergo the application of remedial measures determined by the Administrator to be necessary to prevent the spread of regulated organism;
(ii) The responsible person must contact APHIS as described in the permit within 24 hours of discovery, and subsequently supply a statement of facts in writing no later than 5 business days after discovery.
(6) The duration that the permit is valid will be listed on the permit itself. During such time, the responsible person must maintain records related to permitted activities of sufficient quality and completeness to demonstrate compliance with all permit conditions and requirements under this part. The responsible person must submit reports and notices to APHIS at the times specified in the permit and containing the information specified within the permit. Inspectors must be allowed access, during regular business hours, to the place where the regulated organism is located and to any records relating to the movement of a regulated organism. APHIS' access to records includes visual inspection and reproduction (photocopying, digital reproduction, etc.) of all records required to be maintained under this part, as requested by APHIS.
(7) The responsible person must notify APHIS in writing if any permitted activity associated with environmental release will not be conducted.
(8) Within 28 days after the initiation of any permitted activity related to environmental release, the responsible person must report to APHIS in writing the actual release site coordinates and details of the release, such as how many acres planted, how many organisms released, etc., based on permit
(9) A person who has been issued a permit must submit to APHIS an environmental release report within 6 months after the termination of any release into the environment. The report must include the APHIS reference number, methods of observation, resulting data, and analysis regarding all deleterious effects on plants, nontarget organisms, or the environment.
(f)
(1)
(i) The Administrator concludes that, based on the application or on additional information, the actions proposed under the permit may result in the unauthorized release of the regulated organism, or another plant pest or noxious weed; or
(ii) The Administrator determines that the responsible person or any agent of the responsible person has failed to comply at any time with any provision of this part or any other part of the regulations, or any permit that has previously been issued in accordance with this part.
(2)
(i) Following issuance of the permit, the Administrator receives information that would otherwise have provided grounds for APHIS to deny the permit application;
(ii) The Administrator determines that actions taken under the permit have resulted in the unauthorized release of the regulated organism, or another plant pest or noxious weed; or
(iii) The Administrator determines that the responsible person or any agent of the responsible person has failed to comply at any time with any provision of this part or any other part of the regulations. This includes failure to comply with the conditions of any permit issued.
(g)
(h)
(1)
(2)
(i)
(a) Any person may submit a request to APHIS to have a GE organism's regulatory status evaluated, or to request the reevaluation of the regulatory status of a previously evaluated regulated organism. Information needed for such a request is found on the Internet, at
(b)
(2) If the request is complete, APHIS will conduct an analysis of plant pest and/or weed risks of the GE organism.
(c)(1) APHIS will make both the request and the risk analysis available for public review through a notice published in the
(2) If no comments are received on the notice, or if the comments do not affect the conclusions of the risk analysis or the proposed regulatory status of the organism, APHIS will provide notification through the APHIS stakeholder registry at the end of the
(3) If comments lead APHIS to change its proposed regulatory status for the organism, APHIS will publish a subsequent notice in the
(a)
(1) All records and reports required as a condition of a permit;
(2) Addresses and any other information needed to identify all contained facilities where the regulated organism was stored or utilized, and all locations where the regulated organism was used in an environmental release;
(3) A record identifying which APHIS permit, if any, authorized the permitted activity; and
(4) Copies of contracts between the responsible person and all agents that conduct activities subject to this part for the responsible person, and copies and documents relating to agreements made without a written contract.
(b)
(c)
(i) Denial of a permit application or revocation of a permit;
(ii) Application of remedial measures in accordance the Plant Protection Act, 7 U.S.C. 7701
(iii) Criminal and/or civil penalties.
(2) Prior to the issuance of a complaint seeking a civil penalty, the Administrator may enter into a stipulation, in accordance with § 380.10 of this chapter.
(d)
Persons submitting confidential business information in any document submitted to APHIS under this part should do so in the following manner. If there are portions of a document deemed to contain confidential business information, those portions must be identified, and each page containing such information must be marked “CBI Copy.” A second copy of each such document must be submitted with all such CBI deleted and marked on each page where the CBI was deleted: “CBI Deleted.” In addition, any person submitting CBI must justify how each piece of information requested to be treated as CBI is a trade secret or is commercial or financial information and is privileged or confidential.
The services of the inspector related to carrying out this part and provided during regularly assigned hours of duty and at the usual places of duty will be furnished without cost.
Agricultural Marketing Service, USDA.
Final rule.
The United States Department of Agriculture's (USDA) Agricultural Marketing Service (AMS) is amending the organic livestock and poultry production requirements by adding new provisions for livestock handling and transport for slaughter and avian living conditions; and expanding and clarifying existing requirements covering livestock care and production practices and mammalian living conditions.
(1) Organic egg operations that are certified before March 20, 2020 need to implement the outdoor access requirements by March 21, 2022. Organic egg operations that become certified after March 20, 2020 need to comply with the outdoor access requirements in order to obtain certification.
(2) Organic broiler operations must fully implement the indoor space requirements by March 20, 2020.
Paul Lewis, Ph.D., Director of Standards Division, Telephone: (202) 720-3252; Fax: (202) 260-9151.
This final rule creates greater consistency in organic livestock and poultry practice standards. Based on recommendations from the Office of Inspector General and the National Organic Standards Board, AMS determined that the current USDA organic regulations (7 CFR part 205) covering livestock care and production practices and living conditions needed additional specificity and clarity to better ensure consistent compliance by certified organic operations and to provide for more effective administration of the National Organic Program (NOP) by AMS. One purpose of the Organic Foods Production Act of 1990 (OFPA) (7 U.S.C. 6501-6522) is to assure consumers that organically produced products meet a consistent and uniform standard (7 U.S.C. 6501).
Specifically, this final rule:
1. Clarifies how producers and handlers participating in the NOP must treat livestock and poultry to ensure their wellbeing.
2. Clarifies when and how certain physical alterations may be performed on organic livestock and poultry in order to minimize stress. Additionally, some forms of physical alterations are prohibited.
3. Sets maximum indoor and outdoor stocking densities for organic chickens, which vary depending on the type of production and stage of life.
4. Defines outdoor space and requires that outdoor spaces for organic poultry include soil and vegetation.
5. Adds new requirements for transporting organic livestock and poultry to sale or slaughter.
6. Clarifies the application of USDA Food Safety and Inspection Service (FSIS) requirements regarding the handling of livestock and poultry in connection with slaughter to certified organic livestock and poultry establishments and provides for the enforcement of USDA organic regulations based on FSIS inspection findings.
7. AMS has only established indoor space requirements for chickens in this final rule. AMS may propose space requirements for other avian species in the future. Other avian species must meet all other indoor requirements including exit doors, ammonia levels, and lighting.
AMS estimates the following costs and benefits for this final rule.
You may be affected by this action if you are engaged in the meat, egg, poultry, dairy, or animal fiber industries. Affected entities may include, but are not limited to:
• Individuals or business entities that are considering organic certification for a new or existing livestock farm or slaughter facility.
• Existing livestock farms and slaughter facilities that are currently certified organic under the USDA organic regulations.
• Certifying agents accredited by USDA to certify organic livestock operations and organic livestock handling operations.
This listing is not intended to be exhaustive, but identifies key entities likely to be affected by this action. Other types of entities could also be affected. To determine whether you or your business may be affected by this action, you should carefully examine the regulatory text. If you have questions regarding the applicability of this action to a particular entity, consult the person listed under
This final rule addresses care and production practices, transport, slaughter, and living conditions for organic livestock and poultry.
On April 13, 2016 AMS issued a proposed rule to amend organic livestock and poultry practices. Background on current organic livestock standards, NOSB recommendations contributing toward the development of the proposed rule, AMS policy, and related issues are described in preamble of that action.
In response to AMS's request for comments on the proposed rule, a total of 6,675 written comments were received. Approximately 78 percent of the submitted comments—or 5,182 comments—consisted of form letters. There were 1,493 individual comments on the proposed rule. Comments were received from producers, producer associations, handlers, certifying agents, consumers and consumer groups, animal welfare organizations, veterinarians, state government agencies, foreign government agencies, and trade associations or organizations. AMS analysis and response to comments is described in the following preamble sections of the final rule.
(Comment) Several comments argued that USDA does not have sufficient regulatory authority under OFPA to publish final rules for livestock living conditions and animal welfare as described in the proposed rule. They argued that the livestock section of OFPA only provides authority to prepare regulations regarding feeds and animal health care issues.
(Response) AMS affirms that USDA has the authority to conduct this rulemaking; this action falls within our purview to implement the Organic Foods Production Act. AMS is issuing these regulations to strengthen the USDA organic livestock production regulations with clear provisions to fulfill one purpose of OFPA: to assure consumers that organically-produced products meet a consistent and uniform standard (7 U.S.C. 6501). In accordance with OFPA, this action will clarify USDA statutory and regulatory mandates and establish consistent, transparent, and enforceable requirements. Two provisions within OFPA convey the intent for the USDA to develop more specific standards for organic livestock production; that purpose was also explained in the accompanying Senate Committee report.
This rule would continue the process initiated with the Access to Pasture rulemaking to establish clear and comprehensive requirements for all organic livestock, consistent with recommendations provided by USDA's Office of Inspector General and nine separate recommendations from the NOSB. Further, it will align regulatory language and intent to enable producers and consumers to readily discern the required practices for organic poultry production and to differentiate the products in the marketplace.
(Comment) The proposed rule sought comments on the clarity of the proposed requirements by posing the following specific question: “Can farmers, handlers, and certifying agents readily determine how to comply with the proposed regulations?”
Though they did not directly answer the question posed in the proposed rule, a few comments nevertheless commented more generally on the clarity of the proposed rule. Speaking specifically of the revisions to mammalian living conditions, one comment indicated that the proposed rule was needed as a means to strengthen vague organic livestock standards. This comment did, however, highlight areas that continue to be unclear, claiming inconsistencies in the interpretation of standards upon implementation of the rule. Another commenter provided general support for the proposed rule, as rulemaking clarity will lead to consistent compliance by certified operations while addressing consumer expectations and demand. In contrast, one comment stated that that rule is confusing specifically addressing mammals and avian species. Another comment stated that only organic certifiers with limited livestock experience will find the current the organic regulations clear and concise in contrast to the more seasoned organic inspector community. This commenter further stated that those experienced in the organic industry realize the challenge to promulgate universal standards. The comment also asserted that creating new standards will make it difficult for certifiers to be effective in their work.
(Response) Where appropriate, AMS has amended sections of the final rule to clarify the requirements based on comments, with the goal of making the requirements readily understandable for organic stakeholders.
(Comment) A few comments stated that USDA should do more to inform consumers about what organic means and doesn't mean, and that educating consumers about the existing standards would be better than changing the regulations.
(Response) AMS agrees that consumer education is important to ensure that organic consumers understand the limitations of the existing organic regulations. However, numerous comments and the NOSB have requested that AMS clarify the current regulatory text and add sufficient detail in support of consistent enforcement of the USDA organic regulations that affect the welfare of organic livestock and poultry. Therefore, AMS has opted to proceed with this rulemaking. AMS received a number of comments which addressed how the variability in outdoor access practices among organic producers threatens consumer confidence in the organic label. This is discussed more fully in the Executive Orders 12866 and 13563 section—see Impact of Consumer Confusion.
(Comment) A number of comments asked how the final rule would impact existing organic trade agreements, such as equivalency agreements and recognition agreements. For example, some comments highlighted where specific standards in the proposed rule differ from existing standards in specific countries. It was also asked whether existing equivalency agreements would require renegotiation as a result of a final rule.
(Response) When the USDA organic regulations are amended, the USDA notifies the trading partner in accordance with the terms established in the international organic equivalency arrangement. In addition, the proposed regulations are shared with the World Trade Obligations (WTO) pursuant to the WTO Agreement on Technical Barriers to Trade. Under the current organic equivalency arrangements, the USDA notifies the trading partner in advance of any final USDA organic regulation that may affect the terms of the existing equivalency determination. The foreign country reviews the information, and may initiate discussion to determine whether a renegotiation of the equivalence arrangement is needed. With recognition arrangements, the certification bodies in the foreign country are accredited by the recognized foreign government authority to certify operations under the USDA organic regulations. As a result, the USDA notifies the foreign government of the final USDA organic regulation, and the foreign government authority informs its accredited certification bodies of the final regulation. AMS will provide training and technical assistance during the implementation period to assist foreign governments and accredited certification bodies.
(Comment) USDA received comments regarding meat and poultry imports and how AMS will regulate livestock slaughter by certified operations in foreign countries. One comment provided country-specific recommendations regarding cattle to stipulate that while cattle are in Australia, “they must abide by the standards and guidelines prescribed in the Australian Animal Welfare Standards for the Land Transport of Livestock (The Standards).” Additionally, a comment indicated that U.S. certifiers are currently unequipped to verify compliance with these other rules/laws for producers outside of the U.S.
(Response) Products certified under the USDA organic regulations must first comply with the requirements of the Food and Drug Administration (FDA) and Food Safety and Inspection Service (FSIS). In other countries, FSIS has memorandums of understanding that recognize other countries' processes for safe and humane livestock handling and slaughter. Generally, USDA organic requirements go beyond minimum regulatory requirements for humane handling and slaughter. For NOP requirements, certifiers must ensure inspectors are qualified to evaluate compliance of applicants for organic certification. Certifiers are not responsible for verifying compliance
Documents related to this final rule include the Organic Foods Production Act of 1990, as amended, (7 U.S.C. 6501-6522) and its implementing regulations (7 CFR part 205). The NOSB deliberated and made the recommendations described in this proposal at public meetings announced in the following
AMS published a series of past proposed rules that addressed, in part, the organic livestock requirements at: 62 FR 65850 (December 16, 1997); 65 FR 13512 (March 13, 2000); 71 FR 24820 (April 27, 2006); and 73 FR 63584 (October 24, 2008). Past final rules relevant to this topic were published at: 65 FR 80548 (December 21, 2000); 71 FR 32803 (June 7, 2006); and 75 FR 7154 (February 17, 2010). AMS published the most recent proposed rule at 81 FR 21956 (April 13, 2016).
This final rule adds sixteen new terms to § 205.2: beak trimming, caponization, cattle wattling, de-beaking, de-snooding, dubbing, indoors or indoor space, mulesing, non-ambulatory, outdoors or outdoor space, perch, pullet, ritual slaughter, soil, toe clipping, and vegetation. Six of these terms—caponization, cattle wattling, de-snooding, dubbing, mulesing, and soil—remain unchanged from the proposed rule. The definitions of seven additional terms were revised in response to comments: beak trimming, de-beaking, indoors or indoor space, outdoors or outdoor space, perch, pullets, and toe clipping. The term roost, which was included in the proposed rule, has been removed from the final rule in response to comments. Three terms that were not included in the proposed rule, non-ambulatory, ritual slaughter, and vegetation, have been added to the final rule.
The final rule prohibits several physical alterations on organic livestock. Eight terms related to these physical alterations are defined in the final rule so that certifying agents and producers may ensure that they do not inadvertently perform a prohibited physical alteration which may be known by a different name locally.
The final rule defines “indoors or indoor space” as the space inside of an enclosed building or housing structure that has a solid, slatted, or perforated floor. The term “indoors” from the proposed rule was modified to include “or indoor space” because both of these terms are used interchangeably throughout the rule. While all organic livestock must be provided with species-appropriate shelter, structures providing indoor space are not required. If indoor spaces are provided to organic livestock, then species-specific requirements for the indoor space must be met. Indoor spaces are differentiated from outdoor spaces based upon the structure being enclosed so that livestock may be confined within the footprint of the building.
Indoor space is enclosed so that livestock may be confined within the building or housing structure; outdoor space is the area outside of the enclosed building or enclosed housing structure, but includes roofed areas that are not enclosed. One of the key considerations distinguishing indoor space from outdoor space is how the livestock are managed in that space. How livestock are managed may determine whether space is considered indoors, outdoors, or neither indoors nor outdoors. As an example, a screened in and roofed porch to which the (enclosed) birds always have access, including during temporary confinement events, would be considered indoor space. That same porch would be considered neither indoors nor outdoors if the birds did not have continuous access to the space during temporary confinement events. If the screens were removed from that porch so that the birds could freely access other outdoor space, then the porch would be considered outdoor space (see “Outdoors or outdoor space,” below). These distinctions provide flexibility for producers to work with their certifying agents when developing their organic system plans (OSPs), yet still aligns with the position that enclosed porches are not considered to be outdoor space.
The final rule defines four types of avian indoor space. These indoor housing types are defined because each housing type has a differing indoor space requirement. AMS continues to include an indoor space requirement at § 205.241(b)(8)(v) for housing that does not fit within one of the types defined in § 205.2.
The final rule further clarifies the requirements for avian species indoor space requirements by defining the term “perch” as a rod or branch type structure or flat space above the floor of the house that accommodates roosting, allowing birds to utilize vertical space in the house.
The final rule defines “outdoors or outdoor space” to clarify the meaning of outdoor areas for mammalian and avian species. The term “outdoors” from the proposed rule was modified to include “or outdoor space” because these two terms are used interchangeably throughout the rule. “Outdoors or outdoor space” is defined as any area outside of an enclosed building or enclosed housing structure, but including roofed areas that are not enclosed. In this definition, “outdoors or outdoor space” includes all of the non-enclosed space encompassing soil-based areas such as pastures, pens, or sacrifice lots; hardened surface areas such as feedlots, walkways, or loafing sheds; and areas providing outdoor shelter such as windbreaks and shade structures.
The outdoor space has species-specific requirements. For example, this rule sets the requirement that 50 percent of the outdoor space for avian species must be soil-based and that the soil be maximally covered with vegetation. Vegetative cover must be maintained in a manner that does not provide harborage for rodents and other pests. For avian species, the definition of outdoors has been revised to include pasture pens, which are floorless pens that are moved regularly and provide direct access to soil and vegetation. These pens may consist of solid roofing over all or part of the pen to provide shelter for the birds. For further discussion see “Pasture Pens vs. Other Mobile Housing” in section IX. Avian Living Conditions.
To assist with the mitigation of biosecurity and predation risks, fencing, netting, or other materials are permitted over all or part of the outdoor areas to prevent predators and other wild birds from entering the outdoor area. Many producers also use portable or permanent shade structures throughout their pastures. Structures for shade are also permitted in the outdoor space. For example, the area within a standalone, roofed shade structure could be included as outdoor space area. Areas under the eaves or the awning of a building, with a roof attached to the outer wall of the indoor space structure,
The final rule defines “soil” as the outermost layer of the earth comprised of minerals, water, air, organic matter, fungi, and bacteria, in which plants may grow roots. Soil is defined to distinguish these areas from impervious areas such as concrete or pavement. Soil may consist of bare ground but is generally covered with vegetation. As described in the mammalian and avian living condition sections, maximum vegetative cover should be maintained on the soil as appropriate for the species, season, geography, and climate. Designated sacrifice areas or dry lots are permitted. Outdoor areas must be maintained in a manner that maintains or improves natural resources, including soil and water quality. Temporary confinement may be provided to protect soil and water quality.
The final rule adds the term “non-ambulatory” and references the definition in 9 CFR 309.2(b). FSIS defines non-ambulatory as “livestock that cannot rise from a recumbent position or that cannot walk, including, but not limited to, those with broken appendages, severed tendons or ligaments, nerve paralysis, fractured vertebral column, or metabolic conditions.” Any non-ambulatory livestock on organic farms must be medically treated, even if the treatment causes the livestock to lose organic status or be humanely euthanized.
AMS modified the definition of pullets, which is used by the AMS Livestock, Poultry, and Seed Program, to include species other than chickens. This final rule defines “pullets” as female chickens or other avian species being raised for egg production that have not yet started to lay eggs. Once avian females begin laying eggs, AMS refers to them as layers. The term “pullets” does not describe young broilers used for meat production.
The final rule defines “stocking density” as the weight of animals on a given area or unit of land. This term is used to describe the indoor and outdoor space requirements for organic livestock. For example, the final rule establishes maximum stocking densities for avian species, and the producer must ensure that the area provided is large enough to not exceed the established maximum stocking density when all birds in the flock are on the given area (
The final rule adds the term “ritual slaughter” and references the definition in the Humane Methods of Slaughter Act (7 U.S.C. 1902(b)). This Act defines ritual slaughter as “slaughtering in accordance with the ritual requirements of the Jewish faith or any other religious faith that prescribes a method of slaughter whereby the animal suffers loss of consciousness by anemia of the brain caused by the simultaneous and instantaneous severance of the carotid arteries with a sharp instrument and handling in connection with such slaughtering.”
Organic livestock and handling operations may use ritual slaughter to convert their livestock to meat or poultry without loss of organic status.
The final rule adds the term “vegetation” and defines it as living plant matter that is anchored in the soil by roots and provides ground cover. This term applies to the requirement for vegetation in outdoor areas, which is central to protecting soil and water quality as well as providing for livestock to exhibit their natural behaviors. The roots of vegetation provide stability and structure to soil. Vegetation helps water soak into the soil rather than running off, which can cause erosion. Livestock also have natural behaviors of grazing, rooting, nesting, etc., which require vegetation.
(Comment) The term beak trimming was included in the proposed rule and was defined as the removal of the curved tip of the beak. Many comments expressed that the definition for this term was vague and that the difference between beak trimming and de-beaking was unclear. Comments also shared that it is common within the industry to use the terms beak trimming and de-beaking interchangeably and that a more quantitative measure should be included if the intent of the rule is to control the amount of beak trimmed. One comment requested additional clarification with regards to trimming the bottom of the beak. Some comments suggested revisions to the definition to provide clarity, including the American Veterinary Medical Association (AVMA) which recommended the following definition: “Beak trimming (formerly de-beaking) is the removal of approximately one-quarter to one-third of the upper beak, or both upper and lower beak, of a bird in order to control injurious pecking and cannibalism.” Four comments suggested that the proposed definition be revised to specify the anatomical name of the portion of the beak that is removed in beak trimming. Other comments stated that the definition should specify the age at which beak trimming can be performed.
(Response) AMS agrees with the majority of comments which expressed that the definition of beak trimming should be clarified. We have replaced the definition from the proposed rule with a definition similar to the one provided by AMVA which specifies that beak trimming is “the removal of approximately one-quarter to one-third of the upper beak, or both upper and lower beak”. For the purposes of these regulations, AMS modified the AVMA definition to replace the word “approximately” with “not more than” in order to ensure that beak trimming is clearly distinguished from de-beaking. We believe that this definition adequately addresses the comments received and is both accurate and clear without being overly prescriptive. AMS does not believe that it is necessary to refer to anatomical names for portions of the beak in this definition since these terms are not used in the regulatory text. Other comments in response to the age at which beak trimming can be done are addressed in the avian living conditions section of the final rule.
(Comment) The term de-beaking was included in the proposed rule and was defined as “the removal of more than the beak tip.” The comments received regarding the term beak trimming also addressed de-beaking, expressing that the proposed definition was vague and that the distinction between beak trimming and de-beaking was not clear. One comment requested that the definition of de-beaking be removed entirely as the industry has taken steps to eliminate this practice.
(Response) In response to comments, AMS amended the definition of de-beaking in the final rule to make it more specific. AMS believes that it is important to define de-beaking in order to differentiate it from beak trimming. Comments did not provide a suggested definition for the term, and as a result AMS decided to define de-beaking as anything that goes beyond what is defined in this rule as beak trimming.
(Comment) AMS received two comments stating that the definition for “caponization” should not be included in the final rule. Comments stated that it is unnecessary for AMS to define “caponization” because it beyond the purview of the AMS.
(Response) This final rule prohibits caponization, as defined, based upon a recommendation from the NOSB. Thus, it is within AMS's purview. AMS believes that, because caponization is prohibited, it is necessary to clearly define what it is so that certifying agents and producers can ensure that they do not inadvertently perform this physical alteration.
(Comment) AMS received a range of comments on the proposed definition of indoors. A number of comments suggested that the term “indoors” be replaced by the term “indoors for avian species” since the definition of the term is specifically related to avian living spaces. Other comments recommended changing the term “pasture housing” to “mobile housing.” These comments pointed out that there are fixed housing systems that offer pasture to birds. They also noted that the term “pasture-raised” is defined by other third-party animal welfare standards, and those standards allow fixed housing to be used in combination with a spoke-and-wheel pasture rotation for pasture-raised poultry. Thus, they felt that the term “mobile housing” is more accurate based on the type of housing that AMS intended to describe in the proposed definition.
Two comments recommended that the reference to 70% perforated flooring be removed from the description of pasture housing since this requirement is restrictive when considering that different types of pasture housing (or mobile housing) vary in design. These comments suggested that the definition instead focus on the mobility of the housing and its frequent movement.
Various comments expressed that more clarity is needed in the definition of “indoors” in order to define exactly what counts as indoors and outdoors for the various types of pasture-based systems used. These comments recommended that definitions for “moveable pasture pen” and “day range system” be added in order to provide additional clarity and to better represent the actual types of pasture housing used in pastured-poultry operations. Commenters used “Salatin” style housing, “Prairie Schooners,” and simple hoop structures as examples of moveable pasture pens. The comments described these systems as providing direct access to soil and vegetation; having walls and roofs made of mesh, plastic, wood, and other materials; and having mobility. Birds in these systems are on pasture 24 hours per day, while roofing on all or part of the structure provides shade and protection. These commenters argued that these systems are unique, provide access to the soil and vegetation, and allow birds to exhibit natural behavior, and should be specifically permitted and addressed in the requirements.
(Response) AMS agrees that the proposed definition for indoors focuses specifically on describing what qualifies as indoor areas for avian species. Rather than creating a new term, “indoors for avian species,” AMS determined that it would be best to define indoors more broadly, and provide a separate sub-category of terms that define what is indoors specifically for avian species. Having a broadly applicable definition of indoors helps to clearly distinguish it from the meaning of outdoors. Further defining indoor areas for avian species within the definition of indoors allows AMS to provide more specificity where it is needed. As a result, AMS revised the basic definition of indoors to define it as the space inside of an enclosed building or housing structure with solid, slatted, or perforated flooring.
AMS also agrees with comment that stated that the term “mobile housing” is more appropriate to describe pasture housing that is regularly moved to provide birds with access to new pasture. In various situations, the term “pasture housing” may be applied to stationary housing that provides access to pasture, and this could cause confusion for producers, certifying agents, and inspectors. In response to comments, AMS replaced the term “pasture housing” with “mobile housing” in the final rule.
Additionally, AMS removed the reference to 70% perforated flooring from the definition of mobile housing. AMS agrees with comments that defining mobile housing without specifying what its flooring is made of is more applicable given the diversity of structures used in mobile housing systems.
AMS made several revisions in the final rule in response to comments requesting more clarity around the definitions of indoors and outdoors as they apply to pasture-based systems. AMS agrees with comments that the proposed definitions for these terms did not adequately consider pastured poultry systems where birds are contained within a lightweight, floorless enclosure such as a pen that provides the birds in the pen with direct contact to soil and vegetation. As such, these systems did not clearly fall under either definition that AMS proposed for indoors or outdoors. AMS has clarified that pasture pens are outdoors or outdoor space by revising the definition in section 205.2. For further discussion of this topic, see section IX. Avian Living Conditions, “Pasture Pens vs. Other Mobile Housing.”
Organic livestock must be provided with outdoor space as the default living space, along with shelter. Organic producers may choose to provide indoor covered, enclosed and floored space as shelter if needed for the health and wellbeing of the birds, but it is not required. In addition to revising the broad definition of indoors, AMS responded to these comments by providing a separate definition of pasture pens under the definition of outdoors at section 205.2. The definition of outdoors, similar to the definition of indoors, defines pasture pens in a sub-category of terms describing outdoors for avian species.
(Comment) A small number of comments stated that it was unclear from the proposed rule whether accessible nest box areas could be included in indoor space calculations. These comments suggested adding “and accessible nest boxes” to the first sentence of the definition for indoors. Some comments requested that the definition of indoors clarify that the term includes porches and lean-to type structures attached to the building or housing structure. One comment questioned the reference to feed and water on each level in the description of aviary housing. This comment noted that it is not necessary to include this specific requirement in case producers prefer to keep food and water on the main level of housing to encourage birds to move around and go outdoors. One comment suggested a new definition for “indoors” as: “The flat space or platform areas which are under a solid roof and contained within a solid wall.” Another comment that the definition for indoors specify that it may not contain prohibited materials.
(Response) AMS did not add “accessible nest boxes” to the definition of indoors as some comments requested. Most third-party animal welfare
Humane Farm Animal Care:
Global Animal Partnership:
American Humane Certified:
AMS determined that a specific reference to porches and enclosed lean-to type structures is not necessary in the definition of “indoors.” AMS believes that the definition adequately covers these types of structures and that including them in a broader list of housing categories would be confusing. However, AMS does provide clarification in the regulatory text under Avian Living Conditions (§ 205.241) that these structures can be counted as indoor space provided that they are fully accessible to birds at all times, including during temporary confinement.
AMS removed “feed and water on each level” from the definition of aviary housing in the definition of “indoors or indoor space” at § 205.2. Not all avian housing is designed this way, and this revision allows producers to work with their certifying agents to determine the best location for food and water depending on their housing system.
(Comment) Many comments stated that the definition of outdoors should include a requirement for vegetation instead of soil. These comments expressed concern about soil and water quality in the absence of vegetation in outdoor areas used by livestock. Many also felt that vegetation is important for animal health and natural behaviors. Other comments requested that the 50 percent soil requirement in the definition of outdoors should be removed. These comments felt that this reference contradicted the use of feeding pads and feeding yards, which are specifically allowed under the rule. They also expressed concern that including a requirement specifically for 50 percent soil in the definition of outdoors could negatively impact soil and water quality during winter or dry months.
Various comments questioned the statement in the proposed definition indicating that areas with solid walls or a solid roof attached to the outer wall of an indoor living space cannot be considered outdoors. Comments questioned how these areas (such as eaves or awnings) are different from an outdoor space that has a solid roof and no walls and is not connected to the structure providing the indoor space. They reasoned that these areas provide the same quality of outdoor space and are important for providing shade and protection. Other comments stated that allowing areas under the eaves of buildings and awnings to be counted as outdoors would simplify outdoor space calculations.
Some comments stated that porches should be included in the definition of outdoors. They cited the need to calculate porches as outdoor space due to producer costs, biosecurity concerns, mortality rates, and environmental concerns.
(Response) AMS agrees with comments that it is important that outdoor areas for livestock include vegetation to protect soil and water quality and promote animal health and natural behaviors. AMS is also in agreement with comments that requested that the reference to soil be removed from the definition of outdoors. In response to these comments, AMS in conjunction with Natural Resource Conservation Service, determined that requirements for soil and vegetation in outdoor access areas should be included in the sections of the final rule that address mammalian and poultry living conditions rather than in the definition of outdoors. Including a requirement for vegetation in the definition for outdoors may make it difficult for some producers to meet outdoor access requirements during certain times of the year (
AMS agrees that outdoor areas that are partially covered, such as areas under the eaves or the awning of a building, can be considered outdoors. These areas can offer the same qualities of outdoor space (such as natural ventilation, soil, vegetation, and open access to uncovered outdoor areas) as independent shade structures. In response to comments, AMS revised the definition of outdoors to remove the statement that disqualifies areas where there is a solid wall or roof attached to the indoor living space. This revision is intended specifically to accommodate for features of an avian housing structure that may provide cover but are in areas that are truly outdoors. In these areas, birds have access to soil and vegetation, natural ventilation, and open access to uncovered outdoor areas beyond. AMS considers these areas as distinct from porches specifically because they are not fully enclosed.
For further discussion about porches see “Porches” in the Discussion of Comments Received, section IX. Avian Living Conditions.
(Comment) AMS received a number of comments about the proposed definitions of the terms “perch” and “roost.” Comments stated that the terms in the proposed rule were confusing and are used interchangeably within the proposed rule and within the industry. Some comments suggested replacing the word roost with the word slats, to refer to raised slats positioned over a manure pit. Other comments stated that the reference to manure pit(s) should be removed from the definition of roost entirely, as not all roosts are located over one.
(Response) AMS recognizes that using both terms “perch” and “roost” could be confusing, as the terms can be used interchangeably by producers and industry. AMS determined that it is only necessary to include the term “perch” in the final rule. As defined, this term is intended to refer to various features in poultry housing, such as rods, branch type structures, and flat roost slats that accommodate roosting and are elevated to allow birds to stay off the floor of the house. Perches may be over a manure pit but this is not a requirement. AMS also removed “roost” from the definitions section and regulatory text section based on
(Comment) A small number of comments expressed confusion over the proposed definition of soil and asked whether soil, as defined, is required to be bare since the definition did not include a reference to vegetation. One of these comments suggested revising the definition to add “which may be bare or vegetated” in order to provide clarification. Another comment requested that the definition of soil be revised to describe it as being vegetated, citing soil and water quality concerns. Other comments expressed concern about conflicts with other definitions of soil currently in use. One of these comments suggested replacing the proposed definition of “soil” with a more technical definition from the Natural Resources Conservation Service (NRCS), while another comment suggested using the term “certified ground.” A separate commenter thought that the impact of the proposed rule was limited without an adequate definition of soil that clearly states the quality, depth, and presence of vegetation.
(Response) After considering the comments received, we have retained the definition of soil from the proposed rule because we believe that it is an accurate and a commonly understood description of the term. AMS believes that a more complex or overly technical definition of soil is unnecessary and could contribute to confusion. However, AMS recognizes that the intent of some comments was to avoid circumstances in which animals on bare soil could create soil or water quality problems, and the Agency agrees that avoiding such an outcome is paramount. The final rule provides additional clarification in the avian and mammalian living conditions sections regarding the various requirements for soil and vegetation in outdoor areas to differentiate between the needs and management of avian and mammalian species.
(Comment) AMS received various comments identifying that the reference to “unit of land” in the definition for stocking density is limiting, since it applies to both outdoor and indoor space. Comments suggested that the definition refer to “area of space” instead of to “unit of land.” One comment suggested that AMS also remove the phrase “at any one time” from the definition of stocking density. The comment stated that this phrase could be interpreted to allow space requirements to be calculated by applying the stocking density to a percentage of animals that might be in an area at a point in time, rather than applying the stocking density to the total flock.
(Response) In the final rule, AMS has removed the phrase “at any one time” from the definition to reduce the chance of confusion over the intended meaning and application of the term. AMS has also revised the term to include “given area” in response to comments that the term is used for both indoor and outdoor areas.
For further discussion about space calculations, please see AMS's response to comments in Avian Living Conditions.
(Comment) AMS received various comments questioning whether toe clipping is the same as toe trimming. Toe clipping was a new term defined and used in the proposed rule. Toe trimming, a similar term, was also used in various places throughout the proposed rule and brought forth questions about interchangeability between the terms.
A number of comments also pointed out that toe clipping can be performed on both male and female birds. These comments said that the definition of the term would be more accurate if the specific reference to a male bird was removed.
(Response) AMS recognizes that the proposed rule defined toe clipping and used the term toe trimming in the proposed rule. AMS also recognizes that toe clipping can be done on both male and female birds. In response to comments, the final rule defines toe clipping as the removal of the nail and distal joint of the back two toes of a bird without reference to the sex of the bird. Additionally, the term “toe clipping” is used consistently throughout the final rule and “toe trimming” has been removed.
Two comments asked for clarification about of the definition and composition of a scratch area. AMS has removed the term “scratch area” from the regulatory text. Since the term “scratch area” is not included in the regulatory text, AMS sees no need to define the term.
A small number of comments asked AMS to define the term enrichment or the phrase suitable enrichment. AMS has not defined the term, as we have removed the requirement for suitable enrichment in the final rule. For further discussion, see AMS's response to comments in the section on FDA regulations and food safety.
One comment requested that the rule provide a definition of “willful acts of abuse.” The comment noted that this definition was included in the NOSB's 2011 recommendation on transport and slaughter. Since the term “willful acts of abuse” is not included in the regulatory text, AMS sees no need to define the term.
One comment requested that AMS include a definition of litter in the rule. This comment stated that it is unclear if litter is intended to mean bedding or if it can consist solely of dehydrated manure. AMS determined that the term “litter” is commonly used by avian producers to describe substrates used to absorb moisture and dilute manure, as well as to provide birds the opportunity to express natural behaviors such as foraging and dust bathing. AMS did not provide a definition for litter in the final rule. Instead, litter is described in more detail in the avian living section of the rule.
Four comments stated that the definition of dubbing does not include the removal of the wattles. AMS reviewed the uses of the term dubbing and found some references that included the removal of wattles and others that only referred to combs. Other sources refer to the practices separately as “wattle trimming” and “comb trimming.” AMS retained the definition of dubbing in the final rule to include the removal of both combs and wattles.
One comment requested that the final rule define “swine aggression” to prevent unnecessary confinement of pigs. This commenter stated that without a definition for the term, the provision of the rule allowing for individual housing for swine in cases where aggression is documented could be used for unnecessary confinement of pigs. AMS determined that it would be challenging to develop a definition for “swine aggression” that would be applicable across stages of production, and the diverse realities that exist on each farm. Instead, producers should work with their certifying agents to describe the types of aggression that would warrant individual housing on their operation as they develop an OSP.
AMS amended current provisions and added new provisions to the organic livestock care and production practice standards. The amendment to § 205.238(a)(2) specifies that the sufficiency of the feed ration be demonstrated by appropriate body condition of the livestock. Livestock producers are required to monitor their animals to ensure body condition is being maintained. In addition, certifying agents need to verify the nutritional adequacy of the animals' diet by assessing the body condition of organic livestock during inspection. Suitable body condition varies between species, between breeds, and between production types; for example, a suitable condition for dairy cattle may be considered too thin in beef cattle. AMS plans to publish guidance to assist certifying agents, inspectors, and producers in assessing body condition for different species.
AMS revised § 205.238(a)(5) to clarify the conditions under which physical alterations may be performed on livestock. Physical alterations may only be performed for an animal's welfare, identification, or safety. Alterations must be done at a reasonably young age with minimal pain or stress to the animal, and may only be performed by a person who can competently perform the procedure. Competency in performing physical alterations may be demonstrated by appropriate training or experience of the person.
A 2009 NOSB recommendation allowed teeth clipping and tail docking in piglets, but this revision was retracted in the 2011 NOSB recommendation. In this final rule, AMS added § 205.238(a)(5)(i), which restricts needle teeth clipping and tail docking in pigs. These two types of physical alterations may not be performed on a routine basis, but may be performed as needed to improve animal welfare, as listed below.
Needle teeth clipping and tail docking in pigs may only be performed in response to documented animal welfare reasons after alternative steps to prevent harm fail. Teeth clipping, if performed, is limited to the top third of each needle tooth. For example, an organic swine producer who clipped needle teeth or performed tail docking would need to document excessive needle teeth scarring on the underline of a sow or piglets, or document tail biting on piglets in the litter. Swine producers would also need to document that alternative methods to prevent scarring had failed. Such alternative methods may include, but are not limited to, cross-fostering prior to teat fidelity across litters to minimize weight variation, providing sufficient enrichment materials, and providing vegetation for rooting.
AMS is finalizing § 205.238(a)(5)(ii) to list the physical alterations that are prohibited in an organic operation. Based on the 2011 NOSB recommendations, the following physical alterations to avian species are prohibited: De-beaking, de-snooding, caponization, dubbing, toe clipping of chickens, toe clipping of turkeys unless with infra-red at hatchery, and beak clipping after 10 days of age. In addition, the following physical alterations to mammalian species are prohibited: Tail docking of cattle, wattling of cattle, face branding of cattle, tail docking of sheep shorter than the distal end of the caudal fold, and mulesing of sheep.
AMS added a new § 205.238(a)(7) which specifies that surgical procedures on livestock to treat an illness must be done in a manner that minimizes pain, stress, and suffering. The NOSB recommended that all surgical procedures for livestock be done with the use of anesthetics, analgesics, and sedatives. USDA organic regulations require that all surgical procedures for treatment of disease be undertaken in a manner that employs best management practices in order to minimize pain, stress, and suffering, and only with the use of anesthetics, analgesics, and sedatives as listed in §§ 205.603(a) and 205.603(b).
AMS added a new § 205.238(a)(8) that requires organic producers to actively monitor and document lameness within the herd or flock. Lameness can be an issue in various livestock species, including broilers, sheep, and dairy cattle. The requirement for producers to create a plan for monitoring and recording instances of lameness in the organic system plan enables organic livestock producers to identify and address potential problems among animals before they become widespread. In addition, documentation of lameness will provide an auditable trail for certifying agents to verify that livestock producers are monitoring these potential causes of animal suffering.
AMS revised § 205.238(b) to state that synthetic medications allowed under § 205.603 may be administered to alleviate pain or suffering. In addition, synthetic medications allowed under § 205.603 may be administered when preventative practices and veterinary biologics are inadequate to prevent sickness.
AMS amended § 205.238(c)(1) to clarify that milk from an animal treated with an allowed substance in § 205.603, which has a withholding time, may not be sold, labeled, or represented as organic during that holding time. However, organic animals or breeder stock may continue to provide milk for organic calves on the same operation during the withholding time. This is consistent with the 2010 NOSB recommendation that a calf nursing a cow treated topically with lidocaine or other approved synthetic with a withdrawal time would not lose organic status. For example, if an organic beef cow was nursing her organic calf and the cow became injured, her calf could continue to nurse the cow even during the seven-day withholding period if lidocaine was used to minimize pain and stress during her treatment. In this scenario, the calf would not lose organic status.
AMS revised § 205.238(c)(2) to clarify that other veterinary biologics, in addition to vaccines, are exempt from the prohibition on administering animal drugs in the absence of illness. The USDA Center for Veterinary Biologics (CVB) regulates vaccines and all other veterinary biologics. While vaccines are commonly referred to as veterinary biologics, the CVB also categorizes bacterins and toxoids as biologics. This change is consistent with the definition for biologics in § 205.2 and supports § 205.238(a)(6), which identifies the use of vaccines and other veterinary biologics as a required practice to improve animal health.
AMS revised § 205.238(c)(3) to clarify that organic livestock producers are prohibited from administering synthetic or nonsynthetic hormones to promote growth, or for production and reproductive purposes. However, hormones listed in § 205.603 (
AMS added a new § 205.238(c)(8) to prohibit organic livestock producers from withholding treatment designed to minimize pain and suffering for injured, diseased, or sick animals. Injured, diseased, or sick animals may be treated with any allowed natural substance or synthetic medication that appears on the National List. However, if no appropriate medication is allowed for
AMS added a new § 205.238(c)(9) that requires livestock producers to identify and record treatment of sick and injured animals in animal health records. Early identification can lead to more effective prevention or treatment, which will enhance the overall health of the livestock on that operation.
AMS added a new § 205.238(c)(10) that prohibits the practice of forced molting in poultry. Section 205.238(a)(2) of this final rule requires a nutritionally sufficient feed ration for livestock. Forced molting, a practice in which feed is severely restricted for a period of time in order to rejuvenate egg production, runs counter to this provision. The new 205.238(c)(10) was added to be consistent with the NOSB recommendation.
AMS added a new § 205.238(d) that requires organic livestock operations to minimize internal parasite problems in livestock. The plan to minimize internal parasites must include preventative measures such as pasture management, fecal monitoring, and emergency measures in the event of a parasite outbreak. Livestock producers must also work with their certifying agents to approve a parasite control plan.
In certain cases, livestock may suffer from an illness or injury from which recovery is unlikely. AMS added a new § 205.238(e) to address euthanasia based on the 2011 NOSB recommendations. Section 205.238(e)(1) requires livestock producers to maintain written plans for euthanizing sick or injured livestock. Section 205.238(e)(2) prohibits the following methods of euthanasia: Suffocation, manual blows to the head by blunt instrument or manual blunt force trauma, and use of equipment that crushes the neck (
(Comment) AMS received one comment requesting that we prohibit selective breeding of livestock and poultry for characteristics that may compromise their health and natural behaviors. The comment stated that some chicken breeds that are bred for increased white meat may have difficulty walking due to the size of their breasts relative to the strength/size of their legs.
(Response) Animal breeding is frequently conducted on non-certified operations, outside the scope of organic certification. Day-old birds are often selected and purchased by organic producers before the animals are brought into organic management. Selection of species and types of livestock with regard to suitability for site-specific conditions and resistance to prevalent diseases and parasites is a requirement under § 205.238(a). Some species or types of livestock or poultry may not be suitable for organic production. Under existing regulations, certifying agents should verify that producers have selected breeds that are suitable for their site-specific conditions and that are resistant to prevalent diseases and parasites.
(Comment) One comment stated that the language proposed at § 205.238(a)(2) “. . . resulting in appropriate body condition” should be the sole indicator of the sufficiency of feed rations. Other comments, while expressing support for the inclusion of this additional language, argued that “appropriate body condition” is difficult to quantify. One comment requested that body condition standards be specified in the final rule. Other comments requested that body condition assessment guidance accompany the final rule.
(Response) Livestock body condition may vary greatly depending on the livestock breed, age, season of the year, or stage of production. The primary requirement under this section is to require livestock to receive a feed ration that is sufficient to meet nutritional requirements. This would generally be verified by comparing the net energy and other nutrient requirements for the animal with the diet provided. AMS has added “. . . resulting in appropriate body condition” as a secondary assessment factor within the regulations for inspectors to use to gauge the nutritional status of an individual animal or group of animals. Because qualified organic inspectors should have sufficient livestock experience to evaluate the nutritional condition of livestock as part of their qualifications to inspect an organic livestock operation, we agree that guidance on how to assess appropriate body condition by species would be helpful for training purposes. AMS will provide such guidance after publication of the final rule.
AMS received a number of comments requesting specific changes in words and phrases regarding the first part of § 205.238(a)(5): Physical alterations may be performed to benefit the welfare or hygiene of the animals, for identification purposes or safety. Physical alterations must be performed on livestock at a reasonably young age, with minimal stress and pain and by a competent person. These specific comments will be addressed one by one in the following discussion of comments.
(Comment) AMS received many comments proposing that the word “hygiene” be removed from § 205.238(a)(5). Comments believed that a broad interpretation of hygiene could create conflict among regulatory provisions, resulting in a loophole where farmers could seek to justify physical alterations even when prohibited under proposed § 205.238(a)(5)(ii). For example, hygiene is the main reason the tails of cows are docked on dairy farms, and thus hygiene should not be a justification for physical alterations.
(Response) AMS agrees that the term hygiene could be used to justify physical alterations otherwise prohibited, and has removed hygiene from this section of the final rule.
(Comment) AMS received comments that “reasonably young age” in § 205.238(a)(5) was too vague. These comments requested that we provide target ages for all physical alterations for all livestock.
(Response) The appropriate age of animals for performing alterations may depend on several factors, such as the nature of the physical alteration, temperature, season, species breed, and
(Comment) AMS received comments that “by a competent person” is too subjective to evaluate and should be removed from § 205.238(a)(5). Comments requested further that “competent person” be replaced with “licensed veterinarian.”
(Response) While AMS did not define a “competent person,” AMS will rely on certifying agents to assess the requisite expertise of the individual. Most routine physical alterations, such as dehorning, castration, and beak clipping are not conducted by licensed veterinarians. Livestock operators perform these operations, often on a daily basis. Requiring all physical alterations to be conducted by a licensed veterinarian would result in significant expense and inconvenience to an organic livestock operator. The proposed rule requires that physical alterations be conducted by a “competent person.” This would generally be understood to be someone who has the education, training, and experience necessary to conduct physical operations quickly and easily, with minimal stress and pain for the animal. Certifying agents will assess the competence of personnel conducting physical operations and determine if they have the necessary competencies based on the complexity of the alteration to be performed. AMS has not made any changes in the final rule based on this comment.
(Comment) For § 205.238(a)(5), AMS received many comments that the phrase “minimal stress and pain” was not an explicit enough description of how physical alterations must be performed on livestock. These comments requested that the use of synthetic pain medications allowed on § 205.603 be mandatory. Similar comments were made regarding the language at § 205.238(a)(7). Again, comments requested that USDA organic regulations mandate the use of synthetic pain medication rather than simply allow them.
(Response) AMS agrees that, in many situations, pain medications may be the best way to minimize stress and pain. While certified operations are permitted to use pain medications to treat or prevent pain caused by performing allowed physical alterations, pain medications may not be necessary for some allowed physical alterations. Therefore, AMS has not made any changes based on these comments.
(Comment) AMS received one comment requesting that we add “where effective non-physical methods are not available” to § 205.238(a)(5).
(Response) Under this final rule, physical alterations may be performed to benefit the welfare of the animals, for identification purposes, or for safety purposes. This comment suggests an additional broad requirement that a producer would need to provide justifications for routine, allowed physical alterations, which were not recommended by the NOSB and were not presented for public comment in the proposed rule. Therefore, AMS has not made any changes based on this comment.
(Comment) Many comments requested a complete prohibition of needle teeth clipping and tail docking in swine. Some comments supported the principle that needle teeth clipping and tail docking in pigs should not be routinely used, but could be permitted with documentation that alternative methods to prevent harm failed, as proposed in § 205.238(a)(5)(i). One comment supported the provisions regarding tail docking and needle teeth clipping in swine but requested clarification as to whether proof was required at the operation level or on a by litter basis. This comment felt that requiring proof to be provided at a by litter basis seemed excessive and potentially harmful to the welfare of the sows in that operation.
(Response) AMS does not agree with a complete prohibition of needle teeth clipping and tail docking in swine due to possible animal welfare impacts. AMS is retaining this provision based on consideration of recommendations by the NOSB. AMS will allow certifying agents to determine whether the specific need for physical alterations are sufficiently justified by producers on an operation, litter, or individual animal basis in their organic system plans.
(Comment) AMS received several comments regarding both the proposed language at § 205.238(a)(5)(ii) and the specific physical alterations proposed as prohibited for livestock and poultry. Many comments were supportive of the physical alterations proposed as prohibited, with some comments offering refinements or requesting clarification. Many comments requested that additional practices be prohibited, and other comments argued that some of the practices that were proposed as prohibited should be allowed.
AMS received comments that the opening sentence of § 205.238(a)(5)(ii), “The following practices must not be performed on a certified operation,” creates a loophole in which practices can be performed during the one-year transition of a dairy animal.
(Response) AMS has clarified the regulatory text in the final rule to state:
“The following practices are prohibited . . .” The discussion of comments on the specific physical alterations proposed as prohibited is divided into avian and mammalian sections.
(Comment) AMS received comments identifying that we used the terms “toe clipping” and “toe trimming” interchangeably and inconsistently in reference to altering the toes of male turkeys in the proposed rule. These comments also said that the proposed rule incorrectly defined this physical alteration practice as applying only to the toes of male turkeys, rather than all turkeys, in § 205.2 and § 205.238(a)(5)(ii) of the rule text. Another comment stated that toe trimming, toe cutting, and de-clawing are all essentially the same toe treatment. AMS also received a separate comment requesting that we prohibit toe clipping in turkeys, or only permit the use of infra-red, rather than a hot blade or electric cauterization.
(Response) The definition of “toe clipping” is addressed in this final rule in the Discussion of Comments Received for § 205.2. To be consistent with the changes made to the definition of “toe clipping” in § 205.2, the rule text at § 205.238(a)(5)(ii) “. . . toe clipping of male turkeys unless with infra-red at hatchery . . .” has been changed to “. . . toe clipping of turkeys unless with infra-red at hatchery . . .” AMS received an NOSB recommendation advising the complete prohibition of toe clipping for chickens. Turkeys or other poultry were not included in this prohibition of toe clipping. Methods of both toe clipping and beak clipping are addressed together in a separate discussion following the below discussion of comments regarding beak clipping.
(Comment) AMS received various comments on beak trimming. Many
(Response) AMS is not completely prohibiting beak trimming in poultry in the final rule due to animal welfare and economic impacts to poultry producers. This physical alteration is allowed at up to 10 days of age. Re-trimming of beaks is allowed at up to 10 days of age, but is not permitted after 10 days of age. In addition, beak trimming cannot be limited to a specific measurement because of the wide variability in beaks of bird species and breeds. Therefore, AMS is retaining the definition of beak trimming in § 205.2 as the removal of the curved tip of the beak as recommended by the NOSB. AMS is also retaining de-beaking as defined in § 205.2, and de-beaking remains prohibited in § 205.238(a)(5)(ii) of the final rule as recommended by the NOSB. AMS received many requests about the methods of beak trimming, toe clipping, and toe cutting, which are addressed immediately below.
(Comment) A few comments inquired about various methods of beak clipping, toe trimming, and toe clipping, including the use of traditional mechanical devices, such as knives or scissors, and more modern methods, such as electric cauterization (also called a cautery knife), the hot blade, and infra-red. Some comments stated that the use of infra-red is less invasive and painful, causes less tissue damage, and results in fewer chronic pain issues compared with other methods of poultry beak trimming, toe trimming, and toe clipping. One comment stated that all forms of beak trimming, toe trimming, and toe clipping are inhumane. Other comments asked for guidance on methods of beak trimming.
(Response) Following a review of recent poultry periodicals and literature, AMS notes that infra-red is the newest technology being used for beak trimming, toe clipping, and toe cutting. Articles report that infra-red appears to be more humane and is gradually being adopted over electric cauterization and the hot blade.
(Comment) AMS received two comments requesting that the final rule exclude wattles from the definition of dubbing in § 205.2. They also asked that we remove the prohibition of dubbing in § 205.238(a)(5)(ii). One comment reported that dubbing is used in research to mitigate comb injuries, and is not currently used by the layer industry. This comment stated that with the push for outdoor access in regions where cold weather is a certainty, dubbing may be needed to stop frostbite and other comb injuries that could occur when birds are outdoors.
(Response) AMS disagrees with the comment and is retaining the definition of dubbing that includes both wattles and combs in § 205.2 along with the prohibition of dubbing in § 205.238(a)(5)(ii) of the final rule. Dubbing is the practice of cutting off the comb, wattle and earlobes of chickens. The practice of dubbing, sometimes carried out by poultry operators without anaesthetic, is a cause of pain and distress. Blood circulating from the comb to the wattles helps the bird to regulate its body temperature during hot weather. Removing either wattle or comb provides no benefit to the bird.
(Comment) AMS received various comments regarding prohibiting the use of some physical alterations of livestock and mandating pain-relieving medications for other physical alterations. Many comments requested that the final rule prohibit or restrict de-horning, yet allow disbudding of cattle. Some comments supported the allowance of dehorning or disbudding, but only if performed by a licensed veterinarian and with pain relief mandated. One comment noted that while caponization was prohibited in poultry, castration of cattle, sheep, pigs, or other animals was not mentioned. This comment requested that castrations be performed by licensed veterinarians with pain relief mandated. Another comment proposed that castration be prohibited after two months of age.
(Response) Dehorning and castration of livestock are important practices for animal welfare and farm management. For example, dehorned livestock are easier and less dangerous to handle and transport; can present a lower risk of interference from dominant animals at feeding time; and can pose a reduced risk of injury to udders, flanks, and eyes of other animals. Castration is also an important practice from a safe handling and product quality perspective. Castrated male cattle (steers) are less aggressive, are easier to handle, and yield better marbled, more tender beef. Therefore, AMS is not prohibiting these practices in the final rule.
While best management practices suggest that dehorning and castration should be done at the earliest age practical to minimize pain and suffering,
While the final rule does not mandate the use of allowed synthetics to manage pain, it does not prohibit the use of pain medications when performing allowed physical alterations. The final rule allows operations to work with their certifying agents to agree on a physical alteration process that uses medications, as needed, to meet the regulatory requirement to perform alterations while minimizing pain and stress.
(Comment) AMS received one comment seeking to prohibit all branding, and not just face branding. This same comment offered that there are many alternative animal identification methods such as ear tags, ear notches, back tags, neck chains, tail tags, freeze brands, tattoos, paint marks, leg bands, and electronic identification methods (
(Response) In its recommendation on animal welfare, the NOSB recommended a prohibition specific to face branding. Therefore, the scope of the proposed rule submitted for public comment was limited to that aspect. AMS did not make changes based on this comment. In the future, if the NOSB recommends a prohibition on all branding, we will consider that aspect for proposed rulemaking, with opportunity for public comment.
With consideration to the comment regarding state requirements for face branding of imported cattle, AMS has considered this comment and has amended the final rule to provide an exception for these state requirements. We have amended paragraph 205.238(a)(5)(ii) to prohibit face branding, except as required by state or federal law.
(Comment) AMS received various comments on the proposed new section § 205.238(a)(8) that requires organic producers to actively monitor lameness within the herd or flock, to document cases and causes of lameness, and to describe how they were managed or treated. One comment from the dairy industry remarked that we do not provide a definition or a consistent system for identifying and assessing the degree and severity of lameness, and as a result, producer observations and recordkeeping will not be universal or consistent. For example, some operations may appear to have more cases because they are addressing a potentially worsening condition at an earlier stage, while less observant and less aggressively managed operations may not be as effective at identifying lameness. This comment described a private industry example of a system that offers consistency with a 5-point locomotion scoring (LS) scale in which an animal with a normal walk and no sign of lameness scores as one (1) with the scale progressing to a score of five (5) as a `severely lame' cow.
A few comments suggested that we develop thresholds to assist producers with developing plans to reduce the incidence of lameness. As an example, one comment suggested that if greater than 10% of a herd or flock for more than two years experienced lameness, the producer must implement a plan to reduce the incidence of lameness. Another comment suggested we collect data to establish the average percentage of lameness by species and then require producers to stay below that percentage.
Some comments expressed opposition to this proposed requirement. One comment reported that certifying agents are not trained or qualified to “identify a particular disease or ailment” and that this requirement would violate the certifying agents' prohibition on consulting. Other comments stated that USDA organic regulations already require livestock producers to maintain treatment records for sick and injured animals per the requirements of § 205.103, and that adding this additional record-keeping requirement was too prescriptive and would do little to “lead to effective prevention or treatment.”
(Response) AMS included this new requirement in response to an NOSB recommendation, and it will be retained in the final rule. AMS agrees that a species-based system for scoring lameness will follow the final rule as guidance. AMS agrees with comments that establishing a percentage of herd or flock lameness threshold connected to species averages could be valuable, and we will consider requesting that the NOSB provide additional advice and recommendations on herd or flock lameness thresholds.
(Comment) AMS received comments that it was redundant to include ammonia requirements in both § 205.238 and § 205.241, and comments recommended we keep the requirement in only one section. Other comments suggested we make the requirement in § 205.238 apply to all types of livestock production rather than limit the requirement to poultry production.
(Response) AMS agrees it is not necessary to include both sections as proposed. In the final rule, we have retained the requirement in § 205.241 and removed the requirement in § 205.238.
With regard to ammonia levels in other types of operations, the NOSB recommendations and subsequent proposed rule focused primarily on the ammonia levels in poultry houses. While AMS recognizes that ammonia levels may be relevant for other types of livestock production, we have not broadened the requirement to cover other types of operations in this final rule. AMS may consider future rulemaking to establish ammonia-level action thresholds if recommended by the NOSB and supported by public comment and available evidence.
The remaining discussion of comments regarding ammonia can be found in the discussion of comments in Avian Living Conditions at § 205.241.
(Comment) AMS received comments on the use of milk from animals undergoing treatment with allowed medications on the National List in § 205.603. Some of these comments asked if milk from cows treated with synthetic parasiticides could be provided to a cow's calf or other young calves in the same operation. One comment requested that the USDA organic regulations include nonsynthetic substances not prohibited on § 205.604 but require an FDA withholding period for milk when these substances are administered. A few comments did not want the milk from treated animals fed to any calf.
In addition, another comment requested the removal of the word “edible” from § 205.238(c)(1). This comment argued that including this word could allow the sale of fiber products as organic from animals that have been treated with antibiotics or other prohibited substances.
(Response) AMS concurs with the comments on allowing milk from animals treated with synthetic substances that are included on the National List in § 205.603 to be fed to a treated cow's calf or to other calves in the same operation. AMS also agrees with the comment indicating that the word “edible” may provide a loophole in the regulations that would allow the sale of fiber products as organic from animals that have been treated with antibiotics or other prohibited substances. The word “edible” has been removed from this regulation in the final rule.
AMS does not agree with comments on restricting the sale of milk from animals treated with nonsynthetic substances that are not included on the National List in § 205.604 but have an FDA-required withholding period. AMS is not aware of any nonsynthetic substance that is categorized as a drug with a required withholding period. The USDA organic regulations, in § 205.105(b), prohibit the use of nonsynthetic substances that are on the National List in § 205.604. Currently, under USDA organic regulations, if a nonsynthetic substance is not listed in § 205.604, it may be used in organic livestock production, provided its use complies with all regulation requirements that supersede the USDA organic regulations. Since USDA organic regulations require prohibited nonsynthetic substances to be listed in § 205.604, AMS cannot include a
Accordingly, § 205.238(c)(1) in the final rule prohibits an operation to “sell, label, or represent as organic any animal or product derived from any animal treated with antibiotics, any substance that contains a synthetic substance not allowed under § 205.603, or any substance that contains a nonsynthetic substance prohibited in § 205.604.” Milk from animals undergoing treatment with synthetic substances allowed under § 205.603 cannot be sold as organic but may be fed to a treated animal's calf or to calves on the same operation. Milk from animals undergoing treatment with prohibited substances cannot be sold as organic or fed to organic livestock.
(Comment) AMS received comments on the rule revisions proposed for § 205.238(b). Some of these comments argued that the addition of § 205.238(b)(3), regarding regulation requirements for the use of parasiticides, created confusion. Other comments addressed concerns for physical alterations and surgical procedures and requested that AMS mandate, rather than simply allow, the use of pain medications to relieve pain. One comment requested that AMS add the term “injury” to the conditions for which administering synthetic medications is allowed in organic livestock production under § 205.603.
A few comments addressed the prohibition on administering animal drugs in the absence of illness since the scope of the phrase “animal drug” as defined by the FDA includes preventative procedures or products. These comments argued that the USDA organic regulations prohibit producers from utilizing drugs that are designed to keep animals healthy and prevent illness. One comment asked if antibiotics could be used to treat pain.
(Response) AMS agrees with the comments that stated that the amendment to § 205.238(b), as proposed, is confusing and should be clarified. In the final rule, § 205.238(b)(3) has been deleted and the requirements for this provision have been incorporated under § 205.238(b). Producers may administer medications that are allowed under § 205.603 to alleviate pain or suffering and when preventive practices and veterinary biologics are inadequate to prevent sickness. This amendment to § 205.238(b) includes allowing the administration of synthetic medications when animals are injured or undergo surgery. The requirements for the use of parasiticides under § 205.238(b) is not changed in the final rule; parasiticides allowed under § 205.603 may be used on: (1) breeder stock, when used prior to the last one-third of gestation but not during lactation for progeny that are to be sold, labeled, or represented as organically produced; and (2) dairy stock, when used a minimum of 90 days prior to the production of milk or milk products that are to be sold, labeled, or represented as organic. AMS does not agree with comments that addressed the prohibition on administering animal drugs, including antibiotics, in the absence of illness to keep animals healthy and prevent illness. Under the USDA organic regulations, a livestock producer must establish and maintain preventive health care practices as prescribed in § 205.238(a). This requirement has been included within the USDA organic regulations since these regulations were published on December 21, 2000. This final rule has not changed this requirement. When preventive practices have been inadequate to prevent illness, a producer may administer synthetic medications that are listed in § 205.603. The USDA organic regulations do allow synthetic medications listed in § 205.603 to be used during surgery for the animal's welfare.
(Comment) One comment stated that it is inconsistent and confusing to allow other veterinary biologics, in addition to vaccines, to be exempt from the prohibition on administering animal drugs in the absence of illness. This comment argued that many vaccines contain compounded drugs, which may include prohibited chemicals such as hormones or anti-inflammatories.
(Response) AMS disagrees with this comment. The final rule does not add any new substances to the National List of Allowed and Prohibited Substances. Currently, vaccines are the only synthetic biologic substance on the National List. All other synthetic biologics are prohibited. Additionally, the USDA organic regulations require synthetic animal drugs that are allowed for use in organic livestock production to be manufactured with excipients (non-active drug ingredients) according to regulation requirements described under § 205.603(f).
(Comment) AMS received comments indicating that the requirements for use of synthetic medications allowed in § 205.238(c)(2) should be the same as the requirements for use of synthetic medications allowed in § 205.238(b)(3). These comments argued that the language in these regulation sections should be consistent because they both address circumstances in which synthetic medications can and cannot be administered.
(Response) AMS agrees with these comments and has amended the final rule by inserting changes into § 205.238(b) to clarify when synthetic medications can be administered in organic livestock production. AMS also revised § 205.238(c)(2) to be consistent with paragraph (b) in this section and to describe the exceptions under which the use of synthetic medications are permitted.
(Comment) AMS received comments asking if the new regulations in § 205.238(c)(3), which prohibit the administration of hormones for growth promotion, production, or reproduction, include oxytocin, which may be used in postparturition therapeutic applications. Comments expressed concern that the addition of the terms “production” and “reproduction” may cause confusion with the allowed use of oxytocin as a medical treatment in aiding cows after calving.
(Response) AMS agrees with comments about the potential for confusion when producers or certifying agents interpret the terms “production” and “reproduction” in applications of oxytocin for therapeutic use following calving. In the final rule, AMS amended § 205.238(c)(3) to provide clarification on the allowed use of oxytocin by adding the condition, “except as provided in § 205.603.” The inclusion of this condition clarifies the allowed use of oxytocin in organic livestock production for therapeutic applications.
(Comment) AMS received comments on § 205.238(c)(7) recommending that the USDA organic regulations require livestock producers to have a written marketing plan for diverted animals that have been treated with antibiotics or other prohibited substances. These comments added that such marketing plans might encourage medical treatment of illness or injury. A comment from a certifying agent proposed that § 205.238(c)(7) be amended to state that operations cannot: “Withhold medical treatment designed to minimize pain and suffering from an ill or injured animal in an effort to preserve its organic status. All appropriate medications must be used to restore an animal to health when methods acceptable to organic production fail. Livestock and products
(Response) AMS disagrees with these comments and did not add the requirement for a written marketing plan for diverted animals to § 205.238(c)(7). Under OFPA, AMS does not have the authority to require this type of marketing plan. AMS recognizes that a written marketing plan for diverted animals treated with prohibited substances would be a beneficial component of an organic system plan for producers and certifying agents. Certifying agents can encourage producers to include a component for marketing diverted animals in their organic system plan, however this is not required under USDA organic regulations. Organic livestock producers should clearly identify and separate any animal that has been treated with a prohibited substance. Products from livestock treated with a prohibited substance must be clearly identified and shall not be sold, labeled, or represented as organic. In addition, AMS has determined that § 205.238(c)(7), as described in the proposed rule, requires producers to apply all appropriate medications to restore an animal to health when methods acceptable to organic production fail. The amendment proposed by the certifying agent requiring producers to use all appropriate medications to restore an animal to health when methods acceptable to organic production fail is adequately addressed within § 205.238(c)(7).
(Comment) AMS received comments indicating that § 205.238(c)(10), which prohibits the “practice of forced molting or withdrawal of feed to induce molting,” is too general. Some comments proposed details and definitions about humane methods of molting to better manage the natural molting behaviors of a flock. A certifying agent suggested that AMS add the following language: “. . . or other interventions” to § 205.238(c)(10). This comment indicated that including this phrase would clarify that the USDA organic regulations prohibit all forms of induced or forced molting. An additional comment suggested that forced molting be defined as the starvation of laying hens to make them enter the next laying cycle.
(Response) AMS disagrees with comments proposing that additional language is needed to indicate that all procedures of forced molting are prohibited under § 205.238(c)(10). This regulation specifies that organic producers must not practice forced molting or withdrawal of feed to induce molting. Forced molting practices, including but not limited to the starvation of laying hens, not allowing birds to exercise full range of motion, or the disposal of male chicks or live unhatched eggs by suffocation, are prohibited under § 205.238(c)(10). Because the regulation under § 205.238(c)(10) already includes the prohibition of forced molting or the withdrawal of feed to induce molting, AMS does not agree that additional language is needed to clarify this regulation.
(Comment) AMS received a number of comments in support of the requirement that producers have a comprehensive parasite management plan as required in § 205.238(d). A certifying agent commented in support of the internal parasite management plan, but argued that requiring producers to create a separate plan would be redundant and burdensome to producers. One comment stressed that a parasite management plan should be developed in conjunction with a comprehensive pest management plan.
(Response) AMS agrees with comments in support of a comprehensive pest management plan in livestock and poultry operations that also addresses management of all vectors of internal parasites, illness, and disease. Livestock producers should describe their comprehensive parasite management plan within their overall organic system plan. Under § 205.238(d), livestock producers would describe their parasite management plan as an integral component of comprehensive plans for mammalian living condition practices in § 205.239, or avian living condition practices in § 205.241.
AMS disagrees with comments indicating that a comprehensive plan to minimize internal parasites requires livestock producers to create a separate plan from their organic system plan, which would be redundant and burdensome. The USDA organic regulations do not require producers to create a separate plan, outside of their organic system plan, for comprehensive parasite management.
(Comment) AMS received comments that were in support of the new regulations on humane and prohibited methods of euthanasia described under § 205.238(e). Some comments also sought more details and clarification on methods of euthanasia. The USDA organic regulations specify only three euthanasia methods as prohibited in § 205.238(e)(2) and provide no other parameters for selecting an appropriate euthanasia method. In their comment on the proposed rule, the American Veterinary Medical Association (AVMA) indicated that organic livestock operations culling livestock should implement euthanasia methods according to the most recent edition of the AVMA Guidelines for the Euthanasia of Animals. AVMA argued that the guidelines are widely accepted scientific and ethical standard for euthanasia. Other comments included a request that the USDA organic regulations prohibit the practice of euthanizing piglets by manual blunt force trauma. Another comment asked that we reconsider the banning of Burdizzo devices for emergency euthanasia if other methods are not available. This comment indicated that properly used Burdizzo devices are effective as an emergency euthanasia device for larger animals. One comment requested that we clarify whether poultry operations who cull flocks using onsite euthanasia must adhere to the euthanasia requirements, and requested that we consider developing guidance on culling poultry flocks.
(Response) This final rule specifies, under § 205.238(e)(2), that the following methods of euthanasia are not permitted for use in organic livestock production: suffocation, manual blow to the head by blunt instrument or manual blunt force trauma, and use of equipment that crushes the neck, including killing pliers or Burdizzo clamps. Blow(s) to the head by blunt instrument as prohibited at § 205.238(e)(2) does apply to piglets. AMS disagrees with the comment to allow Burdizzo clamps and retains the prohibition of these clamps under § 205.238(e)(2). AMS agrees with the AVMA comment on euthanasia methods. The final rule, in § 205.238(c)(8), references the AVMA guidelines on euthanasia.
(Comment) One comment asked if we could prohibit the common practice of the disposal of male chicks or live unhatched eggs by suffocation.
(Response) Under the USDA organic regulations, poultry or edible poultry products must be sourced from poultry that has been under continuous organic management beginning no later than the
AMS separated mammalian living conditions from avian living conditions due to the different physiology and husbandry practices for birds and mammals. As a result, AMS revised the title of § 205.239 from “Livestock Living Conditions” to “Mammalian Livestock Living Conditions.” By creating clear requirements for mammalian livestock and avian livestock, animal wellbeing can be enhanced and consumers can be assured of the integrity of the USDA organic seal. Information regarding avian living conditions are addressed in new § 205.241.
The final rule revised § 205.239(a)(1) to remove the requirement that all ruminant livestock must be able to feed simultaneously. One method of feeding livestock, including ruminants, is the use of a self-feeder or a creep-feeder. With creep-feeding and self-feeding, feed is accessible to all animals at all times though they may not feed at the exact same time. Self-feeding and creep-feeding provide organic ruminant producers with more flexibility and options to manage their farm and livestock in farm-specific methods.
AMS is maintaining the current § 205.239(a)(3), which requires the use of appropriate, clean, dry bedding. If roughages are used as bedding, they must be organically produced and handled by certified operations, with the exception of transitioning dairy producers.
AMS revised § 205.239(a)(4)(i) to specify that shelter must be designed to accommodate natural behaviors over every 24-hour period. Shelter must have sufficient space for the animals to lie down, stand up, and fully stretch their limbs and allow livestock to express their normal patterns of behavior over a 24-hour period. AMS recognizes that there are times when animals will be constrained for livestock handling or management purposes. An animal may be limited in its freedom of movement during parts of the day for a variety of reasons, including milking, feeding, or other handling purposes. Animals may be constrained for limited amounts of time to ensure hygiene and wellbeing of the animals. Stalls for organic dairy cattle are often designed to limit the animals from turning to the sides. This stall design directs manure and urine into a collection system to prevent mastitis and maintain low somatic cell counts in the milk. Mammalian livestock may be housed for part of the day in stalls as described in the organic system plan as long as they have complete freedom of movement during significant parts of the day for grazing, loafing, and exhibiting natural social behavior. This allowance does not permit the use of gestation crates or other confinement systems in which swine would be housed individually in stalls for months at a time. However, if livestock are temporarily confined indoors as permitted in § 205.239(b), livestock must be able to move around, turn around, and stretch their limbs indoors for part of the day. Operations will need to fully describe the use of any stalls, methods used in stall management, and how livestock are able to express their normal patterns of behavior.
AMS added § 205.239(a)(4)(iv) to set requirements for an indoor space for bedding and resting that is sufficiently large and comfortable to keep the animals clean, dry, and free of lesions, with the exception of animals raised on pasture or range. Because livestock on pasture or range may not have access to traditional barns or bedded areas, AMS recognizes that while livestock do need to be provided with shelter (defined in § 205.2), livestock do not need to be provided with indoor space. These types of operations may use windbreaks or other methods to provide shelter for the livestock. Additionally, not all man-made shelters are designed to hold bedding; for example, a shelter designed to provide shade may be portable and thus incompatible with holding bedding. Operations need to describe in their OSP how they will provide shelter to their livestock in a manner suitable for the species, stage of production, and environment.
AMS added new requirements in § 205.239(a)(7) concerning the individual housing of dairy young stock. Section 205.239(a)(7) allows for the individual housing of animals until the weaning process is complete but no longer than six months, as long as the animals have sufficient room to turn around, lie down, stretch out while lying down, get up, rest, and groom themselves. In addition, the individual housing of young stock needs to be designed so that animals can see, smell, and hear other animals.
AMS added three new provisions in § 205.239(a)(8) to require the group housing of swine, with three listed exceptions: § 205.239(a)(8)(i) allows for sows to be individually housed at farrowing and during the suckling period; § 205.239(a)(8)(ii) allows for boars to be individually housed to reduce the likelihood of fights and injuries; and § 205.239(a)(8)(iii) allows for swine to be individually housed after multiple documented instances of aggression or to allow an individual pig to recover from a documented illness.
AMS added two new provisions in §§ 205.239(a)(9) and (10) concerning swine housing. Section 205.239(a)(9) prohibits the use of flat decks or piglet cages. This provision prohibits the stacking of piglets in flat decks in multiple layers. In addition, § 205.239(a)(10) requires that both indoor and outdoor areas for swine have some space that permits rooting. Rooting is a natural behavior that must be accommodated by organic swine producers and could be done in soil, deep packed straw, or other materials. Organic swine producers must also demonstrate how swine will be allowed to root during temporary confinement periods.
AMS added a new provision in § 205.239(a)(11) to further clarify the use of barns or other structures with stalls. If indoor shelter is provided by a structure with stalls, then there must be a sufficient number of stalls that allow for the natural behavior of the animals. In no case may a cage be considered a stall. One exception is provided for this provision: In the case of group-housed swine, more animals than feeding stalls may be allowed as long as all animals are fed routinely every day. AMS is aware of some enhanced swine welfare systems, in which animals are robotically fed once they enter an individual feeding stall; once finished, the animal may leave the stall and another animal may enter for its specific quantity of feed. AMS does not intend to prohibit such systems, which enhance the wellbeing of organic animals. AMS also added specific allowances for a variety of cattle barns, including tie stall barns, stanchion barns, and free stall barns. While these barns can all be suitable for organic certification systems, the specific procedures used by producers with these barns may be incompatible with organic production. If a producer provides too few stalls in a free stall barn or leaves an animal tied up for 24 hours per day in a tie stall barn, these methods would not be permitted under USDA organic regulations.
AMS added a new requirement for outdoor access in § 205.239(a)(12). Organic livestock are required to have unencumbered access to the outdoors year-round, unless temporary confinement is justified under a specific
AMS revised § 205.239(b)(7) to clarify the exemption for temporary confinement for the purpose of breeding livestock. Livestock may only be confined for the time required for natural or artificial breeding. A group of livestock may be confined before the procedures and while the various individuals are bred; afterward, the group shall be returned to living spaces that allow outdoor access. Livestock may not be confined indoors to observe estrus or until they are determined to be pregnant. Section 205.239(c)(1) describes the time when ruminants may be denied access to pasture, but not access to the outdoors, before and after a breeding attempt.
AMS revised § 205.239(b)(8) to clarify the temporary confinement exception for youth livestock projects. Because many youth livestock projects include the sale of market animals, organic animals that were under continuous organic management may be sold as organic animals at youth fairs, even if the sales facility is not certified organic. Thus, the revised provision includes an exemption to the § 205.239(b)(6) requirement that a livestock sales facility be certified as an organic operation. As an example, if a youth exhibition and sale is held at a livestock sales facility that is not certified organic, the youth may sell the organic animal as an organic animal, provided all other requirements for the organic management of livestock are met. During the youth event, the livestock may be temporarily confined indoors. Otherwise, non-certified sales facilities, such as auction barns or fairgrounds, may not sell or represent livestock as organic. AMS provided this exception to encourage the next generation of organic farmers.
AMS revised § 205.239(d) to reflect the similar proposed changes in § 205.239(a)(1). AMS removed the phrase requiring that all ruminants be able to feed simultaneously. This change would allow the use of self-feeding and creep-feeding so that the ruminants would have access to feed continuously over a 24-hour period.
(Comment) A number of comments were opposed any changes to the mammalian living conditions section. Some comments indicated that current organic regulations were sufficient and no more were needed. Other comments noted that the sections pertaining to ruminants were sufficient and that no changes needed to be made to them.
(Response) AMS revised the mammalian living conditions sections to clarify a number of provisions for mammals, including ruminants. These changes were recommended by the NOSB through an open public comment process. In addition, livestock living conditions have always been a part of the USDA organic regulations. AMS received many questions from certifying agents and organic producers concerning livestock living conditions that needed clarification in the regulatory text. Due to the NOSB recommendations and the need to clarify livestock living condition requirements, AMS believes that the changes are needed.
Many comments were opposed to requiring soil as part of the outdoor access requirement for all mammals. These comments provided many reasons for excluding soil from the outdoor requirement, including environmental, soil quality, animal health, and disease transmission concerns. Commenters opposed soil for dairy animals during the non-growing season and for swine at any time, though some commenters supported soil for swine. Comments opposing soil as a requirement of outdoor access came from producers, certifying agents, trade associations, and others.
(Comment) Comments showed concern that dairy cattle during the non-growing season or during times when the cattle could be temporarily confined during the grazing season would cause environmental damage to the soil and surrounding waters if dairy cattle were required to be on the soil. Comments cited a variety of conditions (
Some comments were also concerned about the environmental damage that swine could do if the outdoor area included access to soil. Natural behavior of swine includes rooting of the soil, which destroys the vegetation and root structure of the vegetation. If swine are left too long on the land, the land loses vegetation and runoff could occur.
Other comments called for minimum outdoor space allowance for swine in order to protect the soil. These comments noted that if there was sufficient space, a minimum vegetative cover could be maintained, which would minimize or prevent any environmental damage the swine may cause. These comments suggested that the NOSB evaluate how much space is required for swine outdoors and then pass a recommendation that AMS could act upon. Other comments suggested that AMS use a space allowance that the NOSB livestock subcommittee had discussed but which had never been passed by the full board.
(Response) USDA organic regulations prohibit organic producers from reducing soil and water quality. The regulations also provide for temporary confinement of livestock to protect soil and water quality. AMS agrees with comments that livestock should be kept off of soil-covered areas during times of the year when livestock could damage soil and vegetation. In response to comments and consultation with NRCS regarding best practices, AMS removed “soil” as part of the outdoor requirements but requires that ruminants have access to pasture during the grazing season. However, outside of the grazing season, soil based outdoor areas are not required. Operations must provide year-round outdoor access, using either hardened surfaces or soil based areas unless the livestock are temporarily confined indoors.
AMS also agrees with some comments that thought the NOSB should reevaluate swine living conditions and determine minimum outdoor space requirements. AMS recognizes that if swine are placed in too small of an area
(Comment) Some comments expressed concern regarding health implications for swine if soil access was required as part of the outdoor space requirements. These comments noted that a number of diseases that had been eradicated in domestic swine, such as pseudorabies, were still present in feral swine. With outdoor space that requires soil access, domestic swine are more likely to come in contact with feral swine and contract one of these diseases. In the event that these diseases are detected in the domestic swine herd, there would be trade implications as countries may close their markets to U.S. pork.
These comments also discussed health concerns related to consumer safety. Trichinosis, a parasite in pork, has essentially been eradicated in the domestic swine herd. Comments expressed concerns that with outdoor access, swine could become infected with this parasite and could then infect consumers of this pork with this painful condition.
(Response) AMS also agrees with some comments that thought the NOSB should reevaluate swine living conditions and determine minimum outdoor space requirements. Therefore, the final rule requires year-round outdoor access for swine but does not require access to soil-covered areas. AMS recognizes that if swine are placed in too small of an area with soil, environmental problems may occur. AMS is including this topic area in the list of issues that the NOSB may address in a future recommendation. As part of the review process, the NOSB can take into consideration the presence of diseases in the soil or in feral hog populations, which if transmitted to domestic swine, may cause loss of foreign markets to organic and conventional pork producers.
Comments expressed concern with several topics regarding indoor housing for mammalian species, including stalls, space for natural behaviors, space for young dairy animals, swine confinement, the requirement that all mammals have access to indoors, and the use of bedding.
(Comment) Comments noted opposition to the proposed requirement that livestock be able to lie down in full lateral recumbence, turn around, and fully stretch their limbs. These comments stated that most dairy producers use a type of stall housing—whether free stall, tie stall, or stanchion barns—that would not provide the indoor space for a dairy cow to lie down in full lateral recumbence. Most comments wanted organic dairy producers to have the flexibility to use their existing barns and structures as part of an organic system plan approved by their certifying agent. These comments explained that cattle rarely lie down in that manner and usually only do so to sun themselves in a pasture. Many comments preferred the current language for natural maintenance, comfort behaviors, and an opportunity to exercise.
(Comment) Comments also showed concern with the proposed requirements for dairy young stock. Comments agreed with the description of the housing for dairy young stock, but these comments differed on the timing of when dairy young stock must be group-housed. Some comments wanted the dairy young stock to be group-housed by eight weeks of age while others wanted group housing to occur at six months of age. Those preferring a lower age for group housing cited EU organic standards, which include lower age requirements. The comments preferring six months of age discussed how weaning—the removal of milk from the diet of a young animal—is not a good stopping point as calves may retain the suckling impulse. Comments described how a calf can ruin the udder of a heifer by suckling on her in response to the suckling impulse, and these comments tended to prefer six months as the cutoff for group housing, which coincides with when dairy young stock must be provided with pasture or outdoor access if outside the growing season.
(Comment) Comments also addressed indoor housing for swine. Many comments were opposed to the use of farrowing crates or stalls and called for AMS to specifically prohibit their use. These comments wanted to ensure that swine had the opportunity to turn around, lie down, and move around, even during the farrowing period. Other comments were concerned that producers would individually house swine after documented cases of aggression. These comments requested that AMS define aggression so producers did not individually house swine unnecessarily. Comments were split on the requirement for bedding or rooting materials during the farrowing period. Some wanted to require rooting and nesting materials specifically during that time frame while others wanted to remove the requirement for bedding or rooting materials during the farrowing period to reduce disease and maintain cleanliness of the hogs.
(Comment) Comments were split on the issue of a cleanliness standard. Some comments supported such a standard if appropriate guidance was issued. Other comments opposed a cleanliness standard based on the rationale that during certain stages of production—such as ruminants on early spring pastures or swine with access to the soil during rainy periods—animals will be healthy yet also be dirty with manure or mud. Comments that opposed this standard preferred the requirement for clean, dry bedding to be provided. One comment was concerned about the requirement for a shelter that can hold bedding. This comment noted that many cattle are raised in pasture or range conditions that would not include access to the indoors, though may include shade and windbreaks for animal wellbeing.
(Response) AMS agrees with the comments that indicated that indoor space requirements to allow for full lateral recumbence and turning around without touching the enclosure may negatively affect many current producers without enhancing animal well-being. To clarify this issue, AMS revised the standard to specifically state that over a 24-hour period, mammalian livestock must have the opportunity to move, turn around, and exhibit natural behaviors.
AMS also stated that tie stalls, free stalls, stanchion barns, compost pack, and bed pack barns are all suitable facilities for cattle and can be used as part of an Organic System Plan. As part of the OSP, mammalian livestock producers must describe how livestock, over a 24-hour period of time, will be able to turn around, move, lie down, and exhibit natural behaviors. AMS recognizes that certain stall facilities designed for animal comfort and cleanliness purposefully minimize the ability of the animal to turn around. Livestock cannot be confined to these stalls all day, even if the animal may be temporarily confined indoors. As an example, if during the winter, livestock are temporarily confined indoors in a tie stall barn due to a snow storm, the livestock must have the opportunity to move around, turn around, and exhibit natural behaviors.
AMS has declined to clarify individual housing in response to swine aggression. The threshold for aggression to allow for individual housing may differ depending on the facilities, the operation, the producer, and the breeds of swine involved. Swine producers must describe their response to aggression in their OSP, which must be
AMS has chosen to keep the requirement for rooting materials but has removed the requirement that rooting must be available in exercise areas. Rooting is a natural behavior for swine and must be provided by organic swine producers. However, AMS agreed with the comments that requested that bedding and rooting material not be required during the farrowing period when swine may be individually housed. Swine producers may choose to use bedding and rooting material during the farrowing period, but it is not required.
AMS is clarifying that the USDA organic regulations for livestock require outdoor space as the default living space. Indoor space may be provided as a type of shelter, but it does not have to be provided to organic livestock. If indoor space is provided, then the structure must include space for appropriate bedding. However, in range or pasture conditions where no indoor space is required, the requirements for the indoor space do not apply, and bedding does not need to be provided. This does not allow producers to deny livestock access to the indoors if required by law or if it is necessary for the welfare of the animals. However, AMS recognizes that in many production systems, beef cattle, sheep, and some dairy animals may be routinely raised outdoors without indoor spaces. Shade and shelter must be provided based on what is appropriate for the animal species, season, and environmental condition.
The new § 205.241, entitled “Avian living conditions,” includes requirements for all organic avian (“bird” or “poultry”) species, including but not limited to, chickens, turkeys, geese, quail, pheasant, and any other species that are raised for organic eggs, organic meat, or other organic agricultural products.
New § 205.241(a) establishes general requirements for organic poultry production. These general principles are further clarified in §§ 205.241(b), (c), and (d). Section 205.241(a) requires organic poultry operations to establish and maintain living conditions that accommodate the wellbeing and natural behaviors of the birds. These living conditions include: Year-round access to the outdoors, soil, shade, shelter, exercise areas, fresh air, direct sunlight, clean water for drinking, materials for dust bathing, and adequate space to escape aggressive behaviors. The living conditions provided should be appropriate to the species, its stage of life, the climate, and the environment. These requirements, based upon a 2009 NOSB recommendation,
New § 205.241(b) specifies the indoor space requirements for avian species. While shelter must always be provided to birds, indoor space is not a requirement. If indoor space is provided to the birds, then the indoor space requirement must be followed. New § 205.241(b)(1) requires that indoor space be sufficiently spacious to allow all birds to move freely, stretch their wings, stand normally, and engage in natural behaviors. Cages or environments that limit free movement within the indoor space are prohibited. In addition, the indoor space must allow birds to engage in natural behaviors such as dust bathing, scratching, and perching. The requirements are adopted from a 2009 NOSB recommendation and modify previously established requirements for organic livestock at § 205.239(a)(4) that required, “shelter designed to allow for . . . natural maintenance, comfort behaviors, and opportunity to exercise”.
Section 205.241(b)(2) requires producers to monitor ammonia levels at least monthly and implement practices to maintain ammonia levels below 10 ppm. When ammonia levels exceed 10 ppm, producers must implement additional practices and additional monitoring to reduce ammonia levels below 10 ppm. Ammonia levels above 25 ppm are not in compliance with organic avian living conditions. Ammonia is a natural breakdown product of manure from livestock and is harmful to birds when inhaled, especially at concentrations above 25 ppm. In most cases, high levels of ammonia indicate that litter is damp or litter management practices require modification.
New § 205.241(b)(3) clarifies the lighting requirements for organic layers and fully feathered birds. Organic producers may use artificial light for up to 16 hours per day (24-hour period). The 16-hour period must be calculated as a single continuous time period. Artificial light must be lowered gradually to encourage hens to move to perches or otherwise settle for the night. Producers must design indoor spaces with access to natural light so that, on sunny days, inspectors can read and write when the lights are turned off. This requirement sets forth a performance-based standard that facilitates inspection, provides for enough lighting to accommodate natural avian behavior, and allows flexibility to operations in determining how to design their facilities for compliance.
Section 205.241(b)(4) describes the required exit areas, or doors, on shelters so that the birds can easily access both indoor and outdoor areas. Access and utilization of outdoor areas is a core principle of organic production systems. Organic avian systems must be designed so birds have ready access to outdoor areas and so birds are able to return indoors to roost in the evening. Producers must provide exit doors and door sizes to enable all birds to access outdoor and indoor areas. Door size and appropriate placement must provide meaningful outdoor access to the birds. Exit doors must be designed and managed in a manner that prevents movement of wild birds, rodents, and other animals into the poultry house.
New § 205.241(b)(5) requires perches for chicken layers at a rate of six inches per bird for all housing, with the exception of aviary housing. Perch space may include the alighting rail in front of nest boxes. Perches are not required for broilers, meat birds, or layers of non-
New § 205.241(b)(6) specifies indoor requirements to allow for certain natural behaviors. Indoor space must include areas that allow for scratching and dust bathing. Litter (
Section 205.241(b)(7) includes specific flooring requirements for indoor avian housing with slatted/mesh floors. These houses must provide at least 30 percent solid flooring to allow birds indoors to engage in natural behaviors, including scratching and dust bathing, without crowding. The requirement is adopted from a 2009 NOSB recommendation.
New §§ 205.241(b)(8), 205.241(b)(9), and 205.241(b)(10) list the required minimum indoor space requirements for different types of housing. These are minimum standards, and organic producers may choose to provide more indoor space than required. The indoor space requirements apply to chickens (
AMS has established indoor space requirements for common types of poultry housing. Less indoor space is required per bird in houses that provide more access to vertical space in the house, as birds have more room to move around (
AMS has only established indoor space requirements for chickens in this final rule. AMS may propose space requirements for other avian species in the future. Other avian species must meet all other indoor requirements including exit doors, ammonia levels, and lighting.
AMS is using pounds of bird per square foot to establish space requirements. In other words, the minimum space that must be provided depends on the average weight of birds at that time. All weight references in §§ 205.241(b) and (c) refer to the weight of live birds and not the weight of processed birds, for example. By stating the requirement in pounds per square foot, the application of the space requirement is more consistent between breeds, where the average weight per bird can vary significantly. This unit of measurement (pounds per square foot) was recommended by the NOSB in 2011 for pullets and broilers, and AMS is extending this same unit of measurement to layers. Under this final rule, larger breeds (
For example, a layer in a floor litter housing system that is 32 weeks of age and weighs 4.3 pounds must be provided with 1.43 square feet per bird (equivalent to 3.0 pounds of bird for each one square foot); however, at 80 weeks of age and a weight of 4.5 pounds, each bird must be provided with 1.5 square feet per bird (3.0 pounds of bird for each one square foot). In other words, for each 10,000 square feet, a producer could stock 6,993 birds at 32 weeks of age (bird weight of 4.3 pounds) but only 6,667 birds at 80 weeks of age (bird weight of 4.5 pounds). Although older and heavier birds require more space, natural mortalities over time may result in compliance with the space requirements over a production cycle. To calculate the weight of birds, an average weight may be established for the flock by taking weights of a representative sample of the flock. The requirement is not specific to each individual bird in a flock. AMS understands that many producers already monitor and track bird weight closely during the production cycle to monitor bird development and health and calculate feed requirements. However, if weight is not monitored by a producer, the producer will need to establish the weight of birds based on objective criteria to determine the space required indoors and outdoors. Certifiers may also weigh birds at inspections to verify compliance with the requirements.
New § 205.241(b)(11) specifies how the area of the indoor space is calculated. Indoor space must be calculated to ensure that birds are provided with adequate indoor space to meet the space requirements at §§ 205.241(b)(8) through (10). The total size of the indoor space is calculated by including all flat areas in a house, excluding nest boxes. Elevated round perches, for example, are not flat areas and could not be included as indoor space. These requirements match various third-party animal welfare standards, which consider nest boxes to be distinct from useable floor areas of the house where birds can move around freely. They also align with the 2009 and 2011 NOSB recommendations.
New § 205.241(b)(12) clarifies that indoor space may include enclosed porches and lean-to type structures (
Section 205.241(c) establishes the requirements for outdoor areas for organic avian species, including the amount of outdoor space that must be provided to organic avian species. The requirements of section 205.241(c) are adopted or adapted from previously established requirements at section 205.239, 2009 and 2011 NOSB recommendations, and third-party animal welfare organization standards. Section 205.241(c)(1) requires that the outdoor space be designed to promote and encourage outdoor access for all birds. Producers are required to provide access to the outdoors at an early age. This section requires door spacing to be designed to promote and encourage outdoor access and requires outdoor access to be provided on a daily basis (further described at § 205.241(b)(4)). Outdoor access may only be temporarily restricted in accordance with § 205.241(d).
Section 205.241(c)(2) requires outdoor areas for poultry to have a minimum of 50 percent soil and that the soil portion of the outdoor area include maximal vegetative cover. Vegetative cover must be maintained in a manner that does not provide harborage for rodents and other pests. For example, a producer may mow vegetation to ensure that tall vegetation does not provide harborage for pests. A maximum of 50 percent of the outdoor area may be gravel, concrete, or surfaces other than soil or soil with vegetative cover. Maximal vegetation is required, as vegetation protects soil and water quality and
Section 205.241(c)(3) clarifies how producers may provide shade to meet the general requirements of § 205.241(a). Shade may be provided in outdoor areas by trees, shade structures, or other appropriate objects. This section addresses shade in outdoor areas; it does not permit structures that do not meet the definition of “outdoors” (§ 205.2) to be included in calculations of outdoor space.
New §§ 205.241(c)(4) through (6) specify minimum outdoor space requirements for chickens (
Organic layer producers must provide at least one square foot of outdoor space for every 2.25 pounds of bird in the flock. For example, if birds average 4.5 pounds, a producer must provide 2.0 square feet of outdoor space for each bird in the flock. Organic pullet producers must provide at least one square foot of outdoor space for every 3.0 pounds of bird in the flock. Organic broiler producers must provide at least one square foot of outdoor space for every 5.0 pounds of bird in the flock. Outdoor space must be provided for all birds in the flock (
New § 205.241(c)(7) clarifies that porches and lean-to type structures that are not enclosed (
New § 205.241(d) describes the conditions under which organic avian livestock producers may temporarily confine birds indoors (“temporary” and “temporarily” further defined at § 205.2). Producers must record confinement, and should do so in a manner that will demonstrate compliance with the regulations (also see § 205.103). Records could include the reason for the confinement, the duration of the confinement, and the flocks that were confined. Records should be sufficient for a certifier to determine if birds were confined in compliance with this section. The requirements of section 205.241(d) are adopted or adapted from previously established requirements for organic livestock at section 205.239(b), 2009 and 2011 NOSB recommendations, and third-party animal welfare organization standards.
New § 205.241(d)(1) provides an allowance for temporary confinement in response to inclement weather, which is defined at § 205.2. In addition, this provision allows birds to be confined indoors when the temperature does not exceed 40 °F. It also allows birds to be denied outdoor access or be brought inside when the daytime temperature exceeds 90 °F. In this case, producers have to provide outdoor access during parts of the day when temperatures are between 40-90 °F, unless other forms of inclement weather occur. Weather may still qualify as inclement weather (§ 205.2) within the 40-90 °F temperature range. For example, excessive precipitation and very violent weather can occur when temperatures are within 40 °F and 90 °F. Likewise, weather may meet the definition of inclement weather within the range of 40 °F and 90 °F if the relative humidity is very high and the air temperature is nearing 90 °F, or under extremely windy conditions. As inclement weather is defined, in part, as weather than can cause physical harm to a species, a producer would still be in compliance with § 205.241(d)(1) if birds were confined at temperatures that did not exceed 90 °F, if the weather could cause physical harm.
Section 205.241(d)(2) provides an allowance for temporary confinement indoors due to a bird's stage of life. In this section, AMS has established specific requirements for confining chicken broilers and chicken pullets due to their stage of life (“stage of life” previously defined at § 205.2). Additionally, the section includes a general provision for confining other avian species until fully feathered. Chicken broilers may be confined through 4 weeks of age and chicken pullets may be temporarily confined indoors through 16 weeks of age. The NOSB recommended 16 weeks of age as the age after which outdoor access is required to provide adequate time for pullets to complete their vaccination program before exposure to pathogens outdoors. Any confinement beyond the time when birds are fully feathered must be in accordance with § 205.241(d).
New § 205.241(d)(3) provides an allowance for temporary indoor confinement under conditions in which the health, safety, or well-being of the birds could be jeopardized. Temporary confinement must be recorded, and to confine birds under this provision, a producer must have sufficient justification to demonstrate that an animal's health, safety, or well-being could be jeopardized by access to the outdoors. Certifiers will verify compliance with this requirement. Producers and certifiers should consult with animal health officials, as appropriate, to determine when confinement of birds is warranted to protect the health, safety, or well-being of the birds. Animal health officials are also encouraged to reach out to certifiers and to AMS to discuss specific health concerns. AMS will continue to engage animal health officials, including State Departments of Agriculture and State Veterinarians, about risks to bird health and provide appropriate guidance to certifiers or producers, as necessary.
New § 205.241(d)(4) provides an allowance for indoor confinement to prevent risk to soil or water quality. This provision allows for confinement of birds when the outdoor area is being managed to reestablish vegetation. As outdoor areas must be maximally vegetated, producers may need to occasionally confine birds to meet the vegetation requirement at § 205.241(c)(2).
Section § 205.241(d)(5) provides an allowance for indoor confinement for preventive health care procedures and for the treatment of illness or injury. Neither life stages nor egg laying are considered an illness for confinement purposes. For example, this provision allows producers to briefly confine a flock to administer a vaccine or to confine an individual animal that requires medical treatment.
New § 205.241(d)(6) provides an allowance for indoor confinement for sorting, shipping, and poultry sales. Birds must be managed organically during the entire time of confinement. For example, any feed provided during confinement must be organic. Confinement must be no longer than necessary to sort the birds or to catch the birds, place them in shipping containers, and conduct the sale.
New § 205.241(d)(7) provides an allowance for indoor confinement to train pullets to lay eggs in nest boxes, with a maximum period of five weeks allowed for confinement. The training period must not be any longer than required to establish the proper behavior. As soon as the behavior is established, birds must be provided
Section 205.241(d)(8) provides an allowance for indoor confinement for youth exhibitions, such as with 4-H or the National FFA Organization. This provision also includes an exemption to the requirement that a livestock sales facility be certified as an organic operation. As an example, if a youth exhibition and sale is held at a livestock sales facility that is not certified organic, a youth may sell birds there as organic, provided all other requirements for organic management are met. During the youth event, the livestock may be temporarily confined indoors. Otherwise, non-certified sales facilities, such as auction barns, may not sell or represent livestock as organic. AMS is adding these provisions at § 205.241(d)(8) to encourage the next generation of organic producers.
New § 205.241(e) requires organic poultry producers to manage manure in a manner that does not contribute to contamination of crops, soil, or water quality by plant nutrients, heavy metals, or pathogenic organisms. Organic poultry producers must manage the outdoor space in a manner that does not put soil or water quality at risk. In addition, organic poultry producers must comply with all other governmental agency requirements for environmental quality. The requirements of this section are adapted from previously established requirements for organic livestock at section 205.239(e).
(Comment) AMS received several comments noting that it was redundant to include ammonia requirements in both § 205.238 and § 205.241, and recommending that we keep the requirement in only one section. Other comments suggested we make the requirement in § 205.238 apply to all types of livestock production rather than limit the requirement to poultry production.
(Response) AMS agrees it is not necessary to include both sections as proposed. In the final rule, we have retained the requirement in § 205.241(b)(2) and removed the requirement in § 205.238. AMS recognizes that ammonia levels may be relevant for other types of livestock production, but we have not broadened the requirement in the final rule. AMS may seek the NOSB's recommendation on this topic at a later date.
(Comment) We received comments that it was not clear if AMS was establishing a maximum ammonia limit of 10 ppm or 25 ppm. These comments noted that the consequences of exceeding 25 ppm were not clearly different than the consequences for exceeding 10 ppm. Other comments stated that birds could be continuously exposed to ammonia levels in excess of 10 ppm but below 25 ppm without any consequences, limiting the benefits to animal welfare from this requirement.
(Response) The final rule is modified to clarify that producers must implement practices to maintain ammonia levels below 10 ppm. The 10 ppm level is established so that organic birds live in an indoor environment without excessive ammonia levels, which can be harmful to bird health. If required monthly monitoring indicates ammonia levels are above 10 ppm, then the producer must conduct additional monitoring and implement additional practices to bring ammonia levels to below 10 ppm.
The rule also establishes a maximum ammonia level of 25 ppm. Ammonia levels above 25 ppm would be a violation of the organic requirements and lead to appropriate compliance actions, including potential loss of organic certification. The ammonia levels described in the final rule are consistent with the NOSB's recommendation and the thresholds established by a number of animal welfare standards.
(Comment) We received some comments that a maximum ammonia level of 25 ppm was too high and that AMS should revise the upper limit to 20 ppm to better protect animal health.
(Response) AMS has not revised the requirement in the final rule because the 25 ppm level limit was established based on NOSB's recommendation. This limit is also consistent with various third-party animal welfare standards. Furthermore, AMS notes that a producer is required to implement additional practices to reduce ammonia levels when levels exceed 10 ppm. With this 10 ppm action level, AMS does not think it is necessary to reduce the upper limit to be below 25 ppm.
(Comment) We received comments related to the monitoring and measurement of ammonia levels. One comment argued that measurement of ammonia with an objective tool such as test strips or meters should not be required and that the rule should allow for subjective measures (
(Response) In the final rule, AMS has not specified how ammonia levels are to be measured. Producers and certifiers may use a number of methods to measure ammonia levels, including test strips, continuous monitoring devices, or handheld meters. Given the minimal cost of the simplest methods to test ammonia levels and that action is required by producers at a relatively low level (above 10 ppm), producers must use a non-subjective method to measure ammonia levels.
AMS agrees that monthly monitoring may not be sufficient when ammonia levels exceed 10 ppm. AMS has revised the final rule at § 205.241(b)(2) to specify that additional monitoring is required when ammonia levels exceed 10 ppm. The additional requirement is included to ensure that the additional practices implemented by the producer lower ammonia levels below 10 ppm. A producer may return to monthly ammonia monitoring when ammonia levels fall below 10 ppm.
(Comment) AMS received many form letter comments stating that the regulations should require 8 hours of continuous darkness each day for all birds. The comments appear to prefer this to the language proposed at § 205.241(b)(3) that states, “artificial light may be used to prolong the day length up to 16 hours.” Comments suggested the rule as proposed would not ensure a period of darkness.
(Response) AMS has revised the final rule to state, “artificial light may be used to prolong the day length, to provide up to 16 hours of continuous light.” AMS has included the word “continuous” to ensure that layers and mature birds are not subjected to multiple periods of light and dark over the course of a 24-hour day. In most locations, except for locations in extreme latitudes during summer months, this requirement ensures that birds are provided with an 8-hour period of continuous darkness per day, as requested by comments. Producers located in extreme latitudes are not required by the final rule to provide 8 hours of total darkness.
(Comment) Several comments requested clarification about whether the time period for dimming artificial light is to be included in the 16-hour time period described in § 205.241(b)(3).
(Response) Artificial light may be used to provide up to 16 hours of
(Comment) Several comments noted that the method for evaluating the level of natural light in a poultry house (§ 205.241(b)(3)) was overly subjective, including a comment that different inspectors may require different light levels to read and write. Comments suggested that the requirement could be difficult to enforce or that differences between inspectors could lead to inconsistent enforcement of the requirement. Several comments requested we set a specific light requirement that could be verified with a light meter.
(Response) AMS considered alternatives to the requirement as proposed, including a requirement to measure light quantitatively. This alternative would have required producers and organic inspectors to use light meters to monitor and verify the amount of light in a poultry house. While a specific minimum light level could be established, AMS does not believe it is necessary to meet the objective of providing natural light and would impose an additional cost on producers or certifiers. AMS decided that a qualitative assessment of natural light by inspectors, as specified in the proposed rule, is adequate to ensure poultry houses include sufficient natural light. The final rule, therefore, is unchanged.
(Comment) AMS received some comments that the requirement to dim artificial light intensity gradually was not necessary and could require producers to install new equipment. One comment suggested we do not require that lights be dimmed but only recommend it, by changing the wording from, “must be lowered gradually,” to “should be lowered gradually.” Other comments stated that continuous dim lighting be prohibited.
(Response) To protect bird welfare by ensuring that birds are provided with a period of time to move to perches or settle for the night, AMS has retained the requirement that artificial light be lowered gradually at night. AMS notes that producers may turn off artificial light before the end of the natural day to allow natural light in the house to lower gradually. In this case, the total length of the day, including any use of artificial light, would not exceed 16 hours for layers and mature birds except for operations located in extreme latitudes, where natural day lengths may exceed 16 hours per day. The requirement at § 205.241(b)(3) applies only to layers and fully feathered birds.
(Comment) We received one comment that stated that AMS should require windows on poultry houses to be evenly distributed to allow for natural light throughout the house.
(Response) The final rule requires that natural light be provided in housing for layers and mature birds, such that natural light indoors is sufficient for an inspector to read and write when all lights are turned off. As this requirement applies to indoor space and could be applied to any location indoors, AMS has not included additional requirements in the final rule for windows and skylights to be distributed evenly in a house. Housing where natural light is sufficient (
(Comment) Several comments asked why AMS only discussed “layers and mature birds” in the section on use of artificial light. Comments requested clarification on the use of artificial light for production of meat birds (
(Response) AMS has clarified that layers and fully feathered birds, including fully feathered broilers and fully feathered turkeys, are subject to the artificial light requirement (§ 205.241(b)(3).
(Comment) Comments suggested AMS simplify the final rule by describing all requirements about exit areas (
(Response) AMS agrees with these comments. In the final rule, all requirements for exit areas appear at § 205.241(b)(5). All requirements proposed at § 205.241(c)(2) have been moved to § 205.241(b)(5).
(Comment) AMS received several comments to eliminate the requirement that all birds within the house be able go through the exit areas within one hour. Comments stated the one-hour requirement would not be easy to verify. Other comments stated that verifying compliance by forcing birds outdoors would cause birds stress. Some comments suggested that AMS establish more specific requirements for exit areas, such as a minimum width, height, and number of doors per house. Comments argued that this would allow producers to design facilities that would absolutely meet the regulations and would allow certifiers to more easily verify compliance with specific requirements.
(Response) In the final rule, AMS has removed the requirement, as proposed, that exit areas be designed so that all birds within the house can go through the exit areas within one hour. AMS removed the one hour requirement, as it is not feasible for certifying agents to verify compliance with this requirement or take enforcement actions. AMS considered specifying the number and dimensions of exit doors, but decided that setting a clear performance standard for ready access to the outdoors is preferable to specific number and size requirements. In the final rule, AMS is establishing a clear performance standard so organic poultry producers will have the flexibility to design exit doors that provide ready access to the outdoors for birds, based on the design of the poultry house and the outdoor space. In any case, exit areas must: (1) Be sized to allow all birds to exit and enter the house, (2) be distributed to ensure birds have ready access to the outdoors, and (3) be designed and managed in a manner that prevents movement of wild birds, rodents, and other animals into the poultry house. Appropriate distribution ensures that all birds are close enough to a door to be able to readily gain access to the outdoors.
(Comment) AMS received comments on the distribution of exit areas on poultry houses. Some comments recommended AMS specify that exit areas must be provided on every side of the poultry house, while others suggested AMS clarify that exit areas are only required on sides of the house adjacent to the outdoor area. Other comments recommended that AMS specify a maximum distance between a bird inside and the nearest exit area.
(Response) To clarify the requirement, AMS has revised the phrase, “distributed around the building.” The final rule requires, “Poultry houses must have sufficient exit areas that are appropriately distributed to ensure that all birds have ready access to the outdoors . . .” This requirement is
(Comment) AMS received many comments related to how the requirement for perches applies to broilers. Additionally, AMS received several comments about the perch requirement for turkeys, as well as comments about how the requirement will be determined for different species or breeds. We also received comments that noted that some types of poultry, including meat type chickens, will use perches when young but then stop using perches as their weight increases, preferring to spend time on flat surfaces at that time. Other comments noted that meat type chickens can sustain leg injuries moving between perches or roosts and the ground, especially if perches or roosts are too high off the ground.
(Response) In the final rule, AMS has not included a requirement for perch space for broilers or turkeys. The final rule specifies that six inches of perch space per bird is required for layers of species
(Comment) Some comments stated that the requirement of six inches of perch space per bird is excessive and that, at this rate, some perch space would be unused by birds. Other comments stated that all birds in a flock may not perch simultaneously and therefore six inches per bird is not necessary.
(Response) AMS recognizes that all birds in a house may not perch simultaneously. However, we have kept a requirement for six inches per layer in the final requirement. This requirement recognizes that each layer likely requires more than six inches per layer but that not all layers will be perching at the same time.
(Comment) We received many comments that AMS's terms “perch” and “roost” are confusing, as the terms can be used interchangeably by producers and industry. Other comments stated that the definition of “roost” in § 205.2 was too narrowly stated, as roosts are not always found over manure pits. One comment stated that the proposed requirement at § 205.241(b)(6) was too narrowly stated, as roosts in poultry houses can be flat, round, or oval. The comment suggested that AMS revise the requirement to simply state that roosts must allow birds to grip with their feet. Another comment suggested AMS change the term “roost” to “slats” in § 205.2 and maintain the same definition.
(Response) AMS recognizes that using both terms “perch” and “roost” could be confusing, as the terms can be used interchangeably by producers and industry. In the final rule, AMS has removed the term “roost” but retained the term “perch” in § 205.2. As defined, this term is intended to refer to various features in poultry housing, such as rods, branch type structures, and flat roost slats that accommodate roosting and are elevated to allow birds to stay off the floor of the house. Perches may be over a manure pit but this is not a requirement.
(Comment) AMS received a comment that questioned why the perch requirement is different for multi-tiered facilities than for other facilities.
(Response) We have included a perch requirement in multi-tiered facilities that is different from single-level facilities because multi-tiered facilities are designed to allow birds to utilize vertical space. Since birds in these facilities may move between levels to escape aggressive behaviors and engage in natural behaviors, less perch space per bird provides the same benefit.
(Comment) AMS received many comments that AMS did not require enough indoor space. These comments argued that the requirements are similar to current space allowances used in the organic poultry industry and the rule would therefore not improve consumer confidence in the organic seal. Many comments recommended birds be provided with at least 1.5 square feet per bird, regardless of size. Other comments noted the requirements proposed by AMS fell short of the 2.0 square feet of indoor space recommended by the NOSB. Some comments stated AMS should not include different indoor space requirements for different types of production or housing systems (
(Response) In this final rule, AMS has included indoor space requirements that are based on pounds per square feet rather than square feet per layer. These requirements are equivalent to (for a 4.5 pound layer): 1.5 square feet per bird for floor litter housing; 1.2 square feet per bird for slatted/mesh floor housing; and 1 square foot per bird for mobile and aviary housing. The requirements were developed by considering the NOSB's recommendations, commonly-used third-party animal welfare standards, and current practices of certified organic producers. They were designed to balance the need for clear guidance that could be applied across different breeds and types of bird, the goal of safeguarding the value of the organic seal, and the cost of diverging significantly from common practice among organic operations certified to third-party animal welfare standards. AMS also determined that the indoor space requirements differ based on housing design. Less indoor space is required per bird in houses that provide more access to vertical space in the house, as birds have more room to move around (
(Comment) We received numerous comments that the indoor space requirement for turkeys was too large and did not align with current practices of organic turkey producers, including a comment that AMS did not take into account that houses are designed to ensure all turkeys have easy access to feed and water.
(Response) AMS proposed a maximum indoor stocking rate for turkeys of 5.0 pounds per square foot. AMS established the proposed space requirements for turkeys based on a preliminary recommendation included in a “Proposed Discussion Document” by the NOSB, which was presented at the NOSB's spring 2012 meeting.
(Comment) AMS received many comments that the outdoor space required for birds was not large enough. Comments noted that additional outdoor space would be required to ensure vegetation would not be removed entirely from the outdoor area. Some comments stated the size of the outdoor area was insufficient to prevent buildup of manure, which could lead to contamination of nearby surface water and of the soil in the outdoor area. Additionally, some comments stated that more outdoor area was required to ensure birds could be rotated around the outdoor areas since rotation serves important functions, including vegetation regrowth, parasite and disease reduction, and nutrient management. Further, AMS also received comments claiming that this rule would not protect small farmers and was more advantageous to larger producers. These comments remarked that the indoor and outdoor stocking density requirements for layers are weak which threatens consumer confidence in the organic label and continues the economic disadvantage for farmers using more stringent practices.
(Response) AMS recognizes that a larger outdoor area requirement than proposed could have benefits as described by comments. AMS, however, retained the proposed outdoor space requirement in the final rule. The requirement aligns with the recommendation by the NOSB and is established to meet consumer expectations while recognizing the land constraints that were raised by many other commenters (see below). AMS emphasizes that the regulations established here do not limit producers from providing a larger outdoor area for birds.
(Comment) Some comments stated the outdoor space required for poultry was too large. Specifically, some comments from producers noted that all birds in a house do not go outdoors at any one time and requested that AMS reduce the outdoor area requirement to recognize this observation. Several comments noted that producers may not have the amount of land required for outdoor space, or that the land available may not be near the barns, and that these producers would be forced to cease organic production.
(Response) AMS recognizes that an entire flock may not occupy the outdoor area at the same time, as a percentage of the flock may choose to remain inside, even when presented with the opportunity to go outdoors. However, AMS has not revised the outdoor space requirements in the final rule. The outdoor space requirements in the final rule ensure birds have adequate space outdoors if all birds in the flock do go outdoors. When all birds do not use the outdoor area simultaneously, the birds that are outdoors will effectively have more space per bird. This space requirement aligns with the recommendation by the NOSB. NOSB recommendations were guided by public comment that highlighted consumer expectations, or that sought to preserve the value of the organic seal to consumers. For further discussion of land availability and costs to producers, see discussion of comments below in section titled “Assumption about Two Barn Footprints”.
(Comment) AMS received comments that stated the outdoor area required for turkeys was too large. Comments from some organic producers said they would need to increase the size of the outdoor area by 80 percent to meet the proposed requirement.
(Response) AMS proposed a maximum outdoor stocking rate for turkeys of 5 pounds per square foot based on a preliminary recommendation included in a “Proposed Discussion Document” by the NOSB, which was presented at their spring 2012 meeting.
(Comment) AMS received several comments that the general requirement for “adequate space to escape from predators and aggressive behaviors” proposed in § 205.241(a) should be revised. These comments stated that space outdoors does not necessarily help poultry escape from predators and recommended that AMS remove the language “escape from predators.”
(Response) In the final rule, AMS has revised the wording in this section to remove the requirement for adequate space to escape predators. This should not be interpreted to mean that AMS does not recognize the importance of birds having a place to escape from predators, but simply that outdoor space may not meet this goal. The section continues to require “adequate outdoor space to escape aggressive behaviors . . .” (§ 205.241(a)), as outdoor space may allow birds to escape from the aggressive behaviors of other birds in the flock.
(Comment) Some comments requested that we clarify calculations for birds kept in mobile housing units that provide direct contact with the ground. Comments asked whether birds in these production systems also require additional outdoor space.
(Response) See “Pasture pens vs. other mobile housing” comment and response.
(Comment) AMS received many comments requesting that we describe
(Response) AMS understands that it is simpler to think about space requirements on a per bird basis rather than as a number of pounds per square feet. However, AMS has not revised the description of the space requirements in the final rule, as pounds per square foot most fairly addresses differences between species and breeds. From comments received, AMS identified approximately half a dozen layer breeds commonly used for organic production, not including heritage breeds used by some organic producers. Each breed has slightly different characteristics, including the average weight per bird. By retaining the space requirements expressed as maximum pounds per square foot, AMS believes the requirement will be most equitable across species and breeds.
(Comment) Many comments discussed whether a porch could be calculated as either indoor or outdoor space. Some comments questioned when a porch could be included in calculations as either indoor or outdoor space (
(Response) AMS disagrees with comments that space within a porch should never be allowed to count as space for birds. If a porch is always available to birds when inside, the porch space could be utilized by birds and the space should have the same benefits as other indoor space. However, if a porch is not accessible to birds at all times, it may not be included as indoor space. Space in porches may not be included in the calculation for indoor space if birds cannot access the porch for any reason, for example, if doors are closed due to inclement weather or threat of diseases. When calculating the space available to birds outdoors, only space that is outside an enclosed building or housing structure (see definition of “outdoors” at § 205.2), may be included as part of the outdoor area. However, in response to comments, AMS has added § 205.241(c)(7) to clarify that unenclosed porches and lean-to type structures (
(Comment) Several comments requested that AMS clarify what was meant by “at any time” when referring to indoor and outdoor space requirements in §§ 205.241(b) and (c). Some comments thought that this section could be interpreted to mean that space requirements apply only to the birds in the outdoor area at a specific moment rather than to all birds in the flock. Comments noted that different interpretations of the phrase could influence the amount of space provided, as all birds in a house may not be outdoors at the same time.
(Response) In the final rule, AMS has revised the wording in §§ 205.241(b) and (c) to remove the phrase “at any time” and to clarify that space must be provided at the established rates for all birds in the flock. In § 205.241(c), we specified that outdoor space must be provided for all birds in the flock. We have not specified that indoor space is to be calculated for every bird in the flock, as all birds in a flock are regularly indoors at the same time and the method of calculating is clear.
(Comment) Some comments requested clarification about when birds should be weighed to calculate the indoor and outdoor space requirements. Other comments asked if the rule requires that birds be weighed to determine space requirements.
(Response) AMS notes that the space requirements are not linked to any specific age. At any time in a production cycle, producers must meet the requirements. For example, a layer in a floor litter housing system that is 32 weeks of age and weighs 4.3 pounds must be provided with 1.43 square feet per bird (equivalent to 3.0 pounds of bird for each one square foot); however, at 80-weeks of age and a weight of 4.5 pounds, each bird must be provided with 1.5 square feet per bird (3.0 pounds of bird for each one square foot). In other words, for each 10,000 square feet, a producer could stock 6,993 birds at 32 weeks of age (bird weight of 4.3 pounds) but only 6,667 birds at 80 weeks of age (bird weight of 4.5 pounds). Although older and heavier birds require more space, natural mortalities over time may result in compliance with the space requirements over a production cycle. To calculate the weight of birds, an average weight may be established for the flock by taking weights of a representative sample of the flock. The requirement is not specific to each individual bird in a flock. AMS understands that many producers already monitor and track bird weight closely during the production cycle to monitor bird development and health and calculate feed requirements. However, if weight is not monitored by a producer, the producer and/or certifier will need to establish the weight of birds based on objective criteria to determine the space required indoors and outdoors.
(Comment) Some comments requested clarification about whether the area occupied by nest boxes in poultry houses could be included in the calculation of the available indoor space.
(Response) In the final rule, AMS has clarified in § 205.241(b)(11) how indoor space is to be calculated and that nest boxes may not be included in the calculation of indoor space. This clarification aligns with the NOSB's December 2011 recommendation on indoor space, as well as with the methods for calculating indoor space used by animal welfare groups and third-party production standards. The total size of the indoor space is calculated by including all flat areas in a house, excluding nest boxes. Elevated round perches, for example, are not flat areas and could not be included as indoor space.
(Comment) We received some comments that asked what types of housing would be subject to the indoor requirement of 2.25 pounds of hen per square foot. Another comment stated that AMS could hinder innovation by implementing a stricter requirement (
(Response) AMS is not aware of housing that does not fit within one of our housing definitions included in § 205.2, and disagrees that the requirement would disadvantage any type or size production system. In the final rule, AMS continues to include an indoor space requirement at § 205.241(b)(8)(v) for housing that does not fit within one of the types defined in § 205.2 as “indoors” or “outdoors.” AMS also notes that requirements for new housing types could be included in the requirements at a later date, at the recommendation of the NOSB, as appropriate. If housing does not fit within one of the types described in § 205.2 and included at §§ 205.241(b)(8)(i) to (iv), producers must provide an indoor stocking density of no more than 2.25 pounds of hen per square foot.
(Comment) Some comments requested that AMS clarify how to calculate the
(Response) The outdoor area requirement is to be calculated as the outdoor area available to all birds in the flock at any given time. For example, if a producer rotates birds between two outdoor areas, each area must be large enough to meet the stocking density requirement. Performing the calculation in this way ensures that birds are provided with the outdoor space required at all times. AMS has not revised the final rule in response to this comment.
(Comment) AMS received several comments about how the area of the outdoor space is to be calculated. Comments stated that AMS's intent to prohibit porches as outdoors was clear but that the proposed prohibition for including outdoor areas under a solid roof if attached to the structure was either confusing or overly restrictive. Some comments stated that large overhangs or other covered areas can actually encourage birds to go outdoors, as these areas provide a degree of safety for birds (
(Response) AMS recognizes that overhangs, eaves, or other covered areas may encourage use of outdoor areas by providing overhead protection. In the final rule, AMS has removed the requirement as proposed at § 205.241(c)(6).
Additionally, AMS has revised the definition of “outdoors” to, “Any area in the open air, outside a building or housing structure.” AMS also revised the definition of “indoors” to, “the space inside of an enclosed building or housing structure.” Any outdoor space that meets the definition may be included in outdoor space calculations. AMS has also added § 205.241(c)(7), which clarifies that porches and lean-to type structures that are not enclosed, but allow free access to other outdoor areas can be counted in outdoor space calculations. These changes do not affect the decision that an enclosed porch cannot be counted as outdoor space. See AMS's response to comments on Definitions for further discussion.
(Comment) Some comments requested that AMS clarify whether producers must have outdoor areas if they only raise pullets and the pullets are sold or moved to another location prior to 16 weeks of age.
(Response) Section 205.241(d) includes requirements for temporarily confining birds from the outdoors. When birds are temporarily confined from the outdoors in compliance with the requirements at § 205.241(d), outdoor space is not required. To establish if confinement from the outdoors is in compliance with the requirements, a producer must, as required by § 205.201, “develop an organic . . . system plan that is agreed to by the producer . . . and an accredited certifying agent.” Beyond 16 weeks of age, all layer producers must have land available for outdoor access at the maximum stocking rate of 2.25 pounds per square foot, unless birds are temporarily confined in accordance with § 205.241(d). Producers may not confine birds in an indefinite manner to avoid or bypass outdoor space requirements.
(Comment) AMS received many comments that stated that porches should be considered as outdoor space in organic poultry production. Comments received in favor of porches as outdoor space argued that they allow producers to better protect bird health by reducing contact between organic birds and other animals that can carry disease (
AMS also received many comments that were opposed to any use of porches as outdoor space in organic production, including many comments stating they were unaware that currently, operations that provide porches as the only outdoor space for birds are allowed to be certified organic. Generally, these comments expressed that birds should be outside as much as possible on soil or on pasture with sunshine, fresh air, and adequate space in order to maximize opportunities for birds to exhibit natural behavior as recognized by animal welfare experts, consume a diverse diet, and meet consumer expectations for birds raised organically. Many stated that shoppers pay more for organic food and that animals should be raised in a manner that is more in line with consumer expectations, including access to soil and vegetated areas.
(Response) In the final rule, AMS has retained a requirement for outdoor access, and AMS has defined the outdoors (§ 205.2) to clarify that birds must be in the open air, outside an enclosed building or housing structure, to be considered outdoors. AMS disagrees with comments that argued that consumers are satisfied with the use of porches, or that demand for organic eggs is evidence of their satisfaction. AMS received a vast number of comments that indicate that consumers are unaware that porches have been used for outdoor access in organic production. The comments received indicate that there is a gap between how consumers think birds are raised on organic farms and the actual practices of some—but not all—organic producers. One of the key objectives in implementing this final rule is to assure consumers that the practices used to produce organic products meet a consistent standard, including outdoor access for poultry. This objective is guided by the NOSB recommendations and public and expert comment received during those deliberations that indicated a risk to the integrity and value of the organic seal from the gap between consumer expectation and current industry practice.
For further discussion of porches, including comments and cost impacts, see section XII, “Porches as Outdoor Areas.”
(Comment) A number of comments stated that the proposed rule would compromise biosecurity measures and increase exposure of birds to disease and infection by requiring access to the outdoors. Comments stated that there would be increased exposure of organic birds to wild birds and the feces of wild birds, which could harbor and transmit diseases. Additionally, comments noted the requirements would expose organic birds to more contact with soil, other animals (
However, several comments also noted that confinement of poultry to the indoors is not a guarantee that birds will be protected from disease. A comment noted that in the 2015 outbreak of highly pathogenic avian influenza (HPAI) in the United States, the affected poultry farms were non-organic operations that permanently confine birds from the outdoors. Commenters urged AMS to consider that outdoor access is only one component of a comprehensive biosecurity plan and that factors other than outdoor access have been implicated in confirmed cases of HPAI (
(Response) In the final rule, AMS has retained the requirement for outdoor access for organic birds, but the Agency engaged in extensive deliberations to align these requirements with the best practices of federal agencies focused on biosecurity and food safety. Outdoor space requirements have also been retained for layers, pullets, and broilers of species
The final rule continues to allow producers to temporarily confine birds because of conditions under which the health, safety, or well-being of the animal could be jeopardized. This provision has been included to protect animal health. AMS also recognizes that specific disease risks may require temporary confinement to protect bird health, in the absence of a documented occurrence of disease. In response to comments, AMS has removed a provision from this section that would have required a documented occurrence of disease in the region or migratory pathway to temporarily confine animals. By revising the requirement, AMS is providing producers with additional options to address disease risks. This provision to temporarily confine birds must be part of an Organic System Plan approved by the producer's accredited certifying agent. Additional requests for temporary confinement, outside of the approved Organic System Plan, must be approved by the certifying agent. AMS encourages state departments of agriculture to coordinate with NOP and certifiers on occasions where temporary confinement may be necessary to protect animal health. See AMS's discussion of comments on “Temporary confinement—disease” for further discussion of confining animals under this provision.
(Comment) Several comments requested that AMS clarify how the regulations apply to poultry producers that use certain types of mobile pasture-based systems. The comments described these systems as providing direct access to soil and vegetation; having walls and roofs made of mesh, plastic, wood, and other materials; and having mobility. Birds in these systems are on pasture, however, roofing on all or part of the structure provides shade and protection. These comments argued that these systems should meet the definition of outdoors because they provide access to soil and vegetation and allow for natural behaviors (scratching, pecking, foraging, etc.).
(Response) For further discussion, see AMS's response to comments in the Definitions section. AMS made several revisions in the final rule in response to comments requesting more clarity around the definitions of indoors and outdoors as they apply to pasture-based systems. We revised the definition of outdoors in § 205.2 to clarify that pasture pens are outdoors. Additionally, we use the term “mobile housing” in § 205.241(b)(8)(1) of the final rule to distinguish pasture pens from mobile housing. Mobile housing provides indoor space while pasture pens are considered outdoors.
Birds raised in pasture pen systems must be provided with space to meet outdoor space requirements at §§ 205.241(c)(4) through (6); specifically, space for chickens must be provided at a rate of no less than one square foot for every 2.25 pounds of layer, 3.0 pounds of pullet, or 5.0 pounds of broiler in the flock. Species other than chickens must be provided with outdoor space to meet the requirements of §§ 205.241(c)(1) through (3). AMS has determined that this type of production, which provides animals with constant access to pasture, also meets consumer expectations of organically produced birds, and expects that the outdoor space requirement ensures birds in these systems have sufficient space to express natural behaviors and meet the requirements of § 205.241(a).
(Comment) AMS received numerous comments stating that the proposed rule would compromise egg producers' efforts to prevent
(Response) AMS engaged in extensive deliberations to reduce the likelihood that requirements under this rule would jeopardize or impact practices that poultry producers have implemented to meet FDA requirements to prevent SE (21 CFR part 118) published on July 9, 2009 (74 FR 33030). Under the FDA requirements, producers must have and implement a written SE prevention plan and take measures to prevent introduction or transfer of SE into or among poultry houses (21 CFR 118.4). Under FDA regulations, the minimum requirements to prevent SE include, but are not limited to: preventing stray poultry, wild birds, cats, and other animals from entering poultry houses; and removing debris within a poultry house and vegetation and debris outside a poultry house that may provide harborage for pests. Enrichments in the outdoor area could provide harborage for rodents, and thus, could conflict with FDA requirements at 21 CFR 118.4(c)(3).
In the final rule, AMS has removed the proposed requirement, “outdoor areas must have suitable enrichment to entice birds to go outside.” This requirement has been removed in the final rule to remove conflict with FDA rules to prevent SE contamination. Section 205.241(c)(1) requires that “outside access and door spacing must be designed to promote and encourage outside access for all birds on a daily basis. Producers must provide access to the outdoors at an early age to encourage (
Additionally, AMS has amended the rule at § 205.241(c)(2) to require at least half of the outdoor area to be soil with vegetative cover, which encourages birds to come outdoors and accommodates natural behaviors. Organic producers must ensure that vegetation does not provide harborage to pests, as required under FDA requirements (21 CFR 118.4(c)(3)). For example, vegetation in outdoor areas must be kept at a short enough height to ensure it does not harbor pests. FDA draft guidance
(Comment) Comments also stated that doors, as required by AMS, would directly conflict with the FDA requirement to prevent stray poultry, wild birds, cats, and other animals into poultry houses. Comments stated that any door to allow organic birds to move between the indoors and outdoors would inevitably lead to the movement of other animals between the outdoors and indoors, and that failure to prevent this movement would conflict with the FDA requirements.
(Response) The FDA SE rule includes required measures to prevent SE contamination, including biosecurity and pest control measures (21 CFR part 118). Under this final rule, organic producers must provide access to the outdoors (§§ 205.241(a), 205.241(c)(1)). To also comply with FDA requirements, organic producers need to take measures to prevent wild animals and pests from moving freely between the outdoors and indoors. For example, producers could: use visual deterrents to discourage wild birds in or around housing; set traps for pests outdoors and indoors; use perimeter fences to keep stray or wild animals out of outdoor areas; reduce access to feed indoors by managing spilled feed; or design exit areas on housing to prevent wild birds from entering the house.
(Comment) Several comments noted that soil can be contaminated with persistent synthetic chemicals, including dioxins, and specifically, polychlorinated dibenzo-
(Response) No provision under this rule allows for the sale of eggs that contain substances—including dioxins, heavy metals, and PCBs—in excess of levels established by the FDA or other agencies. This rule does not change the requirement that producers, regardless of whether or not they are organic, must comply with FDA requirements. Additionally, organic regulations at § 205.671 address unavoidable residual environmental contamination (further defined at § 205.2) and do not allow for the sale of contaminated agricultural products as organic. For more information on action levels published by the FDA, see FDA's Guidance for Industry: Action Levels for Poisonous or Deleterious Substances in Human Food and Animal Feed.
(Comment) AMS received many comments stating that vegetation should be required in outdoor areas for birds. Comments noted that vegetation is important for birds to engage in the natural behavior of foraging and that denuded soil increases health risks for flocks. Additionally, comments noted that vegetated soil benefits soil and water quality compared to bare soil by reducing water runoff, preventing erosion, and taking up nutrients. Most comments recommended the outdoor area be covered with at least 50 percent vegetation, while some comments recommended AMS require up to 90 or 100 percent vegetative cover in outdoor areas.
(Response) AMS agrees that vegetation in outdoor areas has benefits that warrant this requirement. We have revised the final rule at § 205.241(c)(2) as follows: “at least 50 percent of outdoor space must be soil. Outdoor space with soil must include maximal vegetative cover appropriate for the season, climate, geography, species of livestock, and stage of production . . .” This requirement recognizes the important function and role of vegetation in the outdoor space, including its benefits to soil health and to birds by allowing for the expression of natural behaviors. Vegetation in outdoor areas must be maintained to ensure it does not provide harborage for rodents and other pests. For example, vegetation in outdoor areas must be kept at a short enough height to ensure it does not harbor pests. FDA draft guidance recommends that vegetation should be maintained to less than 6 inches in height.
Additionally, AMS has included at § 205.241(d)(4) an allowance to temporarily confine birds for “risk to soil or water quality, including to establish vegetation by reseeding the outdoor space.” Birds may not be confined any longer than required to seed the area and allow for the vegetation to establish itself. This allowance for temporary confinement was included by AMS to acknowledge that some producers may need to reseed outdoor areas to meet the vegetation requirement included in § 205.241(c)(2) and that birds may need to be kept off the area to allow seeds to germinate and establish. The minimum outdoor space requirements do not apply when birds are temporarily confined under this provision, and a producer may still allow birds outdoors. For example, if 50 percent of the outdoor area is covered by gravel, birds may be allowed into this portion of the outdoor area. Providing a smaller outdoor area when confining animals to reseed the outdoor area and establish vegetation would be in compliance with the provision at § 205.241(d)(4).
(Comment) AMS received a number of comments that contact with gravel or pavement does not allow chickens to exhibit their natural instinctive behaviors. Many comments requested we reduce the amount of outdoor area that can be anything but soil (including soil with vegetative cover) from 50 percent to 25 percent or less.
(Response) AMS has retained the requirement as proposed that outdoor areas be at least 50 percent soil, but we have also revised the requirement to add a requirement for maximal vegetative cover in the outdoor soil area. We think this revision communicates the importance of contact with the ground yet still provides an allowance for producers to use other surfaces as necessary. For example, gravel surfaces may be necessary to ensure adequate drainage adjacent to a house. A producer could still provide a surface or materials in this outdoor area that would accommodate the natural behavior of birds, including scratching and dust bathing.
(Comment) AMS received many comments about whether vegetation would be permitted in outdoor areas, since the proposed rule stated at section 205.241(c)(8), “At least 50 percent of outdoor access space
(Response) AMS understands from comments received that there was confusion about whether outdoor areas could be vegetated or if AMS would require outdoor areas to be cleared of vegetation. In the final rule, AMS has revised the outdoor space requirement to clarify that outdoor soil areas must be covered with vegetation given site-specific conditions.
(Comment) AMS received a few comments about whether land used for outdoor access for poultry must be certified organic and meet the same requirements as land used in the production of organic crops or pasture. One comment recommended that producers not be allowed to remove the top soil from the outdoor area and replace it with another fill material to forego the land transition period requirement (
(Response) AMS agrees that land used to provide outdoor access to poultry must be certified as part of an organic system plan. The USDA organic regulations require that organic agricultural products fed to livestock be organically produced. Additionally, the regulations require that crops be produced from land to which no prohibited substances, including synthetic chemicals, have been applied during the three years immediately preceding the harvest of the agricultural product. As birds may consume vegetation from land used to provide outdoor access, this land must meet the same requirements as used to produce any other organic crop. The implementation period for this final rule takes into account the possibility that producers may need to transition land to meet outdoor space requirements.
(Comment) AMS received many comments that the requirement for “suitable enrichment” in outdoor areas was too subjective. Some comments recommended AMS remove this part of the requirement, while other comments recommended AMS specify the number and types of enrichments required. Many other comments noted that enrichments outdoors would attract other animals and violate FDA requirements for shell egg producers to prevent SE contamination of eggs. Some comments requested AMS clarify how the requirement for suitable enrichment outdoors applies to broiler production.
(Response) In response to comments, AMS has removed the requirement that outdoor areas must have suitable enrichment to entice birds to go outside in the final rule. See AMS's response to comments about FDA regulations in the section above on FDA regulations and food safety. AMS has, however, amended the rule at § 205.241(c)(2) to require at least half of the outdoor area to be soil with vegetative cover, which provides an environment that encourages birds to come outdoors. Additionally, we have retained the requirement in the final rule that outside access and door spacing be designed to promote and encourage outside access for all birds on a daily basis. Producers must still meet the general requirements of § 205.241(a) and provide living conditions that accommodate the health and natural behavior of birds, including: year-round access to outdoors; shade; shelter; exercise areas; fresh air; direct sunlight; clean water for drinking; materials for dust bathing; and adequate outdoor space to escape aggressive behaviors.
(Comment) Several comments noted that suitable enrichments should be required indoors for broilers. A comment stated that perches are of questionable benefit to broiler-type birds and that a general requirement for indoor enrichment for broilers would be beneficial. A comment recommended that beneficial indoor features might include straw bales, string, deep litter, and dust baths.
(Response) In the final rule, AMS has not included a perch or indoor enrichment requirement for broilers. AMS may undertake further work on this topic, with the assistance of the NOSB, as appropriate. However, broiler producers must meet the requirement at § 205.241(b)(1), which requires that birds be able to engage in natural behaviors indoors. Producers should work with their certifier to determine if birds are able to engage in natural behaviors indoors.
(Comment) Several comments noted the benefits of covered areas in the outdoor space for birds and recommended AMS require these features in outdoor areas. Comments noted that birds will be encouraged to go outdoors if they can seek and find safety from overhead predators under trees, roofs, or other structures.
(Response) AMS agrees that protection from predators could be important to encourage birds to use outdoor areas. Furthermore, overhead protection could reduce mortality by reducing predation. However, in the final rule, AMS has not included a specific requirement to provide covered areas outdoors. Producers are required to promote and encourage outside access in the final rule (§ 205.241(c)(1)), and overhead protection may be used to meet this requirement. However, AMS has not specified exactly how producers must promote and encourage outside access. We believe this flexibility is important to allow producers to implement practices that are best suited to their operations, while still establishing a clear standard for producers to promote and encourage outdoor access and while protecting birds from disease and predation.
(Comment) AMS received many comments about temporary confinement for air temperatures that are under 40 °F or above 90 °F. One comment stated that allowing birds to go outdoors at 40 °F would cool down the barn quickly and create moisture issues. Other comments noted that additional fuel would be required to maintain indoor temperatures if doors were opened during cool weather and that birds would require more feed to compensate for the energy required to maintain their body temperature. Comments on the upper limit proposed by AMS noted that cooling systems in poultry houses would not work as designed with doors open, and that birds would be subjected to additional stress that could result in higher incidence of illness or death. Some alternate recommendations for the temperature range were 55-90, 50-90, 60-90, and 50-85 °F. Meanwhile, some comments supported removing any lower or upper limits and instead defining inclement weather. Additionally, several comments requested AMS clarify if producers are required to provide birds with access to
(Response) Organic regulations already include a definition of the term “inclement weather” at § 205.2 In the proposed rule, AMS did not suggest changes to this definition, but we did propose to include a specific temperature range, outside of which producers could temporarily confine birds. The temperature range was proposed to ensure consistent practices between producers for temporarily confining birds due to weather. However, as noted by comments, temperature alone is not necessarily an indicator of inclement weather. For example, humidity can amplify the effect of high temperatures. Information from one poultry breeding company indicates birds experience extreme heat stress at a temperature of 82 °F when the relative humidity exceeds 75 percent. However, at 20% relative humidity, birds experience a similar degree of heat stress once the temperature reaches 100 °F.
The final rule allows for temporary confinement of birds for, “inclement weather, including when air temperatures are under 40 °F or above 90 °F.” AMS notes that weather may still qualify as inclement weather (§ 205.2) even within this temperature range. For example, excessive precipitation and very violent weather can occur when temperatures are within 40 °F and 90 °F. Likewise, weather may meet the definition of inclement weather within the range of 40 °F and 90 °F if the relative humidity is very high and the air temperature is nearing 90 °F, or under extremely windy conditions. As inclement weather is defined as weather than can cause physical harm to a species, a producer would still be in compliance with § 205.241(d)(1) if birds were confined at temperatures that did not exceed 90 °F but when the weather could cause physical harm.
(Comment) AMS received comments that layers should be required to go outdoors before 16 weeks of age. Other comments noted that pullets can be moved from dedicated pullet rearing facilities to dedicated layer houses when pullets are older than 16 weeks; these comments also requested additional time to allow for confinement until pullets are moved to layer houses. One comment cited that the allowance for 16 weeks of temporary confinement conflicts with AMS's proposed requirement at § 205.241(c) that producers, “provide access to the outdoors at an early age to encourage (
(Response) The final rule allows producers to temporarily confine layers for up to 16 weeks of age. AMS agrees that 16 weeks of confinement from the outdoors is not always required. In fact, many organic producers already provide outdoor access for layers prior to 16 weeks of age. AMS also recognizes, however, that many layer operations use vaccination programs to protect bird health and prevent disease, and in many cases, birds receive vaccines during the first 16 weeks of life. Requiring outdoor access before this age could compromise bird health. Birds that are over 16 weeks of age may not be confined under the provision at § 205.241(d)(2(ii). Any confinement of birds beyond 16 weeks of age must be done only in accordance with other provisions at § 205.241(d). In any case, producers must describe their practices for confining birds in their Organic System Plan, and certifiers must approve these plans.
(Comment) AMS received several comments that turkeys are not ready to go outdoors by four weeks of age, as proposed by AMS, because full feather plumage is not complete until approximately seven weeks of age. The comments requested turkeys be addressed specifically in the regulations, as turkeys have different requirements than chickens or other bird species.
(Response) AMS recognizes that turkeys may require a longer period of time than chickens for feather development. In response to comments, AMS has revised the final rule at § 205.241(d)(2)(iii) to allow temporary confinement of turkeys and other species until fully feathered. The requirement for chickens (
(Comment) AMS received many comments about temporary confinement for bird health, safety, or well-being at § 205.241(d)(3). Specifically, comments showed concern that the requirement for a documented disease in the region or relevant migratory pathway would compromise a producer's ability to proactively confine animals to prevent exposure of a flock to disease. One comment suggested that AMS allow birds to be kept inside when there is a reasonable expectation of disease that can rapidly spread through poultry. Another comment suggested that detection of a disease, rather than occurrence of a disease, should be sufficient grounds to confine birds. Other comments urged AMS to allow confinement when recommended by a State or Federal animal health official. Additionally, comments stated that the terms “region,” “migratory pathway,” and “documented occurrence” were not clear and could lead to varying interpretations, including extended periods of confinement for birds in the absence of real risk. One comment suggested that AMS remove references to “region” and “migratory pathway” and allow confinement only in the case of a current local occurrence of a disease.
(Response) The organic livestock and poultry standards allow temporary confinement of poultry for “conditions under which the health, safety, or well-being of the animal could be jeopardized.” In the case of risks posed by highly contagious and rapidly spreading disease, AMS recognizes that it is complicated to precisely assess disease threats, and AMS recognizes that various animal health experts, including State and Federal officials, serve important roles in monitoring disease threats and communicating those threats to producers. In response to comments, AMS has revised the final rule to provide additional flexibility for confining animals to prevent the spread of disease and protect bird health. To temporarily confine birds under this provision, producers must be able to demonstrate that the birds' health, safety, or well-being are jeopardized by access to the outdoors. Plans to temporarily confine birds must be part of the producer's organic system plan approved by the certifying agent. Producers must keep records of confinement and records to justify confinement (see §§ 205.103 and 205.241(d)).
(Comment) AMS received several comments that the allowed period (2 weeks) for confining birds for nest box training (
(Response) AMS recognizes that nest box training is important, as it reduces eggs laid outside of nests; simplifies management; and reduces contact between eggs and manure, dirt, and other substances. AMS understands that different species and breeds may require different amounts of time for nest box training. In response to comments, AMS has revised the final rule to align with the NOSB's recommendation. Birds may be confined to train birds to use nests, but the period must not exceed five weeks.
(Comment) One comment recommended AMS add the word “temporarily” to the last sentence of § 205.241(d) to be clear that confinement cannot be permanent or lasting (see definition of “temporary and temporarily” in § 205.2).
(Response) AMS agrees with the comment, and we have revised § 205.241(d) to clarify, “Operations may
(Comment) AMS received several comments that the proposed requirement “each instance of confinement must be recorded” was unnecessary. Comments cited the existing requirement for recordkeeping and did not think it was practical or reasonable to require producers to record every single instance of confinement, such as every time birds were put inside at night. Some comments noted that producers have written standard operating procedures that describe when birds are confined and this would serve as a sufficient record of confinement.
(Response) AMS agrees that the value of requiring producers to record each instance of confinement may be limited, especially when the confinement is routine, such as confinement of birds inside a poultry house at night for the birds' safety. However, AMS thinks it is also important that certifiers be able to readily assess a producer's compliance with the regulations. By requiring producers to record each instance of confinement, certifiers can easily identify instances of confinement, including the reason for confinement. These records can then be reviewed with third-party information to verify the reason for confinement. For example, a certifier can check weather information for the area to confirm there was inclement weather on the dates when animals were confined or confirm the occurrence of a disease in the region for that time. Meanwhile, AMS has been promoting recordkeeping requirements for organic producers (
(Comment) AMS received a comment that producers should be required to provide additional indoor space if poultry are confined for more than one week. The comment suggested that AMS require indoor space equivalent to the total combined indoor and outdoor space that is otherwise required when birds are not temporarily confined.
(Response) AMS recognizes that the total space per bird is reduced when birds are temporarily confined. However, producers are not able to predict events that require temporary confinement, such as disease outbreaks. If it were necessary to confine animals for more than one week, a producer may need to cull perhaps half of the entire flock in order to meet the requirement proposed by the commenter. In cases where birds could not be sold as organic, the financial loss to producers would be great, or a producer could be forced to destroy a large portion of the flock. AMS does not think this is warranted for circumstances that are beyond a producer's control.
(Comment) AMS received a comment that the period for temporary confinement for youth projects following the conclusion of a fair or demonstration should be extended from 24 hours to one week, to ensure that birds are healthy and will not pass any sickness or disease acquired at these events to other birds.
(Response) The final rule maintains an allowance to confine birds up to 24 hours after the birds have arrived home at the conclusion of a youth event. However, AMS notes that birds may be temporarily confined for a longer period of time in accordance with § 205.241(d)(3), which allows for temporary confinement because of conditions under which the health, safety, or well-being of animals could be jeopardized. Producers must describe their practices in their organic system plan and work with their certifier to ensure that temporary confinement practices meet the requirements.
(Comment) AMS received comments that increased outdoor access could contaminate water systems, as a result of birds being outside on soil. Comments stated that water runoff from outdoor areas containing manure would need to be managed to comply with U.S. Environmental Protection Agency
(Response) An overarching requirement of organic production is that soil and water quality be maintained or improved (7 CFR 205.200). To minimize potential impacts to soil or water quality from livestock with outdoor access, AMS has included a requirement in the final rule for vegetation in outdoor areas (§ 205.241(c)(2)). Vegetation acts to hold soil, reduce water runoff, and take up nutrients deposited in animal feces. Clean Water Act National Pollutant Discharge Elimination System (NPDES) permit requirements for concentrated animal feeding operations do not encompass outdoor areas that have vegetation in the normal growing season. (
(Comment) AMS received comments that requiring birds to be outside on soil would lead to contamination of soil due to excess nutrients from manure. Comments requested that AMS not require outdoor access.
(Response) AMS recognizes concerns about impacts to soil quality, and the final rule includes provisions to protect soil quality. However, AMS disagrees with comments that soil quality should be addressed by removing the requirement for outside access altogether. In the final rule, § 205.241(e) requires producers to manage manure in a manner that does not contribute to contamination of crops, soil, or water. Section 205.241(d)(4) allows for temporary confinement of birds because of risk to soil quality. Each producer will need to manage soil quality as appropriate to their climate, soil type, and size of outdoor area. AMS notes that managing soil in outdoor areas may also include feed management, as excess nutrients provided in feed are excreted by birds. Producers may attain resources and assistance with feed management and manure management by contacting the USDA's Natural Resources Conservation Service (NRCS).
(Comment) AMS received several recommendations to include requirements for slow-growing poultry breeds or for breeds that are suited to free-range conditions. Some comments recommended that AMS set a minimum age at slaughter or a maximum daily growth rate requirement to ensure sustainable weight gain and animal health.
(Response) AMS has not included a requirement for slow-growing breeds or minimum age requirements for slaughter in the final rule. AMS agrees that this topic may deserve further attention and input from stakeholders, and we may ask the NOSB to explore this topic.
(Comment) AMS received comments that current organic regulations require access to the outdoors and that these new rules are not necessary for AMS to require outside access or for AMS to prohibit porches as outside access. The comments cited existing regulations at § 205.239(a)(1), which include a requirement that producers establish and maintain “year-round access for all animals to the outdoors . . . Continuous total confinement of any animal indoors is prohibited.”
(Response) AMS acknowledges that current organic regulations require outdoor access for poultry, but we disagree with the argument that current regulations could achieve the same results as the regulations revised by this final rule. As recommended by the NOSB, AMS is implementing this final rule to establish specific regulations for the care of livestock, as authorized under OFPA (7 U.S.C. 6509(d)(2)).
(Comment) Some comments stated that the requirements in § 205.241(b)(1) and § 205.241(b)(11) were duplicative and that the sections should be combined in a single requirement to streamline the requirements.
(Response) AMS agrees with these comments and has moved the text from § 205.241(b)(11) as proposed to § 205.241(b)(1). We have removed the originally proposed text at § 205.241(b)(1) in the final rule.
(Comment) A comment suggested moving the requirement on litter at § 205.241(b)(4)(iii) to clarify that the requirement applies to all types of poultry houses and not just houses with slatted or mesh floors.
(Response) AMS agrees with the comment that the requirement, “litter must be provided and maintained in a dry condition,” proposed at § 205.241(b)(4)(iii) is more appropriately placed as a standalone requirement. In the final rule, this requirement has been moved to § 205.241(b)(6).
(Comment) A comment noted that proposed § 205.241(b)(4)(i), which allows, “mesh or slatted flooring under drinking areas to provide drainage,” was unnecessary and did not actually impose a requirement since the section only states this type of flooring “may” be used.
(Response) AMS agrees that the allowance for mesh or slatted flooring under drinking areas is not necessary, as nothing else in the requirements prohibits use of mesh or slatted flooring under drinking areas. We have included a separate requirement to maintain litter in a dry condition. In the final rule, AMS has removed § 205.241(b)(4)(i) as proposed. Additionally, AMS has removed § 205.241(b)(4) of the proposed rule, and moved the requirement proposed at § 205.241(b)(4)(ii) to § 205.241(b)(7). The requirements on scratch areas, dust baths, and litter now appear at §§ 205.241(b)(6) and (7).
(Comment) Some comments asked for clarification on the meaning of the term “litter” as used in the avian living section. Comments stated that it was not clear if producers are required to add litter material for birds or if dehydrated manure would suffice without any additional litter. Another comment recommended AMS use the term “bedding” in place of litter, as this term is used elsewhere in the regulations.
(Response) AMS has used the term “litter” in § 205.241, as this term is commonly used by avian producers. The term has not been further defined in § 205.2. Litter includes substrates used to absorb moisture and dilute manure. Litter also provides birds with the opportunity to dust bathe and to express foraging and scratching behaviors. Common types of litter include wood shavings or chips, straw, rice hulls, and sand. The final rule at § 205.241(b)(6) requires that litter be provided and maintained in a dry condition. AMS has not specified the amount of litter that must be provided. However, the rule does require that litter be provided. An absence of litter would not be in compliance with this requirement. Litter should be provided in amounts required to absorb moisture, dilute manure, and to allow birds to express natural behaviors such as dust bathing, foraging, and scratching.
(Comment) Some comments stated AMS's requirements were not based on scientific evidence and appeared to be made by AMS arbitrarily, including the
(Response) The provision on indoor and outdoor space requirements in this rule are based on nine separate NOSB recommendations submitted to the Secretary. In developing these recommendations at their public meetings, the NOSB considered technical information and public comments, including comments from organic livestock producers, animal welfare experts and the scientific community. AMS is establishing these requirements, in consideration of the NOSB's recommendations, to assure consumers that organically produced products meet a consistent standard.
New § 205.242(a)(1) requires that animals are clearly identified during transport. AMS's approach requires that animals are clearly identified but provides flexibility on how the identity is maintained during transport.
New § 205.242(a)(2) sets minimum fitness requirements for livestock to be transported. Section 205.242(a)(2)(i) requires that calves have a dry navel cord and the ability to stand and walk without assistance, if they are to be transported. This provision would apply to transport to buyers, auction facilities, or slaughter facilities. Beef cattle and dairy cattle producers may transport calves on the farm before the navel is dried and the calves can walk. Section 205.242(a)(2)(ii) prohibits transport of non-ambulatory animals to buyers, auction facilities, or slaughter facilities. These animals may either be given medical treatments and cared for until their health conditions improve, so that they are able to walk, or they may be euthanized.
New §§ 205.242(a)(3) and (4) set minimum standards for the trailer, truck, or shipping container used for transporting organic livestock. The mode of transportation is required to provide seasonal-appropriate ventilation to protect animals against cold or heat stress. This provision requires that air flow be adjusted depending on the season and temperature. In addition, bedding is required to be provided on trailer floors as needed to keep livestock clean, dry, and comfortable. If roughage is used as bedding, the bedding needs to be organically produced and handled. Bedding is not required for poultry crates.
Section 205.242(a)(5) requires that all livestock be provided with organic feed and clean water if transport time exceeds 12 hours. The 12-hour time period includes all times during which the animals are on the trailer, truck, or shipping container, even if these modes of transportation are not moving. In cases such as poultry slaughter in which requirements do not allow feed 24 hours before slaughter, producers and slaughter facilities need to ensure that transport time does not exceed 12 hours. After 12 hours of transport, the birds would need to be fed, which may prolong the time to slaughter. The certified operation must present records—which verify that transport times meet the 12 hour requirement—to the certifying agent during inspections or upon request.
New § 205.242(a)(6) requires that operations that transport livestock to sales or slaughter have emergency plans in place that adequately address problems reasonably possible during transport. Such emergency plans could include how to provide feed and water if transport time exceeds 12 hours, what to do if livestock escape during transport, or how to euthanize an animal injured during transport. Shipping and/or receiving operations need to include these plans in their OSPs.
(Comment) One comment asked AMS to clarify whether § 205.242(a)(1), which regulates transportation of organic livestock, applies to transport in general or only transportation to slaughter. Other comments expressed concern over the requirement that organic livestock must be transported in designated pens. The comments noted that while identification of organic livestock during transport is essential, requiring designated pens would be burdensome. In practice, identification is generally done through ear tags or other methods, and that requiring designated pens is burdensome.
(Response) Section 205.242(a)(1) applies to transport of organic livestock to buyers, auction, and slaughter facilities. AMS agrees that requiring identification of pens during transport for organic livestock may not be necessary to maintain an audit trail and organic integrity. AMS has amended the language in § 205.242(a)(1) to remove the requirement for designating and identifying organic pens during transport, changing the text to read: Certified organic livestock must be clearly identified as organic, and the identity must be traceable during transport to buyers, auction, and slaughter facilities.
(Comment) Several comments pointed out that the term `sick' in § 205.242(a)(2)(ii) should be defined to reduce the possibility that animals are withheld from slaughter due to a minor ailment that does not impact the quality of slaughter products. The comments suggested that the language, “sick, injured, weak, disabled, blind, and lame” in this section be replaced with “non‐ambulatory,” which is consistent with humane slaughter practices and readily verified. Several comments also requested that § 205.242(a)(2) be changed to specify that livestock must be ambulatory to be fit for transport to buyers, auctions, or slaughter facilities.
(Response) AMS agrees that animals should not be withheld from slaughter due to a minor ailment that does not impact the quality of slaughter products and has made the suggested change in § 205.242(a)(2)(ii). In the final rule, the terms “Sick, injured, weak, disabled, blind, and lame,” have been replaced with “non‐ambulatory.” As defined in defined at 9 CFR 309.2(b), non-ambulatory is a condition recognized within the industry and provides a more standardized criterion to evaluate.
(Comment) Two comments were concerned with the requirement in the proposed rule that calves must not be transported to auction or slaughter facilities until their navel cords are dried and they have the ability to stand and walk on their own. Both comments suggested changes to the rule to allow for more flexibility around when calves could be transported. One comment requested changes to the rule to allow calves with a dry, clean, and disinfected navel cord to be transported, and the other suggested that the rule be revised to set a minimum age for calf transport
(Response) AMS reviewed and considered comments from all organizations that reviewed and analyzed the proposed rule. Based on the widespread support of this subsection, AMS did not feel that a change to the regulation was warranted.
(Comment) Several comments expressed opposition to the use of bedding for transport of livestock over long distances because of the risk of animal injury due to certain types of bedding or the need to discourage laying down in trailers where crowding may be an issue. One comment asked for clarification on whether rubber mats would be an acceptable form of bedding during transport. Several comments from stakeholders recommended that bedding also be a requirement for poultry crates, stating that poultry should also be kept clean, dry, and comfortable during transport.
(Response) Section 205.242(a)(4) includes the phrase “as needed,” which allows for the discretion of the certified operation and their certifier when determining if the use of bedding is appropriate based on risk of injury to the livestock and other welfare concerns. AMS believes that this language describes the requirements with sufficient clarity, while not being overly prescriptive. Certified operations should describe in their organic system plan how they will determine whether or not bedding is necessary during transport. Certifying agents should assess this information when reviewing the certified operators' organic system plan for compliance. In some cases, bedding may not be required because of other animal welfare considerations. Regarding the acceptability of rubber mats during transport, there is nothing in the proposed rule that prohibits the use of rubber mats. The bedding exemption for poultry crates is consistent with the 2011 NOSB recommendation, and AMS is not making changes to require bedding for these livestock. However, a minor change has been made to § 205.242(a)(4) to clarify that bedding is not required for poultry crates.
(Comment) One certifying agent addressed a position AMS made in the preamble to the proposed rule regarding the use of nonorganic bedding in transport, which would render animals nonorganic. While the commenter does not feel that the use of nonorganic bedding should be allowed, they suggested that if it were used unintentionally, the stated sanction is impractical and harsh since bedding in trailers and temporary pens would be in contact with animals for only a short period of time.
(Response) Certifiers are responsible for taking appropriate enforcement actions depending on the nature of the violation. AMS agrees that stating specific sanctions for non-compliant practices is not appropriate. Compliance procedures under the USDA organic regulations are specified under 7 CFR 205.660-668.
(Comment) Opposing comments were received on the topic of transport exceeding 12 hours. Several comments indicated that 12 hours was too long for livestock to go without feed and water because animals may have been without feed and water prior to loading for transport. These comments stated that it is cruel not to provide feed and water either continuously or at least every 6 to 8 hours. Conversely, several comments stated that livestock are rarely trucked for longer than 12 hours but that, if they are, they can go without feed and water for longer than 12 hours. One comment stated that if livestock are to be trucked for longer than 12 hours to slaughter or auction, it is likely that the transportation load will be larger and may not be exclusively organic. This comment stated that if the 12-hour rule is to be implemented, it will decrease the availability of transport for organic livestock and increase transport cost, especially for small- to mid-size operations. It was recommended that AMS rely on the federally mandated Twenty Eight Hour Law and remove the requirement for access to feed and water after 12 hours of transport. Another comment stated that the 12-hour requirement may be a hardship to the industry and is not important to birds in transit or waiting for slaughter. The comment stated that birds in strange cages or transport racks are not concerned about food. Several comments requested clarification on whether the 12-hour time period included lairage at the slaughter facility.
(Response) The 12-hour time period was recommended by the NOSB in their 2011 NOSB recommendation on
(Comment) Several comments received stated that the Twenty-Eight Hour Law provides minimal protection for animals, excludes poultry, and is under-enforced by APHIS. Some comments stated that the law is out of date and inhumane, and they recommended that the proposed rule be amended to limit transport of organically raised animals (including poultry) without food, water, and rest to no more than eight hours. These comments further recommended that the USDA develop a specific inspection program to adequately ensure compliance with these transportation standards. One comment recommended that the Twenty-Eight Hour Law and the requirement regarding noncompliance records also apply to poultry. Even though this regulation currently excludes poultry, this comment noted that the NOP definition of livestock includes poultry and that the consumer expectation of meat carrying the organic label is that all livestock is subject to the same requirements. Another comment requested that the final rule provide a transport limit for poultry since it is not covered under any federal regulation.
Certifying agents and other industry groups commented that § 205.242(a)(5)(i) does not clearly specify the regulation for which the noncompliance records and subsequent corrective actions must be provided. They suggested that this section, specifically § 205.242(a)(5)(ii), directly reference the Federal Twenty-Eight Hour Law (4 U.S.C. 80502) and the regulations at 9 CFR 89.1-89.5. In addition, one comment suggested that a “Memorandum of Interview (MOI)” be added for incidents related to the transport of poultry; noncompliance records are currently not issued for incidents involving poultry since the transport and slaughter of birds are not covered by any federal regulation.
(Response) The intention of §§ 205.242(a)(5)(i) and 205.242(a)(5)(ii) in the proposed rule was to clarify the authority of the NOP, certifying agents,
Accordingly, after consultation with APHIS, AMS has decided to remove reference to the Twenty-Eight Hour Law in the final rule. The final rule has been amended accordingly.
(Comment) Several comments expressed concern over whose responsibility it is to maintain organic integrity/compliance with standards during transport. Some comments asserted that non-certified truckers would be responsible for compliance with bedding and feed requirements. One comment suggested adding language to the final rule to clarify that if animals are off-loaded during transport, the location must be certified if the animal is to retain organic status. One comment asked whether it is possible for organic livestock to maintain their organic status when they are kept at non-certified auction facilities while they are marketed and sold. The same comment asked whether the length of time the animal is at the facility or away from the original operation of origin and out of oversight of organic certification inspections impacts the organic status of the animal. One comment indicated that the proposed rule implies that the responsibility for compliance of transportation would fall back solely on the producer and that often it is the purchaser of the livestock (a broker or slaughter company for example) that would be paying for the transportation. This comment states that the entity who pays is the one with the most leverage to set requirements for transportation and obtain records that will verify practices. There is concern that the new requirements cannot be verified adequately without direct observation. The commenter suggested that § 205.242(a)(5)(ii) and 205.242(a)(6) be changed to specify that the operation responsible for documenting that transportation adequately meets the requirements is the certified operation that arranged the transport.
(Response) The criteria for who is responsible for maintaining organic integrity and who has to be certified are provided in NOP 5031: Certification Requirements for Handling Unpackaged Organic Products Guidance and the NOP Instruction 4009: Who Needs to be Certified? Both documents can be found on the AMS Web site:
The requirements with regard to slaughter and handling of livestock in connection with slaughter are governed by separate authority applicable to both certified organic and non-organic livestock products. The final rule reiterates that compliance with these regulations, as determined by FSIS, is required for certified organic livestock operations.
New § 205.242(b) regarding mammalian slaughter clarifies the authority of the NOP, certifying agents, and State organic programs to review records related to humane handling and slaughter issued by the controlling national, federal, or state authority, and records of any required corrective actions if certified operations are found to have violated FSIS regulations governing the humane handling of mammalian livestock in connection with slaughter (note that AMS has separated mammalian from avian slaughter requirements due to the differences in how mammalian and avian livestock are handled and slaughtered). This new section, titled “Mammalian Slaughter,” governs mammals defined as “livestock” or “exotic animals” under the FSIS regulations. Under the FSIS regulations, “livestock” are cattle, sheep, swine, goat, horse, mule, or other equine. “Exotic animals” include antelope, bison, buffalo, cattalo, deer, elk, reindeer, and water buffalo. These regulations govern the handling and slaughter of the majority of mammalian animals used for food in the United States and apply to all operations that slaughter these animals.
New § 205.242(b)(1) requires certified organic slaughter facilities to be in full compliance with the Humane Methods of Slaughter Act (HMSA) of 1978 (7 U.S.C. 1901
All establishments that slaughter livestock, which include any certified organic operations that slaughter livestock, must meet the humane handling and slaughter requirements the entire time they hold livestock in connection with slaughter. FSIS provides for continuous inspection in livestock slaughter establishments, and inspection program personnel verify compliance with the humane handling regulations during each shift that animals are slaughtered, or when animals are on site, even during a processing-only shift. The regulations at 9 CFR part 313 govern the maintenance of pens, driveways, and ramps; the handling of livestock, focusing on their movement from pens to slaughter; and the use of different stunning and slaughter methods. Notably, FSIS inspection program personnel verify compliance with the regulations at 9 CFR part 313 through the monitoring of many of the same parameters proposed by the NOSB in 2011, including prod use, slips and falls, stunning effectiveness, and incidents of egregious inhumane handling.
Further, FSIS encourages livestock slaughter establishments to use a systematic approach to humane handling and slaughter to best ensure that they meet the requirements of the HMSA, FMIA, and implementing regulations.
AMS added a new § 205.242(b)(2) for those certified organic facilities that slaughter exotic animals and voluntarily request FSIS inspection. FSIS also provides, upon request, voluntary inspection of certain exotic animal species on a fee-for-service basis under the authority of the Agricultural Marketing Act of 1946. FSIS regulates the humane handling of the slaughter of exotic animals under the regulations at 9 CFR part 352.10, which require that exotic animals be slaughtered and handled in connection with slaughter in accordance with the requirements for livestock at 9 CFR part 309 and 9 CFR part 313. Violation of these regulations can result in a denial of service by FSIS.
New § 205.242(b)(3) requires that all certified organic slaughter facilities provide any FSIS noncompliance records or corrective action records relating to humane handling and slaughter to certifying agents during inspections or upon request. Not all violations of FSIS regulations result in a suspension of FSIS inspection services. In some cases, FSIS will issue a noncompliance record and the slaughter facility must perform corrective actions to bring the slaughter facility back into compliance. These records must be provided to certifying agents during inspection or upon request to verify that the slaughter facility is in full compliance and has taken all corrective actions. In addition, AMS recognizes that in the U.S. some slaughter facilities are regulated by the State for intra-state meat sales. In foreign countries, foreign governments may be the appropriate regulatory authority for humane slaughter inspections. In all cases, the relevant humane slaughter noncompliance records and corrective action records must be provided to certifying agents during the inspections or upon request.
AMS added a new § 205.242(c) regarding avian slaughter facilities. Section 202.242(c)(1) clarifies the authority of the NOP, certifying agents, and State organic programs to review noncompliance records related to the use of good manufacturing practices in connection with slaughter issued by the controlling national, federal, or state authority and records of subsequent corrective action if certified operations are found to have violated the Poultry Products Inspection Act (PPIA) requirements regarding poultry slaughter, violated the FSIS regulations regarding the slaughter of poultry, or failed to use good commercial practices in the slaughter of poultry, as determined by FSIS. Under the PPIA and the FSIS regulations, poultry are defined as chickens, turkeys, ducks, geese, guineas, ratites, and squabs. These species constitute the majority of avian species slaughtered for human food in the U.S. However, the organic standards for avian slaughter apply to all species biologically considered avian or birds. The NOSB did not directly address avian slaughter requirements. However, AMS added avian slaughter requirements for consistency with the new mammalian slaughter requirements and to provide consistent slaughter requirements for certified organic operations.
While the HMSA does not apply to poultry, under the PPIA at 21 U.S.C. 453(g)(5) a poultry product is considered adulterated if it is in whole, or in part, the product of any poultry which has died by other means than slaughter. FSIS regulations, in turn, require that poultry be slaughtered in accordance with good commercial practices in a manner that will result in thorough bleeding of the poultry carcass and will ensure that breathing has stopped before scalding (9 CFR 381.65 (b)). Compliance with FSIS Directives 6100.3 and 6910.1, as determined by FSIS is required under the final rule.
In a 2005
FSIS inspection program personnel verify that poultry slaughter is conducted in accordance with good commercial practices in the pre-scald area of slaughter establishments, where they observe whether establishment employees are mistreating birds or
New § 205.242(c)(2) requires that all certified organic slaughter facilities provide, during the annual organic inspection, any FSIS noncompliance records and corrective action records related to the use of good manufacturing practices in the handling and slaughter of poultry in order to determine that slaughter facilities have addressed any outstanding FSIS noncompliances and are in good standing with FSIS. Not all violations of FSIS regulations result in a suspension of inspection services. In some cases, FSIS will issue a noncompliance record and the slaughter facility must perform corrective actions to bring the slaughter facility back into compliance. These records must be provided to the certifying agent at inspection or upon request to verify that the slaughter facility is operating in compliance with FSIS regulations and is addressing/has addressed all corrective actions. In addition, AMS recognizes that some poultry slaughter facilities in the U.S. are regulated by the State for intra-state poultry sales. In foreign countries, foreign governments may be the appropriate regulatory authority for poultry slaughter inspections. In all cases, the relevant noncompliance records and corrective action records must be provided to the certifying agent during inspections or upon request.
Unlike the requirements for livestock slaughter inspection, exemptions from poultry slaughter inspection exist for some poultry that is going to be sold to the public. AMS added handling and slaughter standards for such poultry that is either exempt from or not covered by the inspection requirement of the PPIA. Section 205.242(c)(3) would prohibit hanging, carrying, or shackling any lame birds by their legs. Birds with broken legs or injured feet may suffer needlessly if carried or hung by their legs. Such birds must either be euthanized or made insensible before being shackled.
New § 205.242(c)(3)(i) through (iii) require poultry slaughter operations that are either exempt or not covered by the requirements of the PPIA to meet the standards that non-exempt slaughter operations must meet. AMS included a requirement that no lame birds be hung on shackles by their feet. AMS also included a requirement that all birds that were hung or shackled on a chain or automated slaughter system be stunned prior to exsanguination. This requirement does not apply to small-scale producers who do not shackle the birds or use an automated system but who instead place the birds in killing cones before exsanguinating them without stunning. This requirement would not apply to ritual slaughter establishments (
(Comment) Several comments stated that the organic standards should require that only organic animals are handled at a certified organic slaughter facility and that the organic standards should go above and beyond the FSIS requirements for humane slaughter. For example, comments recommended that there should be more severe sanctions if noncompliances related to animal welfare are repeated, that the NOP should train slaughter facility staff on the USDA organic regulations, that the organic standards should be as explicit as NOSB recommendations on slaughter, and that the standards include a recommended hierarchy identifying the most humane methods of slaughter for each species. Comments also requested that the organic requirements include more detailed language regarding humane and prohibited forms of euthanasia of non-ambulatory animals upon arrival at the slaughter facility. Several comments recommended adding to 205.242(b)(1): 9 CFR part 309 regarding ante-mortem inspection to ensure that only healthy ambulatory animals are slaughtered and that non-ambulatory animals are euthanized and disposed of promptly. This regulation has recently been updated to include veal calves.
(Response) The USDA organic regulations provide for enforcement options that are implemented by the certifying agent when there are repeated violations of humane handling and slaughter regulations. AMS is not ranking allowed methods of slaughter for preference based on humane considerations as that would be challenging to enforce. AMS agrees with the suggestion to add reference to 9 CFR part 309 in the final rule in §§ 205.242(b)(1) and 205.242(b)(2), which cover the requirements for the humane and prompt euthanizing and disposing of non-ambulatory animals at the slaughter facility. Additionally, AMS has determined that the FSIS regulations are sufficient for protecting animal welfare because they include many of the provisions recommended by the NOSB for livestock slaughter. Adding requirements beyond the FSIS regulations may be overly prescriptive for organic production. AMS will provide trainings on this regulation, which will be available to all interested parties, including certifying agents, organic producers, and handlers who would like further clarification on these requirements.
(Comment) Several comments expressed concern over the requirement for organic inspectors to verify the mitigation of noncompliances found during FSIS inspections. The comments stated that inspectors do not have the expertise to determine if corrective actions to FSIS noncompliances are sufficient. Comments stated that verifying FSIS regulatory requirements is beyond the scope of organic certification and that this would place an unnecessary burden on inspectors and certifying agents. Other comments stated that FSIS personnel are specifically trained in identifying and responding to the PPIA and good commercial practice regulations, whereas certifying agents are not. They expressed concern that the new requirements for transporting livestock and poultry to sale or slaughter are redundant and unnecessary since FSIS already has regulations in place for slaughter. They assert that the duty of identifying and responding to noncompliance events remains exclusively under the oversight of trained FSIS personnel in order to protect the welfare of poultry during slaughter. In addition, several certifying agents were concerned that cross‐references to external statutes may render the organic standards obsolete and in need of future revision should
(Response) Through this final rule, AMS has established requirements that govern mammalian and avian species that are slaughtered by organic operations. Because these requirements are consistent with existing federal regulations for livestock slaughter, AMS expects that the organic producers and handlers will comply with these requirements. FSIS standards apply to organic and non-organic livestock, and FSIS is already carrying out inspections to this regulation. The role of the organic certifier/inspector is to verify whether FSIS has issued noncompliance records and if so, to verify that the certified operation has resolved or is working to revolve any FSIS noncompliances and is in good standing with FSIS. If not, the organic certifier is required to take appropriate enforcement action of organic rules under the USDA organic regulations. For example, if FSIS noncompliances have not been resolved, the certifying agent may issue a noncompliance to the certified facility to request verification that FSIS noncompliances have been resolved with FSIS as a condition for ongoing organic certification. Otherwise, this regulation would not change the current scope of the organic inspection of certified slaughter facilities. Organic inspectors are not required to know how to inspect slaughter facilities according to FSIS regulatory requirements and are not required to determine if corrective actions mitigate FSIS noncompliances.
However, as with any inspection, inspectors need to be highly qualified in the type of operation they are inspecting. AMS conducts annual trainings for certifying agents and will ensure that FSIS issues are also covered during those trainings. AMS will provide guidance to certifiers (agents) and inspectors on issues that may need further clarification once this rule is in effect. Regarding cross-referencing other federal regulations, AMS has determined that this does not pose a significant risk as stated in the comments. The FSIS regulation may be amended over time, but it is less likely to become obsolete. Furthermore, AMS will ensure updates and trainings are provided when FSIS regulations or procedures change.
(Comment) One comment suggested that specific vocalization thresholds be included in the regulation, as provided in the 2011 NOSB recommendation and the Certified Humane Slaughter Standards. Vocalizations of livestock in slaughter facilities can be associated with animal distress and welfare problems in the plant. The NOSB recommended that: (1) No more than 3% of cattle vocalize as they move through the restrainer, stunning box, and stunning area; (2) no more than 5% of hogs squeal in the restrainer due to human provocation; (3) no more than 5% of livestock vocalize when a head holder is used during stunning or slaughter; and (4) no more than 1% of hogs vocalize due to hot wanding. Vocalization scoring, as suggested by the NOSB recommendation, could be used as an objective method for detecting welfare problems during slaughter since cattle and hogs will vocalize during handling if stressed, injured, or scared but they will not vocalize if calm. The percentages provided in the NOSB recommendation would indicate well-managed slaughter plants; skilled, careful handlers; adequate equipment design and condition, and calm animals.
(Response) Facilities that meet the FSIS humane handling and slaughter requirements will ensure that animal distress during handling/slaughter is minimized, achieving the same impact as using vocalization threshold scoring. FSIS inspection program personnel verify compliance with the regulations at 9 CFR part 313 through the monitoring of many of the parameters recommended by the NOSB in 2011, including prod use, slips and falls, stunning effectiveness, and incidents of egregious inhumane handling. AMS did not feel that a change to the rule to include vocalization thresholds was warranted.
(Comment) Several comments asked how an established final rule would impact existing organic trade agreements, such as equivalency agreements and recognition agreements. For example, some comments highlighted specific provisions in the proposed rule that differ from established regulations in some foreign countries. Some of the comments questioned whether existing equivalency agreements would require renegotiation when the final rule becomes effective.
(Response) When the USDA organic regulations are amended, the USDA follows a set of steps with respect to international trade agreements. Under equivalency arrangements, the USDA notifies the foreign country of any amended USDA organic regulation that may affect the terms of the existing equivalency determination. The foreign country reviews the information and may initiate discussion to determine whether renegotiation is needed. With recognition agreements, the certification bodies in the foreign country are accredited by the recognized foreign government authority to certify operations under the USDA organic regulations. As a result, the USDA notifies the foreign government of the amended USDA organic regulation, and the foreign government authority informs its accredited certification bodies of the amended regulation.
(Comment) Comments were received regarding meat and poultry imports and how AMS will regulate livestock slaughter by certified organic operations in foreign countries. One comment provided country-specific recommendations regarding cattle transport and slaughter requirements. This comment recommended a modification of the new rules to stipulate that while cattle are in other countries that must adhere to state and/or federal animal welfare standards, these countries must abide by the standards and guidelines prescribed in their domestic animal welfare standards for the transport and slaughter of livestock. Additionally, one comment indicated that U.S. certifiers are currently unequipped to verify compliance with these other rules/laws for producers outside of the U.S.
(Response) Many facilities in other countries are already producing meat and poultry for the U.S. market that complies with FSIS export program requirements, regardless of whether the facility is certified organic. Certifying agents operating in countries outside of the U.S. are accredited by the USDA and will need to incorporate this final rule into their NOP certification programs. Foreign certifying agents will need to verify that livestock are being transported and handled according to the requirements of the final rule as well as FSIS equivalent programs. Noncompliance records related to these equivalent programs will be reviewed during annual organic certification
(Comments) Some comments received expressed concern that the proposed rule § 205.242(b)(1) contains no reference to the Humane Methods of Slaughter Act (HMSA). Instead, it refers to the Federal Meat Inspection Act (which itself references the HMSA) and parenthetically to the FSIS regulations at 9 CFR part 313. Comments recommended that this omission be corrected to include a direct reference to the HMSA by name and citation and to clarify that the HMSA provides minimum standards. The same comments recommended that provisions from the National Organic Standards Board (NOSB) recommendations on transport and slaughter be added.
(Response) The final rule requires certified organic slaughter facilities to be in full compliance with the Humane Methods of Slaughter Act (HMSA) of 1978 (7 U.S.C. 1901
(Comment) Several comments expressed concern that the proposed rule addresses avian slaughter, which is not covered by the Humane Methods of Slaughter Act (HMSA) and therefore is not currently governed by clearly defined humane standards. Other comments received state that the requirements of § 205.242(c)(3) for organic poultry slaughter operations exempt from or not covered by the requirements of the PPIA—which provide that no lame birds may be shackled, hung, or carried by their legs; that birds must be stunned prior to exsanguination; and that all birds must be irreversibly insensible prior to scalding—should apply to
(Response) Section 202.242(c)(1) clarifies the authority of the NOP, certifying agents, and State organic programs to initiate compliance action if certified operations are found to have violated the Poultry Products Inspection Act (PPIA) requirements regarding poultry slaughter, as well as the FSIS regulations regarding the slaughter of poultry and the use of good commercial practices in the slaughter of poultry. The NOSB did not directly address avian slaughter requirements. However, AMS is implementing avian slaughter requirements for consistency with the mammalian slaughter requirements and to better ensure the welfare of all animals slaughtered by certified operations. While the HMSA does not apply to poultry, under the PPIA at 21 U.S.C. 453(g)(5), a poultry product is considered adulterated if it is in whole, or in part, the product of any poultry which has died otherwise than by slaughter. FSIS regulations require that poultry be slaughtered in accordance with good commercial practices, in a manner that will result in thorough bleeding of the poultry carcass and that will ensure that breathing has stopped before scalding (9 CFR 381.65 (b)). In a 2005
(Comment) Some comments expressed concern that learning and enforcing FSIS rules could present an undue/unreasonable burden for certifiers and producers, especially for on-farm poultry processing. They request information on how a processor can prove they are in compliance with FSIS requirements and on how an operation slaughtering poultry on-farm under exemption can prove compliance with FSIS requirements.
(Response) A certified organic operation must meet the requirements of the USDA organic regulation. Operations must be compliant with all regulations that impact products they produce. Certifying agents are not assessing compliance with other regulations but only verifying compliance through review and inspection of a certified operation's noncompliance records issued by the regulatory authority. This final rule recognizes that some operations are exempt from poultry slaughter inspection and proposed handling and slaughter standards for such poultry that is either exempt from or not covered by the inspection requirement of the PPIA. Section 205.242(c)(3) prohibits hanging, carrying, or shackling any lame birds by their legs. Birds with broken legs or injured feet may suffer needlessly if carried or hung by their legs. Such birds must either be euthanized or made insensible before being shackled.
In addition, the final rule includes §§ 205.242(c)(3)(i) through (iii) to require poultry slaughter operations that are either exempt or not covered by the requirements of the PPIA to meet animal welfare standards that non-exempt slaughter operations must meet. This final rule requires that no lame birds be hung on shackles by their feet and that all birds that were hung or shackled on a chain or automated slaughter system
(Comment) Several comments expressed concern that the rule may require that Kosher or Halal slaughter facilities use a stunning step prior to exsanguination. These comments indicated that the rule is not clear on whether the stunning requirement is mandatory for operations that are exempt from or not covered by the requirements of the Poultry Products Inspection Act. While this requirement is directed at processors operating under state inspection who do not fall under the USDA FSIS inspection requirements, designated religious slaughter facilities are exempt from certain aspects of the Poultry Products Inspection Act, necessitating additional clarity. One comment recommended that slaughter not be limited to stunning prior to exsanguination and include other methods, such as the hand slaughter of birds in killing cones by way of exsanguination. The comment suggested that this should apply to both small/exempt and large/non-exempt producers.
(Response) Sections 205.242(c)(3)(i) through (iii) of the final rule requires that poultry slaughter operations that are either exempt or not covered by the requirements of the PPIA meet animal welfare standards that non-exempt slaughter operations must meet. Except as described below, the final rule requires that all birds that are hung or shackled on a chain or automated slaughter system be stunned prior to exsanguination. This requirement would not apply to handling operations, including small-scale exempt producers, that do not shackle the birds or use an automated system but that instead place the birds in killing cones, or use other methods, before exsanguinating the birds without stunning. This requirement would also not apply to ritual slaughter establishments (
(Comment) Several comments were received that suggested amending the term “noncompliant records” to “noncompliance records” in all relevant sections of 202.242 as this is the typical title of enforcement documents issued by the USDA Food Safety and Inspection Service (FSIS), as well as state departments of agriculture.
(Response) AMS agrees that reference to “noncompliant records” should be “noncompliance records” and has made the necessary changes to all relevant sections of the final rule.
(Comment) One comment stated that, while the proposed rule proposes that sick, injured, weak, disabled, blind, and lame animals must not be transported for sale or slaughter, an organic producer can withdraw livestock from certification. Once this certification is withdrawn, certification agencies have limited authority to document a noncompliance. The comment requested clarification regarding the enforcement of this scenario.
(Response) Only animals certified organic and identified/traceable as such during transport are subject to the requirements of this rule.
(Comment) One comment proposed that the organic animal welfare rule should be more consistent with the OIE Terrestrial Animal Health Code as it applies to transport and slaughter of organic livestock.
(Response) The NOSB reviewed many regulatory references when developing its organic transport and slaughter recommendations. AMS considered OIE Terrestrial Animal Health Code but is not making changes based on the OIE Terrestrial Animal Health Code at this time. However, AMS may provide these standards to the NOSB for their consideration in the future.
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 rulemaking has been designated as an “economically significant regulatory action” under section 3(f) of Executive Order 12866, and, therefore, has been reviewed by the Office of Management and Budget (OMB).
AMS is conducting this rulemaking to maintain consumer confidence in the USDA organic seal. This action is necessary to augment the USDA organic livestock production regulations with clear provisions to fulfill one purpose of the Organic Foods Production Act (OFPA) (7 U.S.C. 6501-6522): To assure consumers that organically-produced products meet a consistent and uniform standard. OFPA mandates that detailed livestock regulations be developed through notice and comment rulemaking and intends for the involvement of the National Organic Standards Board (NOSB) in that process (7 U.S.C. 6508(g)). In 2010, AMS published a final rule (75 FR 7154, February 17, 2010) clarifying the pasture and grazing requirements for organic ruminant livestock, which partially addressed OFPA's objective for more detailed livestock standards. This rule extends that level of detail and clarity to all organic livestock and poultry, and would ensure that organic standards cover their entire lifecycle, consistent with recommendations provided by USDA's Office of Inspector General and nine separate recommendations from the NOSB.
This rule adds requirements for the production, transport, and slaughter of organic livestock and poultry. The provisions for outdoor access and space for organic poultry production are the focal areas of this rule. Currently, organic poultry are required to have outdoor access, but this varies widely in practice. Some organic poultry operations provide large, open-air outdoor areas, while other operations provide minimal outdoor space or use screened and covered enclosures commonly called “porches” to meet outdoor access requirements. This variability perpetuates an uneven playing field among producers and sows consumer confusion about the meaning of the USDA organic label. This final rule will resolve the current ambiguity about outdoor access for poultry and address the wide disparities in production practices among the organic poultry sector. Greater clarity about the significance of the USDA organic seal in the marketplace will help to maintain
The economic impact analysis describes the potential impacts for organic egg and broiler producers, because these types of operations will face additional production costs as a result of this rule, and the potential benefits of greater clarity in the requirements for organic poultry. The following provisions will require producers to incur costs to provide:
• Additional indoor space for broilers;
• Additional outdoor space for layers;
To project costs, AMS assessed current, or baseline, conditions and considered how producers might respond to the above requirements. Based on public comment, NOSB deliberations and surveys of organic poultry producers, we determined that the indoor stocking density requirements for broilers and the outdoor access/stocking density requirements for layers drive the costs of this rule. For organic layers, the key factor affecting compliance is the availability of land to accommodate all birds at the required stocking density. We considered two potential scenarios of how producers would respond: (1) All affected organic egg producers make operational changes to comply with the rule and maintain current levels of production; or, (2), 50 percent of organic egg operations move to the cage-free market because they choose to leave the organic market. Based on public comment, AMS assumed that organic broiler producers would build new facilities to maintain their current production level and remain in the organic market. In this analysis, AMS accounts for costs that accrue to legacy producers and new entrants; the full compliance costs recur annually and are included in the total. Legacy producers are producers who decided to go into the organic business with no knowledge of the costs that would be imposed by this rulemaking. Costs do not accrue until this rule is fully implemented,
In summary, AMS estimates that production costs will range between $8.2 million to $31 million annually. This range spans three producer response scenarios, which are summarized in the table below.
• We estimate that the annualized costs for organic broiler and egg producers are $28.7 to $31 million (over 15 years), if all certified organic egg production in 2022 complies with this rule and all certified organic broiler production in 2020 complies with this rule. The timeframe corresponds to the end of the implementation period for the outdoor access requirements for layers and indoor space requirements for broilers. In this scenario, the potential reduced feed efficiency and increased mortality from greater outdoor access are the key variables that impact costs for layers.
• We estimate the annualized costs for organic broiler and organic egg production is $11.7 to $12.0 million if 50 percent of organic egg production in 2022 transitions to the cage-free egg market. Under the latter scenario, the shift would also result in foregone profits of nearly $80 to $86 million (annualized) for production that moves from organic to cage-free egg production. (Because foregone revenues are not a direct cost of compliance with the rule, they are totaled separately from estimated compliance costs). In this scenario, the difference in price between organic and cage-free eggs accounts for the transfer impact.
• We estimate the annualized costs for organic broiler and organic egg production is $8.2 million if 50 percent of organic egg production in 2022 transitions to the cage-free egg market and producers who cannot comply with the rule do not enter organic production during the implementation timeframe.
• In the above scenarios, we estimate the annualized costs for organic broiler production account for $3.5 million to $4.0 million of the above totals. This reflects costs to build additional housing for more space per bird to meet the indoor stocking density requirement.
This rule will have broad, important benefits for the organic sector as a whole which are difficult to quantify. Clear and consistent standards, which more closely align to consumer expectations, are essential to sustaining demand and supporting the growth of the $43 billion U.S. organic market. Clear parameters for production practices will ensure fair competition among producers by facilitating equitable certification and enforcement decisions.
To monetize the benefits of this rule, AMS used research that has measured consumers' willingness to pay for outdoor access between $0.21 and $0.49 per dozen eggs. Based on this, AMS estimates that the annualized benefits would range between $4.1 million to $49.5 million annually. The range in benefits accounts for several producer response scenarios, which correspond to those described above for the cost estimates.
In the Regulatory Flexibility Analysis, we report that large poultry operations would have significantly higher compliance costs than small operations on average. Larger organic layer operations, in particular, will have demand greater land areas for outdoor access.
AMS estimates that business revenues for small organic layer operations are $736 million, or about $1.03 million per firm. For small egg producers, business revenues would need to be less than $867,000 to $967,000 per firm for the rule to cost more than 3% of revenue. The estimated business revenue is calculated from the projected organic egg production from small producers using AMS Market News data on the U.S. organic layer population, estimated lay rate of 308 eggs/hen/year and the wholesale price for organic eggs $2.83/dozen (AMS Market News).
A summary of the estimated costs and benefits associated with this rule is provided in Table A.
Within 3-5 years of full implementation, the Administrator shall conduct and make publicly available a retrospective analysis of the impacts of this rulemaking. This analysis will include a retrospective evaluation of the benefits, costs and transfers of the rule, along with a comparison of these impacts to the prospective estimates contained in this final regulatory impact analysis. The retrospective analysis should include consideration of factors such as: The impacts on exit and entry of affected entities; market shares of affected entities, as well as market competition and concentration; the impacts on the number of producers participating in the organic program; impacts on organic egg production volume, impacts on secondary (
Executive Order 12988 instructs each executive agency to adhere to certain requirements in the development of new and revised regulations in order to avoid unduly burdening the court system. This final rule cannot be applied retroactively.
States and local jurisdictions are preempted under the OFPA from creating programs of accreditation for private persons or State officials who want to become certifying agents of organic farms or handling operations. A governing State official would have to apply to USDA to be accredited as a certifying agent, as described in section 6514(b) of the OFPA. States are also preempted under sections 6503 and 6507 of the OFPA from creating certification programs to certify organic farms or handling operations unless the State programs have been submitted to, and approved by, the Secretary as meeting the requirements of the OFPA.
Pursuant to section 6507(b)(2) of the OFPA, a State organic certification program may contain additional requirements for the production and handling of organically produced agricultural products that are produced in the State and for the certification of organic farm and handling operations located within the State under certain circumstances. Such additional requirements must: (a) Further the purposes of the OFPA, (b) not be inconsistent with the OFPA, (c) not be discriminatory toward agricultural commodities organically produced in other States, and (d) not be effective until approved by the Secretary.
Pursuant to section 6519(f) of the OFPA, this final rule would not alter the authority of the Secretary under the Federal Meat Inspection Act (21 U.S.C. 601-624), the Poultry Products Inspection Act (21 U.S.C. 451-471), or the Egg Products Inspection Act (21 U.S.C. 1031-1056), concerning meat, poultry, and egg products, nor any of the authorities of the Secretary of Health and Human Services under the Federal Food, Drug and Cosmetic Act (21 U.S.C. 301-399), nor the authority of the Administrator of the EPA under the Federal Insecticide, Fungicide and Rodenticide Act (7 U.S.C. 136-136(y)).
Section 6520 of the OFPA provides for the Secretary to establish an expedited administrative appeals procedure under which persons may appeal an action of the Secretary, the applicable governing State official, or a certifying agent under this title that adversely affects such person or is inconsistent with the organic certification program established under this title. The OFPA also provides that the U.S. District Court for the district in which a person is located has jurisdiction to review the Secretary's decision.
This final rule has been reviewed in accordance with the requirements of Executive Order 13175, “Consultation and Coordination with Indian Tribal Governments.” Executive Order 13175 requires Federal agencies to consult and coordinate with tribes on a government-to-government basis on policies that have tribal implications, including regulations, legislative comments or proposed legislation, and other policy statements or actions that have substantial direct effects on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes or on the distribution of power and responsibilities between the Federal Government and Indian tribes.
AMS assessed the impact of this rule on Indian tribes and determined that this rule does not, to our knowledge, have tribal implications that require tribal consultation under E.O. 13175. If a Tribe requests consultation, AMS will work with the Office of Tribal Relations to ensure meaningful consultation is provided where changes, additions and modifications identified herein are not expressly mandated by Congress.
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520) (PRA), AMS is requesting OMB approval for a new information collection totaling 131,683 hours for the reporting and recordkeeping requirements contained in this final rule. OMB previously approved information collection requirements associated with the NOP and assigned OMB control number 0581-0191. AMS intends to merge this new information collection, upon OMB approval, into the approved 0581-0191 collection. Below, AMS has described and estimated the annual burden,
All certified organic operations must develop and maintain an organic system plan for certification (§ 205.201). The OSP must include a description of practices and procedures to be performed and maintained, including the frequency with which they will be performed; under this final rule, organic livestock operations are subject to additional reporting requirements. The amendments to §§ 205.238, 205.239, 205.241, 205.242, and 205.290 require livestock operations to provide specific documentation as part of an organic system plan to include conditions on livestock living conditions to permit natural behavior, including minimum space requirements, outdoor access, and utilization of preventive health care practices (
The PRA also requires AMS to measure the recordkeeping burden. Under the USDA organic regulations each producer is required to maintain and make available upon request, for 5 years, such records as are necessary to verify compliance (§ 205.103). Certifying agents are required to maintain records for 5 to 10 years, depending on the type of record (§ 205.510(b)), and make these records available for inspection upon request (§ 205.501(a)(9)). The new information that livestock operations must provide for certification will assist certifying agents and inspectors in the efficient and comprehensive evaluation of these operations and will impose an additional recordkeeping burden for livestock operations. Certifying agents currently involved in livestock certification are required to observe the same recordkeeping requirements to maintain accreditation, therefore AMS expects that this final rule does not significantly increase the recordkeeping burden on certifying agents.
Reporting and recordkeeping are essential to the integrity of the organic certification system. A clear paper trail is a critical tool for verifying that practices meet the mandate of OFPA and the USDA organic regulations. The information collected supports the AMS mission, program objectives, and management needs by enabling us to assess the efficiency and effectiveness of the NOP. The information also affects decisions because it is the basis for evaluating compliance with OFPA and USDA organic regulations, administering the NOP, establishing the cost of the program, and facilitating management decisions and planning. It also supports administrative and regulatory actions to address noncompliance with OFPA and USDA organic regulations.
This information collection is only used by the certifying agent and authorized representatives of USDA, including AMS and NOP staff. Certifying agents, including any affiliated organic inspectors, and USDA are the primary users of the information.
AMS identified three types of entities (respondents) that will need to submit and maintain information in order to participate in organic livestock certification. For each type of respondent, we describe the general paperwork submission and recordkeeping activities and estimate: (i) the number of respondents; (ii) the hours they spend, annually, completing the paperwork requirements of this labeling program; and, (iii) the costs of those activities.
1.
Each entity seeking to continue USDA accreditation for livestock will need to submit information documenting its business practices including certification, enforcement and recordkeeping procedures and personnel qualifications (§ 205.504). AMS will review that information during its next scheduled on-site assessment to determine whether to continue accreditation for the scope of livestock. Certifying agents will need to annually update the above information and provide results of personnel performance evaluations and the internal review of its certification activities (§ 205.510).
AMS projects that the additional components of organic system plans for livestock may entail longer review times than those for other types of production systems. AMS estimates the annual collection cost per certifying agent will be $3,053.27. This estimate is based on an estimated 91.8 labor hours per year at $33.26 per hour for a total salary component of $3,053.27 per year. This value is assumed to be an underestimate as the certifying agent bears a portion of the burden of the inspector and certifying agents employ varying numbers of inspectors. The source of the hourly rate is the May 2015 National Occupational Employment and Wage Estimates, United States, published annually by the Bureau of Labor Statistics. The rate is the mean hourly wage for compliance officers (occupation code 13-1041). This classification was selected as an occupation with similar duties and responsibilities to that of a certifying agent.
2.
According to the International Organic Inspectors Association (IOIA), there are approximately 250 inspectors currently inspecting crop, livestock, handling, and/or wild crop operations that are certified or have applied for certification. AMS assumes that approximately half (125) of these inspectors inspect livestock operations.
AMS estimates the annual collection cost per inspector to be $6,760. This estimate is based on an estimated 321 additional labor hours per year at $21.06 per hour for a total salary component of $6,760 per year. The source of the hourly rate is the May 2015 National Occupational Employment and Wage Estimates, United States, published annually by the Bureau of Labor Statistics. The rate is the mean hourly wage for agricultural inspectors (occupation code 45-2011).
3.
In order to obtain and maintain certification, livestock producers and handlers will need to develop and maintain an organic system plan. This is a requirement for all organic operations and the USDA organic regulations describe what information must be included in an organic system plan (§ 205.201). This final rule describes the additional information (§§ 205.238, 205.239, 205.241, 205.242, and 295.290) that will need to be included in a livestock operation's organic system plan in order to assess compliance. Certified operations are required to keep records about their organic production and/or handling for five years (§ 205.103(b)(3)).
AMS used the Organic Integrity Database to estimate the number of livestock operations that would be affected by this action.
AMS estimates the annual collection and recordkeeping costs per organic livestock producer to be $559.45. This estimate is based on an estimated 16.65 labor hours per year at $33.60 per hour for a total salary component of $559.45 per year. AMS estimates that as producers adapt to the requirements introduced by the amendments at §§ 205.238, 205.239, 205.241, 205.242, and 205.290, the number of labor hours per year for currently certified operators will decrease. The source of the hourly rate is the May 2015 National Occupational Employment and Wage Estimates, United States, published annually by the Bureau of Labor Statistics. The rate is the mean hourly wage for farmers, ranchers and other agricultural managers (occupation code 11-9013).
Grand Total of Reporting, Training & Recordkeeping Costs: $3,932,134
AMS received a total of 6,675 written comments on the proposed rule, which addressed the proposed requirements for organic livestock production practices. AMS received 12 comments that addressed the information collection and recordkeeping burden estimates; two of these comments were duplicative. AMS did not make changes based on comments for several reasons. AMS received eight comments specifically objecting to the recordkeeping requirements, relative to the population of respondents. AMS expects that this is because this rule refers to specific, narrow documentation requirements that are already within the scope of the general recordkeeping requirements for organic producers and the components of an organic system plan. Specifically, such records fully disclose all activities in sufficient detail to be readily understood and audited and be sufficient to demonstrate compliance with the USDA organic regulations (7 CFR 205.103); and that an organic system plan must contain a description of practices and procedures to be performed, and monitoring
(Comment) While stating their support for more specific standards regarding the care of poultry and livestock in organic operations, four out of the ten comments expressed concerns about the specific records that would be required to document how animal illness and injury would be prevented and treated. In particular, these comments stated that body condition scoring and monitoring the causes and treatments of lameness as well as having a parasite management strategy and a written plan for the use of euthanasia was too prescriptive. One comment indicated that providing written justification for the use of teeth trimming and tail docking in pigs on a per litter basis would be burdensome while another comment was concerned about needing to document every instance of indoor confinement of poultry.
One comment indicated that quantifiable measures in the 2012 pasture rule had not necessarily increased consistency in interpretation or implementation by certifying agents or producers. This comment also noted that the prescriptive requirements and quantifiable measures in this new regulation would burden producers and certifying agents. The comment contends that this recordkeeping burden would lessen time for producers to perfect solutions on their operation and increase certifying agent and inspector focus on paper trail rather than assessing the livestock system as a whole.
(Response) Recordkeeping is a core principle of the organic program and an important tool for producers to demonstrate, and certifying agents to verify, compliance with the regulations. We believe that the requirements which specify specific documentation are minimal and are essential for verifying the rule is being implemented successfully.
(Comment) Two of the ten comments questioned the validity of the $3000.94 estimate of their annual costs, stating that it underestimated the direct labor hours that will be necessary to implement the new requirements. These comments spoke to the need for new forms, extensive training for personnel and certified operations, and processing additional compliance-related correspondence after the rule takes effect.
One comment estimated that each livestock file would require an additional 1-hour review which would amount to about 900 direct labor hours annually for this entity; this estimate is higher than the proposed rule estimate of 91.8 hours as an average for all certifying agents. Consequently, the comment stated that the additional annual labor costs would be $27,000 at $30 per hour. Alternatively, this comment expects most of their livestock operation inspections to require only one additional hour to inspect rather than the AMS estimate of three hours of additional inspection time per operation in the proposed rule. Whether the inspection takes one or three hours to verify these new requirements, the comments acknowledged that it is the client operations that will ultimately absorb the increased costs of inspections, and they will need time to prepare.
One comment from a certifying agent included a survey of its certified operations to determine if the records described in the proposed rule are necessary to enforce compliance with the standards. Overall, their clients (74.5 percent) reported that additional records are not needed with the largest group (40.1 percent) responding that they already keep more records than would be needed to enforce compliance. While a smaller proportion (25 percent) of their clients said that the records are needed to enforce compliance, the largest portion of that group of responders (21.8 percent) feel more records will be needed. The certifying agent also asked their clients to estimate how much additional time would be spent maintaining records with 89.3 percent stating somewhere between 1-40 hours annually. A much smaller portion expected to spend more than 40 hours per year maintaining records. In conclusion, the certifying agent acknowledged the difficulties with accurately estimating the labor hours that will be needed to establish and maintain the records, and affirmed that some requirements will be met through the current records already kept.
(Response) The estimates of total recordkeeping and reporting burden are average per-operation estimates based on the number of operations and animals across the whole industry. A certifying agent with a large number of livestock and poultry operation clients will have larger annual respective costs.
Describing the illness and injury prevention and treatment strategies in writing with useful monitoring and recordkeeping systems unique to the needs, species, and breeds of each operation in an organic system plan will require an initial investment of labor that may need to be absorbed. In actuality, these prevention strategies and monitoring systems should already be in place at least informally.
Based on one certifying agent's query, 75 percent of their client operations are already keeping the necessary records. The majority of the operations that reported the need for more recordkeeping reported that they see them as necessary, and one hour per week (greater than 40 hours annually) was the most direct labor hours reported by a small percentage of the certified operations queried. The query did not ask certified operations whether or not they perceived the necessary records as a burden. These recordkeeping systems should become routine over time and help operations become more efficient, thus reducing their management burden. The regulation provides marketplace assurance through verification.
(Comment) One certifying agent affirmed that assessing the condition of the animals as well as the dietary rations provided is needed. This comment noted that a broad, integrated approach that observed the overall wellness of the animals was more appropriate. Indicators of poor health could be flagged without requiring the systemized use of body condition scoring.
A Land Grant College that works with smaller scale farmers through their extension services expressed general concern that some small farmers may no longer choose to be certified organic due to the costs and burdens of
(Response) We agree that a broad integrated approach which observes the overall wellness of the animals, flags indicators of poor health, and scores body condition is important. Using a consistent recordkeeping system within an operation is more important than all operations using the same system, although it may be more efficient for inspectors if all certifying agents voluntarily select the same system.
AMS is not seeking to collect and compare data from one operation to another, or from one certifying agent to another. Body condition scoring is considered a low-cost, hands-on, internally consistent method to assess and monitor the condition of individual animals, herds, or flocks. Using a body scoring system is more accurate and efficient than relying on memory about animals' respective conditions, and helps producers identify the need for treatment or intervention. In addition, certifying agents should make every effort to be sure their recordkeeping requirements are not duplicative and coordinate with the requirements of other standards, where possible, that are outside of the direct scope of AMS.
(Comment) Three commenters requested that AMS provide monitoring form templates, training, and other resources in producer-friendly language and format, especially for body condition scoring. One certifying agent requested that we provide the tables that show the original rule language side-by-side with the final rule changes as a separate document for use in outreach materials and training.
A Land Grant College offered that they were likely to prepare new tools and templates to assist organic farmers with monitoring and recording lameness in individual animals. This comment also noted that new records would be needed to document when animals are restricted from outdoor access due to temperature fluctuations within the ranges specified in the rule.
(Response) AMS is considering developing tools to assist producers and certifying agents, especially for body condition scoring. These optional resources will be available on the NOP Web-site. AMS also plans to offer four regional trainings for producers and certifying agents—most likely in Pennsylvania, Iowa, California, and Texas. Other agricultural extension services and agents, the Natural Resources Conservation Service, and other Federal, state, and nonprofit organizations have tools and resources for monitoring animal health and living conditions that can be adapted.
AMS has reviewed this final rule in accordance with the Department Regulation 4300-4, Civil Rights Impact Analysis (CRIA), to address any major civil rights impacts the rule might have on minorities, women, and persons with disabilities. After a careful review of the rule's intent and provisions, AMS determined that this rule would only impact the organic practices of organic producers and that this rule has no potential for affecting producers in protected groups differently than the general population of producers. This rulemaking was initiated to clarify a regulatory requirement and enable consistent implementation and enforcement.
Protected individuals have the same opportunity to participate in the NOP as non-protected individuals. The USDA organic regulations prohibit discrimination by certifying agents. Specifically, § 205.501(d) of the current regulations for accreditation of certifying agents provides that “No private or governmental entity accredited as a certifying agent under this subpart shall exclude from participation in or deny the benefits of the NOP to any person due to discrimination because of race, color, national origin, gender, religion, age, disability, political beliefs, sexual orientation, or marital or family status.” Section 205.501(a)(2) requires “certifying agents to demonstrate the ability to fully comply with the requirements for accreditation set forth in this subpart” including the prohibition on discrimination. The granting of accreditation to certifying agents under § 205.506 requires the review of information submitted by the certifying agent and an on-site review of the certifying agent's client operation. Further, if certification is denied, § 205.405(d) requires that the certifying agent notify the applicant of their right to file an appeal to the AMS Administrator in accordance with § 205.681.
These regulations provide protections against discrimination, thereby permitting all producers, regardless of race, color, national origin, gender, religion, age, disability, political beliefs, sexual orientation, or marital or family status, who voluntarily choose to adhere to the rule and qualify, to be certified as meeting NOP requirements by an accredited certifying agent. This action in no way changes any of these protections against discrimination.
Administrative practice and procedure, Agriculture, Animals, Archives and records, Imports, Labeling, Organically produced products, Plants, Reporting and recordkeeping requirements, Seals and insignia, Soil conservation.
For the reasons set forth in the preamble, 7 CFR part 205 is amended as follows:
7 U.S.C. 6501-6522.
(1)
(2)
(3)
(ii) Litter covering the remaining solid floor.
(4)
(1)
(2)
(a) The producer must establish and maintain preventive health care practices, including:
(1) Selection of species and types of livestock with regard to suitability for site-specific conditions and resistance to prevalent diseases and parasites.
(2) Provision of a feed ration sufficient to meet nutritional requirements, including vitamins, minerals, proteins and/or amino acids, fatty acids, energy sources, and fiber (ruminants), resulting in appropriate body condition.
(3) Establishment of appropriate housing, pasture conditions, and sanitation practices to minimize the occurrence and spread of diseases and parasites.
(4) Provision of conditions which allow for exercise, freedom of movement, and reduction of stress appropriate to the species.
(5) Physical alterations may be performed to benefit the welfare of the animals, for identification purposes, or for safety purposes. Physical alterations must be performed on livestock at a reasonably young age, with minimal stress and pain and by a competent person.
(i) The following practice may not be routinely used and must be used only with documentation that alternative methods to prevent harm failed: Needle teeth clipping (no more than top one-third of the tooth) in pigs and tail docking in pigs.
(ii) The following practices are prohibited: De-beaking, de-snooding, caponization, dubbing, toe clipping of chickens, toe clipping of turkeys unless with infra-red at hatchery, beak trimming after 10 days of age, tail docking of cattle, wattling of cattle, face branding of cattle, tail docking of sheep shorter than the distal end of the caudal fold, and mulesing of sheep.
(6) Administration of vaccines and other veterinary biologics.
(7) All surgical procedures necessary to treat an illness shall be undertaken in a manner that employs best management practices in order to minimize pain, stress, and suffering, with the use of appropriate and allowed anesthetics, analgesics, and sedatives.
(8) Monitoring of lameness and keeping records of the percent of the herd or flock suffering from lameness and the causes. Certified operations may monitor lameness in a manner prescribed by the NOP.
(b) Producers may administer medications that are allowed under 205.603 to alleviate pain or suffering, and when preventive practices and veterinary biologics are inadequate to prevent sickness. Parasiticides allowed under § 205.603 may be used on:
(1) Breeder stock, when used prior to the last third of gestation but not during lactation for progeny that are to be sold, labeled, or represented as organically produced; and
(2) Dairy stock, when used a minimum of 90 days prior to the production of milk or milk products that are to be sold, labeled, or represented as organic.
(c) An organic livestock operation must not:
(1) Sell, label, or represent as organic any animal or product derived from any animal treated with antibiotics, any substance that contains a synthetic substance not allowed under § 205.603, or any substance that contains a nonsynthetic substance prohibited in § 205.604. Milk from animals undergoing treatment with synthetic substances allowed under § 205.603 cannot be sold as organic but may be fed to calves on the same operation. Milk from animals undergoing treatment with prohibited substances cannot be sold as organic or fed to organic livestock.
(2) Administer synthetic medications unless:
(i) In the presence of illness or to alleviate pain and suffering, and
(ii) That such medications are allowed under § 205.603.
(3) Administer hormones for growth promotion, production, or reproduction, except as provided in § 205.603.
(4) Administer synthetic parasiticides on a routine basis.
(5) Administer synthetic parasiticides to slaughter stock.
(6) Administer animal drugs in violation of the Federal Food, Drug, and Cosmetic Act; or
(7) Withhold medical treatment from a sick animal in an effort to preserve its organic status. All appropriate medications must be used to restore an animal to health when methods acceptable to organic production fail. Livestock treated with a prohibited substance must be clearly identified and neither the animal nor its products shall be sold, labeled, or represented as organically produced.
(8) Withhold individual treatment designed to minimize pain and suffering for injured, diseased, or sick animals, which may include forms of euthanasia as recommended by the American Veterinary Medical Association.
(9) Neglect to identify and record treatment of sick and injured animals in animal health records.
(10) Practice forced molting or withdrawal of feed to induce molting.
(d) Organic livestock operations must have comprehensive plans to minimize internal parasite problems in livestock. The plan will include preventive measures such as pasture management, fecal monitoring, and emergency measures in the event of a parasite outbreak. Parasite control plans shall be approved by the certifying agent.
(e)
(2) The following methods of euthanasia are not permitted: suffocation; manual blow to the head by blunt instrument or manual blunt force trauma; and the use of equipment that crushes the neck, including killing pliers or Burdizzo clamps.
(3) Following a euthanasia procedure, livestock must be carefully examined to ensure that they are dead.
(a) The producer of an organic livestock operation must establish and maintain year-round livestock living conditions which accommodate the wellbeing and natural behavior of animals, including:
(1) Year-round access for all animals to the outdoors, shade, shelter, exercise areas, fresh air, clean water for drinking, and direct sunlight, suitable to the species, its stage of life, the climate, and the environment: Except, that, animals may be temporarily denied access to the outdoors in accordance with paragraphs (b) and (c) of this section. Yards, feeding pads, and feedlots may be used to provide ruminants with access to the outdoors during the non-grazing season and supplemental feeding during the grazing season. Yards, feeding pads, and feedlots shall be large enough to allow all ruminant livestock occupying the yard, feeding pad, or feedlot to feed without competition for food. Continuous total confinement of any animal indoors is prohibited. Continuous total confinement of ruminants in yards, feeding pads, and feedlots is prohibited.
(2) For all ruminants, management on pasture and daily grazing throughout the grazing season(s) to meet the requirements of § 205.237, except as provided for in paragraphs (b), (c), and (d) of this section.
(3) Appropriate clean, dry bedding. When roughages are used as bedding, they shall have been organically produced in accordance with this part by an operation certified under this part, except as provided in § 205.236(a)(2)(i), and, if applicable, organically handled by operations certified to the NOP.
(4) Shelter designed to allow for:
(i) Over a 24-hour period, sufficient space and freedom to lie down, turn around, stand up, fully stretch their limbs, and express normal patterns of behavior;
(ii) Temperature level, ventilation, and air circulation suitable to the species;
(iii) Reduction of potential for livestock injury; and
(iv) If indoor housing is provided, areas for bedding and resting that are sufficiently large, solidly built, and comfortable so that animals are kept clean, dry, and free of lesions.
(5) The use of yards, feeding pads, feedlots and laneways that shall be well-drained, kept in good condition (including frequent removal of wastes), and managed to prevent runoff of wastes and contaminated waters to adjoining or nearby surface water and across property boundaries.
(6) Housing, pens, runs, equipment, and utensils shall be properly cleaned and disinfected as needed to prevent cross-infection and build-up of disease-carrying organisms.
(7) Dairy young stock may be housed in individual pens until completion of the weaning process but no later than 6 months of age, provided that they have enough room to turn around, lie down, stretch out when lying down, get up, rest, and groom themselves; individual animal pens shall be designed and located so that each animal can see, smell, and hear other calves.
(8) Swine must be housed in a group, except:
(i) Sows may be housed individually at farrowing and during the suckling period;
(ii) Boars; and
(iii) Swine with documented instance of aggression or recovery from an illness.
(9) Piglets shall not be kept on flat decks or in piglet cages.
(10) For swine, rooting materials must be provided, except during the farrowing and suckling period.
(11) In confined housing with stalls for mammalian livestock, enough stalls must be present to provide for the natural behaviors of the animals. A cage must not be called a stall. For group-housed swine, the number of individual feeding stalls may be less than the number of animals, as long as all animals are fed routinely over a 24-hour period. For group-housed cattle, bedded packs, compost packs, tie-stalls, free-stalls, and stanchion barns are all acceptable housing as part of an overall organic system plan.
(12) Outdoor space must be provided year-round. When the outdoor space includes soil, maximal vegetative cover must be maintained as appropriate for the season, climate, geography, species of livestock, and stage of production.
(b) The producer of an organic livestock operation may provide temporary confinement or shelter for an animal because of:
(1) Inclement weather;
(2) The animal's stage of life, however, lactation is not a stage of life that would exempt ruminants from any of the mandates set forth in this part;
(3) Conditions under which the health, safety, or well-being of the animal could be jeopardized;
(4) Risk to soil or water quality;
(5) Preventive healthcare procedures or for the treatment of illness or injury (neither the various life stages nor lactation is an illness or injury);
(6) Sorting or shipping animals and livestock sales, provided that the animals shall be maintained under continuous organic management, including organic feed, throughout the extent of their allowed confinement;
(7) Breeding: Except, that, animals shall not be confined any longer than necessary to perform the natural or artificial insemination. Animals may not be confined to observe estrus; and
(8) 4-H, National FFA Organization, and other youth projects, for no more than one week prior to a fair or other demonstration, through the event, and up to 24 hours after the animals have arrived home at the conclusion of the event. These animals must have been maintained under continuous organic management, including organic feed,
(c) The producer of an organic livestock operation may, in addition to the times permitted under paragraph (b) of this section, temporarily deny a ruminant animal pasture or outdoor access under the following conditions:
(1) One week at the end of a lactation for dry off (for denial of access to pasture only), three weeks prior to parturition (birthing), parturition, and up to one week after parturition;
(2) In the case of newborn dairy cattle for up to six months, after which they must be on pasture during the grazing season and may no longer be individually housed: Except, That, an animal shall not be confined or tethered in a way that prevents the animal from lying down, standing up, fully extending its limbs, and moving about freely;
(3) In the case of fiber bearing animals, for short periods for shearing; and
(4) In the case of dairy animals, for short periods daily for milking. Milking must be scheduled in a manner to ensure sufficient grazing time to provide each animal with an average of at least 30 percent DMI from grazing throughout the grazing season. Milking frequencies or duration practices cannot be used to deny dairy animals pasture.
(d) Ruminant slaughter stock, typically grain finished, shall be maintained on pasture for each day that the finishing period corresponds with the grazing season for the geographical location. Yards, feeding pads, or feedlots may be used to provide finish feeding rations. During the finishing period, ruminant slaughter stock shall be exempt from the minimum 30 percent DMI requirement from grazing. Yards, feeding pads, or feedlots used to provide finish feeding rations shall be large enough to allow all ruminant slaughter stock occupying the yard, feeding pad, or feed lot to feed without crowding and without competition for food. The finishing period shall not exceed one-fifth (1/5) of the animal's total life or 120 days, whichever is shorter.
(e) The producer of an organic livestock operation must manage manure in a manner that does not contribute to contamination of crops, soil, or water by plant nutrients, heavy metals, or pathogenic organisms and optimizes recycling of nutrients and must manage pastures and other outdoor access areas in a manner that does not put soil or water quality at risk.
(a) The producer of an organic poultry operation must establish and maintain year-round poultry living conditions that accommodate the health and natural behavior of poultry, including: Year-round access to outdoors; shade; shelter; exercise areas; fresh air; direct sunlight; clean water for drinking; materials for dust bathing; and adequate outdoor space to escape aggressive behaviors suitable to the species, its stage of life, the climate, and environment. Poultry may be temporarily denied access to the outdoors in accordance with paragraph (d) of this section.
(b) Indoor space requirements—
(1) Poultry housing must be sufficiently spacious to allow all birds to move freely, stretch their wings, stand normally, and engage in natural behaviors.
(2) Producers must monitor ammonia levels at least monthly and implement practices to maintain ammonia levels below 10 ppm. When ammonia levels exceed 10 ppm, producers must implement additional practices and additional monitoring to reduce ammonia levels below 10 ppm. Ammonia levels must not exceed 25 ppm.
(3) For layers and fully feathered birds, artificial light may be used to prolong the day length, to provide up to 16 hours of continuous light. Artificial light intensity must be lowered gradually to encourage hens to move to perches or settle for the night. Natural light must be sufficient indoors on sunny days so that an inspector can read and write when all lights are turned off.
(4) Exit areas—poultry houses must have sufficient exit areas that are appropriately distributed to ensure that all birds have ready access to the outdoors.
(5) Perches—for layers (
(6) All birds must have access to areas in the house that allow for scratching and dust bathing. Litter must be provided and maintained in a dry condition.
(7) Houses with slatted/mesh floors must have 30 percent minimum of solid floor area available with sufficient litter available for dust baths so that birds may freely dust bathe without crowding.
(8) For layers (
(i) Mobile housing: 4.5 pounds per square foot.
(ii) Aviary housing: 4.5 pounds per square foot.
(iii) Slatted/mesh floor housing: 3.75 pounds per square foot.
(iv) Floor litter housing: 3.0 pounds per square foot.
(v) Other housing: 2.25 pounds per square foot.
(9) For pullets (
(10) For broilers (
(11) Indoor space includes flat areas available to birds, excluding nest boxes.
(12) Indoor space may include enclosed porches and lean-to type structures (
(c) Outdoor space requirements—
(1) Access to outdoor space and door spacing must be designed to promote and encourage outside access for all birds on a daily basis. Producers must provide access to the outdoors at an early age to encourage (
(2) At least 50 percent of outdoor space must be soil. Outdoor space with soil must include maximal vegetative cover appropriate for the season, climate, geography, species of livestock, and stage of production. Vegetative cover must be maintained in a manner that does not provide harborage for rodents and other pests.
(3) Shade may be provided by structures, trees, or other objects in the outdoor area.
(4) For layers (
(5) For pullets (
(6) For broilers (
(7) Outdoor space may include porches and lean-to type structures that are not enclosed (
(d) The producer of an organic poultry operation may temporarily confine birds. Confinement must be recorded. Operations may temporarily confine birds when one of the following circumstances exists:
(1) Inclement weather, including when air temperatures are under 40 degrees F or above 90 degrees F.
(2) The animal's stage of life, including:
(i) The first 4 weeks of life for broilers (
(ii) The first 16 weeks of life for pullets (
(iii) Until fully feathered for bird species other than
(3) Conditions under which the health, safety, or well-being of the animal could be jeopardized.
(4) Risk to soil or water quality, including to establish vegetation by reseeding the outdoor space.
(5) Preventive healthcare procedures or for the treatment of illness or injury (neither various life stages nor egg laying is an illness or injury).
(6) Sorting or shipping birds and poultry sales, provided that the birds are maintained under continuous organic management, throughout the extent of their allowed confinement.
(7) For nest box training, provided that birds shall not be confined any longer than required to establish the proper behavior. Confinement must not exceed five weeks.
(8) For 4-H, National FFA Organization, and other youth projects, provided that temporary confinement for no more than one week prior to a fair or other demonstration, through the event, and up to 24 hours after the birds have arrived home at the conclusion of the event. During temporary confinement, birds must be under continuous organic management, including organic feed, for the duration of confinement. Notwithstanding the requirements in paragraph (d)(6) of this section, facilities where 4-H, National FFA Organization, and other youth events are held are not required to be certified organic for the participating birds to be sold as organic, provided all other organic management practices are followed.
(e) The producer of an organic poultry operation must manage manure in a manner that does not contribute to contamination of crops, soil, or water by plant nutrients, heavy metals, or pathogenic organisms. The producer must also optimize recycling of nutrients and must manage outdoor access in a manner that does not put soil or water quality at risk.
(a)
(2) All livestock must be fit for transport to buyers, auction or slaughter facilities.
(i) Calves must have a dry navel cord and be able to stand and walk without human assistance.
(ii) Non-ambulatory animals must not be transported for sale or slaughter. Such animals may be medically treated or euthanized.
(3) Adequate and season-appropriate ventilation is required for all livestock trailers, shipping containers, and any other mode of transportation used to protect animals against cold and heat stresses.
(4) Bedding must be provided on trailer floors and in holding pens as needed to keep livestock clean, dry, and comfortable during transport and prior to slaughter. Bedding is not required in poultry crates. When roughages are used for bedding, they must be certified organic.
(5) Arrangements for water and organic feed must be made if transport time, including all time on the mode of transportation, exceeds 12 hours.
(i) The producer or handler of an organic livestock operation, who is responsible for overseeing the transport of organic livestock, must provide records to certifying agents during inspections or upon request that demonstrate that transport times for organic livestock are not detrimental to the welfare of the animals and meet the requirements of paragraph (a)(5) of this section.
(6) Organic producers and handlers, who are responsible for overseeing the transport of organic livestock, must have emergency plans in place that adequately address possible animal welfare problems that might occur during transport.
(b)
(2) Producers and handlers who slaughter organic exotic animals must be in compliance with the Agricultural Marketing Act of 1946 (7 U.S.C. 1621,
(3) Producers and handlers who slaughter organic livestock or exotic animals must provide all noncompliance records related to humane handling and slaughter issued by the controlling national, federal, or state authority and all records of subsequent corrective actions to certifying agents during inspections or upon request.
(c)
(2) Producers and handlers who slaughter organic poultry must provide all noncompliance records related to the use of good manufacturing practices in connection with slaughter issued by the controlling national, federal, or state authority and all records of subsequent corrective actions to the certifying agent at inspection or upon request.
(3) Producers and handlers who slaughter organic poultry, but are exempt from or not covered by the requirements of the Poultry Products Inspection Act, must ensure that:
(i) No lame birds may be shackled, hung, or carried by their legs;
(ii) All birds shackled on a chain or automated system must be stunned prior to exsanguination, with the exception of ritual slaughter; and
(iii) All birds must be irreversibly insensible prior to being placed in the scalding tank.
Office of the Assistant Secretary for Housing—Federal Housing Commissioner, HUD.
Final rule.
This final rule codifies several significant changes to FHA's Home Equity Conversion Mortgage program that were previously issued under the authority granted to HUD in the Housing and Economic Recovery Act of 2008 and the Reverse Mortgage Stabilization Act of 2013, and makes additional regulatory changes. The HECM program is FHA's reverse mortgage program that enables seniors who have equity in their homes to withdraw a portion of the accumulated equity. The intent of the Home Equity Conversion Mortgage program is to ease the financial burden on elderly homeowners facing increased health, housing, and subsistence costs at a time of reduced income. FHA's mission is to serve underserved markets, which must be balanced with HUD's inherent, as well as, statutory obligation under the National Housing Act to protect the FHA insurance funds. This rulemaking strengthens the FHA Home Equity Conversion Mortgage program and codifies changes that reduce risk to the Mutual Mortgage Insurance Fund and increase the sustainability of this important program for seniors. This final rule follows publication of a May 19, 2016, proposed rule and takes into consideration the public comments received on the proposed rule.
Karin Hill, Senior Policy Advisor, Office of Single Family Housing, Department of Housing and Urban Development, 451 7th Street SW., Room 9282, Washington, DC 20410-8000; telephone number 202-402-3084 (this is not a toll-free number). Persons with hearing or speech challenges may access this number through TTY by calling the toll-free Federal Relay Service at 800-877-8339.
Since the 2008 housing and economic recession, the HECM portfolio has experienced major borrower demographic and behavioral changes that have caused additional risk to the Mutual Mortgage Insurance Fund (MMIF). Some of the changes include shifting from a predominantly adjustable interest rate mortgage with borrowers receiving payments over time using the line of credit, modified term, or modified tenure payment options to a fixed interest rate mortgage with borrowers drawing large amounts of HECM proceeds at the time of closing; younger borrowers with higher amounts of property indebtedness; and increasing property charge defaults. While program changes made prior to and during 2013, such as consolidating the HECM Standard and HECM Saver products, did improve the stability of the HECM program, the HECM portfolio has continued to experience volatility. The economic value of the HECM portfolio has fluctuated from a negative $1.2 billion reported in FHA's Fiscal Year (FY) 2014 submission to Congress, to a positive $6.8 billion in FY 2015, to a negative $7.7 billion in FY 2016. Even under an improved housing market, the positive impacts of program changes on the HECM portfolio overall will be gradual and initially difficult to model for purposes of the actuarial study, as they will be evidenced only in future cohorts of activity. As a result, it is critical to remain vigilant in monitoring program performance and policy to ensure the soundness of the MMIF.
Recognizing the need to stabilize the HECM program and ensure it remains a sustainable program, Congress passed and the President signed into law, the Reverse Mortgage Stabilization Act of 2013 (RMSA) (Pub. L. 113-29). The RMSA gave FHA the tools to make, through mortgagee letter,
On May 19, 2016 (81 FR 31770), HUD published a proposed rule to codify these policies, with amendments as discussed in the preamble to the proposed rule. In addition, FHA proposed to implement a number of new policies. Also, so that all regulatory requirements are codified in the HECM regulations, HUD also proposed to codify HECM program changes made by mortgagee letter
In this rule, FHA codifies existing policy which has been implemented by mortgagee letters under various statutory authorities; implements statutory changes; issues new origination and servicing policies; and clarifies existing regulatory language. The main policy provisions are discussed below. All policies which have been implemented by mortgagee letters will remain in effect until the effective date of this final rule.
While FHA does not intend to change the current limits of 60 percent and 10 percent at this time, this rule provides flexibility for this limit to be changed in the future to respond to market changes or other factors. Specifically, this rule revises the regulations such that the 60 percent cap will never be modified to be less than 50 percent, and the additional percentage will never be modified to be less than 10 percent absent future rulemaking.
This rule codifies the following program changes that have reduced risks to both FHA and to borrowers: Implementation of limits on fixed-rate full draw loans (full draw loans expose FHA to high risk of insurance loss, and such loans are often not sustainable solutions for borrowers since they do not provide the borrower with future access to HECM proceeds); a Financial Assessment to enable mortgagees to determine if the HECM enables borrowers to comply with the mortgage requirements and that the HECM is a sustainable solution for borrowers; protection to Eligible Non-Borrowing Spouses from foreclosure after the death of the last borrower; removal of incentives for borrowers to obtain higher principal limits by using only the age of the older spouse through quit-claiming the younger spouse from the title; and a Life Expectancy Set Aside which will reduce the incidence of borrower defaults due to non-compliance with the mortgage obligation for the borrower to make timely payment of property taxes, and hazard and flood insurance payments. The new changes to the HECM program are expected to reduce foreclosures arising from these defaults, which will benefit FHA, borrowers, and communities where properties are located; give FHA more flexibility to accept short sales on properties where market conditions warrant; and provide homeowners with the ability to purchase a more suitable home without incurring the costs of two loan closings. Together, these changes may initially reduce HECM origination volume, although the potential demand for HECM is expected to remain high.
The social benefits that may be realized by this rule also include reducing resolution costs and borrower distress in cases where loans are no longer sustainable; improved sustainability of the MMIF, which would enhance the choice and wellbeing of future borrowers; and increased protections for borrowers, including those afforded non-borrowing spouses and those from improving the ultimate sustainability of HECM loans related to financial assessment changes.
The policies discussed in this rule may reduce FHA HECM insurance endorsements by $1.9 billion per year, thereby reducing choices for potential HECM borrowers to access home equity and imposing an equivalent cost on them; reduce foreclosures due to tax and insurance default by up to 6,000 cases (totaling about $1.5 billion in loan amount) per year, along with reduction in ancillary costs of foreclosures to neighborhoods and local governments; and reduce loan origination costs for 2,000 “HECM for Purchase” borrowers, saving them $12 million per year representing transfers from mortgagees to borrowers.
Other costs from the rule would include reduced borrowers' choice and the well-being of those borrowers who may not meet the eligibility requirements, or who no longer have access to as much upfront cash. The table below and the bullet points that follow display the benefits, costs, and transfers of this rule.
Absent the changes in the HECM program made by mortgagee letters issued by HUD under the authority of RMSA, the ongoing operation of the HECM program would have required a credit subsidy appropriation under the Federal Credit Reform Act of approximately $684 million. The fact that this appropriation was not required represents a transfer from potential HECM borrowers to taxpayers. This transfer was effected by the regulatory mortgagee letters, and not this final rule which merely codifies these existing policies in the Code of Federal Regulations. This transfer amount is reported in this analysis to inform the public, but had no bearing on whether these provisions would be included in the final rule.
Other benefits include the following:
• Improving the financial condition of the FHA MMIF due to:
○ Fewer foreclosures and lower loss rates;
○ Financial incentives of a Cash for Keys program for short sales and REO properties;
○ Persistently lower insured loan balances over time, due to limits on initial disbursement; and
○ More flexibility for FHA to accept short sales on properties where market conditions warrant.
• Improving overall HECM program viability and in turn improving suitability and attractiveness for potential borrowers
○ Reduces risks to both FHA and to borrowers associated with fixed-rate full draw loans (full draw loans expose FHA to high risk of insurance loss, and such loans are often not suitable for borrowers);
○ Helps borrowers and their housing counselors determine if a HECM is a sustainable option for them through the use of a Financial Assessment;
○ Provides protection to Eligible Non-Borrowing Spouses from foreclosure, and removes incentives for borrowers to obtain higher principal limits than they would otherwise be eligible for by using only the age of the older spouse; and
○ Reduces the incidence of borrower defaults due to non-compliance with the mortgage obligation.
The HECM program, authorized by section 255 of the National Housing Act (NHA) (12 U.S.C. 1715z-20), is FHA's reverse mortgage insurance program. The regulations for this program are codified in 24 CFR part 206. The HECM program enables FHA-approved mortgagees to extend insured mortgage financing to eligible borrowers, 62 years of age or older, who want to convert the equity in their homes into liquid assets. The withdrawal of equity may take a variety of forms, as authorized by the NHA and selected by the borrower. The home, which serves as security for the mortgage, must be, and continue to be, the borrower's principal residence during the life of the borrower. For adjustable interest rate HECMs, equity payments to the borrower may be in the form of monthly disbursements for life or a fixed term of years, disbursements from a line of credit advance or a combination of monthly disbursements and a line of credit. For fixed interest rate HECMs, equity payments to the borrower must be in the form of a single lump sum disbursement at closing.
The maximum amount of equity in the home that is available to a borrower under a HECM loan is the “principal limit” that is calculated for that loan. The borrower retains ownership of the property and may sell the home at any time keeping any residual sale proceeds in excess of the outstanding loan balance. Until the mortgage is repaid, and regardless of whether or not additional disbursements under the mortgage are permissible, interest on the mortgage, mortgage insurance premiums, and servicing charges, where applicable, continue to accrue.
On May 19, 2016, HUD published its proposed rule to implement the HERA and RMSA mortgagee letters described above in addition to other regulatory changes. HUD proposed to strengthen the HECM program by consolidating the requirements of these HERA and RMSA mortgagee letters into the regulations and introducing new requirements that would reduce risk to the Mutual Mortgage Insurance Fund and increase the sustainability of the HECM program for seniors. Interested readers should refer to the preamble of the May 19, 2016, proposed rule for details regarding the proposed regulatory changes to the HECM program.
On August 11, 2016, at 81 FR 53095, HUD published in the
The current regulations at § 206.107(a) provide the mortgagee an option, before the mortgage is submitted for insurance endorsement, to select either: (1) The assignment option, which allows the mortgagee to assign the HECM to the Secretary if the mortgage balance is equal to or greater than 98 percent of the maximum claim amount; or (2) the shared premium option, which allows the mortgagee to retain a portion of the monthly MIP but does not allow the mortgagee to assign the mortgage unless the mortgagee fails to make payments and the Secretary demands assignment. Under the assignment option, the mortgagee may only assign the mortgage to the Secretary if the following requirements are satisfied: (1) The mortgagee is current in making the required payments to the mortgagor; (2) the mortgagee is current in making the required MIP payments to the Secretary; (3) the mortgage is not due and payable; and (4) the mortgage is a first lien of record and title to the property securing the mortgage is good and marketable.
The public commenter suggested that, under the assignment option, HUD should instead require that the mortgagee assign the HECM loan to FHA if the outstanding loan balance is equal to or greater than 98 percent of the maximum claim amount. The commenter stated that, in some cases, a mortgagee may decline to file a claim in this scenario if the property value has risen rapidly and the loan has an above-market rate. The commenter concluded that lenders in this way have a “put option” and “can choose to keep the best loans and make claims for the worst ones”.
HUD is deferring its final determination as to whether to adopt the commenter's proposal at this time, and after HUD fully reviews and takes into consideration the comments received, HUD will issue, or choose not to issue, its final determination of this proposal through a subsequent final rule.
In the May 19, 2016, proposed rule, HUD explicitly solicited public comment on numerous proposed policy changes, including specific questions on the maximum closing costs allowed on the sale of a property, including utilities as property charges, property inspections, non-borrowing spouse communication, and the benefits and costs of the rule. HUD received 241 public comments, including 83 unique comments, on the proposed rule. HUD appreciates all the questions raised, and suggestions and recommendations made by the public commenters. After review and consideration of the public comments and upon further consideration of issues by HUD, the following highlights key clarifications and changes made by HUD at the final rule stage.
The final rule:
• Amends the provision limiting the number of mortgages by allowing borrowers to provide legal documentation evidencing the release of the borrower's financial obligation to satisfy the existing HECM rather than requiring the borrower to demonstrate a final divorce decree. (See § 206.34.)
• Amends the seasoning requirements for existing non-HECM liens to: (1) Impose the 12-month requirement beginning at the date of the HECM closing rather than the HECM loan application; and (2) allow the pay-off at closing of Home Equity Lines of Credit (HELOCs) that do not meet the seasoning requirements from borrower funds, the HECM funds, or a combination of HECM funds and borrower funds, as long as the draw from HECM funds does not exceed the draw limits during the first 12 months of the HECM. (See § 206.36.)
• Includes required pay-off of debt not secured by the property, as defined by the Commissioner through
• Clarifies that the mortgagees are required to request borrowers to designate, at the borrower's discretion, an alternative individual for the purpose of communicating with the mortgagee if the mortgagee has not been able to reach the borrower directly. (See § 206.40(c).)
• Retains the current policy requirement that the mortgagor must provide the mortgagee with a physical copy of the housing counseling
• Clarifies that the mortgagee shall provide any disclosures required by law when asking the borrower about any costs or other obligations that the borrower has incurred to obtain the mortgage. (See § 206.43(a).)
• Allows fees customarily paid by the seller in the subject property locality to be included as an interested party contribution. (See § 206.44(c).)
• Clarifies the requirement for maintaining flood insurance coverage. (See § 206.45(c).)
• Grants the FHA Commissioner the authority, where a HECM is due and payable, to increase the maximum closing costs allowable for selling the property above 11% of the sales price by establishing a fixed dollar amount as determined through
• Allows the FHA Commissioner to approve the use of qualified appraisers acceptable to and identified by the Commissioner when the mortgagee is required to appraise the property. (See § 206.125(b).)
• Authorizes the FHA Commissioner to expand availability of the Cash for Keys incentive, in an amount to be determined by the Commissioner, on REO properties with bona fide tenants. (See § 206.125(g)(4).)
• For the Cash for Keys incentive, authorizes the Commissioner to increase the minimum amount of time a mortgagee shall grant the borrower or bona fide tenant to vacate the property. (See § 206.125(f)(1)(ii) and § 206.125(g)(4).)
• Amends the limitation on reimbursements for advances made by the mortgagee for property charges to cover two-thirds of the overall advances made by the mortgagee rather than the full value of the first two years of such advances. (See § 206.129(d)(3).)
• Removes the ability for the borrower to elect that the mortgagee pay ground rents through the borrower's voluntary election to have the mortgagee pay property charges. (See § 206.205(b)(2) & § 206.205(d).)
• Authorizes the Commissioner to establish an incentive for voluntarily electing a Life Expectancy Set Aside through
• Authorizes the Commissioner to expand the borrower's options for property charge payment by the mortgagee through
Additionally, in order to fully consider the comments received on these issues, HUD will defer making its final determination of the policies listed below from the proposed rule and afterwards, HUD will issue its final determination on these issues in a final rule.
• The change to the cap on interest rate adjustments for annually adjustable interest rate products and the imposition of a five percent cap on interest rate adjustments for monthly adjustable interest rate products;
• The establishment of extenuating circumstances exceptions for exceeding the Initial Disbursement Limit or Borrower's Advance during the First 12-Month Disbursement Period;
• Post-closing property inspections;
• The requirement to undergo counseling before signing a HECM for Purchase contract and/or making an earnest money deposit; and
• The definition of property charges to include utilities.
HUD received 241 public comments, including duplicate mass mailings, resulting in 83 unique public submissions covering a wide range of issues. Comments came from a wide variety of entities, including lenders, servicers, interest groups, real estate agents, and academics. In general, the public commenters expressed support for codifying policy implemented via Mortgage Letter under statutory authority, updating CFR part 206 and a number of the proposed regulatory changes. Many commenters also raised questions or offered suggestion for changes at the final rule stage. This section of the preamble discusses the significant issues raised by the commenters and provides HUD's responses to the comments received. All public comments can be viewed at
Comment: HUD should clarify that the leasehold period is based on the life of the borrower rather than the life of the mortgagor.
Comment: HUD should clarify that repair administration fees need not be listed on the HUD Settlement Statement at closing.
30. Housing Counseling
HUD believes that the proper role of a HECM Counselor is to educate clients on the features of reverse mortgages and on the appropriateness of a reverse mortgage or other financial options to meet the client's needs. HUD further believes that it is not the role of the HECM Counselor to advise the client whether to proceed with a reverse mortgage, or which reverse mortgage product to use, but to provide guidance and resources to enable the client to make an informed decision. HUD disagrees that HECM Counselors should be required to inform clients that they should seek financial or legal advice to understand the suitability and consequences of the HECM. As with forward mortgages, it is the consumers' decision whether or not to seek financial or legal advice before entering into a loan transaction.
Comment: HUD should create a template certification packet for all servicers to use for surviving non-borrowing spouse situations.
Comment: HUD should add an additional factor under the critical circumstances for the “at risk” loss mitigation option: a diagnosis of Alzheimer's or other dementia of family member receiving care at the residence.
The information collection requirements contained in this proposed have been approved by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520) and assigned OMB Collection Numbers 2502-0524 and 2502-0611. In accordance with the Paperwork Reduction Act, an agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection displays a currently valid OMB control number.
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 OMB in accordance with the requirements of the order. This rule was determined to be a “significant regulatory action,” as defined in section 3(f) of Executive Order 12866.
Executive Order 13563 (Improving Regulations and Regulatory Review) directs executive agencies to analyze regulations that are outmoded, ineffective, insufficient, or excessively burdensome and to modify, streamline, expand, or repeal them in accordance with what has been learned. Executive Order 13563 also directs that, where relevant, feasible, and consistent with regulatory objectives, and to the extent permitted by law, agencies are to identify and consider regulatory approaches that reduce burdens and maintain flexibility and freedom of choice for the public. This rule reduces burdens on mortgagees by codifying in one place all the regulatory policy related to the HECM program. Prior to this rule, mortgagees had to deduce the current program requirements by determining which HECM regulations in 24 CFR part 206 were superseded by HERA and RMSA mortgagee letters.
The Regulatory Flexibility Act (5 U.S.C. 601
The new policy changes in this rule would address important concerns with the HECM program, including the risk the program has, in the past, posed to the MMIF, as well as the continued availability of this program for seniors. Some of the new policy proposals are expected to relieve burdens on all mortgagees, large and small. For example, the amendment to the definition of “expected average mortgage interest rate”, providing the mortgagee with the ability to lock in the expected average mortgage interest rate prior to the date of loan closing, will align the provision with current industry policy. Removing the duplicative appraisal requirement and creating a Cash for Keys incentive structure will both relieve burden on mortgagees. Other policies contained in the rule may result in mortgagees incurring additional costs. However, as detailed in the regulatory impact analysis for the rule, these costs are not estimated to rise to the level of having a significant impact on a substantial number of small entities. Moreover, HUD has attempted to mitigate the economic impacts of these provisions. One example is the requirement that all mortgagees disclose all available HECM program options. To minimize the effect of this provision on all mortgagees, FHA intends to create disclosure documents listing all available options for mortgagees to provide to prospective borrowers. Another example is the limitation on insurance claim reimbursement for the mortgagee's payment of certain property charges. Rather than limiting this reimbursement based on the timing of the property charges, requiring mortgagees to track when each property charge occurred, HUD is limiting the reimbursement to two-thirds of all property charges, consistent with how mortgagees are reimbursed for foreclosure costs.
FHA believes that these policies are reasonable and provide mitigating features so that the FHA-approved mortgagees, large and small, will not be adversely affected by these policies.
Accordingly, the undersigned certifies that this rule would not have a significant economic impact on a substantial number of small entities.
A Finding of No Significant Impact (FONSI) with respect to the environment has been made at the proposed rule state in accordance with HUD regulations in 24 CFR part 50, which implemented section 102(2)(C) of the National Environmental Policy Act of 1969 (42 U.S.C. 4332(2)(C)). The FONSI remains applicable to this final rule and is available for public inspection during regular business hours in the Regulations Division, Office of General Counsel, Department of Housing and Urban Development, 451 7th Street SW., Room 10276, Washington, DC 20410-0500. Due to security measures at the HUD Headquarters building, please schedule an appointment to review the FONSI by calling the Regulations Division at (202) 708-3055 (this is not a toll-free number). Individuals with speech or hearing impairments may access this number via TTY by calling the Federal Relay Service at (800) 877-8339.
Executive Order 13132 (entitled “Federalism”) prohibits, to the extent practicable and permitted by law, an agency from promulgating a regulation that has federalism implications and either imposes substantial direct compliance costs on state and local governments and is not required by statute, or preempts state law, unless the relevant requirements of section 6 of the executive order are met. This rule does not have federalism implications and does not impose substantial direct
The Catalog of Federal Domestic Assistance number for Home Equity Conversion Mortgages is 14.183.
Title II of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) (UMRA) establishes requirements for federal agencies to assess the effects of their regulatory actions on state, local, and tribal governments, and on the private sector. This rule would not impose any federal mandates on any state, local, or tribal governments, or on the private sector, within the meaning of the UMRA.
Administrative practice and procedure, Grant programs—housing and community development, Loan programs—housing and community development, Mortgage insurance, Penalties.
Aged condominiums, Loan programs, Housing and community development, Mortgage insurance, Reporting and recordkeeping requirements.
Accordingly, for the reasons stated in the preamble, HUD amends 24 CFR parts 30 and 206 to read as follows:
12 U.S.C. 1701q-1; 1703, 1723i, 1735f-14, and 1735f-15; 15 U.S.C. 1717a; 28 U.S.C. 2461 note; 42 U.S.C. 1437z-1 and 3535(d).
(a) * * *
(8) Fails to timely submit documents that are complete and accurate in connection with a conveyance of a property or a claim for insurance benefits, in accordance with §§ 203.365, 203.366, or 203.368, or a claim for insurance benefits in accordance with § 206.127 of this title;
(10) Fails to service FHA insured mortgages, in accordance with the requirements of 24 CFR parts 201, 203, 206, and 235;
Authority: 12 U.S.C. 1715b, 1715z-20; 42 U.S.C. 3535(d).
The purposes of the Home Equity Conversion Mortgage (HECM) Insurance
As used in this part, the following terms shall have the meaning indicated.
(1) Contingent on the prospective borrower obtaining a mortgage loan under this part, except the origination fee authorized by § 206.31 or a fee specifically authorized by the Commissioner; or
(2) For information that borrowers and Eligible and Ineligible Non-Borrowing Spouses, if applicable, must receive under § 206.41, except a fee by:
(i) A participating agency approved under subpart B of 24 CFR part 214; or
(ii) An individual or company, such as an attorney or accountant, in the
(3) For other services that the provider of the services represents are, in whole or in part, for the purpose of improving a prospective borrower's access to mortgages covered by this part, except where the fee is for services specifically authorized by the Commissioner.
The regulations in this part may be amended by the Commissioner at any time and from time to time, in whole or in part, but amendments to subparts B and C of this part will not adversely affect the interests of a mortgagee on any mortgage to be insured for which either the Direct Endorsement mortgagee or Lender Insurance mortgagee has approved the borrower and all terms and conditions of the mortgage, or the Commissioner has made a commitment to insure. Such amendments will not adversely affect the interests of a borrower in the case of a default by a mortgagee where the Commissioner makes payments to the borrower.
(a)
(b)
(a)
(b)
At the time of initial contact, the mortgagee shall inform the prospective HECM borrower, in a manner acceptable to the Commissioner, of all products, features, and options of the HECM program that FHA will insure under this part, including: fixed interest rate mortgages with the Single Lump Sum payment option; adjustable interest rate mortgages with tenure, term, and line of credit disbursement options, or a combination of these; any other FHA insurable disbursement options; and initial mortgage insurance premium options, and how those affect the availability of other mortgage and disbursement options.
Mortgages originated under this part must be endorsed through the Direct Endorsement program under § 203.5 of this chapter, except that any references to § 203.255 in § 203.5 shall mean § 206.115. The mortgagee shall submit the information as described in § 206.115(b) for the Direct Endorsement
(a) [Reserved]
(b)
(1) Fixed interest rate mortgages shall use the Single Lump Sum payment option (§ 206.19(e)).
(2) Adjustable interest rate mortgages shall initially provide for the term (§ 206.19(a)), the tenure (§ 206.19(b)), the line of credit (§ 206.19(c)), or a modified term or modified tenure (§ 206.19(d)) payment option, subject to a later change in accordance with § 206.26.
(c)
(a)
(b)
(c)
(d)
(e)
(f)
(2)
(ii)
(B)
(3)
(g)
(h)
(2) For adjustable interest rate HECMs:
(i) No disbursements shall be made under any of the payment options during the First 12-Month Disbursement Period in excess of the Initial Disbursement Limit.
(ii) If the borrower makes a partial prepayment of the outstanding loan balance during the First 12-Month Disbursement Period, the mortgagee shall apply the funds from the partial prepayment in accordance with the Note.
(3) For fixed interest rate HECMs, if the borrower makes a partial prepayment of the outstanding loan balance any time after loan closing and before the contract of insurance is terminated, the mortgagee shall apply the funds from the partial prepayment
(a)
(b)
(1)
(i)
(ii)
(iii)
(B) To set the new interest rate, the mortgagee will determine the change between the initial (
(iv)
(A) For all annual adjustable interest rate HECMs, no single adjustment to the interest rate shall result in a change in either direction of more than two percentage points from the interest rate in effect for the period immediately preceding that adjustment. Index changes in excess of two percentage points may not be carried over for inclusion in an adjustment for a subsequent year. Adjustments in the effective rate of interest over the entire term of the mortgage may not result in a change in either direction of more than five percentage points from the initial contract interest rate.
(B) At each adjustment date for annual adjustable interest rate HECMs, changes in the index interest rate, whether increases or decreases, must be translated into the adjusted mortgage interest rate, except that the mortgage may provide for minimum interest rate change limitations and for minimum increments of interest rate changes.
(2)
(c)
(i) The circumstances under which the rate may increase;
(ii) Any limitations on the increase; and
(iii) The effect of an increase.
(2) Compliance with pre-loan disclosure provisions of 12 CFR part 1026 (Truth in Lending) shall constitute full compliance with paragraph (c)(1) of this section.
(d)
(1) The current index amount;
(2) The date of publication of the index; and
(3) The new interest rate.
(a)
(b)
(1) If the outstanding loan balance at the time the mortgagee's share of net appreciated value becomes payable is less than the appraised value of the property at the time of loan origination, the mortgagee's share is calculated by subtracting the appraised value at the time of loan origination from the adjusted sales proceeds (
(2) If the outstanding loan balance is greater than the appraised value at the time of loan origination but less than the adjusted proceeds, the mortgagee's share is calculated by subtracting the outstanding loan balance from the adjusted sales proceeds and multiplying by the appreciation margin.
(3) If the outstanding loan balance is greater than the adjusted sales proceeds, the net appreciated value is zero.
(4) If there has been no sale or transfer involving satisfaction of the mortgage at the time the mortgagee's share of net appreciated value becomes payable,
(c)
(d)
(a)
(i) The mortgagee is responsible for determining the maximum Initial Disbursement Limit.
(ii) The maximum disbursement allowed at closing and during the First 12-Month Disbursement Period is the lesser of:
(A) The greater of an amount established by the Commissioner through notice which shall not be less than 50 percent of the principal limit; or the sum of Mandatory Obligations and a percentage of the principal limit established by the Commissioner through notice which shall not be less than 10 percent; or
(B) The principal limit less the sum of the funds in the LESA for payment beyond the First 12-Month Disbursement Period and the Servicing Fee Set Aside.
(iii) The amount in the First 12-Month Disbursement Period or at any point in time may not exceed the principal limit.
(iv) Mortgagees shall monitor and track all disbursements that occur at loan closing and during the First 12-Month Disbursement Period; the total amount of disbursements shall not exceed the maximum Initial Disbursement Limit.
(v) The borrower shall notify the mortgagee at loan closing of the amount of the additional percentage of the principal limit beyond Mandatory Obligations that the borrower will draw or that will remain available to be drawn during the First 12-Month Disbursement Period. The borrower may not increase or decrease this election after closing.
(2)
(i) The mortgagee is responsible for determining the maximum Borrower's Advance.
(ii) The disbursement shall only be taken at the time of closing and the maximum disbursement shall not exceed the lesser of:
(A) The greater of an amount established by the Commissioner through notice which shall not be less than 50 percent of the principal limit; or the sum of Mandatory Obligations and a percentage of the principal limit established by the Commissioner through notice which shall not be less than 10 percent; or
(B) The principal limit less the sum of the funds in the LESA for payment beyond the First 12-Month Disbursement Period and the Servicing Fee Set Aside.
(iii) The borrower shall notify the mortgagee at loan closing of the amount of the additional percentage of the principal limit beyond Mandatory Obligations that the borrower will draw. The borrower may not increase or decrease this election after closing.
(b) Mandatory Obligations for traditional and refinance transactions include:
(1) Initial MIP under § 206.105(a);
(2) Loan origination fee;
(3) HECM counseling fee;
(4) Reasonable and customary amounts, but not more than the amount actually paid by the mortgagee for any of the following items:
(i) Recording fees and recording taxes, or other charges incident to the recordation of the insured mortgage;
(ii) Credit report;
(iii) Survey, if required by the mortgagee or the borrower;
(iv) Title examination;
(v) Mortgagee's title insurance;
(vi) Fees paid to an appraiser for the initial appraisal of the property; and
(vii) Flood certifications.
(5) Repair Set Asides;
(6) Repair administration fee;
(7) Delinquent Federal debt;
(8) Amounts required to discharge any existing liens on the property;
(9) Customary fees and charges for warranties, inspections, surveys, and engineer certifications;
(10) Funds to pay contractors who performed repairs as a condition of closing, in accordance with standard FHA requirements for repairs required by the appraiser;
(11) Property tax and flood and hazard insurance payments required by the mortgagee to be paid at loan closing;
(12) Property charges not included in paragraph (b)(11) of this section and which are scheduled for payment during the First 12-Month Disbursement Period, as follows:
(i)
(B) The total amount of semi-annual disbursements scheduled to be made during the First 12-Month Disbursement Period to the borrower from a Partially-Funded LESA; or
(C) The total amount of property charges scheduled for payment during the First 12-Month Disbursement Period from a Fully-Funded LESA.
(D) Mortgagees shall use the actual insurance premium and actual tax amount; if a new tax bill has not been issued, the mortgagee must use the prior year's amount multiplied by 1.04 or an amount set by the Commissioner through notice.
(ii)
(B) Mortgagees shall use the actual insurance premium and actual tax amount; if a new tax bill has not been issued, the mortgagee must use the prior year's amount multiplied by 1.04 or an amount set by the Commissioner through notice;
(13) Required pay-off of debt not secured by the property, as defined by the Commissioner through
(14) Other charges as authorized by the Commissioner through notice.
(c) Mandatory Obligations for HECM for Purchase transactions include:
(1) Initial MIP under § 206.105(a);
(2) Loan origination fee;
(3) HECM counseling fee:
(4) Reasonable and customary amounts, but not more than the amount actually paid by the mortgagee for any of the following items:
(i) Recording fees and recording taxes, or other charges incident to the recordation of the insured mortgage;
(ii) Credit report;
(iii) Survey, if required by the mortgagee or the borrower;
(iv) Title examination;
(v) Mortgagee's title insurance;
(vi) Fees paid to an appraiser for the initial appraisal of the property; and
(vii) Flood certifications.
(5) Delinquent Federal debt;
(6) Fees and charges for real estate purchase contracts, warranties, inspections, surveys, and engineer certifications;
(7) The amount of the principal that is advanced towards the purchase price of the subject property;
(8) Property tax and flood and hazard insurance payments required by the mortgagee to be paid at loan closing;
(9) Property charges not included in paragraph (c)(8) of this section and which are scheduled for payment during the First 12-Month Disbursement Period, as follows:
(i)
(B) The total amount of semi-annual disbursements scheduled to be made during the First 12-Month Disbursement Period to the borrower from a Partially-Funded LESA; or
(C) The total amount of property charges scheduled for payment during the First 12-Month Disbursement Period from a Fully-Funded LESA.
(D) Mortgagees shall use the actual insurance premium and actual tax amount; if a new tax bill has not been issued, the mortgagee must use the prior year's amount multiplied by 1.04 or an amount set by the Commissioner through notice.
(ii)
(B) Mortgagees shall use the actual insurance premium and actual tax amount; if a new tax bill has not been issued, the mortgagee must use the prior year's amount multiplied by 1.04 or an amount set by the Commissioner through notice;
(10) Required pay-off of debt not secured by the property, as defined by the Commissioner through
(11) Other charges as authorized by the Commissioner through notice.
(d)
(e)
(i) An initial disbursement under paragraph (a) of this section plus any initial servicing charge set aside under § 206.19(f)(3); or
(ii) The outstanding loan balance at the time of a change in payment option in accordance with § 206.26, plus any remaining servicing charge set aside under § 206.19(f)(3); and
(iii) The amount of the principal limit set aside in accordance with § 206.19(f) which is not included in the amount set aside in paragraphs (e)(1)(i) or (e)(1)(ii) of this section;
(iv) All MIP or monthly charges due to the Commissioner in lieu of mortgage insurance premiums due through the payment term; and
(v) All interest through the remainder of the payment term. The expected average mortgage interest rate shall be used for this purpose.
(2) The mortgagee shall make all monthly disbursements through the payment term even if the outstanding loan balance exceeds the principal limit because the actual average mortgage interest rate exceeds the expected average mortgage interest rate unless the HECM becomes due and payable under § 206.27(c). In the event of a deferral of due and payable status in accordance with § 206.27(c)(3), disbursements shall cease immediately upon the death of the borrower and no further disbursements are permissible.
(3) Mortgagees shall ensure that term monthly disbursements made to the borrower during the First 12-Month Disbursement Period do not exceed the Initial Disbursement Limit. If the sum of disbursements made during the First 12-Month Disbursement Period would exceed the Initial Disbursement Limit for that time period, the mortgagee shall decrease the monthly disbursements during the First 12-Month Disbursement Period to conform with the Initial Disbursement Limit; upon conclusion of the First 12-Month Disbursement Period, the borrower may request a payment plan recalculation.
(4) If the borrower makes a partial prepayment of the outstanding loan balance during the First 12-Month Disbursement Period, the mortgagee shall apply the funds from the partial prepayment in accordance with the Note.
(5) If the mortgagee receives repayment from insurance or condemnation proceeds after restoration or repair of the damaged property, the available principal limit and outstanding loan balance shall be reduced by the amount of such payments.
(f)
(2) Mortgagees shall ensure that tenure monthly disbursements made to the borrower during the First 12-Month Disbursement Period do not exceed the Initial Disbursement Limit. If the sum of disbursements made during the First 12-Month Disbursement Period would exceed the Initial Disbursement Limit for that time period, the mortgagee shall decrease the monthly disbursements during the First 12-Month Disbursement Period to conform with the maximum Initial Disbursement Limit; upon conclusion of the First 12-Month Disbursement Period, the borrower may request a payment plan recalculation.
(3) If the borrower makes a partial prepayment of the outstanding loan balance during the First 12-Month Disbursement Period, the mortgagee shall apply the funds from the partial prepayment in accordance with the Note.
(4) If the mortgagee receives repayment from insurance or
(g)
(h)
(2) If the borrower makes a partial prepayment of the outstanding loan balance any time after loan closing and before the contract of insurance is terminated, the mortgagee shall apply the funds from the partial prepayment in accordance with the Note.
(i)
(j)
(k)
(a)
(b)
(ii) After the First 12-Month Disbursement Period, as long as the outstanding loan balance is less than the principal limit, a borrower may request a recalculation of the current payment option, a change from any payment option to another available payment option or a disbursement of any amount (not to exceed the difference between the principal limit and the sum of the outstanding loan balance and any set asides for repairs, servicing charges or property charges). A mortgage will continue to bear interest at an adjustable interest rate as agreed between the mortgagee and the borrower at loan origination. The mortgagee shall recalculate any future monthly payments in accordance with § 206.25.
(iii)
(iv)
(2)
(c)
(1)
(ii) If repairs after closing under § 206.47 cannot be completed with the funds set aside for repairs, the mortgagee may advance additional funds to complete repairs from an existing line of credit. If a line of credit is not sufficient to make the advance or if no line of credit exists, future monthly disbursements shall be recalculated for use as a line of credit in accordance with § 206.25.
(iii) If repairs are not completed when required by the mortgage, the mortgagee shall stop monthly payments and the mortgage shall convert to the line of credit payment option. Until the repairs are completed, the mortgagee shall make no line of credit disbursements except as needed to pay for repairs required by the mortgage.
(2)
(a)
(b)
(1) Disbursements by the mortgagee under the term or tenure payment options shall be mailed to the borrower or electronically transferred to an account of the borrower on the first
(2) The borrower shall insure all improvements on the property that serves as collateral for the HECM whether in existence at the time of origination or subsequently erected, against any hazards, casualties, and contingencies, including but not limited to fire and flood, for which the mortgagee requires insurance. Such insurance shall be maintained in the amount and for the period of time that is necessary to protect the mortgagee's investment. Whether or not the mortgagee imposes a flood insurance requirement, the borrower shall at a minimum insure all improvements on the property, whether in existence at the time of origination or subsequently erected, against loss by floods to the extent required by the Commissioner. If the mortgagee imposes insurance requirements, all insurance shall be carried with companies acceptable to the mortgagee, and the insurance policies and any renewals shall be held by the mortgagee and shall include loss payable clauses in favor of and in a form acceptable to the mortgagee.
(3) The borrower shall not participate in a real estate tax deferral program or permit any liens to be recorded against the property, unless such liens are subordinate to the insured mortgage and, if applicable, any second mortgage held by the Commissioner.
(4) A mortgage may be prepaid in full or in part in accordance with § 206.209.
(5) The borrower must keep the property in good repair.
(6) The borrower must provide for the payment of property charges in accordance with § 206.205.
(7) The payment of monthly MIP may be added to the outstanding principal balance.
(8) The borrower shall have no personal liability for payment of the outstanding loan balance. The mortgagee shall enforce the debt only through sale of the property. The mortgagee shall not be permitted to obtain a deficiency judgment against the borrower if the mortgage is foreclosed.
(9) If the mortgage is assigned to the Commissioner under § 206.121(b), the borrower shall not be liable for any difference between the insurance benefits paid to the mortgagee and the outstanding loan balance including accrued interest, owed by the borrower at the time of the assignment.
(10) If State law limits the first lien status of the mortgage as originally executed and recorded to a maximum amount of debt or a maximum number of years, the borrower shall agree to execute any additional documents required by the mortgagee and approved by the Commissioner to extend the first lien status to an additional amount of debt and an additional number of years and to cause any other liens to be removed or subordinated.
(c)
(2) The mortgage shall state that the outstanding loan balance shall be due and payable in full, upon approval of the Commissioner, if any of the following occur:
(i) The property ceases to be the principal residence of a borrower for reasons other than death and the property is not the principal residence of at least one other borrower;
(ii) For a period of longer than 12 consecutive months, a borrower fails to occupy the property because of physical or mental illness and the property is not the principal residence of at least one other borrower;
(iii) The borrower does not provide for the payment of property charges in accordance with § 206.205; or
(iv) An obligation of the borrower under the mortgage is not performed.
(3)
(d)
(a)
(1)
(2)
(i) Recording fees and recording taxes, or other charges incident to the recordation of the insured mortgage;
(ii) Credit report;
(iii) Survey, if required by the mortgagee or the borrower;
(iv) Title examination;
(v) Mortgagee's title insurance;
(vi) Fees paid to an appraiser for the initial appraisal of the property;
(vii) Flood certifications; and
(viii) Such other charges as may be authorized by the Commissioner.
(b)
In order for a mortgage to be eligible under this part, a borrower must establish to the satisfaction of the mortgagee that after the initial payment of loan proceeds under § 206.25(a), there will be no outstanding or unpaid obligations incurred by the borrower in connection with the mortgage transaction, except for mortgage servicing charges permitted under § 206.207(b) and any future Repair Set Aside established pursuant to § 206.19(f)(1); and the initial disbursement will not be used for any payment to or on behalf of an estate planning service firm.
The youngest borrower shall be 62 years of age or older at the time of loan closing.
(a) Once a borrower has obtained an insured mortgage under this part, the borrower is eligible to obtain future insured HECM loan financing if the existing HECM is satisfied prior to or at the closing of the new HECM, or the borrower provides legal documentation, in a manner acceptable to the Commissioner, evidencing release of the borrower's financial obligation to satisfy the existing HECM.
(b) Current HECM borrowers that plan to sell their existing residence and use the HECM for Purchase program to obtain a new principal residence must pay off the existing FHA-insured mortgage before the HECM for Purchase mortgage can be insured.
(a) A mortgagor is not required to be a borrower; however, any borrower is required to be on title to the property which serves as collateral for the HECM, and is therefore, by definition, also a mortgagor.
(b) The mortgagor shall hold title to the entire property which is the security for the mortgage. If there are multiple mortgagors, all the mortgagors must collectively hold title to the entire property which is the security for the mortgage. If one or more mortgagors hold a life estate in the property, for purposes of this section only, the term “mortgagor” shall include each holder of a future interest in the property (remainder or reversion) who has executed the mortgage.
(c) If Non-Borrowing Spouses and non-borrowing owners of the property will continue to hold title to the property which serves as collateral for the HECM, such Non-Borrowing Spouses and non-borrowing owners must sign the mortgage as mortgagors, evidencing their commitment of the property as security for the mortgage.
(d) All Non-Borrowing Spouses and non-borrowing owners shall sign a certification that:
(1) Consents to their spouse or other borrowing owner obtaining the HECM;
(2) Acknowledges the terms and conditions of the mortgage; and
(3) Acknowledges that the property will serve as collateral for the HECM as evidenced by mortgage lien(s).
(a) The Commissioner may establish, through notice, seasoning requirements for existing non-HECM liens. Such seasoning requirements shall not prohibit the payoff of existing non-HECM liens using HECM proceeds if the liens have been in place for longer than 12 months prior to the HECM closing or if the liens have resulted in cash to the borrower in an amount of $500 or less, whether at closing or through cumulative draws prior to the date of the HECM closing.
(b) Mortgagees must provide documentation satisfactory to the Commissioner as established by notice that the seasoning requirement was met.
(c)
(a) Each borrower shall have a general credit standing satisfactory to the Commissioner.
(b)
(i)
(ii)
(iii)
(iv)
(2)
(3)
(ii) The Financial Assessment shall be conducted in compliance with all
(A) Fair Housing Act (42 U.S.C. 3601
(B) Fair Credit Reporting Act (15 U.S.C. 1681
(C) Equal Credit Opportunity Act (15 U.S.C. 1691
(D) Regulation B (12 CFR part 1002).
(a) The property must be the principal residence of each borrower, and if applicable, Eligible Non-Borrowing Spouse, at closing.
(b)
(a)
(2)
(b)
(c)
(a)
(b)
(i) The information required by section 255(f) of the NHA;
(ii) Whether the borrower has signed a contract or agreement with an estate planning service firm that requires, or purports to require, the borrower to pay a fee on or after closing that may exceed amounts permitted by the Commissioner or this part;
(iii) If such a contract has been signed under paragraph (b)(1)(ii) of this section, the extent to which services under the contract may not be needed or may be available at nominal or no cost from other sources, including the mortgagee; and
(iv) Any other requirements determined by the Commissioner.
(2) If the HECM borrower has an Eligible Non-Borrowing Spouse, in addition to meeting the requirements of paragraph (b)(1) of this section, a HECM counselor shall discuss with the borrower and Eligible Non-Borrowing Spouse:
(i) The requirement that the Eligible Non-Borrowing Spouse must obtain ownership of the property or other legal right to remain in the property for life, upon the death of the last surviving borrower;
(ii) A failure to obtain ownership or other legal right to remain in the property for life will result in the HECM becoming due and payable and the Eligible Non-Borrowing Spouse will not receive the benefit of the Deferral Period;
(iii) The requirement that the property must be the principal residence of the Eligible Non-Borrowing Spouse prior to and after the death of the borrowing spouse;
(iv) The requirement that the Eligible Non-Borrowing Spouse fulfills all obligations of the mortgage, including the payment of property charges and upkeep of the property; and
(v) Any other requirements determined by the Commissioner.
(3) If the HECM borrower has an Ineligible Non-Borrowing Spouse, in addition to meeting the requirements of paragraph (b)(1) of this section, a HECM counselor shall discuss with the borrower and Ineligible Non-Borrowing Spouse:
(i) The Deferral Period will not be applicable;
(ii) The HECM will become due and payable upon the death of the last surviving borrower; and
(iii) Any other requirements determined by the Commissioner.
(c)
(a)
(b)
(2) This paragraph does not apply to any part of the principal limit used for the following:
(i) Initial MIP under § 206.105(a) or fees and charges allowed under § 206.31(a) paid by the mortgagee from mortgage proceeds instead of by the borrower in cash; and
(ii) Amounts set aside in accordance with § 206.19(f) for repairs under § 206.47, for property charges under § 206.205, or for servicing charges under § 206.207(b).
(a)
(b)
(1) Cash on hand;
(2) Cash from the sale or liquidation of the borrower's assets;
(3) HECM mortgage proceeds; or
(4) Other approved funding sources as determined by the Commissioner through notice.
(c)
(i) Fees required to be paid by a seller under state or local law;
(ii) Fees customarily paid by a seller in the subject property locality; and
(iii) The purchase of the Home Warranty policy by the seller.
(2) The Commissioner may define additional permissible interested party contributions and impose requirements for permissible interested party contributions through a notice in the
(a)
(b)
(c)
(i) Are located in an area designated by the Federal Emergency Management Agency (FEMA) as a floodplain area having special flood hazards; or
(ii) Are otherwise determined by the Commissioner to be subject to a flood hazard.
(2) No mortgage may be insured that covers property improvements located in an area that has been identified by FEMA as an area having special flood hazards, unless the community in which the area is situated is participating in the NFIP and such insurance is obtained by the borrower. Such requirement for flood insurance shall be effective one year after the date of notification by FEMA to the chief executive officer of a flood prone community that such community has been identified as having special flood hazards.
(3) The flood insurance must be maintained during such time as the mortgage is insured in an amount at least equal to the lowest of the following:
(i) 100 percent replacement cost of the insurable value of the improvements, which consists of the development or project cost less estimated land cost; or
(ii) The maximum amount of the NFIP insurance available with respect to the particular type of the property; or
(iii) The outstanding principal balance of the loan.
(d)
(e)
(f)
(g)
(2) Properties are eligible for FHA insurance under the HECM for Purchase program when construction is completed and the property is habitable, as evidenced by the issuance of a Certificate of Occupancy or its equivalent, by the local jurisdiction.
(a)
(b)
(c)
(d)
(e)
If the mortgage involves a dwelling unit in a condominium, the project in which the unit is located shall have been committed to a plan of condominium ownership by deed, or other recorded instrument, that is acceptable to the Commissioner.
(a)
(2)
(b)
(2)
(3)
(ii) However, FHA will require that the mortgagee obtain additional documentation if the re-sale price is 100 percent over the purchase price. Such documentation must include an appraisal from another appraiser. The mortgagee may also document its loan file to support the increased value by establishing that the increased value results from the rehabilitation of the property.
(iii) FHA may revise the level at which additional documentation is required under paragraph (b)(3) of this section at 50 to 150 percent over the original purchase price. FHA will revise this level by
(4)
(ii) However, FHA may require that the mortgagee provide additional documentation to support the re-sale value of the property if the re-sale price is 5 percent or greater than the lowest sales price of the property during the preceding 12 months (as evidenced by the contract of sale). At FHA's discretion, such documentation must include, but is not limited to, an appraisal from another appraiser. FHA may exclude re-sales of less than a specific dollar amount from the additional value documentation requirements.
(iii) If the additional value documentation supports a value of the property that is more than 5 percent lower than the value supported by the first appraisal, the lower value will be used to calculate the maximum claim amount. Otherwise, the value supported by the first appraisal will be used to calculate the maximum claim amount.
(iv) FHA will announce its determination to require additional value documentation through issuance of a
(v) The level at which additional documentation is required under paragraph (b)(4) of this section shall supersede that under paragraph (b)(3) of this section.
(5)
(c)
(1) Sales by HUD of Real Estate-Owned (REO) properties under 24 CFR part 291 and of single family assets in revitalization areas pursuant to section 204 of the NHA (12 U.S.C. 1710);
(2) Sales by another agency of the United States Government of REO single family properties pursuant to programs operated by these agencies;
(3) Sales of properties by nonprofit organizations approved to purchase HUD REO single family properties at a discount with resale restrictions;
(4) Sales of properties that were acquired by the sellers by inheritance;
(5) Sales of properties purchased by an employer or relocation agency in connection with the relocation of an employee;
(6) Sales of properties by state- and federally-chartered financial institutions and government-sponsored enterprises (GSEs);
(7) Sales of properties by local and state government agencies; and
(8) Only upon announcement by FHA through issuance of a notice, sales of properties located in areas designated by the President as federal disaster areas. The notice will specify how long the exception will be in effect.
(d)
(a)
(b)
(c)
(2) The HECM refinance authority is only applicable when the property that serves as collateral for the FHA-insured mortgage remains the same.
(3) Existing HECM borrowers refinancing an existing HECM are eligible for a MIP reduction under the conditions of this section, but existing HECM borrowers who participate in a HECM for Purchase transaction are ineligible for a reduction in the initial MIP.
(d)
(i) The total cost of the refinancing to the borrower; and
(ii) The increase in the borrower's principal limit as measured by the estimated initial principal limit on the mortgage to be insured less the current principal limit on the HECM that is being refinanced under this section.
(2)
(e)
(1) The original HECM was assigned a Case Number on or after August 4, 2014, and the borrower and Non-Borrowing Spouse, if applicable, received counseling required under § 206.41; or where the original HECM was assigned a Case Number prior to August 4, 2014, and there is no applicable Non-Borrowing Spouse.
(2) The borrower has received the anti-churning disclosure required under paragraph (d) of this section.
(3) The increase in the borrower's principal limit (as provided in the anti-churning disclosure) exceeds the total cost of the refinancing by an amount established by the Commissioner through
(4) The time between the date of the closing on the original HECM and the date of the application for refinancing under this section does not exceed five years (even if less than five years have passed since a previous refinancing under this section).
(a)
(b)
(2) If a Deferral Period ceases but the Eligible Non-Borrowing Spouse continues to meet the Qualifying Attributes, the mortgagee must provide an Eligible Non-Borrowing Spouse with 30 days to cure the default, in accordance with § 206.57.
(c)
(i) Have been the spouse of a HECM borrower at the time of loan closing and remained the spouse of such HECM borrower for the duration of the HECM borrower's lifetime;
(ii) Have been properly disclosed to the mortgagee at origination and specifically named as an Eligible Non-Borrowing Spouse in the HECM mortgage and loan documents;
(iii) Have occupied, and continue to occupy, the property securing the HECM as his or her principal residence; and
(iv) Meet any other requirements as the Commissioner may prescribe by
(2) A Non-Borrowing Spouse who meets the Qualifying Attributes in paragraph (c)(1) of this section at origination is an Eligible Non-Borrowing Spouse and may not elect to be ineligible for the Deferral Period. A Non-Borrowing Spouse that is ineligible for the Deferral Period at the time of loan origination because he or she failed to satisfy the Qualifying Attributes requirements in paragraph (c)(1) of this section is not subsequently eligible for a Deferral Period when the borrowing spouse dies or moves out of the home.
(3) An Eligible Non-Borrowing Spouse shall become an Ineligible Non-Borrowing Spouse should any of the Qualifying Attributes requirements in paragraph (c)(1) of this section cease to be met.
(d)
(1) Within 90 days from the death of the last surviving HECM borrower, establish legal ownership or other ongoing legal right to remain for life in the property securing the HECM;
(2) After the death of the last surviving borrower, ensure all other obligations of the HECM borrower(s) contained in the loan documents continue to be satisfied; and
(3) After the death of the last surviving borrower, ensure that the HECM does not become eligible to be called due and payable for any other reason.
(e)
(f) Nothing in this section may be construed as interrupting or interfering with the ability of the borrower's estate or heir(s) to dispose of the property if they are otherwise legally entitled to do so.
(a) When the mortgagee is required by § 206.55(b)(2) to provide an Eligible Non-Borrowing Spouse with 30 days to cure the default, this section shall apply.
(b) If the default is cured within the 30-day timeframe, the Deferral Period shall be reinstated, unless:
(1) The mortgagee has reinstated the Deferral Period within the past two years immediately preceding the current notification to the Eligible Non-Borrowing Spouse that the mortgage is due and payable;
(2) The reinstatement of the Deferral Period will preclude foreclosure if the mortgage becomes due and payable at a later date; or
(3) The reinstatement of the Deferral Period will adversely affect the priority of the mortgage lien.
(c) If the default is not cured within the 30-day timeframe, the mortgagee shall proceed in accordance with the established timeframes to initiate foreclosure and reasonable diligence in prosecuting foreclosure.
(d) Even after a foreclosure proceeding has been initiated, the mortgagee shall permit an Eligible Non-Borrowing Spouse to cure the condition which resulted in the Deferral Period ceasing, consistent with § 206.55(b)(2), and to reinstate the mortgage and Deferral Period, and the mortgage insurance shall continue in effect. The mortgagee may require the Eligible Non-Borrowing Spouse to pay any costs that the mortgagee incurred to reinstate the mortgage, including foreclosure costs and reasonable attorney's fees. Such costs may not be added to the outstanding loan balance and shall be paid from some other source of funds. The mortgagee shall reinstate the Deferral Period unless:
(1) The mortgagee has reinstated the Deferral Period within the past two years immediately preceding the latest notification to the Eligible Non-Borrowing Spouse that the mortgage is due and payable;
(2) The reinstatement of the Deferral Period will preclude foreclosure if the mortgage becomes due and payable at a later date; or
(3) The reinstatement of the Deferral Period will adversely affect the priority of the mortgage lien.
(a)
(b)
(c)
(1) Obtain all certifications, as required by the Commissioner, from the Eligible Non-Borrowing Spouse, and continue to obtain the required certifications no less than annually thereafter for the duration of the Deferral Period; and
(2) Notify any Eligible Non-Borrowing Spouse that the due and payable status of the loan is in a Deferral Period only for the amount of time that such Eligible Non-Borrowing Spouse continues to meet all requirements established by the Commissioner.
(d)
(a) The HECM is not assumable. HECM proceeds may not be disbursed to any party during a Deferral Period, except as determined by the Commissioner through notice.
(b) If a Repair Set Aside was established as a condition of the HECM, funds may be disbursed from the Repair Set Aside during a Deferral Period for the sole purpose of paying the cost of those repairs that were specifically identified prior to origination as necessary to the insurance of the HECM. Repairs under this paragraph shall only be paid for using funds from the Repair Set Aside if the repairs are satisfactorily completed during the time period established in the Repair Rider or such additional time as provided by the Commissioner. Unused funds remaining beyond the established time period shall not be disbursed.
(a)
(b)
(c)
(d)
(i) The assignor, pledgor or transferor shall remain the mortgagee of record.
(ii) The Commissioner shall have no obligation to recognize or deal with any party other than the mortgagee of record with respect to the rights, benefits and obligations of the mortgagee under the contract of insurance.
(2) An assignment or transfer of an insured mortgage or group of insured mortgages may be made by an approved mortgagee to other than an approved mortgagee provided the requirements under paragraphs (d)(1)(i) and (d)(1)(ii) of this section are met and the following additional requirements are met:
(i) The assignee or transferee shall be a corporation, trust or organization (including but not limited to any pension trust or profit-sharing plan) which certifies to the approved mortgagee that:
(A) It has assets of $100,000 or more; and
(B) It has lawful authority to hold an insured mortgage or group of insured mortgages.
(ii) The assignment or transfer shall be made pursuant to an agreement under which the transferor or assignor is obligated to take one of the following alternate courses of action within 1 year from the date of the assignment or within such additional period of time as may be approved by the Commissioner:
(A) The transferor or assignor shall repurchase and accept a reassignment of such mortgage or group of mortgages.
(B) The transferor or assignor shall obtain a sale and transfer of such mortgage or group of mortgages to an approved mortgagee.
(3) Notice to or approval of the Commissioner is not required in connection with assignments, pledges or transfers pursuant to this section.
(e)
(f)
(1)
(2)
(3)
(i) A mortgagee approved by the Commissioner; or
(ii) A corporation, trust or organization (including, but not limited to any pension fund, pension trust, or profit-sharing plan) which certifies to the principal mortgagee that:
(A) It has assets of $100,000 or more; and
(B) It has lawful authority to acquire a partial interest in an insured mortgage.
(4)
(i) The principal mortgagee shall retain title to the mortgage and remain the mortgagee of record under the contract of mortgage insurance.
(ii) The Commissioner shall have no obligation to recognize or deal with anyone other than the principal mortgagee with respect to the rights, benefits and obligations of the mortgagee under the contract of insurance.
(iii) The mortgage and loan documents shall remain in the custody of the principal mortgagee.
(iv) The responsibility for servicing the insured mortgages shall remain with the principal mortgagee.
Loans endorsed for insurance under this part, prior to October 1, 2008, shall be obligations of the General Insurance Fund. Loans endorsed for insurance under this part, on or after October 1, 2008, shall be obligations of the MMIF.
(a) The payment of any MIP due under this subpart shall be made to the Commissioner by the mortgagee in cash until an event described in paragraph (b) or (c) of this section occurs.
(b)
(c)
(2) If the mortgagee or a party other than the mortgagee acquires title at a foreclosure sale or the mortgagee acquires title by a deed in lieu of foreclosure, or where the property is sold in accordance with § 206.125(c), and a claim for the payment of the insurance benefits will be presented, the MIP shall no longer be remitted as of the date of the foreclosure sale, the date the deed in lieu of foreclosure is recorded, or the date in which the sale in accordance with § 206.125(c) is completed, as applicable.
(a)
(b)
(c)
(1) For adjustable interest rate HECMs, the amount of Mandatory Obligations, the amount disbursed to the borrower at loan closing, and the amount of the available Initial Disbursement Limit not taken by the borrower at loan closing that the borrower selects to remain available during the First 12-Month Disbursement Period.
(2) For fixed interest rate HECMs, the amount of Mandatory Obligations and the amount disbursed to the borrower at loan closing.
(d)
(a)
(1) Under the assignment option, the mortgagee shall have the option of assigning the mortgage to the Commissioner if the outstanding loan balance is equal to or greater than 98 percent of the maximum claim amount, regardless of the deferral status, or the borrower has requested a payment which exceeds the difference between the maximum claim amount and the outstanding loan balance and:
(i) The mortgagee is current in making the required payments under the mortgage to the borrower;
(ii) The mortgagee is current in its payment of the MIP (and late charges and interest on the MIP, if any) to the Commissioner;
(iii) The mortgage is not due and payable under § 206.27(c)(1), or, if due and payable under § 206.27(c)(1), its due and payable status has been deferred pursuant to a Deferral Period;
(iv) An event described in § 206.27(c)(2) has not occurred, or the Commissioner has been so informed but has denied approval for the mortgage to be due and payable. At the mortgagee's option, the mortgagee may forgo assignment of the mortgage and file a claim under any of the circumstances described in § 206.123(a)(3)-(5); and
(v) The mortgage is a first lien of record and title to the property securing the mortgage is good and marketable. The provisions of § 206.136 pertaining to mortgagee certifications also apply.
(2) Under the shared premium option, the mortgagee may not assign a mortgage to the Commissioner unless the mortgagee fails to make payments and the Commissioner demands assignment (§ 206.123(a)(2)), but the mortgagee shall only be required to remit a reduced monthly MIP to the Commissioner. The mortgagee shall collect from the borrower the full amount of the monthly MIP provided in § 206.105(b) but shall retain a portion of the monthly MIP paid by the borrower as compensation for the default risk assumed by the mortgagee. The portion of the MIP to be retained by a mortgagee shall be determined by the Commissioner as calculated in § 206.109. For a particular mortgage, the applicable portion shall be determined as of the date of the commitment. The mortgagee retains the right to file a claim under any of the circumstances described in § 206.123(a)(2)-(5).
(b)
Using the factors provided by the Commissioner, the amount of the mortgagee share of the premium shall be determined for each mortgage based upon the age of the youngest borrower or Eligible Non-Borrowing Spouse and the expected average mortgage interest rate.
(a)
(b)
(a)
(b)
(c)
(a)
(b)
(1) Property appraisal upon a form meeting the requirements of the Commissioner (including, if required, any additional documentation supporting the appraised value of the property under § 206.52), and a HUD conditional commitment, or a Lender's Notice of Value issued by the Lender Appraisal Processing Program (LAPP) approved lender when the appraisal was originally completed for use in a VA application, but only if the appraiser was also on the FHA roster as of the effective date of the appraisal, and all accompanying documents required by the Commissioner;
(2) An application for insurance of the mortgage in a form prescribed by the Commissioner;
(3) A certified copy of the mortgage and loan documents executed upon forms which meet the requirements of the Commissioner;
(4) An underwriter certification, on a form prescribed by the Commissioner, stating that the underwriter has personally reviewed the appraisal report and credit application (including the analysis performed on the worksheets) and that the proposed mortgage complies with FHA underwriting requirements, and incorporates each of the underwriter certification items that apply to the mortgage submitted for endorsement, as set forth in the applicable handbook or similar publication that is distributed to all Direct Endorsement mortgagees, except that if FHA makes the TOTAL Mortgage Scorecard available to HECM mortgagees by setting out requirements applicable for the use of the TOTAL Mortgage Scorecard in a
(5) Where applicable, a certificate under oath and contract regarding use of the dwelling for transient or hotel purposes;
(6) Where an individual water or sewer system is being used, an approval letter from the local health authority indicating approval of the system in accordance with § 200.926d(f);
(7) A mortgage certification on a form prescribed by the Commissioner, stating that the authorized representative of the mortgagee who is making the certification has personally reviewed the mortgage documents and the application for insurance endorsement, and certifying that the mortgage complies with the requirements of paragraph (b) of this section. The certification shall incorporate each of the mortgagee certification items that apply to the mortgage loan submitted for endorsement, as set forth in the applicable handbook or similar publication that is distributed to all Direct Endorsement mortgagees;
(8) Documents required by § 206.15;
(9) Documentation providing that the seller is the owner of record in accordance with § 206.52(a) and the time restriction requirements of § 206.52(b) are met;
(10) For HECM for Purchase transactions, a Certificate of Occupancy, or its equivalent, if required for new construction; and
(11) Such other documents as the Commissioner may require.
(c)
(i) The mortgage is executed on a form which meets the requirements of the Commissioner;
(ii) The mortgage maturity meets the requirements of the applicable program;
(iii) The stated mortgage amount does not exceed 150 percent of the maximum claim amount;
(iv) All documents required by paragraph (b) of this section are submitted;
(v) All necessary certifications are made in accordance with paragraph (b) of this section;
(vi) There is no mortgage insurance premium, late charge or interest due to the Commissioner; and
(vii) The mortgage was not in default when submitted for insurance or, if submitted for insurance more than 60 days after closing, the mortgagee certifies that the borrower is current in paying all property charges or is otherwise in compliance with all the terms and conditions of the mortgage documents.
(2) The Commissioner is authorized to determine if there is any information indicating that any certification or required document is false, misleading, or constitutes fraud or misrepresentation on the part of any party, or that the mortgage fails to meet a statutory or regulatory requirement. If, following this review, the mortgage is determined to be eligible, the Commissioner will endorse the mortgage for insurance by issuance of a Mortgage Insurance Certificate. If the mortgage is determined to be ineligible, the Commissioner will inform the mortgagee in writing of this determination, and include the reasons for the determination and any corrective actions that may be taken.
(d)
(e)
(f)
No amount of the initial MIP shall be refundable except as authorized by the Commissioner.
The Commissioner is required by statute to take any action necessary to provide a borrower with funds to which the borrower is entitled under the mortgage and which the borrower does not receive because of the default of the mortgagee. The Commissioner may hold a second mortgage to secure repayment by the borrower under § 206.27(d). Where the Commissioner does not hold a second mortgage, but makes a payment to the borrower, and such payment is not reimbursed by the mortgagee, the Commissioner shall accept assignment of the first mortgage.
(a)
(b)
(c)
(a)
(1) The conditions of § 206.107(a)(1) pertaining to the optional assignment of the mortgage by the mortgagee have been met and the mortgagee assigns the mortgage to the Commissioner;
(2) The mortgagee is unable or unwilling to make the payments under the mortgage and assigns the mortgage to the Commissioner pursuant to the Commissioner's demand, as provided in § 206.121(b);
(3) The borrower or other permissible party sells the property for less than the outstanding loan balance and the mortgagee releases the mortgage of record to facilitate the sale, as provided in § 206.125(c);
(4) The mortgagee acquires title to the property by foreclosure or a deed in lieu
(5) The mortgagee forecloses and a bidder other than the mortgagee purchases the property for an amount that is not sufficient to satisfy the outstanding loan balance, as provided in § 206.125(e).
(b) [Reserved]
(a)
(2) After notifying and receiving approval of the Commissioner when needed, the mortgagee shall notify the borrower, Eligible Non-Borrowing Spouse, borrower's estate, and borrower's heir(s), as applicable, within 30 days of the later of notifying the Commissioner or receiving approval, if needed, that the mortgage is due and payable. The mortgagee shall give the applicable party 30 days from the date of notice to engage in the following actions:
(i) Pay the outstanding loan balance, including any accrued interest, MIP, and mortgagee advances in full;
(ii) Sell the property for an amount not to be less than the amount determined by the Commissioner through notice, which shall not exceed 95 percent of the appraised value as determined under § 206.125(b), with the net proceeds of the sale to be applied towards the outstanding loan balance. Closing costs shall not exceed the greater of: 11 percent of the sales price; or a fixed dollar amount as determined by the Commissioner through
(iii) Provide the mortgagee with a deed in lieu of foreclosure;
(iv) Correct the condition which resulted in the mortgage coming due and payable for reasons other than the death of the last surviving borrower;
(v) For an Eligible Non-Borrowing Spouse, correct the condition which resulted in an end to the Deferral Period in accordance with § 206.57; or
(vi) Such other actions as permitted by the Commissioner through notice.
(3) For a borrower, even after a foreclosure proceeding is begun, the mortgagee shall permit the borrower to correct the condition which resulted in the mortgage coming due and payable and to reinstate the mortgage, and the mortgage insurance shall continue in effect. The mortgagee may require the borrower to pay any costs that the mortgagee incurred to reinstate the borrower, including foreclosure costs and reasonable attorney's fees. Such costs shall be paid by adding them to the outstanding loan balance. The mortgagee may refuse reinstatement by the borrower if:
(i) The mortgagee has accepted reinstatement of the mortgage within the past two years immediately preceding the current notification to the borrower that the mortgage is due and payable;
(ii) Reinstatement will preclude foreclosure if the mortgage becomes due and payable at a later date; or
(iii) Reinstatement will adversely affect the priority of the mortgage lien.
(4) For an Eligible Non-Borrowing Spouse, even after a foreclosure proceeding is begun, the mortgagee shall permit the Eligible Non-Borrowing Spouse to cure the condition which resulted in the Deferral Period ceasing, in accordance with § 206.57(d).
(b)
(c)
(d)
(2) If the laws of the State, city, or municipality or other political subdivision in which the mortgaged property is located or if Federal bankruptcy law does not permit the commencement of the foreclosure in accordance with § 206.125(d)(1), the mortgagee shall commence foreclosure within six months after the expiration of the time during which such foreclosure is prohibited by such laws.
(3) The mortgagee shall give written notice to the Commissioner within 30 days after the initiation of foreclosure proceedings, and shall exercise reasonable diligence in prosecuting the foreclosure proceedings to completion and in acquiring title to and possession of the property. A time frame that is determined by the Commissioner to constitute “reasonable diligence” for each State is made available to mortgagees.
(4) The mortgagee shall bid at the foreclosure sale an amount at least equal to the lesser of the sum of the outstanding loan balance and any and all other incurred expenses, or the current appraised value of the property. Such a bid by any party other than the mortgagee, for the full loan balance and all associated expenses, will result in a full payoff of the loan and no claim for insurance benefits being presented to FHA.
(e)
(f)
(ii)
(2) In exchange for the executed and delivered deed, the mortgagee shall cancel the credit instrument and deliver it to the borrower and satisfy the mortgage of record. If applicable, the mortgagee shall request that the Commissioner cancel the credit instrument and deliver it to the borrower and satisfy the mortgage of record.
(g)
(2) Repairs shall not exceed those required by local law, or the requirements of the Commissioner or the Secretary of Veterans Affairs if the sale of the property is financed with a mortgage insured by the Commissioner or guaranteed, insured, or taken by the Secretary of Veterans Affairs. No other repairs shall be made without the specific advance approval of the Commissioner.
(3) The mortgagee shall not enter into a contract for the preservation, repair, or sale of the property with any officer, employee, or owner of ten percent or more interest in the mortgagee or with any other person or organization having an identity of interest with the mortgagee or with any relative of such officer, employee, owner, or person.
(4) The Commissioner may provide financial incentive, in an amount to be determined by the Commissioner, to be paid by the mortgagee and reimbursed through a subsequent claim when a bona fide tenant vacates the property prior to an eviction being initiated by the mortgagee.
(a)
(2) If the property will not be sold within six months from the foreclosure sale date where the mortgagee is the successful bidder, the mortgagee shall apply for the insurance benefit not later than 30 days after the end of the six-month period, substituting the appraised value, using a valid appraisal, for the sale price. The mortgagee may add the cost of the appraisal to the claim amount.
(b)
(c)
(d)
(a)
(b)
(2) For HECMs assigned Case Numbers on or after September 19, 2017, in no case may the claim paid under this subpart exceed the maximum claim amount, as defined in § 206.3. The interest allowance provided in paragraphs (d)(3)(x), (e)(2) and (f)(2)(ii) of this section shall be made in cash in the amount determined under this section and shall be included in determining the limit on the claim amount.
(c)
(d)
(1)
(2) The amount of the claim shall be computed by:
(i) Totaling the outstanding loan balance and any accrued interest and servicing fees which have not been added to the outstanding loan balance as of the due and payable date, and allowances for items set forth in paragraph (d)(3) of this section; and
(ii) Subtracting from that total the amount for which the property was sold (or the appraised value determined under § 206.127(a)(2)) and the items set forth in paragraph (d)(4) of this section.
(3) The claim shall include items listed in paragraphs (d)(3)(i) through (xiv) of this section. For HECMs with Case Numbers assigned on or after September 19, 2017, the inclusion of items listed in paragraphs (d)(3)(i), (ii), and (iii) of this section shall be limited to two-thirds of advances made by the mortgagee on such expenses.
(i) Taxes, ground rents, water rates, and utility charges that are liens prior to the mortgage;
(ii) Special assessments, which are noted on the application for insurance or which become liens after the insurance of the mortgage;
(iii) Hazard and flood insurance premiums on the mortgaged property not in excess of a
(A) For purposes of this section,
(B) If a State has neither a FAIR Plan nor a State-licensed rating organization for essential property insurance in the voluntary market, the mortgagee must provide to the Home Ownership Center (HOC) having jurisdiction, information concerning the lowest rates available from an insurer for the types of coverage involved, with a request for a determination of whether the rate is reasonable. FHA will determine the rate to be reasonable if it approximates the rate assessed for comparable insurance coverage applicable to similarly situated properties in a State that offers a FAIR Plan or maintains a State-licensed rating organization;
(iv) Taxes imposed upon any deeds or other instruments by which said property was acquired by the mortgagee pursuant to § 206.125;
(v) Reasonable payments made by the mortgagee, with the approval of the Commissioner, for the purpose of protecting, operating, or preserving the property, or removing debris from the property;
(vi) Reasonable costs for performing property inspections required by § 206.140 and to determine if the property is vacant or abandoned are considered to be costs of protecting, operating or preserving the property;
(vii) Charges for the administration, operation, maintenance, or repair of community-owned property or the maintenance or repair of the mortgaged property, paid by the mortgagee for the purpose of discharging an obligation arising out of a covenant filed for record prior to the issuance of the mortgage; and charges for the repair or maintenance of the mortgaged property required by, and in an amount approved by, the Commissioner under § 206.142;
(viii) Reasonable costs of the title search ordered by the mortgagee, in accordance with procedures prescribed by FHA, to determine if the criteria for approval of the mortgagee's acceptance of a deed in lieu of foreclosure or to determine clear title to complete a pre-foreclosure sale;
(ix) Foreclosure costs or costs of acquiring the property in accordance with such conditions as the Commissioner shall prescribe;
(x) An amount equal to the interest allowance which would have been earned, from the due and payable date to the date when payment of the claim is made, if the claim had been paid in debentures, except that when the mortgagee fails to meet any one of the applicable requirements of §§ 206.125 and 206.127 of this subpart within the specified time, and in a manner satisfactory to the Commissioner (or within such further time as the Commissioner may approve in writing), the interest allowance in such cash payment shall be computed only to the date on which the particular required action should have been taken or to which it was extended.
(A)
(B)
(C)
(D)
(E)
(F)
(G)
(xi) Any amount of incentive paid by the mortgagee in accordance with § 206.125(f)(1)(ii) or § 206.125(g)(4);
(xii) Costs of any appraisal under §§ 206.125 or 206.127, provided that the property was appraised after the mortgage became due and payable and that the mortgagee is not otherwise reimbursed for such costs;
(xiii) Reasonable payments made by the mortgagee for:
(A) Preservation and maintenance of the property;
(B) Repairs necessary to meet the objectives of the property standards required for mortgages insured by the Commissioner, those required by local law, and such additional repairs as may be specifically approved in advance by the Commissioner; and
(C) Expenses in connection with the sale of the property including a sales commission at the rate customarily paid in the community and, if the sale to the buyer involves a mortgage insured by the Commissioner or guaranteed by the Secretary of Veterans Affairs, a discount at a rate not to exceed the maximum allowable by the Commissioner, as of the date of execution of the discounted loan. Closing costs shall not exceed the greater of: 11 percent of the sales price; or a fixed dollar amount as determined by the Commissioner through
(xiv) A certification that the property is undamaged in accordance with § 206.143.
(4) There shall be deducted from the amount computed in paragraph (d)(2)(i) of this section:
(i) The items listed in § 206.145; and
(ii) Any adjustment for damage or neglect to the property pursuant to §§ 206.140, 206.141, and 206.142.
(e)
(1) When a mortgagee assigns a mortgage which is eligible for assignment under § 206.107(a)(1), the amount of payment shall be computed by subtracting from the outstanding loan balance on the date of assignment all cash retained by the mortgagee, including amounts held or deposited for the account of the borrower or to which it is entitled under the mortgage transaction that have not been applied in reduction of the principal mortgage indebtedness, and any adjustments for damage or neglect to the property
(2) The claim shall also include:
(i) Reimbursement for such costs and attorney's fees as the Commissioner finds were properly incurred in connection with the assignment of the mortgage to the Commissioner; and
(ii) An amount equivalent to the interest allowance which will have been earned from the date the mortgage was assigned to the Commissioner to the date the claim is paid, if the claim had been paid in debentures, except that if the mortgagee fails to meet any of the requirements of § 206.127(c), or § 206.131 if applicable, within the specified time and in a manner satisfactory to the Commissioner (or within such further time as the Commissioner may approve in writing), the interest allowance in the payment of the claim shall be computed only to the date on which the particular required action should have been taken or to which it was extended. The provisions of paragraphs (d)(3)(x)(A)-(G) of this section pertaining to debentures are applicable except that the issue date of the debentures shall be the date the mortgage was assigned to the Commissioner.
(3) When a mortgagee assigns a mortgage under § 206.121(b) after demand by the Commissioner, the mortgagee will not receive the entire claim payment as contained in paragraphs (e)(1) and (2) of this section. The amount of the claim shall be computed by totaling the payments made by the mortgagee to the borrower or for the benefit of the borrower, and subtracting from the total the cash retained by the mortgagee, including amounts held or deposited for the account of the borrower or to which it is entitled under the mortgage transaction that have not been applied in reduction of the principal mortgage indebtedness, and any adjustments for damage or neglect to the property pursuant to §§ 206.141 and 206.142. The claim shall also be reduced by an amount determined by the Commissioner to reimburse the Commissioner for administrative expenses incurred in assuming the mortgagee's responsibility under the mortgage, which may include expenses for staff time. If more than one mortgage is assigned to the Commissioner, the administrative expenses incurred for all the mortgages assigned shall be allocated among the mortgages as determined by the Commissioner. The claim shall not include accrued interest whether or not it has been included in the loan balance.
(f)
(1)(i)
(ii)
(A)
(B)
(2)(i)
(ii)
(A)
(B)
(a)
(b)
(c)
(1) To any changes in the plan of apartment ownership including the administration of the property;
(2) That as of the date the assignment is filed for record, the family unit is
(3) To the condition of the property as of the date the assignment is filed for record. Section 234.275 of this chapter concerning the certification of condition is incorporated by reference.
(d)
(a)
(b)
(2) For HECMs with Case Numbers assigned on or after September 19, 2017, if the mortgagee or a party other than the mortgagee acquires title at a foreclosure sale or the mortgagee acquires title by a deed in lieu of foreclosure and a claim for the payment of the insurance benefits will be presented, the contract of insurance shall be terminated as of claim payment.
(c)
(d)
(e)
(f)
(a) A mortgagee shall not release the security or any part thereof, while the mortgage is insured, without the prior consent of the Commissioner.
(b) A mortgagee may, with the prior consent of the Commissioner, accept an addition to, or substitution of, security for the purpose of removing the dwelling to a new lot or replacing the dwelling with a similar or like kind on the existing lot under the following conditions:
(1) The mortgagee obtains a good and valid first lien on the property to which the dwelling is removed or the existing lot upon which the dwelling is rebuilt;
(2) All damages to the structure are repaired or all rebuilding of the structure is completed without cost to FHA; and
(3) The property to which the dwelling is removed or rebuilt is in an area known to be reasonably free from natural hazards or, if in a flood zone, the borrower will insure or reinsure under the National Flood Insurance Program.
(c) A mortgagee may, without the prior consent of the Commissioner, accept an addition to, or substitution of, security for the purpose of removing the dwelling to a new lot under the following conditions:
(1) The dwelling has survived an earthquake or other disaster with little damage, but continued location on the property might be hazardous;
(2) The conditions stated in paragraph (b) of this section exist; and
(3) Immediately following the emergency removal the mortgagee notifies the Commissioner of the reasons for removal.
(a) On the date the application for assignment is filed, the mortgagee shall submit to the Commissioner:
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(b) All documents required in paragraph (a) of this section must be submitted and approved before a claim for assignment may be submitted.
(c)
(a) In order for a HECM to be eligible for assignment, the following must be met:
(1)
(2)
(3)
(b) The mortgagee shall certify that the conditions of paragraph (a) have been met.
If, for any reason, the mortgagee fails to comply with the regulations in this subpart, the Commissioner may hold processing of the application for insurance benefits in abeyance for a reasonable time in order to permit the mortgagee to comply. In the alternative to holding processing in abeyance, the Commissioner may reconvey title to the property or reassign the mortgage to the mortgagee, in which event the application for insurance benefits shall be considered as cancelled and the mortgagee shall refund the insurance benefits to the Commissioner as well as other funds required by § 206.138. The mortgagee may reapply for insurance benefits at a subsequent date; provided, however, that the mortgagee may not be reimbursed for any expenses incurred in connection with the property after it has been reconveyed or the mortgage reassigned by the Commissioner, or paid any debenture interest accrued after the date of initial conveyance, whichever is earlier, and there will be deducted from the insurance benefits any reduction in the Commissioner's estimate of the value of the property occurring from the time of reconveyance or mortgage reassignment to the time of reapplication.
Where the Commissioner accepts an assignment, acquires a property after accepting an assignment of a mortgage, or otherwise pays a claim for insurance benefits and thereafter it becomes necessary for the Commissioner to either reconvey the property or reassign the mortgage to the mortgagee due to the mortgagee's noncompliance with these regulations, the mortgagee shall reimburse the Commissioner for all expenses incurred in connection with such acquisition and reconveyance or reassignment. The reimbursement shall include interest on the amount of insurance benefits refunded by the mortgagee from the date the insurance benefits were paid to the date of refund at an interest rate set in conformity with the Treasury Fiscal Requirements Manual, and the Commissioner's cost of holding the property or servicing the mortgage, accruing on a daily basis, from the date of assignment or claim payment to the date of reconveyance or reassignment. These costs are based on the Commissioner's estimate of the taxes, maintenance and operating expenses of the property, and administrative expenses. Appropriate adjustments shall be made by the Commissioner on account of any income received from the property.
The mortgagee, upon learning that a property subject to a mortgage insured under this part is vacant or abandoned, shall be responsible for the inspection of such property at least monthly, if the loan is in a due and payable status. When a mortgage is in due and payable status and efforts to reach the borrower or applicable party by telephone within that period have been unsuccessful, the mortgagee shall be responsible for a visual inspection of the security property to determine whether the property is vacant. The mortgagee shall take reasonable action to protect and preserve such security property when it is determined or should have been determined to be vacant or abandoned until assigned to the Commissioner or an application for insurance benefits is filed, if such action does not constitute an illegal trespass. “Reasonable action” includes the commencement of foreclosure within the time required by § 206.125.
(a)
(b)
(c)
(1) Damage by fire, flood, earthquake, hurricane, or tornado; and
(2) Damage to or destruction of security properties on which the loans are in default and which properties are vacant or abandoned, when such damage or destruction is due to the mortgagee's failure to take reasonable action to inspect, protect and preserve such properties as required by § 206.140.
(d)
(a) Except as provided for in paragraphs (a)(1) and (a)(2) of this section: if the property has been damaged by fire, flood, earthquake, hurricane, or tornado, the damage must be repaired before assignment of the mortgage to the Commissioner; if the property has suffered damage because of the mortgagee's failure to take action as required by § 206.140, the damage must be repaired before the mortgagee sells the property.
(1) If the prior approval of the Commissioner is obtained, there will be deducted from the insurance benefits the Commissioner's estimate of the cost of repairing the damage or any insurance recovery received by the mortgagee, whichever is greater.
(2) If the property has been damaged by fire and was not covered by fire insurance at the time of the damage, or the amount of insurance coverage was inadequate to repair fully the damage, only the amount of insurance recovery received by the mortgagee, if any, will be deducted from the insurance benefits, provided the mortgagee certifies, at the time that a claim is filed for insurance benefits, that:
(i) At the time the mortgage was insured, the property was covered by fire insurance in an amount at least equal to the lesser of 100 percent of the insurable value of the improvements, or the principal loan balance of the mortgage;
(ii) The insurer later cancelled this coverage or refused to renew it for
(iii) The mortgagee made diligent though unsuccessful efforts within 30 days of any cancellation or non-renewal of hazard insurance, and at least annually thereafter, to secure other coverage or coverage under a FAIR Plan, in an amount described in paragraph (a)(2)(i) of this section, or if coverage to such an extent was unavailable at a reasonable rate, the greatest extent of coverage that was available at a reasonable rate;
(iv) The extent of coverage obtained by the mortgagee in accordance with paragraph (a)(2)(iii) of this section was the greatest available at a reasonable rate, or if the mortgagee was unable to obtain insurance, none was available at a reasonable rate; and
(v) The mortgagee took the actions required by § 206.140.
(b) If the property has been damaged during the time of the mortgagee's possession by events other than fire, flood, earthquake, hurricane, or tornado, or if it was damaged notwithstanding reasonable action by the mortgagee as required by § 206.140, the mortgagee must provide notice of such damage to the Commissioner and may not sell the property until directed to do so by the Commissioner. The Commissioner will either:
(1) Allow the mortgagee to sell the property damaged; or
(2) Require the mortgagee to repair the damage before sale, and the Commissioner will reimburse the mortgagee for reasonable payments not in excess of the Commissioner's estimate of the cost of repair, less any insurance recovery.
(a) The mortgagee shall certify that as of the date the mortgagee sold the property in accordance with § 206.125(g) or assignment of the mortgage to the Commissioner, the property was:
(1) Undamaged by fire, flood, earthquake, hurricane or tornado; and
(2) Undamaged due to failure of the mortgagee to take action as required by § 206.140; and
(3) Undamaged while the property was in the possession of the mortgagee.
(b) In the absence of evidence to the contrary, the mortgagee's certificate or description of the damage shall be accepted by the Commissioner as establishing the condition of the property, as of the date of mortgagee sale or assignment of the mortgage to the Commissioner.
The mortgagee may not file any supplemental claims to its mortgage insurance claim after six months from settlement by the Commissioner of the claim payment except where the Commissioner determines it appropriate and expressly authorizes an extension of time for supplemental claim filings.
(a) There shall be deducted from the total of the added items in § 206.129 the following cash items:
(1) All amounts received by the mortgagee on account of the mortgage after the institution of foreclosure proceedings or the acquisition of the property or otherwise after due and payable.
(2) All amounts received by the mortgagee from any source relating to the property on account of rent or other income after deducting reasonable expenses incurred in handling the property.
(3) All cash retained by the mortgagee including amounts held or deposited for the account of the borrower or to which it is entitled under the mortgage transaction that have not been applied in reduction of the outstanding loan balance.
(4) With regard to claims filed pursuant to successful short sales, all amounts received by the mortgagee relating to the sale of the property.
(b) [Reserved]
(a) Debentures shall bear interest from the date of issue, payable semiannually on the first day of January and the first day of July of each year at the rate in effect as of the day the commitment was issued, or as of the date the mortgage was endorsed for insurance, whichever rate is higher. For applications involving mortgages originated under the single family Direct Endorsement program, debentures shall bear interest from the date of issue, payable semiannually on the first day of January and on the first day of July of each year at the rate in effect as of the date the mortgage was endorsed for insurance;
(b) For mortgages endorsed for insurance after January 23, 2004, if an insurance claim is paid in cash, the debenture interest rate for purposes of calculating such a claim shall be the monthly average yield, for the month in which the default on the mortgage occurred, on United States Treasury Securities adjusted to a constant maturity of 10 years.
(a)
(b)
(c)
(2) Whenever servicing of any mortgage is transferred from one mortgagee or servicer to another, notice of the transfer of service shall be delivered:
(i) By the transferor mortgagee or servicer to the borrower. The notification shall be delivered not less than 15 days before the effective date of the transfer and shall contain the information required in 12 CFR 1024.33(b)(4); and
(ii) By the transferee mortgagee or servicer:
(A)
(B)
(a)
(b) [Reserved]
(c)
(i) A servicing office staffed with competent personnel located within 200 miles of the property, capable of providing timely responses to requests for information. Complete records need not be maintained in such an office if the staff is able to secure needed information and pass it on to the borrower.
(ii) Toll-free telephone service at an office capable of providing needed information.
(2)(i) All borrowers must be informed of and reminded annually of the system available for obtaining answers to loan inquiries and the office from which needed information may be obtained. Toll-free telephone service need not be provided to a borrower other than at the office designated to serve the borrower nor other than from the immediate vicinity of the security property.
(ii) The mortgagee shall provide the borrower with the telephone number where the borrower may speak to employee(s) specifically designated by the mortgagee or its servicer to address inquiries concerning mortgages insured under this part. Such information shall be provided annually and whenever the servicer or the designated employee (or employee group) changes.
(3) Mortgagees must respond to FHA requests for information concerning individual accounts.
(a)
(2) Payment of the following property charges are obligations of the borrower and shall be made through the LESA, by the borrower, or by the mortgagee, in accordance with paragraphs (b) through (e) of this section on or before the due date: property taxes, including any special assessments levied by local or State law, hazard insurance premiums, and applicable flood insurance premiums.
(b)
(2)
(A) Borrower is responsible for the independent payment of all property charges;
(B) Borrower elects to have a Fully-Funded LESA for the payment of property charges identified in paragraph (a)(2) of this section; or
(C) For adjustable interest rate HECMs only, borrower elects to have the mortgagee pay property charges listed in paragraph (a)(2) of this section which would have otherwise been required to be paid by the borrower, in accordance with paragraph (d) of this section.
(ii) Through
(c)
(A) Make payments for property charges identified in paragraph (a)(2) of this section before bills become delinquent and establish controls to ensure that the information needed to pay such bills is obtained on a timely basis;
(B) Make early payments to take advantage of a discount whenever it is to the borrower's advantage;
(C) Not charge the borrower penalties for late payments for property charges unless it can be shown that the penalty was the direct result of the borrower's error or omission;
(D) Ensure that LESA funds are not held in an escrow account;
(E) Add payments for property charges to the outstanding loan balance when the mortgagee disburses funds to the taxing authority or insurance carrier; and
(F) Provide written notification to the borrower and FHA within 30 days of the mortgagee receiving notification that a property charge payment is outstanding when there are no funds or insufficient funds remaining in the LESA, and recommend that the borrower speak with a HUD-Approved Housing Counselor.
(ii) For a Partially-Funded LESA, the mortgagee shall:
(A) Ensure that LESA funds are disbursed to the borrower semi-annually;
(B) Establish controls to ensure the taxing authority, insurance carrier, or both, received the borrower's payment;
(C) Ensure the LESA funds are not held in an escrow account;
(D) Add payments disbursed to the borrower for the payment of property charges identified in paragraph (a)(2) to the outstanding loan balance when the mortgagee disburses the funds; and
(E) Provide written notification to the borrower and FHA within 30 days of the mortgagee receiving notification that a property charge payment is outstanding when there are no funds or insufficient funds remaining in the LESA, and recommend that the borrower speak with a HUD-Approved Housing Counselor.
(2)
(ii) The mortgagee shall not require any LESA to be funded in excess of the projected cost of property charges.
(iii) For a Fully-Funded LESA, the amount withheld from the mortgage proceeds shall equal the projected cost of property charges.
(iv) For a Partially-Funded LESA, the amount withheld from the mortgage proceeds is based on a calculation of the gap in residual income and may not
(v) Mortgagees shall use the
(3)
(4)
(B) The mortgagee shall provide the borrower with a written notification within 30 days of the mortgagee receiving notification that a property charge payment is outstanding. The borrower shall have 30 days to respond to the mortgagee to explain the circumstances which resulted in the non-payment. (C) If there is no available principal limit from which the mortgagee can pay the property charge amount in full, and the borrower fails to pay the property charges, the mortgage will become due and payable under § 206.27(c)(2).
(ii)
(iii)
(A) Immediately suspend future semi-annual payments to the borrower from the Partially-Funded LESA, although scheduled and unscheduled payments from the borrower's payment option may continue;
(B) Disburse funds from the Partially-Funded LESA to pay the full amount owed for the past due property charge; and
(C) Provide written notification to the borrower, within 30 days of the mortgagee receiving notification that a property charge payment is outstanding, that funds were advanced from the Partially-Funded LESA to pay the outstanding property charge. The borrower shall have 30 days to respond to the mortgagee to explain the circumstances which resulted in the non-payment.
(iv)
(B) The mortgagee shall provide written notification to the borrower within 30 days of the mortgagee receiving notification that a property charge payment is outstanding. The borrower shall have 30 days to respond to the mortgagee to explain the circumstances which resulted in the non-payment.
(C) If there is no available principal limit from which the mortgagee can pay the property charge amount in full, and the borrower fails to pay the property charges, the mortgage will become due and payable under § 206.27(c)(2).
(5)
(6)
(d)
(1)
(2)
(ii) It is the mortgagee's responsibility to make disbursements for property charges before bills become delinquent. Mortgagees shall establish controls to ensure that the information needed to pay such bills is obtained on a timely basis. Penalties for late payments for property charges must not be charged to the borrower unless it can be shown that the penalty was the direct result of the borrower's error or omission. Early payment of a bill to take advantage of a discount should be made whenever it is to the borrower's benefit.
(iii) Not later than the end of the second loan year the mortgagee shall establish a system for the periodic analysis of the amounts withheld from monthly payments. The analysis shall be performed at least once a year thereafter. The amount shall be adjusted, after analysis, to provide sufficient available funds to make anticipated disbursements during the
(iv) The mortgagee's estimate of withholding amount shall be based on the best information available as to probable payments which will be required to be made for property charges in the coming year. If actual disbursements during the preceding year are used as the basis, the resulting estimate may deviate from those disbursements by as much as ten percent. The mortgagee may not require withholding in excess of the current estimated total annual requirement, unless expressly requested by the borrower. Each monthly withholding for property charges shall equal one-twelfth of the annual amounts as reasonably estimated by the mortgagee.
(e)
(2)
(i) The mortgagee may make the payment for the borrower and charge the borrower's account if there are available funds from which the mortgagee may make payment. If a pattern of missed payments occurs, the mortgagee may establish procedures to pay the property charges from the borrower's funds as if the borrower elected to have the mortgagee pay the property charges under this section.
(ii) The mortgagee shall provide a written notification to the borrower and notify the Commissioner that an obligation of the mortgage has not been performed within 30 days of the mortgagee receiving notification of a missed payment when there are no available HECM funds from which the mortgagee may make payment. The borrower shall have 30 days to respond to the mortgagee to explain the circumstances which resulted in the non-payment. The mortgagee may provide any permissible loss mitigation made available by the Commissioner through notice. If the borrower is unable or unwilling to repay the mortgagee for any funds advanced by the mortgagee to pay property charges outside of a LESA, the mortgagee shall submit a due and payable request under the provisions of § 206.27(c)(2).
(a)
(1)(i) Charges for substitution of a hazard insurance policy at other than the expiration of term of the existing hazard insurance policy;
(ii) Attorney's and trustee's fees and expenses actually incurred (including the cost of appraisals and cost of advertising) when a case has been referred for foreclosure in accordance with the provisions of this part after a firm decision to foreclose if foreclosure is not completed because of a reinstatement of the account (no attorney's fee may be charged for the services of the mortgagee's or servicer's staff attorney or for the services of a collection attorney other than the attorney handling the foreclosure);
(iii) A trustee's fee if the security instrument in deed-of-trust states provides for payment of such a fee for execution of a satisfactory, release, or trustee's deed when the deed of trust is paid in full;
(iv) Where permitted by the security instrument, attorney's fees and expenses actually incurred in the defense of any suit or legal proceeding wherein the mortgagee shall be made a party thereto by reason of the mortgage (no attorney's fee may be charged for the services of the mortgagee's or servicer's staff attorney); and
(v) Property preservation expenses incurred pursuant to § 206.140.
(2) Such other reasonable and customary charges as may be authorized by the Commissioner, but which shall not include:
(i) Charges for servicing activities of the mortgagee or servicer;
(ii) Fees charged by independent tax service organizations which contract to furnish data and information necessary for the payment of property taxes;
(iii)
(iv) The fee for recordation of a satisfaction of the mortgage in states where recordation is the responsibility of the mortgagee.
(b)
(i) The charge is authorized by the Commissioner;
(ii) The charge is selected by the mortgagee;
(iii) The charge is within the range established by the Commissioner, which shall be set, through notice, in an amount which shall be between 36 and 150 basis points. The Commissioner may, through a
(iv) The charge is disclosed as required by § 206.43 to the borrower in a manner acceptable to the Commissioner at the time the mortgagee provides the borrower with a loan application; or
(2) If the following conditions are met, the mortgagee may collect a fixed monthly charge for servicing activities of the mortgagee or servicer, starting with the month of loan closing and continuing through the life of the loan, including any applicable Deferral Period.
(i) The charge is authorized by the Commissioner;
(ii) The charge is disclosed as required by § 206.43 to the borrower in a manner acceptable to the Commissioner at the time the mortgagee provides the borrower with a loan application;
(iii) Amounts to pay the charge are set aside as a portion of the principal limit in accordance with § 206.19(f)(3); and
(iv) The charge is payable only from the Servicing Fee Set Aside.
(a)
(b)
(c) Funds received from a partial prepayment shall be applied in accordance with the Note.
(a)
(b)
(1)
(2)
This subpart provides for the establishment of the HECM Counselor Roster (Roster) and sets forth the requirements for the operation of the HECM Counselor Roster.
(a)
(b)
(a)
(b)
(1) Is employed by a HUD-approved housing counseling agency or an affiliate of a HUD-approved intermediary or State housing finance agency;
(2) Successfully passed a standardized HECM counseling exam administered by FHA, or a party selected by FHA, within the last 3 years. In order to maintain eligibility, a HECM counselor must successfully pass a standardized HECM counseling exam every 3 years;
(3) Received training and education related to HECMs within the prior 2 years;
(4) Has access to and is supported by technology that enables FHA to track the results of the counseling offered to each loan applicant,
(5) Is not listed on:
(i) The General Services Administration's Suspension and Debarment List;
(ii) HUD's Limited Denial of Participation List; or
(iii) HUD's Credit Alert Interactive Response System.
(a)
(b)
(1) Failure to comply with the education and training requirements of § 206.308;
(2) Failure to respond within a reasonable time to HUD inquiries or requests for documentation;
(3) Misrepresentation or fraudulent statements;
(4) Promotion, representation, or recommendation of any specific mortgagee;
(5) Failure to comply with applicable fair housing and civil rights requirements;
(6) Failure to comply with applicable statutes and regulations;
(7) Failure to comply with applicable statutory counseling requirements found at section 255(f) of the National Housing Act, which include, but are not limited to, providing information about: options other than a HECM, the financial implications of entering into a HECM, the tax consequences of a HECM, and any other information that HUD or the applicant may request;
(8) Failure to maintain any registration, license, or certification requirements of a State or local authority;
(9) Unsatisfactory performance in providing counseling to HECM loan applicants. FHA may determine that a HECM counselor's performance is
(10) For any other reason HUD determines to be so serious as to justify an administrative sanction.
(c)
(d)
(1) FHA will give the HECM counselor written notice of the proposed removal. The notice will state the reasons for and the duration of the proposed removal.
(2) The HECM counselor will have 30 days from the date of receipt of the notice (or such time as described in the notice, but in no event less than a period of 30 days) to submit a written appeal of the proposed removal, along with a written request for a conference.
(3) An FHA official will review the appeal and render a response affirming, modifying, or canceling the removal. The FHA official will not be a person who was involved in FHA's initial removal decision. FHA will respond with a decision within 30 days after the date of receiving the appeal or, if the HECM counselor has requested a conference, within 30 days after the conference was held. FHA may extend the 30-day period by providing written notice to the counselor.
(4) If the HECM counselor does not submit a timely written response, the removal will be effective 31 days after the date of FHA's initial removal notice (or after the period provided in the notice, if longer than 30 days). If a written response is submitted, and the removal decision is affirmed or modified, the removal will be effective on the date of FHA's notice affirming or modifying the initial removal decision.
(e)
(f)
(g)
(h)
A HECM counselor listed on the Roster must receive, on a continuing basis, training, education, and technical assistance related to HECMs. The HECM counselor must maintain evidence of the successful completion of such continuing education, and such evidence must be made available to FHA upon request. FHA will consider a HECM counselor's successful completion of a HECM course no less than once every 2 years as satisfying the requirements of this section.
Department of Homeland Security; Department of Agriculture; Department of Energy; National Aeronautics and Space Administration; Department of Commerce; Social Security Administration; Agency for International Development; Department of Housing and Urban Development; Department of Labor; Department of Defense; Department of Education; Department of Veterans Affairs; Environmental Protection Agency; Department of Health and Human Services; National Science Foundation; and Department of Transportation.
Final rule.
The departments and agencies listed in this document announce revisions to modernize, strengthen, and make more effective the Federal Policy for the Protection of Human Subjects that was originally promulgated as a Common Rule in 1991. This final rule is intended to better protect human subjects involved in research, while facilitating valuable research and reducing burden, delay, and ambiguity for investigators. These revisions are an effort to modernize, simplify, and enhance the current system of oversight.
This rule is effective on January 19, 2018. The compliance date for this rule, except for § __.114(b) (cooperative research), is January 19, 2018. The compliance date for § __.114(b) (cooperative research) is January 20, 2020.
Jerry Menikoff, M.D., J.D., OHRP, 1101 Wootton Parkway, Suite 200, Rockville, MD 20852.
Jerry Menikoff, M.D., J.D., Office for Human Research Protections (OHRP), Department of Health and Human Services, 1101 Wootton Parkway, Suite 200, Rockville, MD 20852; telephone: 240-453-6900 or 1-866-447-4777; facsimile: 301-402-2071; email:
Individuals who are the subjects of research may be asked to contribute their time and assume risk to advance the research enterprise, which benefits society at large. U.S. federal regulations governing the protection of human subjects in research have been in existence for more than three decades. The Department of Health, Education, and Welfare first published regulations for the protection of human subjects in 1974, and the Department of Health and Human Services (HHS) revised them in the early 1980s. During the 1980s, HHS began a process that eventually led to the adoption of a revised version of the regulations by 15 U.S. federal departments and agencies in 1991. The purpose of this effort was to promote uniformity, understanding, and compliance with human subject protections as well as to create a uniform body of regulations across federal departments and agencies (subpart A of 45 Code of Federal Regulations [CFR] part 46), often referred to as the “Common Rule” or “Protection of Human Subjects Regulations.” Those regulations were last amended in 2005, and have remained unchanged until the issuance of this final rule.
Since the Common Rule was promulgated, the volume and landscape of research involving human subjects have changed considerably. Research with human subjects has grown in scale and become more diverse. Examples of developments include: an expansion in the number and types of clinical trials, as well as observational studies and cohort studies; a diversification of the types of social and behavioral research being used in human subjects research; increased use of sophisticated analytic techniques to study human biospecimens; and the growing use of electronic health data and other digital records to enable very large datasets to be rapidly analyzed and combined in novel ways. Yet these developments have not been accompanied by major change in the human subjects research oversight system, which has remained largely unaltered over the past two decades.
On July 26, 2011, the Office of the Secretary of HHS, in coordination with the Executive Office of the President's Office of Science and Technology Policy (OSTP), published an advance notice of proposed rulemaking (ANPRM) to request comment on how current regulations for protecting those who participate in research might be modernized and revised to be more effective.
On September 8, 2015, HHS and 15 other federal departments and agencies published a Notice of Proposed Rulemaking (NPRM) proposing revisions to the regulations for protection of human subjects in research.
The final rule is designed to more thoroughly address the broader types of research conducted or otherwise supported by all of the Common Rule departments and agencies such as behavioral and social science research. It also benefits from continuing efforts to harmonize human subjects policies across federal departments and agencies.
The final rule differs in important ways from the NPRM. Most significantly, several proposals are not being adopted:
• The final rule does not adopt the proposal to require that research involving nonidentified biospecimens be subject to the Common Rule, and that consent would need to be obtained in order to conduct such research.
• To the extent some of the NPRM proposals relied on standards that had not yet been proposed, the final rule either does not adopt those proposals or includes revisions to eliminate such reliance.
• The final rule does not expand the policy to cover clinical trials that are not federally funded.
• The final rule does not adopt the proposed new concept of “excluded” activities. Generally, activities proposed to be excluded are now either described as not satisfying the definition of what constitutes research under the regulations or are classified as exempt.
• The proposed revisions to the exemption categories have been modified to better align with the long-standing ordering in the final rule. The final rule does not include the proposed requirement that exemption determinations need to be made in specified ways.
• The final rule does not include the proposed standardized privacy safeguards for identifiable private information and identifiable biospecimens. Aspects of proposals that relied on those safeguards have been modified or are not being adopted.
• The final rule does not adopt the most restrictive proposed criteria for obtaining a waiver of the consent requirements relating to research with identifiable biospecimens.
The final rule makes the following significant changes to the Common Rule:
• Establishes new requirements regarding the information that must be given to prospective research subjects as part of the informed consent process.
• Allows the use of broad consent (
• Establishes new exempt categories of research based on their risk profile. Under some of the new categories, exempt research would be required to undergo limited IRB review to ensure that there are adequate privacy safeguards for identifiable private information and identifiable biospecimens.
• Creates a requirement for U.S.-based institutions engaged in cooperative research to use a single IRB for that portion of the research that takes place within the United States, with certain exceptions. This requirement becomes effective 3 years after publication of the final rule.
• Removes the requirement to conduct continuing review of ongoing research for studies that undergo expedited review and for studies that have completed study interventions and are merely analyzing study data or involve only observational follow up in conjunction with standard clinical care.
Other minor changes have been to improve the rule and for purposes of clarity and accuracy.
Table 1 summarizes the quantified and nonquantified benefits and costs of all changes to the Common Rule. Over the 2017-2026 period, present value benefits of $1,904 million and annualized benefits of $223 million are estimated using a 3 percent discount rate; present value benefits of $1,494 million and annualized benefits of $213 million are estimated using a 7 percent discount rate. Present value costs of $528 million and annualized costs of $62.0 million are estimated using a 3 percent discount rate; present value costs of $474 million and annualized costs of $67.0 million are estimated using a 7 percent discount rate. Nonquantified benefits include improved human subjects protections in research; enhanced oversight of research reviewed by IRBs not operated by a Federalwide Assurance (FWA)-holding institution; and increased uniformity in regulatory requirements among Common Rule departments and agencies. Nonquantified costs include the time needed for consultation among
This final rule recognizes that in the past two decades a paradigm shift has occurred in how research is conducted. Evolving technologies—including imaging, mobile technologies, and the growth in computing power—have changed the scale and nature of information collected in many disciplines. Computer scientists, engineers, and social scientists are developing techniques to integrate different types of data so they can be combined, mined, analyzed, and shared. The advent of sophisticated computer software programs, the Internet, and mobile technology has created new areas of research activity, particularly within the social and behavioral sciences. In biomedical science, the Human Genome Project laid the foundation for precision medicine and promoted an environment of data sharing and innovation in analytics and technology, and drew attention to the need for policies that support a changing research landscape. New technologies, including genomic sequencing, have quickly led to exponential growth in the data to which investigators have access. The sheer volume of data that can be generated in research, the ease with which it can be shared, and the ways in which it can be used to identify individuals were simply not possible, or even imaginable, when the Common Rule was first adopted.
Research settings are also shifting. Although much biomedical research continues to be conducted in academic medical centers, more research is being conducted in clinical care settings, thus combining research and medical data. Biospecimen repositories and large databases have made it easier to do research on existing (stored) biospecimens and data. Clinical research networks connected through electronic health records have developed methods for extracting clinical data for research purposes and are working toward integration of research data into electronic health records in a meaningful way. The scientific community recognizes the value of data sharing and open-source resources and understands that pooling intellectual resources and capitalizing on efficient uses of data and technology represent the best ways to advance knowledge.
At the same time, the level of public engagement in the research enterprise has changed. More people want to play an active role in research, particularly related to health.
As technology evolves, so does the nature of the risks and benefits of participating in certain types of research. Many studies do not involve interaction with research subjects, but instead involve secondary analysis of data or biospecimens. Risks related to these types of research studies are largely informational, not physical; that is, harms could result primarily from the inappropriate disclosure of information and not from the research interventions themselves. Nonetheless, those harms can be significant.
Because of these shifts in science, technology, and public engagement and expectations, a wide range of stakeholders have raised concerns about the limitations of the existing regulatory framework, arguing for a re-evaluation of how the fundamental principles of the 1979
Finally, it is important to note that, to the extent appropriate, the intent is to eventually amend the other subparts of the HHS human subjects protection regulations in 45 CFR part 46 (subparts B, C, D, and E), and consider the need for updates to FDA regulations and other relevant federal departmental or agency regulations with overlapping scope.
The revisions to the Common Rule are based on a variety of sources of public, stakeholder, and expert comments and advice, including comments received on the 2011 ANPRM and the 2015 NPRM. They also benefit from guidance provided by a 2014 National Research Council consensus report,
Since the publication of the 2011 ANPRM, HHS has continued to solicit public comment on a variety of policy issues related to human subjects protections, including consent, the use of a single IRB for multi-institutional studies, and sharing of genomic data. Although these policies were more specific than the issues raised in the ANPRM, the responses received from public comments provide insight for refining the proposals initially put forward in the ANPRM. Of particular relevance are the National Institutes of Health's (NIH's) recently issued policy on the use of a single IRB for multi-institutional research,
Other developments include the enactment of the Newborn Screening Saves Lives Reauthorization Act of 2014 (Pub. L. 113-240) in December 2014. The law made a number of changes relevant to the HHS regulations for protecting research subjects, including asserting that research with newborn dried blood spots (DBS) that is federally funded pursuant to the Public Health Service Act is to be considered research with human subjects, and that the provisions allowing IRBs to waive consent would not apply. By statute, the changes made by this law applied only until changes to the Common Rule are promulgated. Thus, the changes made by this statute will no longer apply after the effective date of this rule, January 19, 2018. In addition, in April 2015, the Medicare Access and Children's Health Insurance Program Reauthorization Act of 2015 (Pub. L. 114-10) was passed. That law requires HHS to issue a clarification or modification of the Common Rule with regard to how the regulatory requirements should be applied to activities involving clinical data registries. In addition, in December 2016 the 21st Century Cures Act (Pub. L. 114-255) was enacted.
Finally, as a result of conducting a variety of public discussions associated with the President's Precision Medicine Initiative,
The NPRM received more than 2,100 public comments, the majority of which were from people writing in their individual capacity. The remaining comments were submitted by institutions, professional organizations and societies, and membership organizations. The proposals receiving the most comments were those related to biospecimens (expanded definition of human subject, broad consent, and tightened criteria for waiver of consent). Here we summarize comments on the overall structural, conceptual, and policy implications of the proposed rule. Comments regarding the specific provisions of the rule appear throughout this preamble.
The NPRM asked for public comment on whether the proposed changes will achieve the objectives of: (1) decreasing administrative burden, delay, and ambiguity for investigators, institutions, and institutional review boards (IRBs); and (2) strengthening, modernizing, and making the regulations more effective in protecting research subjects. In response, many public commenters expressed concern about the overall complexity and length of the NPRM, the unavailability of key deliverables, proposals being internally inconsistent, and proposals giving investigators too much leeway to determine if their research is exempt or falls outside the scope of the rule.
Several commenters expressed concerns that they were unable to adequately or meaningfully comment on particular provisions proposed in the NPRM because an underlying document, tool, or list had not been developed or shared with the public at the time the NPRM was published, specifically: (1) the proposed broad consent templates; (2) the proposed standards for privacy protection; (3) the proposed list of eligible expedited procedures; and (4) the proposed exemption decision tool. Several commenters suggested that these items should be removed from the final rule and developed independently, urging government personnel to work collaboratively with representatives from the research community and funding agencies in the development of such documents, tools, and lists.
Some commenters suggested issuing a new NPRM that would be more complete and would include details on the privacy protection standards, exemption decision tool, and broad consent templates. Another commenter recommended that only the fully developed, less controversial provisions of the NPRM should be adopted into a final rule. Another commenter urged the Common Rule departments and agencies to reissue the NPRM to solicit comment on several of these documents, tools, and lists, arguing that it would be unlawful for a final rule to be issued until such an action were taken. This commenter noted that for members of the public to reasonably participate in rulemaking, agencies must provide enough factual detail and rationale to allow interested parties to comment meaningfully on the rule. This commenter also argued that the NPRM did not satisfy the requirement set forth in the Administrative Procedure Act that the notice provided to the public in rulemaking include either the terms or substance of the proposed rule or a description of the subjects and issues involved. In sum, the commenter argued that the NPRM sought comments on numerous provisions without providing the “terms or substance” of the specific proposals.
Some commenters encouraged dropping the proposal to require consent for research use of nonidentified biospecimens and instead exploring a system of public notification and opportunity to opt out of such research through issuance of a new NPRM following widespread consultation. A few commenters
Commenters, including state health departments and other health entities involved in newborn screening activities, raised concerns that several of the NPRM proposals represented unfunded mandates, specifically the expansion of the definition of human subject to include all biospecimens regardless of identifiability, expansion of the policy to apply to all clinical trials that meet certain conditions, and mandatory single IRB review of cooperative research. Several institutions and disease advocacy groups noted that statewide newborn screening programs are often modestly funded, and the NPRM proposals would impose processes that could cost millions of dollars each year.
In addition, commenters raised concerns that HHS and other Common Rule departments and agencies are not authorized under 42 U.S.C. 289 to regulate humanities and social science research.
Public comments also discussed several ideas for consideration in a final rule that were not otherwise proposed in the NPRM, including:
• Develop or strengthen sanctions and penalties for investigators or institutions that re-identify subjects without proper authorization or review, rather than focusing solely on obtaining consent as the way to protect subjects. To this end, several commenters suggested that a separate section be added to the Common Rule focused on investigator responsibilities.
• Develop an IRB efficiency rating system.
• Deem research about IRB operations as an excluded, exempt, or expeditable activity to foster research into IRB operations.
• Include provisions about compensation for research-related injuries.
• More fully review and address how the rule should or should not apply to prisoners, children, and pregnant women and fetuses.
• Include provisions about U.S.-funded studies in developing countries with regard to defining standards of care and addressing post-trial access to proven therapies.
The final rule differs in numerous, major ways from what was proposed in the NPRM. Most significantly, the provisions relating to making nonidentified biospecimens subject to the Common Rule are not being implemented. That change alone addresses many of the public comments on the NPRM. Eliminating that proposal is intended to address concerns about the complexity of and lack of justification for the proposed changes in the rule, as well as concerns about embarking on significant changes without evidence that they would improve the system. Responses to public comments on specific provisions appear throughout this preamble. Below we summarize our responses to comments that addressed major structural or organizational issues or perceived insufficiencies in the NPRM proposals and their presentation.
Concerns about the overall complexity of the proposed changes have been addressed in several ways. For example, concerns about creating a new category of “excluded” activities have been addressed by not adopting that concept in the final rule. Instead, the goal of clarifying what is covered by the rule has been accomplished by modifying the definition of what constitutes research, and by adding or modifying exemptions that were already in the pre-2018 rule.
To reduce public concerns about the aspects of the proposal that were not yet developed, we chose not to implement most of those provisions. For example, given the changes made to the proposals regarding broad consent, the final rule does not reference or include the concept of broad consent templates. The requirement that the Secretary of HHS develop a list of proposed privacy safeguards has been eliminated, as has the proposed exemption decision tool. In addition, we have dropped the regulatory requirement for the Secretary of HHS to publish a list of activities that are minimal risk (as was proposed in the NPRM in the definition of minimal risk). The final rule retains the requirement at § __.110(a) that the Secretary of HHS will establish and publish for public comment a list of categories of research that may be reviewed by an IRB through the expedited review procedure, consistent with the pre-2018 rule.
Some of the “new ideas” for altering the system for protecting research subjects that were presented by commenters—for example, addressing compensation for research-related injuries or the meaning of equivalent protections when research is conducted in foreign countries—were either very innovative or not yet widely discussed. This made it difficult to adopt them at this point without further study and additional notice and opportunity for public comment. Therefore, the fact that one or another of these ideas was not incorporated into the final rule should not be viewed as a rejection of their possible merits, or an indication that they might not be explored in some future revision of the Common Rule or in guidance.
We carefully considered concerns voiced by commenters about the process that led to this final rule, and other legal concerns about the adequacy of that process. We concluded that the approach proposed in the NPRM and the approach adopted in this final rule are consistent with the Federal Government's obligations under the Administrative Procedure Act.
Regarding the concerns expressed that the Common Rule departments and agencies are not authorized to regulate humanities and social science research, this challenge had been asserted previously against the 1981 HHS protection of human subjects regulations,
This section provides information about where each Common Rule department or agency's statutory authority for enacting and revising human subjects research protection regulation lies, and provides additional information about new signatories to the Common Rule.
The regulations are codified in each department or agency's title or chapter of the CFR. The Common Rule was based on HHS's regulations, 45 CFR part 46, subpart A, and includes identical language in the separate regulations of each department and agency.
Although they did not previously issue the Common Rule in regulations, four departments and agencies have historically complied with all subparts of the HHS protection of human subjects regulations at 45 CFR part 46. These are the Central Intelligence Agency (CIA), the Office of the Director of National Intelligence (ODNI), the Department of Homeland Security (DHS), and the Social Security Administration (SSA).
Pursuant to Executive Order 12333 of December 4, 1981, as amended, elements of the Intelligence Community must comply with the guidelines issued by HHS regarding research on human subjects found in 45 CFR part 46. This final rule does not supersede the Executive Order. The CIA will continue to adhere to the HHS regulations at 45 CFR part 46, pursuant to the Executive Order.
Through this rulemaking, DHS is codifying the final rule into its own agency regulations. DHS, which was created after issuance of the pre-2018 rule, has been required by statute (Pub. L. 108-458, title VIII, section 8306) to comply with 45 CFR part 46, or with equivalent regulations promulgated by the Secretary of Homeland Security or his designee. Through this rulemaking, DHS is issuing equivalent regulations, consistent with statute, and will comply with the DHS regulations as the requirements will be equivalent to compliance with HHS regulations at 45 CFR part 46, subpart A.
Through this rulemaking, SSA is codifying the final rule into its own agency regulations. SSA was separated from HHS in 1995 and, pursuant to the transition rules provided in Section 106 of title 1 of Pub. L. 103-296, has been required to apply regulations that applied to SSA before the separation, absent action by the Commissioner. With this rulemaking, SSA will follow the SSA regulations (adopting the provisions of this final rule) instead of HHS regulations at 45 CFR part 46, subpart A. (See Pub. L. 103-296 §106(b), 108 Stat. 1464, 1476.)
The Department of Labor (DOL), which was not a signatory to the pre-2018 rule, is now a signatory to this rulemaking and is codifying the final rule in DOL regulations for human subjects research that DOL conducts or supports.
The Consumer Product Safety Commission (CPSC), subject to Commission vote, intends to adopt this rule through a separate rulemaking.
The legal authority for the departments and agencies that are signatories to this action is as follows:
Department of Homeland Security, 5 U.S.C. 301; Pub. L. 107-296, sec. 102, 306(c); Pub. L. 108-458, sec. 8306. Department of Agriculture, 5 U.S.C. 301; 42 U.S.C. 300v-1(b). Department of Energy, 5 U.S.C. 301; 42 U.S.C. 7254; 42 U.S.C. 300v-1(b). National Aeronautics and Space Administration, 5 U.S.C. 301; 42 U.S.C. 300v-1(b). Department of Commerce, 5 U.S.C. 301; 42 U.S.C. 300v-1(b). Social Security Administration, 5 U.S.C. 301; 42 U.S.C. 289(a). Agency for International Development, 5 U.S.C. 301; 42 U.S.C. 300v-1(b), unless otherwise noted. Department of Housing and Urban Development, 5 U.S.C. 301; 42 U.S.C. 300v-1(b) and 3535(d). Department of Labor, 5 U.S.C. 301; 29 U.S.C. 551. Department of Defense, 5 U.S.C. 301. Department of Education, 5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; 42 U.S.C. 300v-1(b). Department of Veterans Affairs, 5 U.S.C. 301; 38 U.S.C. 501, 7331, 7334; 42 U.S.C. 300v-1(b). Environmental Protection Agency, 5 U.S.C. 301; 7 U.S.C. 136a(a) and 136w(a)(1); 21 U.S.C. 346a(e)(1)(C); sec. 201, Pub. L. 109-54, 119 Stat. 531; and 42 U.S.C. 300v-1(b). Department of Health and Human Services, 5 U.S.C. 301; 42 U.S.C. 289(a); 42 U.S.C. 300v-1(b). National Science Foundation, 5 U.S.C. 301; 42 U.S.C. 300v-1(b). Department of Transportation, 5 U.S.C. 301; 42 U.S.C. 300v-1(b).
This section of the preamble describes changes made in the final rule with regard to its scope and applicability. Specifically, it addresses which entities are subject to the rule; coverage of clinical trials; department and agency discretion in applying the rule; the relevance of state and local laws; coverage of research conducted in foreign countries; the goal of harmonizing guidance across the federal entities; effective and compliance dates; and severability.
Before this final rule, IRBs not operated by an institution holding an FWA were not directly subject to oversight for compliance with the Common Rule. In situations in which an institution relied on an IRB not operated by the institution, OHRP's practice was to hold the institution engaged in human subjects research accountable for compliance violations, even in circumstances in which the regulatory violation was directly related to the responsibilities of the IRB.
An institution might rely on an IRB not operated by that institution to review cooperative research, that is, research conducted at more than one institution. However, for some, such reliance has been considered problematic due to lack of direct regulatory accountability for these IRBs. Previously, the choice to have cooperative research reviewed by a single IRB was voluntary and, for federally funded research, most institutions have been reluctant to replace review by their own IRB with review by a single IRB not operated by that institution.
For the reasons outlined above, and based on comments to OHRP's 2011 ANPRM, the NPRM proposed adding a new provision at § __.101(a) that would explicitly give Common Rule departments and agencies the authority to enforce compliance directly against IRBs that are not operated by an FWA-holding institution (sometimes referred to as “independent IRBs”). Under the pre-2018 rule, even if an institution engaged in research relied on an IRB operated by another FWA-holding institution, OHRP's practice has been to enforce compliance through the engaged institution and not the reviewing IRB.
Relatedly, another NPRM proposal would require single IRB review of multi-institution studies (see Section XII of this preamble). This proposal would place responsibility for meeting the relevant regulatory requirements on the IRB of record in a multi-institutional study, rather than on the institution engaged in the research.
Approximately 50 comments addressed this proposal, largely in support, because it would encourage institutions to rely on IRBs not operated by an FWA-holding institution when necessary and would place responsibility on the IRB and its decisions rather than on the institution relying on the IRB's determination. Commenters stated that this change could increase IRB accountability and protect institutions relying on IRBs that they do not operate. However, a few commenters supported the proposal only if the mandate for a single IRB of record in multi-institutional research was not implemented. That is, they supported the concept of holding IRBs not operated by the institution engaged in research accountable for compliance, but did not support it if it was intended solely to facilitate mandatory single IRB review for cooperative research, because they opposed that mandate. One organization that advocates for human subjects protections opposed the proposal because it did not believe that any research should be reviewed by an independent IRB, and feared this practice would become more frequent with this change. Several academic institutions opposed the proposal, as did a large trade organization, stating that this extension of the rule was not necessary.
New language at § __.101(a) is adopted that gives Common Rule departments and agencies the authority to enforce compliance directly against IRBs that are not operated by an assured institution. This authority will allow Common Rule departments and agencies to avoid involving other engaged institutions in enforcement activities related to the responsibilities of the designated IRB. It is anticipated that this change will reassure institutions using an IRB that they do not operate because compliance actions could be taken directly against the IRB responsible for the regulatory noncompliance, rather than against the institutions that relied on that review.
The Common Rule has historically applied to human subjects research that is conducted or supported by a Common Rule department or agency. Research that is not federally conducted or supported has not been subject to the Common Rule's requirements unless the U.S. institution receiving federal funding for research voluntarily extended the Common Rule to all research conducted at that institution, regardless of funding source.
The Institute of Medicine,
The NPRM proposed changes in the regulatory language to extend the rule to all clinical trials, irrespective of funding source, that met three conditions: (1) The clinical trials are conducted at an institution that receives support from a federal department or agency for human subjects research that was not proposed to be excluded under the NPRM and was not exempt; (2) the clinical trials are not subject to FDA regulation; and (3) the clinical trials are conducted at an institution located within the United States.
The purpose of the proposed clinical trials extension was to ensure that clinical trials involving significant risks that would otherwise not be covered be subject to federal oversight. It was for that reason that the proposed extension excluded clinical trials subject to FDA oversight. The proposed extension also was based on whether an institution received funding specifically for other human subjects research that had to comply with the substantive requirements of the Common Rule. The Common Rule departments and agencies have a more substantial relationship with institutions that receive federal support to conduct research subject to the regulatory requirements than they do with institutions that receive such support for only exempt human subjects research.
The NPRM proposed that a clinical trial be defined as a research study in which one or more human subjects are prospectively assigned to one or more interventions (which may include placebo or other control) to evaluate the effects of the interventions on biomedical or behavioral health-related outcomes. By the term “behavioral health-related outcomes,” the NPRM recognized that clinical trials may occur outside of the biomedical context, and further stated that the studies addressed in the proposed definition of clinical trial are more likely to present more than minimal risk to subjects, and, therefore, require the highest level of oversight.
Approximately 70 comments discussed the proposal to extend the Common Rule to cover certain clinical trials. Opinion was mixed, with a slim majority opposing the proposed change. Universities and medical centers providing comments largely opposed the proposed measure, while professional associations and advocacy groups largely supported the proposal. We note that some of those who opposed the clinical trial extension did so because they felt that the proposal did not go far enough to include additional types of research.
Those supporting the proposed change indicated that it had the potential to ensure greater consistency of rules and protections for research subjects, thereby aiding efficiency and speeding the review process of study protocols. However, even those commenters who supported the proposal indicated that such an extension must fulfill the intent of a risk-based, streamlined approach to human subject protection, considering the effects of this extension on certain minimal risk research activities, such as student research, and social, behavioral, and educational research.
Those expressing opposition to this expansion of coverage noted concerns that: (1) Because the research institutions likely to engage in clinical trials already require IRB review of such research, the expansion would only increase administrative burdens (such as federal reporting requirements) for this type of research without a meaningful increase in protections to human subjects; (2) the regulatory extension to nonfederally funded
Several commenters also expressed concern that the unfunded clinical trials encompassed by this proposal would be subject to the single IRB mandate without a corresponding provision of federal funds to implement that requirement.
Some commenters suggested that the proposed change in the NPRM will not address the real gap in human subjects protections—facilities that receive no federal funding—and that if broad concern exists that some subjects are not being adequately protected in research that is not federally funded, then Congress would be the appropriate body to address any such deficiency through legislation. Further, some commenters expressed concern that extending the Common Rule to nonfederally funded clinical trials might have an overall effect of decreasing human subject protections by discouraging some smaller organizations from accepting any federal funding, thus removing federal oversight of their work.
One research institution noted that, if finalized, the proposed clinical trials extension would be implemented at the same time the ability of institutions to formally extend the application of the rule to all research conducted at the institution is being eliminated. Some states, such as Virginia, have state human subjects regulations that must be applied to research when federal regulations are not required. The commenter noted that removing the option to voluntarily extend the FWA would have the effect of reducing uniform application of the federal standards, as nonfederally funded research that does not meet the proposed definition of a clinical trial would by default be subject to state law.
A few commenters challenged whether the legal authority provided by the Public Health Service Act was sufficient to extend the Common Rule to nonfederally funded clinical trials. Commenters also suggested that this proposal is an unfunded mandate from the Federal Government with no benefit accruing to subjects or the research enterprise.
The final rule does not adopt the NPRM proposal. Although we continue to maintain the position that increased harmonization of appropriate standards for ethical oversight of human subjects research is an important and desirable endpoint, we agree with the concerns expressed by commenters suggesting that our proposal for extending the Common Rule to currently unregulated clinical trials would benefit from further deliberation. Some commenters asserted that, in our attempt to close the perceived “gap” in oversight, the NPRM created a structure that would be both confusing and complicated for institutions to implement. We received multiple comments objecting to the administrative complexity involved in applying a regulatory extension triggered by the receipt of Common Rule department or agency funding for other nonexempt research, and asserting that the administrative burden is not offset by a corresponding increase in the meaningful protection of human subjects. Additionally, it is apparent from the public comments received that our intention to apply the Common Rule to cover the most risky types of research—clinical trials—was not accomplished through the NPRM proposal, given the definition of “clinical trial” included in the NPRM, as that definition encompassed research that would pose no more than minimal risk to subjects. Commenters were further concerned that an unintended consequence might be that the proposed extension would apply to low-risk student research and social, behavioral, or educational research, and would cause currently unregulated institutional activities, such as certain quality improvement or quality assurance activities, to fall within regulatory oversight. Upon reflection on the perspectives expressed by these commenters, we are persuaded that the proposed extension of the Common Rule is not appropriate to include in a final rule at this time. We will continue to carefully consider the related issues.
As an alternative, we contemplated explicitly limiting the extension of this policy to clinical trials that present greater than minimal risk to subjects in order to better align with the intent of this extension, as described in the preamble to the NPRM. However, such an alteration of the rule would itself introduce a variety of complexities, including the question of how a determination would be made that a particular activity involves more than minimal risk. Thus, there would be a very real possibility that such a rule would lead to an administrative burden on substantially more activities than the rule itself would be targeting (such as many minimal risk quality improvement activities).
We also considered the alternative of maintaining the pre-2018 standard of allowing institutions to voluntarily extend their FWAs to nonfederally funded research. We concluded that this alternative would not further the expressed goal of increasing the application of consistent protections to clinical trials, regardless of the source of support, because the extension of the FWA would be optional. We therefore plan to implement the proposed nonregulatory change to the assurance mechanism to eliminate the voluntary extension of the FWA to nonfederally funded research.
We note the concern expressed by commenters that a gap in federal oversight will remain for nonfederally funded research, and the comment that Congress would be the appropriate body to address any such deficiency through legislation. We recognize that institutions may choose to establish an institutional policy that would require IRB review of research that is not funded by a Common Rule department or agency (and indeed, as commenters noted, almost all institutions already do this), and nothing in this final rule precludes institutions from providing protections to human subjects in this way. As a result, the final rule continues to allow institutions the same wide degree of flexibility that they currently have with regard to making other similar determinations regarding ethical oversight of research not regulated by the Common Rule.
Although we are not implementing the proposed extension of the Common Rule to “clinical trials” (as defined by this policy), the proposed definition of “clinical trial” is still relevant to the final rule provision requiring posting of one IRB-approved consent form used to enroll subjects for a clinical trial conducted or supported by a federal department or agency, at § __.116(h). The definition of clinical trial is unaltered from the NPRM proposal and appears at § __.102(b).
In response to the public comments, the NPRM's general approach of designating various categories of
In the final rule, some of the proposed exclusions from the requirements of the Common Rule are addressed in the definition of research, which includes a provision identifying “activities that are deemed not to be research” (see Section III). In addition, some of the proposed exclusions are included as exemptions in the final rule. Under § __.101(b) of the pre-2018 rule, six categories of research were considered exempt from this policy unless otherwise required by department or agency heads. In the final rule, exempt research is now described at § __.104 and eight categories are included (see Section V).
The pre-2018 requirements included provisions at § __.101 that allowed federal department or agency heads to determine which specific activities or classes of activities are covered by the rule and whether certain requirements could be waived. This flexibility was allowed in recognition of the varying missions of the federal departments and agencies, the possibility that there may be superseding or alternative statutes or regulations governing their activities, and the possibility that a given situation requires either more stringent oversight (
The NPRM proposed to retain the Common Rule's pre-2018 requirement that federal department or agency heads retain final judgment about the coverage of particular research activities under the Common Rule (§ __.101(c)) and proposed an additional requirement that federal department or agency heads exercise their authority consistent with the principles of the
The NPRM also proposed at § __.101(d) that a department or agency may require additional protections for specific types of research it supports or conducts, or that is otherwise subject to regulation by the federal department or agency but not otherwise covered by the Common Rule. However, advance public notice would be required when those additional requirements apply to entities outside of the federal department or agency itself. This latter requirement was intended to promote harmonization among federal agencies or departments, to the extent possible, and to ensure transparency between funding entities and the regulated community.
Finally, at § __.101(i) the NPRM proposed to amend the criteria for a department or agency waiving the applicability of some or all of the provisions of the policy, by stating that the alternative procedures to be followed must be consistent with the principles of the
Approximately 25 comments related to the NPRM proposals at § __.101(c) and (i) and none on § __.101(d). Comments received on these proposals generally expressed opposition to ever granting the authority to department or agency heads to retain final judgment as to whether a particular activity is covered by this policy, or to waive certain requirements, even though these provisions existed in the pre-2018 rule. These commenters were concerned about the potential for Common Rule departments and agencies to exclude certain activities for political purposes or for expediency, such as certain activities that might involve surveillance or criminal investigative aims. With regard to § __.101(i), some commenters stated that reference to the ethical principles of the
The final rule adopts the NPRM proposals in § __.101(c). Thus, under § __.101(c), department or agency heads retain final judgment as to whether a particular activity is covered by the Common Rule, and this judgment should be exercised consistent with the ethical principles of the
Although some commenters were opposed to ever granting departments or agencies the authority permitted by § __.101(c), we believe requiring that these decisions be consistent with the principles of the
The final rule in § __.101(d) does not adopt the NPRM proposals, and instead retains the pre-2018 language. The NPRM proposed to modify § __.101(d) to say that department or agency heads could require additional protections to research activities conducted or supported by federal departments or agencies, but that were not otherwise covered by the Common Rule. This language was intended as a clarification to the pre-2018 language. However, we determined that the term “additional protections” could potentially be confusing in that the activities at issue in this provision are those for which no Common Rule protections are required; thus the protections imposed by department or agency heads might be the only protections to which these activities are subject. We also note that departments or agencies conducting or supporting an activity subject to the Common Rule may require additional protections for human subjects.
The final rule also does not incorporate the NPRM proposal in § __.101(d) that advance public notice must be provided when a department or agency head requires that the Common Rule, or part of it, be applied to research activities not otherwise subject to the rule. Upon further assessment, we decided that such a requirement could hinder the ability of a department or agency to move quickly in cases where the department or agency determined that additional protections are warranted.
Section __.101(i) of the final rule adopts a majority of the NPRM proposals. As proposed in the NPRM, § __.101(i) is modified to require that any alternative procedures adopted by departments or agency heads are consistent with the principles of the
The final rule also adopts in § __.101(i) the NPRM proposal to require that the waiver notice include a statement that identifies the conditions under which the waiver will be applied and a justification as to why the waiver is appropriate for the research, including how the decision is consistent with the principles in the
Section __.101(i) of the final rule does not include the NPRM proposal that would have required each federal department or agency conducting or supporting the research to establish on a publicly accessible federal Web site a list of the research for which a waiver has been issued. We decided that the rule's requirement to publish the waiver notice in the
The final rule thus formally codifies in § __.101(c) and (i) the general practice that the ethical standards articulated in the Belmont Report are the ethical standards that Common Rule departments or agencies will use in determining whether an activity is covered under this policy or whether to grant a waiver of the applicability of some or all of the provisions (unless otherwise required by law). The addition of the reference to the Belmont Report makes explicit the ethical basis underpinning how waiver decisions have and must be considered.
The pre-2018 rule specified that the policy does not affect any state or local laws or regulations that may otherwise be applicable and that provide additional protections for human subjects. The NPRM did not propose any changes to this statement. However, questions raised by public comments, as described below, led to some clarifications to the final rule.
Several public comments raised questions and concerns about the ability of tribal nations to require additional protections that might be needed for research involving American Indian/Alaska Native (AI/AN) populations.
One tribal government noted the documented mistrust of research by AI/AN people and communities, and advocated for specific provisions acknowledging the authority and role of tribal nations in overseeing research that happens on their lands and with their citizens. Additionally, this entity noted that tribal nations do not always have their own regulatory bodies for human subject research protections, expressing concern about external groups deciding what constitute risks and benefits for the community.
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Consistent with the pre-2018 rule, this final rule retains the language in § __.101(f)) providing that the Common Rule does not affect any state or local laws or regulations that may otherwise be applicable and that provide additional protections for human subjects. However, the final rule adds clarifying language providing that the referenced state or local laws or regulations include tribal laws passed by the official governing body of an AI/AN tribe. Thus, if the official governing body of a tribe passes a tribal law that provides additional protections for human subjects, the Common Rule does not affect or alter the applicability of such tribal law. (Note that a similar change was also made to § __.116(i) and (j) to provide the same clarification.) In addition, for purposes of the exception to the single IRB review requirement for cooperative research, relating to circumstances where review by more than a single IRB is required by law, § __.114(b)(2)(i) specifies that tribal law is to be considered in assessing whether more than single IRB review is required by law.
The pre-2018 requirements at § __.101(h) stated that when research covered by this policy takes place in foreign countries, procedures normally followed in those countries to protect human subjects may differ from those set forth in this policy. The previous rule cited the Declaration of Helsinki, as amended in 1989, as an example of internationally recognized ethical standards that a foreign country might use as its ethical standard. The rule provided that if a department or agency head determined that procedures prescribed by the institution in the foreign country afforded protections that are at least equivalent to those provided in this policy, the department or agency head may approve the substitution of the foreign procedures in lieu of the procedural requirements provided in this policy.
The NPRM proposed to remove the specific reference to the Declaration of Helsinki in this provision. A concern with providing a specific example of an internationally recognized ethical document is that such a document is subject to change independent of Common Rule departments and agencies, and therefore could be modified to contain provisions that are inconsistent with future U.S. laws and regulations.
A few comments addressed the removal of the reference to the Declaration of Helsinki. These comments were equally divided between those opposed and those supportive or generally supportive. Those opposed feared that the removal of the reference would suggest that the Declaration of Helsinki does not apply and that it was cited in the pre-2018 requirements as an example, not as an equivalent replacement for the Common Rule. These commenters also noted that the United States had refused to sign on to some recent revisions to the Declaration. One organization commented that it would have been useful for the NPRM to address the issue of equivalent protections for U.S.-funded research conducted in foreign countries, as that might have addressed ongoing concerns about the use of alternative systems of protections when research is conducted outside the United States. Those supportive of removing the reference to the Declaration of Helsinki agreed with the arguments laid out in the NPRM and felt that it was judicious to not align U.S. regulations with other standards because those standards are likely to change, perhaps in ways inconsistent with U.S. policy.
The final rule adopts the NPRM proposal. Although the pre-2018 requirements cited the Declaration of Helsinki as an example of internationally recognized ethical standards that a foreign country might use as its ethical base, we note that providing a specific example of an internationally recognized ethical document is concerning because such a document is subject to change independent of Common Rule department or agency policies, and therefore might be modified in ways that create standards that are inconsistent with U.S. laws and regulations.
Each Common Rule department and agency and the Food and Drug Administration (FDA) are authorized to issue its own guidance with regard to interpreting and implementing the regulations protecting human subjects. That guidance may differ substantially across entities. Currently, multiple efforts are underway to address variation in guidance across the Federal Government, but no regulatory requirement exists for departments and agencies to consult with other departments before issuing a policy, to the extent appropriate. As a result, interdepartmental communication has been at times uneven, leading to potentially avoidable inconsistencies. The Common Rule departments and agencies have procedures for sharing proposed guidance before it is adopted, and these procedures have generally been successful. Additionally, FDA and OHRP have worked closely to ensure harmonization of guidance to the extent possible, given the differing statutory authorities and regulatory missions. Also, as mentioned earlier in section I.B., the 21st Century Cures Act was enacted in December 2016. Among other things, it requires that the Secretary of HHS, to the extent practicable and consistent with other statutory provisions, harmonize the differences between 45 CFR part 46, subpart A, and FDA's human subject regulations.
Responses to questions in the 2011 ANPRM about the need for harmonization of guidance across Common Rule departments and agencies reflected widespread support for such efforts. Several commenters acknowledged the difficulty of getting all Common Rule departments and agencies to agree on all issues, as each has a different mission and research portfolio. However, they encouraged seeking harmonized guidance whenever possible. Thus the NPRM proposed that the regulations contain language requiring consultation among the Common Rule departments and agencies for the purpose of harmonization of guidance, to the extent appropriate, before guidance on the Common Rule is issued, unless such consultation is not feasible. The NPRM requested public comment on whether the proposed language would be effective in achieving greater harmonization of department and agency guidance, and if not, how it should be modified.
Approximately 60 comments were received regarding this proposal, and they were almost equally divided for and against it, although some of those opposed thought it did not go far enough to achieve the intended goal. Those who supported the proposal, either fully or partially, cited concerns they have as institutions, investigators, or IRBs in navigating different sets of regulations and different department or agency guidance documents. As noted above, among those who opposed the proposal, some expressed concern that the proposed language about harmonization did not go far enough. That is, they thought the language should mandate harmonization in guidance across Common Rule departments and agencies. These commenters felt that without a requirement to harmonize, federal departments and agencies will continue with business as usual and policy and guidance will continue to differ, creating complexity in the research environment. For example, one large research university emphasized the importance of harmonization across federal departments and agencies regarding guidance on the protections of human subjects for investigators, IRB administrators, and human subjects, and felt that the proposed language in the Common Rule NPRM might be ineffective in harmonizing agency
Others were concerned that this provision would, in effect, mean that Common Rule departments and agencies issue fewer guidance documents because of lengthy internal government review and approval processes.
We believe there is a compelling case for as much consistency as is possible regarding guidance on the protections of human subjects. As such, the final rule implements the NPRM proposal at § __.101(j). The final rule creates a requirement that guidance should be issued only after consultation among the Common Rule departments and agencies, while also permitting guidance to be issued without such consultation when it is not feasible. The proposal recognizes that harmonization will not always be possible or desirable given the varied missions of the departments and agencies that oversee the protection of human subjects and differences in their statutory authorities.
We note that some public comments expressed concern about the acceptable degree of variability among departments and agencies and encouraged attention to these concerns when diverging on guidance. The departments and agencies that oversee the protection of human subjects have a variety of missions and functions, including regulatory agencies and agencies that conduct and support research. In addition, in some cases, statutory differences among the departments and agencies have resulted in different regulatory requirements and guidance. They also oversee very different types and phases of research and thus may have reasonable justifications for differences in guidance. However, we agree that efforts should be made to issue collective guidance when possible and feasible and in a timely manner. We do not believe that this provision will result in the issuance of less guidance, because it largely codifies what has been the working practice among Common Rule departments and agencies up to this point.
In the NPRM, we shared the expectation that both the effective date of the final rule (meaning the date that the regulatory text is published in the Code of Federal Regulations) and the general compliance date of the final rule (meaning the date after which, as a general matter, regulated entities must comply with this rule) would be 1 year after publication of the final rule in the
The preamble to the NPRM also discussed the option for institutions or investigators to implement provisions of the final rule anticipated to provide additional regulatory flexibilities voluntarily 90 days after publication of the final rule in the
The NPRM also explained that the proposed extension of the Common Rule to clinical trials that are not directly funded by a Common Rule department or agency, but that are conducted at an institution that receives funding from a Common Rule department or agency for other human subjects research, would not apply to an institution until the institution had received federal funding for nonexempt research in an award made after the effective date of the final rule.
The NPRM also proposed that ongoing human subjects research initiated before the effective date of the final rule would not need to comply with particular regulatory requirements.
In addition, the NPRM proposed a grandfather clause for research involving the use of biospecimens collected before the compliance date. This clause applied to the provision that would extend the Common Rule to cover all biospecimens, regardless of identifiability. Specifically, the NPRM proposed that such research would not need to comply with the final rule if any research uses of the biospecimens occurred only after removal of any individually identifiable information.
A majority of comments received on the effective dates opposed the NPRM's proposal that only nonidentified biospecimens would be grandfathered. Others commented on the proposed 3-year compliance date for the proposed expansion of the definition of human subjects to all biospecimens, regardless of their identifiability. In Section III, we discuss the determination not to finalize the biospecimen provisions, which addresses these comments. Some commenters expressed support for the general compliance date, as well as the delayed compliance date for the cooperative research provision.
Many commenters expressed the viewpoint that regulated entities would need to invest significant time and resources before they would be able to comply with the changes to the Common Rule proposed in the NPRM. Some commenters (including an academic institution and a hospital association) noted that such investments would have implications not only for research operations, but also for clinical care. Some commenters also noted their concern that 1 year was not enough time for institutions to comply with the large number of new and different regulatory requirements proposed in the NPRM and that such changes would necessitate significant modifications to their research and clinical enterprises and might impose hardships on IRBs, IRB staff, institutional leadership, and the regulated research community. Several commenters explained that the proposed 1-year general compliance period would not provide enough time to update written IRB procedures (which are required under the Common Rule), disseminate such procedures, update related documents (
Other commenters recommended 2-year or 3-year general compliance dates (including some that recommended permitting institutions to comply earlier), noting that compliance would be particularly challenging for institutions with smaller research programs. At least one commenter argued that the 3-year compliance date for the proposed cooperative research provision was inadequate given the significant costs and time that would be associated with establishing reliance agreements between collaborating research sites, maintaining required documents at the reviewing IRB, and ensuring that applicable laws were followed. At least one commenter argued that the proposed effective and compliance provisions left institutions with the discretion to remove studies from the oversight of the Common Rule without establishing any protective standards for doing so.
One group representing multiple professional societies stated that the efficiencies achieved by eliminating protracted negotiations concerning consent forms and institutional responsibilities will far outweigh any upfront costs incurred through implementation of this policy, and advocated for a faster timeframe for compliance than the proposed 3 years from the time of final publication: 1 year for clinical trials and 2 years for research studies. Another commenter echoed these views.
We did not receive many comments concerning the proposal to allow institutions to implement provisions offering regulatory flexibilities before the compliance date.
The effective date and compliance dates included in this final rule are intended to meet the same general objectives as those described in the NPRM. Nonetheless, the approach adopted in the final rule is different in certain respects from the approach proposed in the NPRM.
As a general matter, none of the proposed dates in the NPRM related to research with biospecimens will be implemented because the proposal included to extend the Common Rule to research with all biospecimens, regardless of identifiability, is not being implemented.
The final rule adopts an effective date and a general compliance date of 1 year from publication of this final rule in the
Section 101(l) describes the regulatory requirements that will apply to specific categories of research once the final rule goes into effect. For clarity, § __.101(l) begins by defining two sets of requirements. First, as set forth in § __.101(l)(1), the pre-2018 rule is described as the “pre-2018 Requirements”, which refers to the Common Rule as published in the 2016 edition of the Code of Federal Regulations. As described below, certain ongoing research may be subject to these requirements.
Section 101(l)(3)-(4) describes the different regulatory requirements that apply to different categories of research. For clarity and in order to have an easy-to-implement standard, these categories are generally based upon the date the research was initially approved by an IRB, waived pursuant to § __.101(i), or determined to be exempt.
The first category of research, described in § __.101(l)(3), applies to research initially approved by an IRB, waived pursuant to § __.101(i), or determined to be exempt before January 19, 2018. We believe that such research (
However, we also recognize that institutions may prefer, for a particular study initiated before to January 19, 2018, to comply with this final rule given the benefits that it offers and for administrative simplicity such as common regulatory requirements across an institution. Thus, § __.101(l)(3) permits institutions engaged in ongoing research that was initially approved by an IRB, waived pursuant to § __.101(i), or determined to be exempted before January 19, 2018, to choose, on a study-by-study basis, whether such research will be subject to the pre-2018 requirements (the rule in place before January 19, 2018, or the final rule. This is an exception and is offered as an additional flexibility to regulated entities. If an institution engaged in such research determines that it prefers to comply with the final rule for a particular research study, such research will be subject to the final rule if the institution formally makes a determination that the final rule will apply to such research and an IRB documents the decision made by the institution. If these requirements are not met or if the institution makes no decision, the pre-2018 requirements will apply to such research.
The second category of research, described in § __.101(l)(4), applies
A single IRB requirement for cooperative research has been adopted in § __.114(b) of this final rule. As set forth in § __.101(l)(2), this final rule adopts the proposed 3-year compliance date for this requirement to afford affected institutions sufficient time to prepare for and implement this requirement (
Although we understand the concerns expressed concerning the complexities that will be involved in establishing reliance agreements to satisfy the cooperative research provision adopted in this final rule, this final rule reflects the conclusion that a 3-year compliance date is adequate for this provision, based on our belief that this provision will offer significant benefits to institutions, particularly as the regulated community becomes
This final rule does not adopt the proposal mentioned in the preamble to the NPRM to permit institutions and investigators to voluntarily implement provisions in the final rule that allow additional flexibilities 90 days after publication of the final rule. We determined that the approach adopted at § __.101(l)(3), and described above, offers institutions and investigators similar advantages with respect to the conduct of ongoing research, while providing greater clarity and more simplicity concerning which set of regulatory requirements apply to particular studies.
We disagree with the comment that the proposed timelines enable institutions to remove their studies from the oversight of the Common Rule without establishing appropriate standards for doing so. The final rule does not enable institutions to opt out of compliance with the Common Rule. The effective dates do afford institutions the discretion to choose, on a study-specific basis whether existing research should comply with the Common Rule in place when the research was initiated (the pre-2018 requirements) or this final rule (the 2018 requirements). This flexibility is offered only for certain ongoing research studies that were initially approved, determined to be exempt, or subject to a § __.101(i) waiver before the effective date of this final rule.
To explain the approach adopted in this final rule, the following chart describes the standards that apply to different categories of research:
A severability clause has been added as § __.101(m), providing that if any provision of this final rule is held to be unenforceable in one set of circumstances, it should be construed to give maximum effect to the provision as applied to other persons or circumstances. Similarly, if a provision is held to be invalid or unenforceable, that provision should be severable from, and have no impact on the application of, the remainder of the rule. This provision reflects our intention regarding the way that this final rule, and the pre-2018 rule, should be construed and interpreted and is meant as a clarification.
The final rule revises and adds new definitions of key terms for the purposes of this policy, as summarized below. Some of the changes are made to clarify new provisions that appear elsewhere in the final rule. In addition, the definitions have been placed in alphabetical order to facilitate searching by the reader. The definitions of institution, IRB, and IRB approval are unchanged but appear in a different place in the regulatory language.
Although “certification” was defined in the pre-2018 requirements, as was proposed in the NPRM, the final rule clarifies that notification by the institution that a proposed research study has been reviewed and approved is made to the supporting “federal” department or agency and that it might be a component of the agency or department that is notified rather than the entity as a whole. This clarification relates to the change included in the final rule at § __.102(d) regarding the definition of “federal department or agency” that clarifies that this phrase refers to the department or agency itself, not its bureaus, offices, or divisions. There were no public comments on this clarification.
The pre-2018 rule did not include a definition of “clinical trial.”
The NPRM proposed defining “clinical trial,” for purposes of this policy, as a research study in which one or more human subjects are prospectively assigned to one or more interventions (which may include placebo or other control) to evaluate the effects of the interventions on biomedical or behavioral health-related outcomes. In addition, the NPRM requested public comment on whether the proposed definition should include additional explanation of what is encompassed by the term behavioral health-related outcomes.
Approximately 20 comments explicitly addressed the definition of “clinical trial” included in the NPRM. All expressed concern that the proposed definition encompassed more activities than intended, given the NPRM discussion that the definition was intended to cover the riskiest research. Commenters who responded asked for some type of clarification, either in guidance or in the regulatory language itself about the term “behavioral health-related outcomes.” One commenter noted that clinical trials involving activities such as behavioral interventions, psychotherapy, or skills training, for example, should be included in the proposed regulations of clinical trials in a risk-based manner, as for nonbehavioral studies. That is, greater oversight would be required for trials with a higher potential degree of risk, regardless of what type of trial. The commenter noted that certain populations for whom behavioral health research is conducted are high risk by
The final rule at § __.102(b) adopts the NPRM definition of “clinical trial,” which is a research study in which one or more human subjects are prospectively assigned to one or more interventions (which may include placebo or other control) to evaluate the effects of the interventions on biomedical or behavioral health-related outcomes. We generally expect that this definition will be applied harmoniously with the definition of clinical trial recently promulgated in the ClinicalTrials.gov final rule.
In response to public concerns about an overly expansive definition of “clinical trial” given the importance of that definition to the proposed extension of the rule to clinical trials previously not covered by the rule, we have eliminated that proposed expansion of coverage in this final rule. As such, the definition that appears in the final rule will only be relevant to the requirement for posting of consent forms for clinical trials conducted or supported by Federal departments or agencies (§ __.116(h)). It should be appropriate for that relatively narrow regulatory purpose.
The pre-2018 rule provided a definition of “department or agency head.” The phrase appeared repeatedly throughout the regulations.
New definitions of “department or agency head” and “federal department or agency” were proposed in the NPRM to clarify requirements related to federal department and agency discretion in applying the policy to their funded or conducted research.
There were no comments directly related to these proposed revisions.
The final rule adopts the NPRM proposals to provide new definitions of “department or agency head” and “federal department or agency,” which appear at § __.102(c) and (d). “Department or agency head” at § __.102(c) refers to the head of any federal department or agency, for example, the Secretary of HHS, and any other officer or employee of any federal department or agency to whom authority has been delegated. To add clarity to the definition found in the pre-2018 regulations, the example of the Secretary of HHS was inserted.
The final rule provides at § __.102(d) a definition of “federal department or agency” in order to avoid confusion as to whether this phrase encompasses federal departments and agencies that do not follow the Common Rule. The definition also clarifies that this phrase refers to the department or agency itself, not its bureaus, offices, or divisions. This is consistent with the historical interpretation of the Common Rule. Related to this, the definition of “institution” was changed at § __.102(f) in the final rule to clarify that departments can be considered institutions for the purposes of this policy. The final rule provides examples of what is intended by this definition: HHS, the Department of Defense, and the Central Intelligence Agency.
The pre-2018 rule defined “human subject” as a living individual about whom an investigator (whether professional or student) conducting research obtains (1) data through intervention or interaction with the individual, or (2) identifiable private information. Further, the pre-2018 rule asserted that “private information” was considered individually identifiable if the identity of the subject is or may readily be ascertained by the investigator or is associated with the information.
Thus, in cases where no intervention or interaction with an individual occurred, determining the meaning of “identifiable” and “readily ascertainable” was central to determining whether human subjects were involved in a research activity covered by the pre-2018 rule. Under the pre-2018 rule, provided the data were collected for purposes other than the currently proposed research, it was permissible for investigators to conduct research on biospecimens and data that had been stripped of all identifiers or coded without obtaining consent because the nonidentified biospecimens and data did not meet the regulatory definition of a human subject.
Moreover, “private information” was not considered to be identifiable under the pre-2018 rule if the identity of the subject is not or may not be “readily ascertained” by the investigator from the information or associated with the information.
If the definition of “human subject” was met, together with the other significant requirements, the pre-2018 rule required IRB review and approval unless the study was exempt. IRB waiver of informed consent was allowable under the Common Rule, if the research study satisfied the criteria for waiver of informed consent.
The NPRM proposed to revise the definition of “human subject” to include research in which an investigator obtains, uses, studies, or analyzes biospecimens, regardless of identifiability. Thus, the focus of this proposal was to require informed consent for research involving biospecimens in all but a limited number of circumstances. In addition, the NPRM proposal would have still permitted IRBs to waive the requirement for informed consent for research use of biospecimens, but the requirements for approval of such waivers would have been very strict, and such waivers would have occurred only in rare circumstances (see Section XIV on waiver of informed consent). This expansion of the definition of “human subject” would also have triggered other provisions of the NPRM relating to the use of biospecimens, including security measures. Thus, it was a complex and far-reaching proposal.
The NPRM also offered two alternative proposals to altering the definition of “human subject,” both of which maintained “identifiability” as a major aspect of determining applicability of the Common Rule to biospecimens. The public was asked to comment on which of the three proposals achieved the most reasonable tradeoff between the principles of autonomy and beneficence.
Alternative Proposal A would have expanded the definition of “human subject” to include whole genome sequencing (WGS). Under this
Alternative Proposal B would have expanded the definition of “human subject” to include the research use of information that was produced using a technology applied to a biospecimen that generated information unique to an individual. In such a case, it was foreseeable that, when used in combination with publicly available information, the individual could have been identified. Information that met this standard would have been referred to as “bio-unique information.”
The NPRM also asked the public to comment on whether the rule should include a definition of “biospecimen” and whether the rule should be clearer and more direct about the definition of “identifiable private information.”
The NPRM also proposed some minor changes to the wording of the definition of “human subject” merely to clarify how the word “obtains” has been interpreted.
The NPRM did not propose any major substantive modifications to the descriptions of “private information” and “identifiable private information” found in the pre-2018 rule. However, the NPRM proposed clarifying language with regard to “private information” and “identifiable private information.” The pre-2018 rule used the example of a medical record as constituting private information. The NPRM added the example of a biospecimen in keeping with the proposal to expand the definition of “human subject” to include all biospecimens. In addition, the NPRM proposed adding the words “shared or” to the description of what constitutes “private information,” for the purpose of expanding the scope of the information that would be described by that term.
In addition, the NPRM asked for public comment about whether a different identifiability standard would be appropriate. One alternative discussed was to adopt the term “identifiable private information” with the term used across the Federal Government: “personally identifiable information” (PII). PII refers to information that can be used to distinguish or trace an individual's identity (such as name, social security number, biometric records) alone, or when combined with other personal or identifying information that is linked or linkable to a specific individual, such as date and place of birth, or mother's maiden name. It acknowledged that replacing “identifiable private information” with “PII” would increase the scope of what is subject to the Common Rule. Subsequent to the release of the NPRM, the Office of Management and Budget (OMB) updated government-wide guidance for managing personally identifiable information.
Related to this issue, the NPRM noted new legislative developments, specifically the Newborn Screening Saves Lives Reauthorization Act of 2014 (Pub. L. 113-240), signed into law in December 2014. The law required consent for federally funded research with newborn dried blood spots and prohibits IRBs from waiving consent. These changes were to be effective until updates to the Common Rule were promulgated, and applied whether or not the newborn dried blood spots would be considered “identifiable private information” under the regulatory definition.
The proposal regarding revising the definition of “human subject” to include biospecimens regardless of identifiability was commented on by almost 50 percent of the commenters. Others commented on the effects such an expansion would have on consent requirements, the ability to waive consent, and the applicability of exemptions and exclusions. The vast majority of commenters who addressed this expansion (80 percent) were opposed to it for a variety of reasons, particularly because of the implications of this change for requiring consent for most research uses of biospecimens that were collected as part of clinical care.
A majority of these commenters responded as members of the general public (that is, not explicitly affiliated with a specific organization or institution) or as patients (including family members of patients). Patients tended to oppose these proposals, focusing on the additional and more stringent criteria for waiver of informed consent because they believed the effects of the proposals would be that many people would not provide consent, thus restricting access by investigators to biospecimens, which would in turn slow research. Investigators also expressed concerns about the negative impact on research. Organizations and institutions with some affiliation with the research enterprise expressed opposition to this suite of proposals as well, but for different reasons, as discussed further below.
Most support for the expansion of the definition of “human subject” to encompass all biospecimens and its implications for consent, waiver of consent, and exempt research came from members of the public who argued that they wanted to always be consulted before their biospecimens were used in research, without exception. Within this group, a strong majority opposed the comprehensive biospecimen-related proposals because they were uncomfortable with the concept of broad consent (as discussed in Section IIV of this preamble) to any future research use of those biospecimens and the existence of any type of over-ride by an IRB of the requirement to obtain informed consent.
Many of the commenters supporting the expansion stated that it would respect autonomy by requiring that nearly all research with biospecimens be subject to IRB review and informed consent requirements. Others expressed distrust of the medical and scientific enterprises. One member of the public felt that consent should be required for government research seeking to use an individual's biospecimens, and that researchers should be required to inform the individual of the “who, what, how, and why” of the desired research.
Many of those who expressed support for this proposal also indicated that they felt it important for their biospecimens to be anonymized in research activities. For example, a member of the public with experience in biobanking expressed a willingness to consent to the use of his biospecimens to advance science, but called for a mechanism to inform the public about such research use even if some individuals might decline to participate. The commenter stressed the importance of respecting the individual's right to know and refuse, citing privacy concerns and stressing the importance of anonymity of biospecimens to protect individuals from potential negative consequences.
Still others supported the expansion of the definition of “human subject” to include all biospecimens because of a desire to receive research results or to financially profit from discoveries, implying that retaining identifying information with biospecimens would enable both of these possibilities. Some who felt there is an entitlement to
Several commenters noted that medical services should not be allowed to be contingent upon a person's consent to use of their leftover biospecimens for research despite the fact that this was not proposed in the NPRM. In fact, the pre-2018 rule states that informed consent must include a statement that “refusal to participate will involve no penalty or loss of benefits to which the subject is otherwise entitled” and that element appears in the final rule as well.
For example, one commenter indicated that patients should be informed and be given the opportunity to consent to the use of their body tissues, and if one declines consent, the individual should not be denied treatment or receive diminished care. In other words, they felt that consent should never be a condition of treatment.
The reasons for opposing the expansion of the definition of “human subject” to include all biospecimens were numerous, including: the feasibility of obtaining broad consent in a clinical setting; the costs of obtaining, tagging, and tracking consents given the low risk nature of the research in question; allowing autonomy to trump beneficence and justice; insufficient evidence of risk or public concern about the issue; the fact that it would result in fewer specimens collected from fewer sources, with adverse implications for rare diseases and for justice; the idea that requiring all biospecimens to remain identified poses greater privacy and confidentiality risks than the current system; and overall negative impacts on research.
Many expressed concern about the number of biospecimens that might no longer be available for research, not out of concern that individuals would decline to have their leftover tissue used in research, but rather because many hospitals and medical providers might decline to enact the expensive consent and tracking system that the NPRM envisioned. Some commenters were concerned that this would then limit the heterogeneity of biospecimens obtained and stored, as community hospitals and clinics might opt out of participating in such collections.
Several comments suggested that for academic medical centers where a large amount of research is conducted, research activities often do not result in profits, and that the proposed policies would come at great costs to institutions already struggling to financially sustain a healthy research enterprise. For example, one commenter noted that the NPRM proposal would require additional resources to obtain consent, which would hinder smaller institutions with fewer staff or resources available in their ability to contribute to scientific and medical research, and limit the opportunities for patients at these facilities to participate in research. The commenter also pointed out that academic institutions rarely receive significant financial gain from their research, and institutions sometimes share biospecimens, which can be valuable in research, especially in the case of uncommon and poorly understood diseases. Thus, this commenter expressed concern that biospecimens might not be available for research given the requirements of the proposed policy.
Many members of the public with rare diseases commented on how research into their specific diseases might be affected should the NPRM proposal be finalized. For example, several commenters expressed interest in the proposed rule because they or a family member had been diagnosed with a desmoid tumor, which are often limb threatening and sometimes life threatening. Research using tissue blocks is critical to determine how to treat these tumors, which are rare and can vary among patients. The commenter felt that the proposed rule would make desmoid tumor research virtually impossible by reducing access to the already low number of tissue blocks available for research.
More than one academic medical center asserted that there was a lack of evidence that patients value their autonomy over the potential for innovative diagnostics, treatments, cures, or preventative interventions that could result from research with leftover biospecimens, and called for empirical research on whether patients, patient advocacy groups, and the general public value autonomy (in the form of written consent for research use of nonidentified biospecimens) above other values when explained in light of potential impact on medical advances.
Some public commenters pointed out the illogic of treating biospecimens differently from information for the purposes of defining what constitutes a human subject. For instance, one professional organization composed of investigative pathologists and dozens of individual pathologists around the country noted that there are several areas in which the NPRM proposes treating biospecimens differently from identifiable information unjustifiably since both create the potential for identification of the donor and a potential negative impact on the individual and their family, such as employment or insurance discrimination, embarrassment, or stigmatization. That organization noted that no empirical evidence has been provided to indicate either that biospecimens pose a risk greater than that posed for identifiable information or that the public is more concerned about the use of biospecimens compared to the use of identifiable private information.
One member of the public asserted that the research use of leftover biospecimens in medical research poses less of a privacy risk to individuals than market research that analyzes one's attitudes, words, and behaviors and is used to generate commercial profit.
Several commenters noted that the proposed expansion of the definition of “human subject” creates a cascade of consequences throughout the rule that are overly complex and unnecessary given the minimal risk of such research.
Other commenters suggested that the NPRM proposals would have negative impacts on the advancement of precision medicine. For example, a research university felt that mandating consent for de-identified biospecimens would impair the ability to achieve precision medicine for all. The commenter asserted that to offer care tailored to the needs of each individual based on understanding how each person is affected by disease requires understanding differences in the origins and manifestations of disease in individual patients who differ in genetics and environmental exposures. The commenter felt that restricting access to nonidentified biospecimens would violate the principles of justice and beneficence because many health care facilities serving under-represented minorities and economically-disadvantaged individuals, particularly those in rural settings, might not have the financial resources to obtain and track consent. As a result, medical research therefore might represent a skewed population of individuals receiving care at large, research intensive referral centers. In addition, the commenter felt that compliance would impose an onerous and expensive bureaucratic burden that would result in many institutions no longer collecting and using these critically important specimens with the net effect of thwarting efforts to provide precision medicine for all citizens.
Many commenters expressed the opinion that the existing regulatory framework is adequate and that current practices should be maintained, stressing that the research use of nonidentified data or biospecimens involves minimal or low risk to the research subject. Furthermore, several commenters noted that, although it is theoretically plausible to identify a person based on their biospecimen, the likelihood remains remote enough to argue against the presumption that the sources of all biospecimens are identifiable and cited a study showing that the risk of re-identification from a system intrusion of databases was only 0.22 percent.
The NPRM specifically asked whether the final rule should include a definition of “biospecimen” to assist the regulated community in understanding what types of activities might fall under the rule. Approximately 100 comments answered this question. A majority of these comments did not provide a suggestion for how biospecimen should be defined, but suggested that the Federal Government convene panels and solicit input from governmental and nongovernmental experts.
One university emergency medical department suggested including in this definition biological samples from human subjects which contain DNA and are being obtained for the purpose of medical analysis and provided examples of biospecimens which would fall under this definition, including excised tissue (fresh, fixed, or paraffin embedded), whole blood, urine (when hematuria is known to exist), and saliva among others. The commenter also provided examples of biospecimens which would not fit in this definition, including serum or plasma, urine (when no hematuria is known to exist), and processed tissues where the DNA has been removed as a part of the processing.
Others indicated that the definition of biospecimen used by the National Cancer Institute
A majority of comments on the definition of “biospecimen” asked for explicit clarification on how certain biospecimens would be treated under the rule. Several comments asked whether microbiology biospecimens would be considered covered under the NPRM proposal. One research university requested specification that biologic material of organisms that use human biospecimens merely as a host (
The NPRM also asked whether covering only biospecimens that include nucleic acids would be a reasonable definition. A majority of those who responded to this said it would not be a good line to draw. One commenter specifically noted that the presence of nucleic acids does not guarantee re-identification.
Some of the alternative NPRM proposals were partly based on the premise that biospecimens could at some point become readily identifiable as a result of increasingly sophisticated technology. Many public commenters stated that a better approach to protecting privacy than requiring consent is to impose sanctions against investigators who aim to or do re-identify biospecimens without authorization by an IRB or other body. Such an approach, they said, would be less onerous for the entire enterprise, and if accompanied by clear guidance from funding agencies, would do more to protect privacy and guard against potential harms to subject rights and welfare.
Few commenters, approximately 20, explicitly supported Alternative A or B over the NPRM proposal or the pre-2018 rule.
The Presidential Commission for the Study of Bioethical Issues explicitly supported Alternative B, noting that it is the most forward-looking of all three proposals, using “bio-unique” data as human subjects research with a focus on the technology and its ability to identify donors using small amounts of data, as opposed to tying the definition of human subjects research to a particular kind of data.
Those who supported the primary NPRM proposal—to expand the definition of “human subject” to include all biospecimens—indicated that Alternatives A and B would not give individuals who wanted to control the use of their biospecimens the opportunity to do so.
Approximately 250 commenters (about 12 percent of the total comments received) said that they endorsed the pre-2018 policy, but that if the Federal Government must do something other than maintain the current definition of human subject, Alternative A would be preferable to the NPRM proposal or to Alternative B. These comments argued that Alternative A would be the least disruptive to the research enterprise, but that the pre-2018 policy would be better.
However, the majority of those commenters addressing the alternative proposals indicated that neither struck an appropriate balance among the
Additional concerns about Alternative A included the fact that while limiting the expansion of the scope of activities covered by the rule to whole genome sequencing may be a reasonable line for inclusion today, that line might not be inclusive enough in the future.
Additional concerns about Alternative B included that by requiring continual re-review of technologies and databases by the federal government, there would be an “inevitable lag” between when a technology might be identified and when it would be added to the list. Thus, these commenters argued that the list might end up being useless.
Many commenters proposed or endorsed alternatives to the NPRM proposals. Generally, these alternatives involved maintaining the existing schema, developing a system of notice and opt out, engaging in a public education campaign about how the research enterprise works, and developing penalties and sanctions for re-identification of biospecimens and information. A policy that requires notice, opt out, and public education were generally endorsed or discussed together.
The Secretary's Advisory Committee on Human Research Protections (SACHRP) offered one of the most detailed alternative proposals. SACHRP indicated that existing practices of research with biospecimens and data that have been collected for nonresearch uses (most often in the course of clinical care) should be revised to better protect subjects through greater transparency, public education about research with biospecimens, more exacting standards for protecting against dignity harms, allowing individuals to opt out, requiring IRB or institutional review and approval of specific research uses of identified biospecimens and identified data, and through strict legal consequences for re-identification of de-identified biospecimens and data that have been shared for research purposes.
SACHRP also proposed that data security protections be developed to safeguard biospecimen-associated data and identified data against unauthorized release or access, and focused review of the storage, maintenance, or secondary research use of identified biospecimens and identified data to determine whether the proposed activity is likely to be objectionable.
A professional organization of investigative pathologists urged consideration of opt-out broad consent models for nonidentified biospecimens collected in research and nonresearch settings, and suggested that this model would bring consent for the broad use of nonidentified biospecimens in line with HIPAA privacy practices, preserving the ability for an individual to decide not to participate in research efforts. This organization asserted that this option would be less burdensome and an inclusive, respectful, and functional way to promote ethically conducted biomedical research on biospecimens.
Approximately 40 comments were received in response to the request to comment on the definition of identifiable private information. Comments were mixed. The largest proportion of those comments (approximately 13) supported the definition in the pre-2018 rule. Others felt that the pre-2018 definition of identifiable private information was sufficient, but that additional guidance would be needed to implement it. Another group of commenters supported adopting a different identifiability standard in the final rule (such as the federal government's personally identifiable information standard, or the HIPAA identifiability standard).
Several public comments claimed that the meaning of “identifiable” with regard to information and biospecimens will change as technology advances. They indicated that the technique of whole genome sequencing altered the conversations about the identifiability of biospecimens and future technological advances using advanced computing and large databases could provide methods for easily aggregating disparate data for the purposes of identifying an individual.
Public comments received from a large professional association related to the definition of identifiable private information noted that the modifier “may be readily ascertained” that was included in the definition of identifiable private information within the definition of human subject allows for changes in scientific technology and data sharing over time since what was readily ascertainable 10 years ago has changed and will be different 10 years from now. The commenter noted that this allows IRBs and investigators to assess identifiability based on current technology, data sharing and computing capabilities, rather than comparing it to an enumerated list of identifiers or scientific technologies.
Some commenters expressed a desire for guidance to be issued on these definitions or for the definitions to be better clarified and explained in the regulatory text. Several comments specifically suggested a need for a definition of or guidance on the term “readily ascertainable.”
Approximately 10 comments endorsed replacing the Common Rule's identifiability standard with either the Federal Government's concept of personally identifiable information (PII) or HIPAA's concept of protected health information (PHI).
One academic medical center felt that the concept of PII would unnecessarily broaden the scope of the Common Rule and create a larger administrative burden due to the vagueness of the PII definition without providing substantial added protection to human subjects, and suggested replacing the term “identifiable private information” with the definition of “protected health information,” which can be found at 45 CFR 160.103.
Those who supported the use of the PII concept noted that it would harmonize other definitions of identifiability used in other Federal Government regulations. One state department of health and human services noted that adopting PII would be consistent with other confidentiality laws, policies, and industry standards that require organizations to protect the privacy and security of PII, achieving consistency across standards and helping organizations comply with the various privacy and security requirements. The commenter felt that replacing the identifiable private information standard with the concept of PII should not be overly burdensome on the research community since exemptions and waivers of informed consent would likely apply in many contexts.
A few commenters also noted that regardless of how identifiability might be defined, some concerns about group harms still were not addressed in the NPRM.
Several other commenters noted that a change to the definition of PII would not increase public trust or understanding of the system, nor would it likely clarify for investigators whether biospecimens or private information are identifiable.
A majority of the commenters noted that whatever direction the final rule takes; additional guidance will be necessary to reduce ambiguity within the regulated community.
Approximately 50 comments discussed how issues related to research use of residual newborn dried blood spots (DBS) were addressed by the proposal to expand the definition of human subject. Of those comments, 35 supported the idea of parental consent for research with DBS. Thirty-two comments stated that specific consent should be required for all research uses, in other words, that the exemptions and exclusion categories should not apply to research involving DBS. Those who felt that parental consent should always be required for the research use of DBS expressed the need to respect autonomy and parents' rights, and frequently conveyed a distrust of medicine and scientists. These individuals generally supported the spirit of the main NPRM
Fifteen comments expressed concerns that the biospecimen proposals in the NPRM would impede research involving DBS, which could negatively affect the expansion and improvement of newborn screening programs due to, among other things, a possible lack of resources for obtaining consent. In this regard, an employee of a California state health department described the health department's experience of seeking and obtaining consent for the research use of DBS. This individual noted that 52 percent of new parents were offered the opportunity to consent. Of those offered the opportunity, 90 percent said yes. This employee was thus concerned that due to staffing constraints, the majority of new parents simply would not be asked to provide consent to future research uses of DBS.
Others indicated that some kind of notice and opt-out process would be acceptable, but that as a general matter the research community would benefit from guidance on the extent to which the exemptions and exclusions apply to this type of work.
The final rule does not implement the proposed expansion of the definition of “human subject” to include all biospecimens regardless of identifiability. It is clear from the comments received that the public has significant and appropriate concern about both the need for obtaining consent before using such biospecimens for research, and the potential negative impacts of implementing that proposal on the ability to conduct research. And, while it does not substantially change the definition of “identifiable private information,” the final rule includes a new process by which Common Rule departments and agencies can regularly assess the scientific and technological landscape to determine whether new developments merit reconsideration of how identifiability of either information or biospecimens is interpreted in the context of research. Because the final rule does not implement the NPRM's proposed expansion to the definition of “human subject,” it also does not implement the NPRM proposal to exclude certain research activities involving nonidentified biospecimens.
With regard to changing the definition of “human subject” to include all biospecimens, the majority of commenters who addressed this expansion opposed it for a variety of reasons, as described above. As explained in the NPRM, one of the core reasons for proposing that the rule be broadened to cover all biospecimens, regardless of identifiability, was based on the premise that continuing to allow secondary research with biospecimens collected without consent for research places the publicly funded research enterprise in an increasingly untenable position because it is not consistent with the majority of the public's wishes, which reflect legitimate autonomy interests. However, the public comments on this proposal raise sufficient questions about this premise such that we have determined that the proposal should not be adopted in this final rule.
Further, the current regulatory policy appears to sufficiently protect against the unauthorized research use of identifiable biospecimens. Under the pre-2018 rule, if an investigator funded by a Common Rule department or agency uses nonidentified biospecimens and manages to re-identify them, that investigator would then be conducting human subjects research without IRB approval, in violation of the rules. It should also be noted that the position adopted in the final rule does not eliminate any authority, separate and apart from the Common Rule, that Common Rule departments and agencies have to establish policies with additional requirements related to consent for research involving nonidentifiable biospecimens or nonidentifiable private information, or preclude them from exercising such authority.
Nonetheless, we acknowledge the need to also appropriately respect and promote autonomy interests. Any future proposals aimed at promoting autonomy should jointly evaluate the importance of the autonomy interests at issue, as well as explicitly quantify the potential negative impacts the proposal might have on the ability to conduct research, including such consequences on the representativeness of biospecimens available for research.
In the final rule, we have added requirements to the informed consent process to increase transparency so that potential subjects will have more information about how their biospecimens or private information might be used. Specifically, prospective subjects will be told that identifiers might be removed from their biospecimens or private information and used for future research, if this might be a possibility. Finally, as some public comments addressed the desire to share in any profits that might accrue as a result of research use of their biospecimens, an additional element of consent will require, as appropriate, a statement that the subject's biospecimens may be used for commercial profit and whether the subject will or will not share in this commercial profit. We believe that this increased attention to transparency in the consent process will allow individuals to make informed choices about whether they want to consent to current or future research uses of their biospecimens. A few clarifying changes are made in the final rule pertaining to the definition of “human subject” and the components within that definition, particularly referring to both information and biospecimens as key determinants of whether a human subject is involved in research.
With respect to the definition of “identifiable private information,” although the pre-2018 definition of “identifiable” did not incorporate a specific process for considering the growing volume of information being generated and shared in research (including from biospecimens), or consider how evolving technology can ease and speed the ability to re-identify information or biospecimens previously considered nonidentifiable, we appreciate that a change in that definition could have collateral implications with respect to imposing unwarranted consent requirements on activities that were not subject to the regulations. We appreciate the commenter requests for more guidance on how they should interpret the definition of identifiable private information. Thus, although the final rule only makes minor changes to the existing definition of “identifiable private information,” it sets in place a process (§ __.102(e)(7), discussed below) that will help facilitate any necessary future updates to the understanding of that term.
In the final rule the language at § __.102(e)(1)(i) relating to information obtained through intervention or interaction with an individual was adopted and modified by replacing the reference to data, as proposed in the NPRM, with a reference to information or biospecimens, and by adding the NPRM-proposed language relating to using, studying, or analyzing the information or biospecimens. The explicit reference to biospecimens in this context is intended as a mere clarification of the previous understanding of how the pre-2018 rule operated.
Likewise, the final rule adopts the NPRM-proposed language at § __.102(e)(1)(ii) relating to obtaining identifiable private information, but
A definition of “identifiable biospecimen” has been added at § __.102(e)(6). This new definition was not added as a result of any substantive change, but rather to enable greater clarity in other provisions of these regulations in explaining when a particular provision relates to either identifiable private information alone (not including biospecimens), or identifiable biospecimens alone, or both. The pre-2018 rule's concept of “identifiable private information” had encompassed the concept of an identifiable biospecimen, whereas under the final rule that concept has been “cleaved off” from that definition and given its own definition. Note that a biospecimen is deemed to include private information (consistent with the understanding of this concept under the pre-2018 rule), so there is no need to add the adjective “private” in the definition of an “identifiable biospecimen.” In effect, once a biospecimen becomes identifiable (for example, by being tagged with the name or other information that indicates the person from whom the biospecimen was obtained), then an investigator using that biospecimen is already using something to which § __.102(e)(1)(ii) would apply. There is no need to make any additional determination about the “private” aspects of what is taking place.
In addition, the minor clarifying change in the language for the concept of “private information” that was proposed in the NPRM, namely adding the phrase “shared or,” was not adopted. It was decided that because any information that should not be shared would always meet the standard of being information that should not be made public, this change would not actually expand the amount of information that is considered private information.
Although the description of when private information is identifiable was not significantly changed, a new provision has been added at § __.102(e)(7) requiring federal departments and agencies that implement the Common Rule to regularly, upon consultation with appropriate experts, reexamine the meaning of the terms “identifiable private information,” as defined in § __.102(e)(5), and “identifiable biospecimen,” as defined in § __.102(e)(6). Such reexamination shall take place at least every 4 years. This new provision specifically requires that the federal departments and agencies implementing this policy collaborate on this process to avoid a duplication of efforts and in order to have a consistent interpretation of these terms.
This new process responds to the growing volume of information being generated and shared in research (including from biospecimens), and evolving technology that can ease and speed the ability to re-identify information or biospecimens previously considered nonidentifiable. With an increase in the number of exemptions included in this final rule, it will be important to reconsider the potential identifiability of information and biospecimens and facilitate uniform interpretation to ensure adequate privacy and security measures are in place.
Section 102(e)(7) also provides that, after conducting this process, if it is determined to be appropriate and permitted by law, Common Rule departments and agencies could alter the interpretation of identifiable private information or identifiable biospecimens, including through the use of guidance.
In addition, there will occur, also at least every 4 years and as a collaborative process among those federal departments and agencies, upon consultation with appropriate experts, an assessment as to whether there are analytic technologies and techniques that should be considered by investigators to generate identifiable private information or identifiable biospecimens. The ultimate goal is to implement the Common Rule in a way that is aligned with the evolving understanding of the concept of identifiability while protecting subjects and encouraging and facilitating valuable research.
To the extent that this process leads to a determination that particular analytic technologies or techniques, when applied to information or biospecimens that are not identified, do lead to the generation of identifiable private information or identifiable biospecimens, those technologies or techniques will be placed on a list of technologies and techniques satisfying that determination, and recommendations might accordingly be made with regard to relevant issues relating to consent and privacy and data security protections. The result may be that such technologies and techniques could therefore only be used in instances where the person has provided their consent (broad or study-specific) which meets the requirements of the Common Rule, or where an IRB has waived the requirement for consent.
Notice and the opportunity for public comment would take place before a technology or technique could be placed on this list. The expectation is that whole genome sequencing will be one of the first technologies to be evaluated to determine whether it should be placed on this list.
It is important to note that an investigator who possesses information or biospecimens to which such a technology or technique might be applied is not to be considered in possession of identifiable private information or identifiable biospecimens merely as a result of such a circumstance: that would only be true were the investigator to actually apply the technology or technique to generate identifiable private information or identifiable biospecimens.
This new provision is not being added as a result of any pre-conceived determination that there is indeed a need to change, whether by guidance or otherwise, the interpretation of “individually identifiable” as that concept is currently interpreted. Consistent with a core theme underpinning the process that led to this final rule, it would be inappropriate to expand the scope of coverage of the Common Rule with regard to activities that usually involve very little risk absent good reason to think that there is a problem that the added administrative burden will be correcting. The public comments on both the ANPRM and the NPRM do not identify a specific problem, but clarification from the regulatory agencies might be useful. Thus, apart from the consequences of placing technologies and techniques on the new list, the most significant effect of § __.102(e)(7) may be the issuance of guidance from time to time that facilitates understanding of and compliance with existing interpretations.
Finally, with regard to the use of newborn DBS, retaining the pre-2018 approach toward nonidentified biospecimens resolves many of the concerns expressed by commenters who felt that important research involving newborn screening would be halted or inhibited under the NPRM. The Newborn Screening Saves Lives Reauthorization Act of 2014 (Pub. L.
The Common Rule contains a definition of legally authorized representative to clarify who can consent on behalf of a prospective subject who is unable to consent to research participation on his or her own behalf. Under the pre-2018 rule, a legally authorized representative was defined as an individual or judicial or other body authorized under applicable law to consent on behalf of a prospective subject to the subject's participation in the procedure(s) involved in the research.
As there is no federal legal standard as to who, or what entity, is authorized to serve as a legally authorized representative to provide consent to a subject's research participation, the issue of who can serve as a legally authorized representative has been determined by the laws of the jurisdiction in which the research will be conducted. Within the United States, this generally means state or local law. “Applicable law” could be a state statute or regulation, case law on point, an opinion of a State Attorney General, or a combination of these.
Some states and jurisdictions have statutes, regulations, or common law that specifically address consent by someone other than the subject for participation in research. Most states and jurisdictions have no law specifically addressing the issue of consent in the research context. In these states and jurisdictions, law that addresses who is authorized to give consent on behalf of another person to specific medical procedures or generally to clinical care may be relevant if those types of procedures are the procedures involved in the research. The long-standing interpretation by OHRP has been that such laws relating to surrogate consent in the clinical context can be used for purposes of the Common Rule.
In every state, a legally authorized representative can be authorized through an advance directive or by a court through guardianship proceedings. However some states have no law specifically addressing the issue of consent by a surrogate in the research setting, and some states have no applicable statutes, regulations, or common law specifying when an individual can provide consent for another to medical treatment. In the absence of such law, it is usually the case that community or other standards (such as institutional policies) define hierarchies or identify individuals who are allowed to provide consent, for medical treatment purposes, on behalf of others who cannot consent for themselves.
SACHRP and the Presidential Commission for the Study of Bioethical Issues have raised concerns that the definition of legally authorized representative may be inappropriately hindering the conduct of research with subjects who lack capacity to consent. In the second part of its report on neuroscience and ethics,
Although the NPRM did not propose regulatory text that would change the definition of “legally authorized representative,” it requested public comment on whether we should modify the definition in light of the definition's reference to persons or entities “authorized under applicable law.”
The NPRM sought comment on whether expansion of the current definition to permit a legally authorized representative to be defined by an accepted common practice standard within a state or jurisdiction that lacks applicable state law for determining who can legally consent to clinical care would be consistent with the ethical principles underlying the Common Rule. The NPRM proposed to allow use of this alternative standard only in jurisdictions in which there is also no applicable law affirmatively authorizing a legally authorized representative to provide consent to the subject's research participation.
Approximately 60 commenters discussed the Common Rule's definition of “legally authorized representative.” A clear majority supported the goal of addressing the barrier that the regulatory definition of “legally authorized representative” poses in jurisdictions that have no applicable law affirmatively authorizing an individual to provide consent for another. Commenters also favored the suggested approach and responded that including the allowance of an accepted common practice standard would still appropriately protect subjects. About one-third of the commenters responding to this question, including disability rights organizations, advocacy organizations, and academic institutions, did not agree with the direction of the contemplated modification or whether this issue should be addressed through regulatory change.
Those supporting a modified definition generally agreed that broadening the definition to cover anyone considered acceptable to provide consent for another individual in the clinical setting would be appropriate, would represent an alignment with accepted common practice, and would bring consistency to the consent process for the jurisdictions that are silent on both who may provide consent for clinical care and who may provide consent for research. A number of commenters who supported the proposal for modification noted that state law authorizing individuals to provide consent would continue to apply.
Among the commenters who opposed the modification, several said state law provides sufficient guidance regarding the hierarchy of those who can consent for an adult incapable of consenting on his or her own behalf, and reduces the institution's liability in the event that an inappropriate person consents for the subject. A research institution recommended that we reassess this proposal and include more specific requirements and details as to the role and authority of the legally authorized representative. A disability rights organization, while recognizing that the pre-2018 standard is not acceptable, commented that the problem is not solved by incorporating broad discretion among different jurisdictions. The organization also opined that a common practice standard does not provide
Commenters responded specifically to the solicitation of comment on the proposed standard of “accepted common practice” and indicated that practices for surrogate consent should be those used in clinical settings. Several commenters provided ideas for a more specific approach to interpreting the terms “accepted” and “common.” A researchers' association commented that interpretation of these terms should include standards that define hierarchies or identify individuals who may provide legally acceptable consent, for clinical purposes, on behalf of others who cannot consent for themselves. One commenter supporting the modification suggested that the terms could be defined to refer to the historically used form of governing and familial decision making within the group of subjects. A research institution commented that an IRB's careful review and documentation of who may serve as a legally authorized representative would be preferable to an accepted common practice standard, as that standard is vague. A research institution commenting in support of broadening the definition to those who are allowed to consent to clinical procedures advised that this would reduce confusion between physicians and researchers as to who can consent for whom in research situations, and suggested that the terms “accepted” and “common” should refer to the conducting institution's own policies on who can provide consent to clinical procedures.
The definition of legally authorized representative in the final rule at § __.102(i) has been modified to address jurisdictions in which no applicable law authorizes a legally authorized representative to provide consent on behalf of a prospective research subject. In these jurisdictions, an individual recognized by institutional policy as acceptable for providing consent in the nonresearch context to the subject's participation in the procedures involved in the research, will now be considered a legally authorized representative for purposes of this rule.
The change made from the NPRM discussion that “accepted common practice” could be used to identify a legally authorized representative is in response to objections to the vagueness of these terms and the potential for confusion in implementation, which was expressed by the majority of commenters opposed to the proposal. We agree with the commenters' suggestion that an institution's own policies as to surrogate consent may be a better touchstone than “accepted common practice,” as a standard referencing institutional policy will provide additional clarity as to who may serve as a legally authorized representative at that particular institution.
The final rule also differs from the NPRM discussion in that it allows institutional policies applicable to surrogate consent in either the clinical context, or other nonresearch contexts, to authorize a legally authorized representative. We expect that implementation of this aspect of the final rule definition will in large part rely on institutional policies for determining surrogates for clinical decision making. In those instances, there is relatively little risk that this rule will have inappropriate consequences, as far more significant considerations, not related to the Common Rule, play a role in shaping and constraining an institution's policies relating to surrogate decision making in the clinical context.
However, we recognize that some studies could be taking place that do not relate to the types of decisions that are involved in clinical care, or that do not involve procedures utilized in the clinical context. If the institution has a policy relating to who acts as a surrogate outside of the research context for those types of decisions, then such a policy could be employed in the research context. Similar to our assessment of policies relating to surrogate decision making in the clinical context, we expect that considerations not related to the Common Rule would constrain the institution's design and implementation of policies in other nonresearch contexts, and thus see relatively little risk that this added regulatory flexibility will have inappropriate consequences.
Maintaining the pre-2018 standard would have continued to allow disparate results in terms of when research can take place in those states that have specific laws governing either surrogate clinical consent or research consent, and those that do not. Accepting that the Common Rule has been interpreted to allow the use of laws governing surrogate consent in the clinical context to be applied to surrogate decision making in the research context, it is difficult to see why there should be different outcomes in terms of what research is allowable based on whether the standards for surrogate consent in the clinical context in a state are based on specific laws or some other accepted regime.
This outcome also appears inconsistent with the
Reduced ambiguity in the interpretation of the regulatory requirements will facilitate research that may offer the promise of improved medical treatment for this subject population, thus increasing beneficence. This approach reflects the calls for increased clarity in the regulatory requirements regarding who may serve as a legally authorized representative, which will serve to facilitate the responsible inclusion of subjects who cannot consent on their own behalf to research participation.
The concept of “minimal risk” is central to numerous aspects of the Common Rule, as it affects the type of review required, the permissibility of waiver of informed consent, considerations for IRBs in the review process, and the frequency of review. In sum, the review process has been calibrated, for the most part, to the risk of the research. For example, under the pre-2018 rule at § __.110, a research study could receive expedited review if the research activities to be conducted
The definition of “minimal risk” in the pre-2018 rule at § __.102(i) encompassed research activities where the probability and magnitude of harm or discomfort anticipated in the research are not greater in and of themselves than those ordinarily encountered in daily life or during the performance of routine physical or psychological examinations or tests. IRBs report challenges in assessing the level of risk presented by some studies in order to make the critical minimal risk determination. This is, in part, due to the difficulties in applying the definition of minimal risk under the pre-2018 rule, particularly because the terms “ordinarily encountered in daily life” and “routine physical or psychological examinations or tests” are not clarified.
The NPRM did not propose to modify the definition of “minimal risk,” but rather proposed adding to the definition a requirement that the Secretary of HHS create and publish a list of activities that qualify as “minimal risk.” This list would be re-evaluated periodically, but at least every 8 years, based on recommendations from federal departments and agencies and the public. This would not be an exhaustive list of all activities that should be considered minimal risk under the Common Rule, but would allow IRBs to rely on the determination of minimal risk for activities appearing on the list. IRBs would still need to make minimal risk determinations about activities that do not appear on this list. The public was asked to comment on whether 8 years was a reasonable time period for updating the list and whether advice should be solicited from outside parties when updating the list. The public was also asked to comment on whether the Secretary's list would be a useful tool for the research community, and whether it would represent a loss of IRB flexibility in risk determinations.
Approximately 100 comments were received on this proposal. A strong majority supported the proposal, stating that it would be useful to have such a list, and some even suggested that the list of minimal risk activities should be reviewed more often than once every 8 years. One research university suggested that it is impossible to determine the future direction of human research and therefore a list of minimal risk activities would need to be updated at least yearly.
Several commenters, including those who supported this proposal generally, stated that even though this list of minimal risk activities was a good idea in theory, it should be developed separately from a final rule to allow for more time to work collaboratively with other Common Rule departments and agencies and with members of the regulated community. Some of those who supported the proposal asked that there be widely solicited public input on the list. Others who supported the proposal noted the list does not represent a loss of flexibility because the IRB can still override the presumption of minimal risk as long as the rationale is documented. One large research university felt that the Secretary's list should not replace the IRB's discretion to review a study, particularly if it will only be updated periodically. One commenter was opposed to the NPRM proposal that the list be further codified, suggesting that it should instead be eliminated as a regulatory yardstick to simplify the regulations and remove added administrative burden.
Although this proposal received significant support, several commenters expressed concern that the Secretary's list was another NPRM deliverable that the public did not have a chance to see and comment on during the NPRM public comment period. These commenters suggested that this proposal be removed from a final rule and developed on a separate track. We agree that this list should be developed as a separate process from the final rule promulgation, and thus this proposal has not been included in the final rule.
Thus, no change is made to the definition of “minimal risk” in the final rule at § __.102(j). We still intend to publish guidance on this issue and could still pursue publication of such a list in the future.
The pre-2018 rule did not provide a definition of “public health authority.” As proposed in the NPRM, the final rule now defines the term so that references to it in the definition of research are understood. Specifically, because the definition of “research” (§ __.102(l)(2)) removes from that definition public health surveillance activities that are conducted, supported, requested, ordered, required, or authorized by a public health authority, this definition of “public health authority” clarifies the scope of the activities removed from the definition of “research” for the purposes of this final rule.
In the final rule, as in the NPRM, the term “public health authority”
The pre-2018 rule defined “research” as a systematic investigation, including research development, testing, and evaluation, designed to develop or contribute to generalizable knowledge. Activities that met this definition constituted research for the purposes of that rule. An activity was only subject to that rule if it met this definition (in addition to meeting various other criteria). The pre-2018 rule also included categories of research involving human subjects that would be considered exempt from the rule.
The pre-2018 rule was criticized for not being clear about how to interpret which activities were covered by the rule and which were not. Some commenters also criticized the pre-2018 rule for extending to activities that should not be covered and for inhibiting the conduct of certain activities. According to some, the definition of “research” did not provide a sufficiently clear and precise way to distinguish between similar activities in a way that made it immediately obvious which
The NPRM proposed creating a new section in the regulations referred to as “exclusions.” By proposing exclusion categories, the NPRM intended to make clear that these activities would not have to satisfy the regulatory requirements of the Common Rule. That is, the proposed excluded activities would have been outside the scope of the Common Rule.
Three of the proposed exclusions sought to reduce uncertainty about whether certain internal program improvement activities, historical or journalistic inquiries, or quality assurance or improvement activities satisfied the Common Rule's definition of research.
Another three proposed exclusions pertained to activities that are part of inherently governmental functions with purposes other than research, such as responsibilities to protect public health and welfare (
An additional four categories of proposed exclusions included human subjects research activities that were either considered low risk, or for which there were appropriate safeguards already in place independent of the Common Rule. These four categories pertained to: (1) Research that involves the use of educational tests, survey procedures, interview procedures, or observation of public behavior uninfluenced by the investigators; (2) research involving the collection or study of information that has been or will be acquired solely for non-research activities or were acquired for research studies other than the proposed research study; (3) research conducted by a federal government agency using federal government-generated non-research information when certain criteria are met; and (4) research regulated as “health care operations,” “public health activities,” or “research” under HIPAA. As noted in the NPRM, in these categories the principle of beneficence alone could support the conduct of these activities after considering the level of risk, potential benefits, and nature of human participation in these activities, without the need to add the protections of the Common Rule.
A final proposed exclusion would have applied to research involving the secondary use of nonidentified biospecimens when the research was limited to generating information about the subject that is already known by the subject (
Approximately 375 public comments discussed at least one aspect of the proposed NPRM exclusions. General concerns about the exclusions included that they added a layer of unnecessary complexity in determining what studies fall under the Common Rule, and that overlapping categories of exclusions and exemptions were proposed. Comments also expressed the concern about the lack of requirements on who would decide whether an activity met the criteria for an exclusion, including investigators, or whether those decisions would be documented in any way.
In response to the public comments, the NPRM's general approach of designating various categories of activities as excluded has not been adopted. Instead, the final rule reverts to the general structure of the pre-2018 rule and integrates some of the categories proposed for exclusion in the NPRM into that structure, with some changes to the categories.
The final rule retains the wording of the pre-2018 definition of research, and explicitly removes four categories of activities from activities that would meet that definition. These revisions are intended to make the rule simpler, more familiar to readers who are aware of the pre-2018 rule and its definition of research, and easier to understand.
The four categories of activities removed from the definition of research are set out in order to make clear that they are not within the jurisdiction of the rule. The four categories pertain to certain scholarly and journalistic activities, public health surveillance activities, criminal justice activities, and authorized operational activities in support of national security missions. These categories were proposed as exclusions in the NPRM; the final rule retains these categories, with some changes made in the wording for clarity, in response to public comments.
The category of certain scholarly or journalistic activities is removed from the definition in order to resolve long-standing debate and uncertainty about whether these activities are considered research in the sense of the regulatory definition. We believe that these activities should not be considered research in the context of the Common Rule, and that making this explicit in the final rule will help to resolve the uncertainty.
The final rule includes a simpler definition of national security missions not considered to be human subject research, as a response to concern that the earlier draft language in the NPRM could be interpreted too broadly or too narrowly due to the specific activities listed, such as surveys, interviews, surveillance activities and related analyses, and the collection and use of biospecimens. These authorized operational activities, as determined by each agency, do not include research activities as defined by the Common Rule, nor have they ever in the past been considered regulated by the Common Rule. This category of activity is removed from the definition of research to make explicit that the requirements of the final rule do not apply to authorized operational activities in support of national security missions.
The other two categories of activities deemed not to be research under the final rule (pertaining to public health surveillance activities and criminal justice activities) include many activities that under the pre-2018 rule do not fit the definition of research, and some activities that otherwise might. These categories are included in the final rule in order to make it explicit that the requirements of the final rule do not apply to them.
Three categories of activities proposed as exclusions have been eliminated from the final rule. The proposed exclusion for certain quality assurance/quality improvement (QA/QI) activities has been dropped because it could create more confusion than it resolved, and it might have inadvertently created inappropriate obstacles to those QA/QI activities that should not fall under the rule. The proposed exclusion for internal program improvement activities has been dropped due to similar considerations. The category regarding secondary research involving nonidentified biospecimens designed only to generate information about an individual that is already known has been dropped because it is no longer necessary given that the NPRM proposal
The four exclusions proposed in the NPRM that are incorporated into the exemptions in the final rule are: (1) The proposed exclusion for certain educational tests, survey or interview procedures or observation of public behavior; (2) the proposed exclusion for secondary research use of information that is publicly available or recorded without identifiers; (3) the proposed exclusion regarding secondary research use of information collected by the Federal Government for other purposes and subject to certain privacy laws; and (4) the proposed exclusion regarding secondary research use of information covered by HIPAA protections.
Approximately 50 comments discussed the NPRM proposal to exclude scholarly and journalistic articles from coverage by the rule. The majority of these comments supported the intent of the exclusion, although several comments suggested possible changes. The minority of the comments expressed concerns. Those who opposed this exclusion generally opposed all exclusions, arguing that investigators should be required to get permission from subjects before engaging in these activities.
One commenter expressed concern about an exclusion that would permit oral history activities with tribal nations without oversight. This commenter noted that some oral history with tribal nations is tantamount to cultural appropriation, and the concern of tribal nations might not be adequately protected by the ethical standards of various professions.
Several commenters discussed that the wording of the NPRM regulatory text here might be more restrictive than necessary. Specifically, several commenters noted that in calling out specific disciplines and methodologies, the regulatory text seems counter to the NPRM policy goal of allowing this type of research (as opposed to research in these specific fields) to occur.
A few commenters discussed the need for ethnographic research to be explicitly called out in this exclusion. One commenter also raised cultural anthropology as another academic discipline that should be referenced in this exclusion.
Several commenters, including academic discipline advocacy groups, noted that the exclusion conflated broad disciplines (journalism) with methodologies (oral history), which could be confusing to those attempting to implement the exclusion.
Several commenters also questioned whether the provision “that focus directly on the specific individuals about whom the information is collected” applied only to historical scholarship activities or to all of the activities and disciplines noted in the exclusion. Several other commenters indicated that they supported a full exclusion of all oral history, journalism, biographical, and historical scholarship activities, suggesting that those several individuals do not presume that the provision “that focus directly on the specific individuals about whom the information is collected” served as a limitation on what activities were covered under this exclusion.
A minority of commenters—including accreditation bodies, human research protection experts, and research universities—suggested that an exclusion for these activities was not needed, and that this topic could be addressed through guidance. These comments also indicated that addressing this topic in guidance might be clearer to the regulated community as well. Others indicated that the exclusion is not warranted because the excluded activities are those that would not contribute to generalizable knowledge and thus already would not fall under the rule.
The NPRM also asked whether biospecimens should be included in this exclusion. Very few individuals answered this question, and those that did indicated that biospecimens should not be included.
One research university indicated that with respect to oral history, the exclusion should make a distinction between oral history projects that meet the definition of research and those that do not, suggesting that the exclusion should not exempt all projects that might fall under the “oral history” banner. One commenter noted that oral history should be defined in order to distinguish that activity from interviews.
The final rule explicitly removes a category of activities consisting of certain scholarly and journalistic activities from the definition of research and the scope of the regulations. This category of activities concerns certain activities in various fields that focus directly on the specific individuals about whom information are collected. As described above, this category is removed from the definition in order to resolve long-standing debate and uncertainty about whether these activities are considered research in the sense of the regulatory definition. We believe that these activities should not be considered research in the context of the Common Rule, and that making this explicit in the final rule will help to resolve the uncertainty.
In these activities, the ethical requirement is to provide an accurate and evidence-based portrayal of the individuals involved, and not necessarily to protect them from public scrutiny. For example, a biographer might collect and present factual information to support the biographer's opinion about the character of an individual to show that the individual does not deserve the positive reputation he or she enjoys in society. These fields of research have their own codes of ethics, according to which, for example, consent is obtained for oral histories. We note that this consent standard should address the issue of oral histories of tribal members. For these reasons, we have determined that it is appropriate to remove these activities from the definition of research and from the scope of the Common Rule.
In response to public comments, § __.102(l)(1) refers to more fields and methodological traditions than were proposed in the NPRM. The final rule also explicitly cites those fields and traditions as examples, in order to clarify that the focus is on the specific activities that collect and use information about specific individuals themselves, and not generalizing to other individuals, and that such activities occur in various fields of inquiry and methodological traditions. Literary criticism has been added as an example because while a piece of literary criticism might focus on information about the author(s), it would typically focus on the specific author(s) in view. Legal research has been added as an example because it would often focus on the circumstances of specific plaintiffs or parties involved in a case. It is not the particular field
Activities described in § __.102(l)(1) may sometimes be performed in the fields of anthropology or sociology, but not all activities characteristic of these fields are outside of the rule. Studies using methods such as participant observation and ethnographic studies, in which investigators gather information from individuals in order to understand their beliefs, customs, and practices, and the findings apply to the studied community or group, and not just the individuals from whom the information was obtained, fall within the scope of the definition of research of the final rule.
Approximately 80 comments discussed the proposed exclusion for certain public health surveillance activities. Public comments were generally mixed with many comments suggesting that the regulated community will need to see additional examples of activities that satisfy this exclusion and activities that fall outside its scope. Those who supported this exclusion generally said that this would streamline important public health surveillance activities.
Several comments discussed the importance of this exclusion with respect to residual newborn DBS screening programs. These comments generally expressed the opinion that most state mandated public health reporting of such program activities would fall under this exclusion. Commenters requested additional explanation of what aspects of these state newborn screening programs would be covered under this exclusion, and listed components of the program that should be covered, including validity testing and test development. Others suggested that this exclusion should also exclude minimal risk efforts to evaluate surveillance methods. Others suggested that this exclusion should also exclude minimal risk efforts to evaluate surveillance methods. Another comment suggested that a final rule address, in this exclusion or elsewhere, the issue of research that must be conducted during public health emergencies, citing the example of HHS's emergency use provision with a waiver of informed consent, which describes limited circumstances in which a patient is physically incapacitated or otherwise unable to give consent.
Those who opposed excluding these activities argued that in some cases, research activities for which informed consent should be sought and obtained are sometimes conducted under the auspices of public health surveillance; the importance of the activity itself should not be an argument to avoid seeking and obtaining consent. Others argued that consent should always be sought and obtained for research activities and that all of the exemptions and exclusions discussed in the NPRM should be covered activities. One institution indicated that this exclusion was simply not needed because the activities described did not meet the definition of “research” and thus were not subject to the Common Rule.
Another commenter indicated that while the intent of the exclusion seemed reasonable, implementation of the regulatory intent would be difficult, and there are many examples of modern public health surveillance activities where informed consent would have been appropriate.
A few comments that opposed the exclusion indicated concern that it might be abused, and cited the Tuskegee Syphilis study
The [federal government panel investigating this study] found that the men had agreed freely to be examined and treated. However, there was no evidence that researchers had informed them of the study or its real purpose. In fact, the men had been misled and had not been given all the facts required to provide informed consent . . . The men were never given adequate treatment for their disease. Even when penicillin became the drug of choice for syphilis in 1947, researchers did not offer it to the subjects. The advisory panel [investigating this study] found nothing to show that subjects were ever given the choice of quitting the study, even when this new, highly effective treatment became widely used.” Source: “The Tuskegee Timeline.” Centers for Disease Control and Prevention, last updated 19 Feb 2016. Retrieved from
The NPRM asked whether the parameters of this exclusion were sufficiently clear, and if not, how the exclusion could be clarified. In response, one private organization conducting public health research stated that it was unclear if this only applies to governmental entities like the Centers for Disease Control and Prevention (CDC), or if it applies to other organizations as well. Another institution suggested that the community needed additional clarification of what types of activities fall under this exclusion. One research university requested clarification on whether public health surveillance activities falling under this exclusion is subject to subpart B and C, that is, research involving pregnant women or prisoners, respectively. One organization indicated that it would be helpful for the examples used in the NPRM preamble to be published as a separate guidance document.
Another comment noted that the examples included in the preamble only addressed acute infectious disease surveillance and no other types of public health surveillance activities, specifically, chronic disease surveillance and biomonitoring for toxic chemical compounds and metabolites, which should be covered under this exclusion.
Another research organization noted that the regulatory text and examples provided might be too narrow, suggesting the exclusion be broadened to clarify that it applies to public health monitoring aimed at evaluating the degree to which affected individuals seek and obtain treatment, barriers to care, quality of care, treatment outcomes, and health disparities.
Commenters also requested additional explanation of what aspects of state newborn screening programs would be covered under this exclusion, and listed a variety of components of the program, including validity testing and development of new tests, that should be covered by the exclusion. Commenters asked that clarification of the parameters of the public health exclusion be provided so that state newborn screening programs can undertake the activities necessary for new test development. They added that if the parameters are not clarified, given the past controversies associated with the retention and secondary use of newborn DBS, many programs may not undertake activities for which they have not been given express permission to pursue.
The final rule adopts the NPRM proposal related to deeming certain public health surveillance activities as explicitly outside of the scope of the Common Rule. Several editorial modifications have been made to this category to improve readability. Additionally, the final rule explicitly specifies that the collection of information is permitted under this category of activities.
The final rule codifies the current interpretation that the definition of research does not include a category of activities that solely involve public health surveillance, including collecting and testing information or biospecimens in activities that are conducted, supported, requested, ordered, required, or authorized by a public health authority and that are limited to those necessary to allow the public health authority to identify, monitor, assess, or investigate potential public health signals, onsets of disease outbreaks, or conditions of public health importance. Such surveillance activities can include collecting information about trends, signals, risk factors, patterns in diseases, or increases in injuries from using consumer products. Such activities include those associated with providing timely situational awareness and priority-setting during the course of an event or crisis that threatens public health, including natural or man-made disasters.
This codification of public health surveillance activities as outside the definition of research is designed to remove uncertainty, but is not intended to change the scope of activities subject to or not subject to the Common Rule. When a public health authority conducts public health surveillance activities to fulfill its legal mandate to protect and maintain the health and welfare of the populations it oversees, the regulatory protections of the Common Rule should not impede that authority's ability to accomplish its mandated mission of promoting this recognized public good, in keeping with the principle of beneficence. Other protections independent of the Common Rule exist that serve to protect the rights and welfare of individuals participating in such activities, including federal and state policies to protect privacy, confidentiality, and security safeguards for the information collected.
Public health surveillance refers to collecting, analyzing, and using data to target public health and disease prevention. It is the foundation of public health practice. Surveillance uses data from a variety of sources, including mandatory reporting of certain conditions, routine monitoring, vital records, medical billing records, and public health investigations. The line between public health surveillance and epidemiological research can be difficult to draw, as the same epidemiological techniques may be used in both. Generally, the difference between the activities is the purpose or context in which the investigation is being conducted and the role of the public health authority.
The following are examples of public health surveillance activities being codified as outside of the definition of research in this regulation:
• Safety and injury surveillance activities designed to enable a public health authority to identify, monitor, assess, and investigate potential safety signals for a specific product or class of products (for example, the surveillance activities of the FDA's Adverse Event Reporting System,
• Surveillance activities designed to enable a public health authority to identify unexpected changes in the incidence or prevalence of a certain disease in a defined geographic region where specific public health concerns have been raised (
• Surveillance activities designed to enable a public health authority to identify the prevalence of known risk factors associated with a health problem in the context of a domestic or international public health emergency;
• Surveillance activities designed to enable a public health authority to locate the range and source of a disease outbreak or to identify cases of a disease outbreak;
• Surveillance activities designed to enable a public health authority to detect the onset of disease outbreaks or provide timely situational awareness during the course of an event or crisis that threatens the public health, such as a natural or man-made disaster; and,
• Surveillance activities designed to enable a public health authority to identify the prevalence of a condition of public health importance, known risk factors associated with a condition of public health importance, or behaviors or medical practices related to prevalence of a known condition of public health importance (
On the other hand, subsequent research using information collected during a public health surveillance activity, for instance, genetic analysis of biospecimens, would not be removed from the definition.
This clarification of current interpretation would not remove the following activities from the definition of “research”: exploratory studies designed to better understand risk factors for chronic diseases, including genetic predisposition, for chronic diseases; exploratory studies designed to elucidate the relationships between biomarkers of exposure and biomarkers of disease; and exploratory studies of potential relationships between behavioral factors (
We note that this provision does apply to some activities responding to emergencies, and that various department or agency activities, not just those of HHS, will be affected. Research evaluations of public health surveillance activities are not included in this category because the nature of such evaluations is to create generalizable knowledge. We also recognize that in some public health surveillance activities, it may be appropriate to obtain consent from the individuals from whom information or biospecimens are collected.
We recognize the public comments stating that the boundaries of public health surveillance activities being removed from the definition of research
Finally, to clarify what public health surveillance activities are being removed from the definition of research, the final rule contains a new definition of “public health authority” at § __.102(k).
Approximately 60 comments discussed the exclusion for certain criminal justice activities, the exclusion for intelligence surveillance activities, or both. The majority of commenters opposed these provisions.
Several commenters stated that the two exclusions seemed to contradict President Clinton's Memorandum of 1997, which stated that classified research activities are subject to the Common Rule and directed that the regulations be revised to include certain protections specific to classified research activities.
The majority of commenters discussing these provisions also expressed concern about what appeared to be an expansion of activities not covered by the Common Rule. These commenters also discussed concerns about how this exclusion would affect human subjects protections in classified research activities.
Those who supported these exclusions generally did not provide the rationale for why they supported them.
One research organization noted that additional clarification on the exclusion for certain criminal justice activities would be needed, and noted that such activities should continue to be subject to the Common Rule because this type of research often includes the collection of sensitive, identifiable information, which, if disclosed could present risks to the subjects.
The final rule clarifies that, consistent with current practice, data collection and analysis that enables the conduct of certain activities carried out as part of the criminal justice system is not research. The scope of these activities is collection and analysis of information, biospecimens, or records by or for a criminal justice agency for activities authorized by law or court order solely for criminal justice or criminal investigative purposes. The activities are necessary for the operation and implementation of the criminal justice system. The final rule changes the wording of the category from that proposed in the NPRM only by substituting the word “information” for “data,” for consistency with other parts of the rule.
The provision essentially codifies current federal interpretation that such activities are not considered to be research under the Common Rule. Revising the regulations to explicitly remove such activities from the scope of research subject to the rule is designed to avoid the imposition of disparate requirements by IRBs with overlapping jurisdictions when information collection or analysis encompasses the development of methods required by law or court order for criminal justice or criminal investigative purposes. For example, the Federal Bureau of Investigation (FBI) is charged by law with setting standards governing the collection and processing of DNA biospecimens and information taken (forcibly if necessary) from certain federal and state criminal suspects or offenders incident to their arrest or conviction for prescribed offenses under the National DNA Identification Act of 1994 and other acts. Similarly, the FBI is charged by law with setting standards governing the collection and processing of fingerprints and related biographical information taken from federal and state criminal suspects or offenders and certain sensitive civil employment applicants. Many criminal law enforcement agencies routinely collect human biospecimens at crime scenes from or relating to victims, suspects, and offenders both known and unknown. Incident to these activities, the FBI is also charged with maintaining, and authenticating through identification processes, the criminal record history of criminal offenders for federal government agencies and for the overwhelming majority of state governments that elect to participate and share information through those systems. We have determined that this category of activities does not meet the definition of research in the final rule, so that these activities can be conducted in accordance with the legitimate goals of the criminal justice system.
We do not believe that this provision contradicts President Clinton's 1997 memorandum, which addressed the regulatory requirements for certain activities that are considered research under the regulations. This category pertains to activities that are outside of the regulatory requirements.
This category is also not intended to include social and behavioral studies of the causes of criminal behavior. Such studies would be considered research under the final rule.
The final rule clarifies current federal practice that the definition of research does not include authorized operational activities (as determined by each agency) in support of intelligence, homeland security, defense, or other national security missions. This clarification codifies the interpretation of the pre-2018 Common Rule.
As described above, the final rule includes a simpler reference to authorized operational activities in support of national security missions not considered to be human subject research, as a response to concern that the NPRM proposal could be interpreted too broadly or too narrowly due to the specific activities listed, such as surveys, interviews, surveillance activities and related analyses, and the collection and use of biospecimens. These authorized operational activities, as determined by each agency, do not include research activities as defined by the Common Rule, nor have they ever in the past been considered regulated by the Common Rule. This category of activity is removed from the definition of research to make explicit that the requirements of the final rule do not apply to authorized operational activities in support of national security missions. This clarification is not intended to narrow the scope of the Common Rule.
We do not believe that this category contradicts President Clinton's Memorandum of 1997 regarding classified research, because this category is merely clarifying what activities are not considered to meet the definition of research. The Clinton Memorandum calls for a number of requirements to be added to protections for classified research activities, but it does not address activities that are not considered research.
Approximately 90 comments discussed the proposed exclusion for certain QA/QI activities in the NPRM involving the implementation of an accepted practice. A majority of comments supported the concept of excluding some QA/QI activities from the Common Rule, although some stated that the QA/QI exclusion proposed in the NPRM was too narrow to cover what has evolved as current practice.
These commenters expressed concerns that: (1) The NPRM proposed to exclude only the QA/QI activities that met the exclusion, and that all other QA/QI activities would fall under the rule; or (2) the exclusion would be interpreted to mean that the activities described in the exclusion were the only QA/QI activities that could be considered not covered by the rule.
The most commonly discussed suggestions for expanding the scope of this exclusion included:
• Expanding the exclusion beyond “accepted practices”
• Permitting the collection of outcome measures in the category of activities proposed to be excluded by the NPRM
One hospital noted that QA/QI is not limited to implementation of an “accepted practice” and that limiting the exclusion in this way might impede innovation, for example, accessing an electronic medical record system for QA/QI to test incorporating clinical information to analyze and test best-practice pop-up alerts that signal important information for healthcare providers in caring for a patient. This commenter asserted that there is no current “accepted practice” for activities like this, yet they should be excluded from the definition of research to avoid confusion and to support ongoing innovation and care improvement activities. This commenter also suggested that any QA/QI exclusion should permit activities that allow medical centers to analyze how they deliver care, improve outcomes, and modify processes to achieve healthcare reform goals.
One commenter also noted that the “accepted practice” limitation would also be problematic in the social sciences. This commenter disagreed that the proposed exclusion for quality improvement or assurance practices should be limited to “an accepted practice,” and felt that it should apply to the evaluation of alternative practices. In social sciences research an “accepted practice” is generally not as well defined, can evolve rapidly, and vary by considerations such as timing, culture, geography, and nature of service. In social science research, this limitation could severely limit the use of this exclusion for research that is equally low in risk and therefore does not require review.
A few commenters explicitly referenced the importance of QA/QI activities in the context of a learning health care system, and discussed the need for a broader exclusion in order to achieve the goals of a learning health system.
A professional organization focused on advancing the fields of health services research and health policy noted that a basic tenet of the learning health system is the expectation of continuous learning from routine care, which often is accomplished by evaluating health outcomes. The intentional assessment of the outcomes related to a QI activity by itself should not make the activity subject to the Common Rule.
A medical education membership organization felt that routine evaluation of practices and continuous incorporation of knowledge learned into patient care is fundamental to a learning health system and should not be impeded by the regulatory framework. It stated that the current Common Rule provides insufficient guidance to distinguish research and improvement in care delivery in a consistent manner. The organization indicated that the revised Common Rule explicitly recognizes that efforts to improve care by evaluating an accepted practice and the resulting effects are not research that should be regulated under the Common Rule.
Commenters suggested many other QA/QI activities that should be explicitly excluded or exempted from the Common Rule, such as:
• Activities mandated by the Clinical Laboratory Improvement Amendments (CLIA)
• Evaluations of systems-level interventions to improve quality and safety
• Comparative assessment of alternative practices to determine relative effectiveness
• All QA/QI research for the purpose of health care operations, including patient-centered comparative effectiveness research
• Evaluation of competing QA/QI strategies for implementation of accepted medical practices, which should not be subject to IRB review
• Evaluation of competing low-risk interventions that would typically be implemented in a QA/QI framework without further research: these typically are not direct medical treatments but ancillary aspects of care.
• The use of other analytic assessment methods, such as interrupted time series analysis, or randomization of clusters (including stepped wedge designs)
• Dissemination of QA/QI results, or the intention to disseminate results, including by publication, which should not by itself make the activity subject to IRB review (consistent with current OHRP guidance)
• Multi-institution collaborations of otherwise routine QA/QI activities
• Public health-related QA/QI activities
• Comparative benchmarking
Others expressed approval for the proposed exclusion, but suggested that substantial guidance would be necessary for the regulated community to apply this exclusion appropriately. Specifically, several commenters asked about the extent to which OHRP's current guidance on QA/QI activities would still apply. Others asked for clarification about the extent to which the NPRM proposal would apply in situations where a hospital system with several hospitals implemented different accepted practices at different hospitals within the system, and compared outcomes to determine which accepted practice would be best for that hospital system.
Several comments did not support the NPRM's QA/QI proposal. Reasons included: believing that the activities excluded by the NPRM already did not meet the definition of research and thus did not need to be explicitly excluded; believing that these activities should be subject to some type of review because of concerns about investigator self-determination; and, believing that even in QA/QI activities, human subjects should be offered the opportunity to know that they are subjects in a research activity and should be offered the option to consent.
One patient advocacy group noted that because much research is done in the guise of administration or QI, this proposed exclusion might encourage researchers to evade human subjects protections while the projects may put primary subjects and third parties at risk. It stated that although some hospital-based projects might incur minimal risk to primary subjects, they might pose greater risk to other parties, for example, patients. Thus, the group argued that this exclusion should be
One research institution felt that the proposed change suggests that patient consent will be necessary for many activities designed to ensure QA/QI in health care settings, and could interfere with the imperative to design and evaluate new approaches to enhance patient safety and clinical outcomes. The commenter added that the implications of this provision should be assessed by clinical practitioners and hospital administrators in addition to researchers and research institutions.
Another commenter noted that the proposed exclusion of QA/QI activities fails to exclude important activities that are considered “not research” under the current Common Rule, arguing that the new NPRM exclusion is more in line with evidence-based practice than with QI. Institutions are required under The Joint Commission to perform continuous QI activities, which typically are small, iterative changes to improve clinical care; these activities are seen as part of hospital operations rather than research. The commenter stated that the proposed limitations would make certain QI activities subject to IRB review and possible informed consent requirements, which could result in overregulating an activity that is currently not subject to the Common Rule.
Several of these commenters generally indicated that they interpreted the proposed exclusion as providing a definition of QA/QI, as opposed to excluding a specific type of QA/QI activity. Several of these commenters suggested deleting a QA/QI exclusion from the rule so that IRBs and investigators would not be confused. One hospital suggested eliminating quality activities from the NPRM since by specifying that certain quality activities are not research, the NPRM seems to designate all other quality activities as research by default.
The proposed exclusion for QA/QI activities is not included in the final rule. The degree of concern expressed by the public comments on this topic is significant. We recognize that human subject protections would be meaningful and appropriate for some QA/QI research activities, but not for others. However, to avoid increasing confusion and unnecessary obstacles to innovation, the final rule does not single out certain QA/QI activities as meeting or not meeting the definition of research.
Approximately 20 comments were received on this proposed exclusion regarding data collection and analysis for internal operational monitoring and program improvement purposes, with a strong majority in support. Commenters indicated that the proposed exclusion would require significant guidance because it was unclear what types of activities it might include and when. Several commenters supported the proposed exclusion, but noted that the exclusion should specifically reference QI activities instead of just program improvement activities. One commenter suggested that activities defined as “health care operations” under HIPAA also be included in this exclusion. One commenter opposed this exclusion because of the lack of specific reference to QI. Another opposed this exclusion because they felt it was too narrowly written.
One large private research firm indicated opposition to this proposal because it was too confusing. Further, this group questioned the need for an exclusion that seemed to only reference activities that would not be considered to fall under the rule because these activities would not satisfy the definition of research (specifically, these activities would not be designed to contribute to generalizable knowledge).
Of those who opposed this proposal, a minority suggested that the proposed exclusion could be abused by investigators, especially given that the NPRM did not propose to require any institutional oversight of exclusion determinations. One commenter noted that because many research activities might be conducted under the guise of internal improvement activities, this exclusion seemed to be giving investigators significant opportunities to conduct human research activities outside the confines of the rule.
One commenter who supported this provision suggested that it could be merged with the QA/QI exclusion proposed in the NPRM. This commenter also suggested that a definition of program improvement and operational monitoring be provided.
The NPRM asked whether the use of biospecimens should be permitted in this exclusion. Of those who answered this question, a majority indicated yes. This majority generally referenced a belief that many activities with residual newborn DBS (see Section III.D) would fall under this exclusion. One commenter who opposed the inclusion of biospecimens in this excluded category indicated that if the goal of the NPRM was to cover all nonidentified biospecimens, then this exclusion should not include the research use of biospecimens.
The proposed exclusion for program improvement activities is not included in the final rule. Based on the public comments it does not seem useful for this category of activities to be singled out as not meeting the definition of research. As with the NPRM proposed exclusion regarding QI/QA activities implementing accepted practices, public commenters raised concerns that this exclusion would have created more misunderstanding and confusion than it would have resolved. As with QI/QA activities, some program improvement activities involve research and deserve the protections of the rule, while others are not research and are not under the rule. We believe that this topic would be better addressed through other means.
The final rule includes a definition that was not included in the NPRM nor in the pre-2018 rule. The definition of “written or in writing” is included at § __.102(m) to clarify that, in accordance with the longstanding interpretation of the pre-2018 rule, these terms include electronic formats, which are increasingly used to fulfill many of the documentation requirements that appear throughout the rule.
Although public comments did not directly address this issue, we are aware that some in the regulated community are uncertain of whether, for example, consent forms may be in electronic formats. This definition is intended to address this concern. Note that the definition of “written or in writing” does not preclude the possibility that consent forms could be in media other than paper or electronic formats and still meet the requirements of the Common Rule.
Requirements in the pre-2018 rule at § __.103 delineated procedural requirements for institutions and IRBs to follow to comply with the rule. The
The pre-2018 rule also stated who will execute and evaluate assurances. Finally, the rule described the process by which institutions certify that nonexempt research has been reviewed and approved by an IRB. There has been concern expressed by some that the assurance process may have been unduly burdensome for institutions and did not provide meaningful protections for human subjects.
The NPRM proposed a number of substantive and procedural modifications to § __.103 of the Common Rule. First, the NPRM proposed to move several requirements from § __.103 to § __.108, which pertains to IRB functions and operations: (1) The IRB recordkeeping requirements; (2) the requirement in the pre-2018 rule that IRBs have sufficient meeting space and staff to support IRB reviews and record keeping requirements; and (3) the pre-2018 requirement that an up-to-date list of the IRB members and their qualifications be included in an institution's assurance. The NPRM also proposed to modify the IRB membership requirement such that this up-to-date list would no longer be required as part of an institution's assurance. Instead, an IRB or an institution would be required to prepare and maintain a current list of IRB members.
The NPRM proposed to delete several requirements found in the pre-2018 rule: (1) The requirement that an institution provide a statement of ethical principles by which the institution will abide, as part of the assurance process; (2) the pre-2018 rule requirement that an institution designate one or more IRBs on its FWA; (3) the provision found in the pre-2018 rule that a department or agency head's evaluation of an assurance will take into consideration the adequacy of the proposed IRB(s) designated under the assurance, in light of the anticipated scope of the institution's activities and the types of subject populations likely to be involved, the appropriateness of the proposed initial and continuing review procedures in light of the probable risks, and the size and complexity of the institution; and (4) the requirement that grant applications undergo IRB review and approval for the purposes of certification.
Note that under the NPRM federal departments or agencies would retain the ability to ask for information about which IRBs review research conducted at an institution as part of the assurance process, even if providing this information is not explicitly mandated.
According to the NPRM, an additional, nonregulatory change was proposed for the assurance mechanism. The current option of “checking the box” on an FWA (described in section IV.A above) would be eliminated.
To further strengthen the proposed new provision at § __.101(a), giving Common Rule departments and agencies explicit authority to enforce compliance directly against IRBs that are not operated by an assured institution, language was proposed requiring that for nonexempt research involving human subjects that is covered by this policy and takes place at an institution in which IRB oversight is conducted by an IRB that is not operated by the institution, the institution and the organization operating the IRB shall establish and follow procedures for documenting the institution's reliance on the IRB for oversight of the research and the responsibilities that each entity will undertake to ensure compliance with the requirements of this policy (
The NPRM requested public comment on whether protection for human subjects in research would be enhanced if OHRP conducted routine periodic inspections to ensure that the membership of IRBs designated under FWAs satisfy the requirements of § __.107.
Very few comments were received on the proposals at § __.103. Four commenters expressed their views on the proposal to delete the requirement that an institution provide a statement of ethical principles as part of the assurance process, with three supporting the proposal and one opposing it.
Four commenters supported the proposal to eliminate the requirement that an institution designate one or more IRBs on its FWA.
Two comments were received, one in support and one opposed, on the proposed elimination of the requirement that an up-to-date list of the IRB members and their qualifications be included in an institution's assurance. Two comments, one for and one against, were received on the proposal to remove the requirement that a department or agency head's evaluation of an assurance take into consideration the adequacy of the proposed IRBs. Responses to the question about periodic inspections to ensure IRBs were compliant were mixed, with most commenters saying that it is not clear that ensuring IRBs are compliant would enhance human subjects protections. Others questioned the need for this requirement, given other incentives institutions have to ensure they have a duly constituted IRB, and still others asked what was meant by “periodic.”
Approximately 30 commenters supported the proposal to delete the requirement that the IRB review grant applications, with only one commenter opposed to the proposal.
As proposed in the NPRM, the final rule eliminates the pre-2018 rule requirement that an institution provide a statement of ethical principles by which an institution will abide as part of the assurance process. We believe this requirement is unnecessary. Further, for international institutions that may receive federal funding for research activities, it creates the impression that these international institutions must modify their internal procedures to comport with the set of principles designated on the FWA for activities conducted at those institutions that receive no federal funding. OHRP has received many questions about the extent to which international institutions must adhere to the ethical principles designated as part of the assurance process for research activities conducted by the institution that receive no Common Rule department or agency funding. That such measures are not required will be made clear by deletion of this requirement in the final rule.
Additionally, as proposed in the NPRM, the final rule eliminates the
The final rule, as proposed in the NPRM, also eliminates the requirement that appeared in the pre-2018 rule that an institution designate one or more IRBs on its FWA. Federal departments or agencies retain the ability to ask for information about which IRBs review research conducted at an institution as part of the assurance process, even if that requirement is not explicitly mandated in the regulations.
An additional, a nonregulatory change that was described in the NPRM will be made to the assurance mechanism. The prior option that enabled institutions with an active FWA to “check the box” (described in section IV.A above) is being eliminated. Importantly, institutions could, if they so desire, continue for purposes of their own internal rules to voluntarily extend the regulations to all research conducted by the institution, but this voluntary extension will no longer be part of the assurance process and such research will not be subject to OHRP oversight. We expect this change to have the beneficial effect of encouraging some institutions to explore a variety of flexible approaches to overseeing low-risk research that is not funded by a Common Rule department or agency, without reducing protection of human subjects, thus furthering the goal to decrease inappropriate administrative burdens.
In addition, as proposed in the NPRM, the final rule removes the provision found in the pre-2018 rule that a department or agency head's evaluation of an assurance will take into consideration the adequacy of the proposed IRB(s) designated under the assurance in light of the anticipated scope of the institution's activities and the types of subject populations likely to be involved, the appropriateness of the proposed initial and continuing review procedures in light of the probable risks, and the size and complexity of the institution. We believe this deletion aligns the regulations with changes made in December 2000 to OHRP's implementation of the FWA process. Those changes streamlined and simplified the assurance process and eliminated OHRP's institution-specific evaluation of the adequacy of each IRB designated under the assurance.
Each FWA-holding institution continues to have responsibility for ensuring that the IRBs on which it relies are registered with OHRP and are appropriately constituted to review and approve the institution's human subjects research, as required under §§ __.107 and __.108 of the final rule.
The final rule contains language at § __.103(e) requiring that for nonexempt research involving human subjects (or exempt research that requires limited IRB review) that takes place at an institution for which an IRB not operated by that institution exercises oversight, the institution and the organization operating the IRB must document the institution's reliance on the IRB for its research oversight. The final rule also requires that this documentation include the responsibilities of each entity to ensure compliance with the requirements of the rule.
The requirement included in the final rule for documenting an institution's reliance on an IRB that it does not operate is more flexible than what was proposed in the NPRM. The final rule only requires that the reliance agreement between the institution and the organization operating the IRB be documented. It does not include the NPRM proposal that the institution and the organization operating the IRB establish and follow procedures for documenting the institution's reliance on the IRB for oversight of the research and delineating the responsibilities that each entity would assume to ensure compliance with the requirements of the rule.
In considering the public comments, we determined that it was unnecessary to require that such reliance relationships be described in institutional procedures. Under the final rule, compliance with this provision could be achieved in a variety of flexible ways, for example, through a written agreement between the institution and a specific IRB, through language contained in a protocol of a multi-institutional study, or more broadly, by implementation of an institution-wide policy directive providing the allocation of responsibilities between the institution and all IRBs that are not operated by the institution. Documenting the responsibilities of the institution and the IRB is already a requirement under the terms of an FWA, but is now a regulatory requirement. An additional requirement has been added at § __.115(a)(9) that such documentation be part of the IRB records.
We acknowledge that the new requirement could increase administrative burden for some institutions, but believe that the examples cited above reflecting the various options an institution may use to document reliance on an IRB not operated by that institution are generally already standard practice in the regulated community.
Finally, the final rule eliminates the requirement in the pre-2018 rule at § __.103(f) that grant applications undergo IRB review and approval for the purposes of certification. The grant application is often outdated by the time the research study is submitted for IRB review and contains detailed information about the costs of a study, personnel, and administrative issues that go beyond the mission of the IRB to protect human subjects. Therefore, experience suggests that review and approval of the grant application is not a productive use of IRB time.
In the pre-2018 rule, the application of the exemptions to research under subparts B, C, and D was specified through footnote 1, which stated that the exemptions do not apply to research involving prisoners, and are also limited in their application to research involving children. Regarding the latter issue, the pre-2018 exemption at § __.101(b)(2) for research involving educational tests, survey or interview procedures or observations of public behavior did not apply to subpart D (
Although some of the exemptions proposed in the NPRM were based largely on exemptions in the pre-2018 rule, not all would have applied to subparts B, C, and D. Language in the
Although the NPRM did not propose changes to the HHS regulations at 45 CFR part 46, subparts B, C and D, consideration was given to whether the proposed exemption categories should apply to research involving prisoners under subpart C, either if the research consists mostly of nonprisoners and only incidentally includes some number of prisoners, or if the research intends to involve prisoners as research subjects. Public comment was requested on whether the revised exemption categories should be permitted to apply to research involving prisoners. The NPRM explained considerations including the following: The history of HHS subpart C research certifications to date; the preponderance of low-risk, sociobehavioral research focused on prisoner welfare, substance abuse treatment, community reintegration, and services utilization; the occurrence of prisoner-subjects in databases or registries; and the broad interpretation of the subpart C “prisoner” definition that includes, for example, subjects in court-mandated residential substance abuse treatment.
The NPRM posed a question asking whether language in the final rule should resemble the 2003 waiver of the applicability of certain provisions of the rule for HHS-conducted or -supported epidemiologic research involving prisoners and state that the exemptions apply except for research where prisoners are a particular focus of the research.
Approximately 50 comments were received on the applicability of the proposed exclusions and exemptions to the subparts of the rule. Eight comments addressed the applicability of the exemptions to subparts B and D. However, responses to the question, “Is the proposed application of the exemptions to subparts B and D appropriate?” uniformly agreed with the proposal. A strong majority of the comments addressed the applicability of the exemptions to subpart C.
The NPRM sought comment on the proposal to allow the exemptions to apply in research that only incidentally involves prisoners, but that is enrolling a primarily nonprisoner population. This would represent a policy shift in how the exemptions historically have been applied to subpart C. Comments regarding this proposal were mixed. Some responses claimed that the proposal expanded the application of the exemptions to all research under subpart C, rather than a small subset of subpart C research. Other comments opposed the proposal, pointing to the troubled history of research with prisoners, and suggesting that research involving prisoners, regardless of the risk level, should always go through subpart C IRB review. A narrow majority of comments responded that the exemptions should be permitted to apply to subpart C in a limited way. However, responses regarding the proposed language or which exemptions should be applicable to subpart C prisoners varied. Some felt a study should be exempted only if it offered some benefit to the prison population. Others felt it could be exempt so long as there was no identifiable sensitive information or biospecimens involved. Some who supported the proposal indicated that because the NPRM did not propose to expand the applicability of the exemptions to research targeting prisoners, the proposal seemed to be a reasonable expansion. One comment noted that permitting a broader interpretation might enable more prisoner-subjects to participate in potentially low-risk beneficial research. A few commenters addressed whether the language describing the applicability of the subparts to research involving subpart C should resemble the 2003 epidemiological waiver criteria. Of these, comments were mixed, with some indicating that the 2003 epidemiological waiver criteria would be too ambiguous, others indicating that it would be appropriate language to use, and a final minority reiterating their opinion that the exemptions should never be permitted in research conducted under subpart C.
The NPRM proposal regarding how the proposed exemptions may be applied to the subparts is largely unchanged in the final rule. The language at § __.104(b)(2) regarding subpart C has been modified slightly to reduce ambiguity and potential administrative burden, and in response to public comment, to narrow the scope of exemption application. The final rule does not adopt the 2003 epidemiological waiver language due to concerns from public comments that such language would be ambiguous and difficult to interpret.
The final rule section__.104(b)(1) states that all of the exemptions at § __.104 may be applied to research conducted under subpart B if the conditions of the exemption are met. Language at § __.104(b)(2) states that none of the § __.104 exemptions may be applied to research conducted under subpart C, except for research aimed at involving a broader subject population that only incidentally includes prisoners. This is a modification of the NPRM language, which proposed that the exemptions could apply if research consisted “mostly of nonprisoners and only incidentally” included some number of prisoners. The language was changed in order to avoid the implied need (“mostly”) for institutions to project and track the percentage of prisoners participating in nonexempt research. The revision also more clearly describes and limits the circumstances in which exempt research may include prisoners. The language at § __.104(b)(3) relevant to subpart D has been modified to reflect the revised structure of the final rule, and now
The final rule does not make revisions to the HHS regulations at 45 CFR part 46, subparts B, C, and D. Throughout this rulemaking process, the intent has been to revise subpart A, and to address revisions to subparts B, C, and D at a later time. However, particular consideration has been given to the specific issue of whether the proposed exemption categories should apply in the context of research that is aimed at a broad population and only incidentally includes prisoners. We concur with the comments expressing support for this change.
In such instances, the specific protections required by subpart C are frequently not relevant to the research subjects. The permitted inclusion of this subset of prisoners under the exemptions at § __.104 is intended to allow an appropriate reduction in IRB administrative burden while preventing IRBs from necessarily prohibiting the participation of this group in exempt research activities, assuming the conditions of the exemptions are fully satisfied.
We believe this subpart C change is narrow in scope, affecting only a small subset of subjects who are prisoners. This change will permit, for example, the exempt secondary research use of information or biospecimens from subjects who are prisoners, if that analysis is not seeking to examine prisoners as a population and only incidentally includes prisoners in the broader study. Such inclusion would previously have required IRB review under subpart C, including review by an IRB prisoner representative, followed by certification to and authorization by OHRP. In addition, if the research did not fit into a § 46.306(a)(2) subpart C category of permissible research, prisoners could not be included as subjects in the study, thereby causing problems involving identifying and removing these subjects from the analysis of repositories and databases.
Similarly, the narrow expansion would allow a subject to continue participation in exempt research if he or she became a prisoner during the course of an exempt study, assuming the study was aimed at a broad nonprisoner population, without the need for subpart C IRB review and certification to OHRP. For example, an exempt study that recruited subjects from a local community center to participate in a comparison of HIV educational materials would continue to be exempt, and would not trigger the need for review under subpart C, even if some of the subjects became prisoners after enrollment. On the other hand, a study that recruited subjects from a jail or prison to participate in a comparison of HIV educational materials would continue to be nonexempt under the final rule and require both subpart A and subpart C review, including certification to OHRP.
The pre-2018 rule did not specify who at an institution may determine that research is exempt. However, in the past, OHRP has recommended that because of the potential for conflict of interest, investigators not be given the authority to make an independent determination that their human subjects research is exempt. OHRP has recommended that institutions implement exemption policies that most effectively address the local setting and programs of research. OHRP has recognized that this may result in a variety of configurations of exemption authority, any of which were acceptable assuming compliance with the pre-2018 regulations. In addition, OHRP guidance provided that institutional policies and procedures should identify clearly who is responsible for making exemption decisions. We note that under the pre-2018 and final rule a Common Rule department or agency retains final authority as to whether a particular human subjects research study conducted or supported by that department or agency is exempt from the Common Rule.
The NPRM proposed to adopt a requirement that exemption determinations be documented, and that such determinations could be made only in two specified ways. To assist investigators and institutions in making a timely and accurate determination of exemption status the NPRM proposed that federal departments or agencies would develop one or more exemption determination tools (the use of which would constitute one of the ways in which determinations could be made). Federal departments or agencies would create their own tool, or rely on a tool created by another department or agency (including a web-based tool created by HHS). Institutions would have discretion as to whether or not to implement such a tool. As proposed in the NPRM, it would be designed in such a way that if the person using the tool inputs accurate information about the study, the tool would produce a determination of whether the study is exempt. Institutions could rely on the use of the federally developed tool by investigators as a “safe harbor” for this determination. Use of the tool would be voluntary, and each institution and agency would decide whether to rely on the decision tool for their determinations, and if so, who would be allowed to use it. Institutions that chose not to use the tool for particular determinations would be required to have such determinations made by an individual who is knowledgeable about the exemption categories and who has access to sufficient information to make an informed and reasonable determination. In general, as envisioned in the NPRM, it was expected that investigators would not be allowed to make exemption determinations for themselves without the use of the decision tool, due to considerations of a conflict of interest.
The NPRM requested public comment on several aspects of the proposal to develop a decision tool: (1) The likelihood of an institution allowing investigators to use the tool; (2) the ease of investigators contriving answers in using the tool; (3) whether use of the tool should be restricted to certain exempt categories of research; (4) whether deployment of such a tool would erode public trust in research; and (5) what additional information should be required to be kept as a record other than the information submitted into the decision tool.
The NPRM also proposed that the institution or IRB be required to maintain records of exemption determinations, which records must include, at a minimum, the name of the research study, the name of the investigator, and the exemption category applied to the research study. As described in the NPRM, maintenance of the output of the completed decision tool would fulfill this recordkeeping
This was one of the more commented-on provisions of the NPRM, receiving approximately 280 comments. Public comment was generally mixed, with approximately half supporting and half opposing this proposal. A large majority noted that they felt unable to adequately respond to this proposal without seeing the decision tool first. Many of those who indicated general support for this proposal noted substantial qualifications to their support, such as the need to see the tool before deciding. Some requested that this proposal not be included in a final rule, and that a separate NPRM be issued specific to this proposal. Many commenters said that for simplicity and consistency, one tool should be agreed on by all of the sponsoring departments and agencies and that the departments and agencies should involve research administration professionals in developing such a tool so that it would have field-friendly workability and produces trustworthy results. Further, they thought that the tool should be pilot tested and validated by institutions and investigators before being deployed. For those who supported the concept of a decision tool, they felt that its use would speed the review process for exempt research. Some cited long wait times to receive an exemption determination from their institution's IRB.
Some commenters stated that the tool should clearly indicate that although it determines exemption from federal regulations, state restrictions still apply. A large academic center argued that though the tool could be useful, for institutions that provide services, treatment, and care for vulnerable populations it might be prudent to have someone with expertise in human research protections independently review research proposals to determine whether they are exempt or excluded from IRB review, rather than rely on the tool.
One large research university questioned the need for such a tool, asserting that properly designed oversight and review of exempt research should take minimal time and ensure that only exempt research is conducted without IRB approval. This commenter preferred comprehensive guidance on exempt research to support IRBs in making efficient and expeditious exemption determinations. A large academic/research organization concurred, pointing out confusion among investigators about exempt categories, which requires careful conversation with IRB officers to understand how their project fits into the human protection framework. This organization believed that these conversations promote safe and effective research decision making and argued that use of the tool could fail to properly educate investigators about the complexities of exempt research determinations.
Some commenters noted that the decisions produced by the tool would be only as good as the tool and the materials and guidance that accompany it. Some commenters added that it is unlikely, however, that the use of a federal decision tool would shield the institution or investigator from liability in third-party actions. Still others went so far as to say that they doubted their institution would allow its use, at least for some time after which it was proven. To the extent institutions are not engaged in the exemption determination process through the tool, some argued that institutions should not be held accountable for any unintended outcomes.
Of those who commented on whether investigators should be allowed and trusted to use the exemption determination tool, some noted that it seemed inappropriate and a conflict of interest for investigators to be allowed to use the tool to generate exemption determinations for their own research activities. Others noted that an investigator might be able to use the tool, but that the proposed exemptions categories were so nuanced that experienced IRB staff might have difficulty determining what qualifies for an exemption. To that end, these comments noted that the tool would need to be accompanied with substantial guidance for an investigator to be able to accurately input information into it. Finally, some commenters expressed concern about the possibility that investigators might enter inaccurate or misleading information into the tool to “game the system,” while others noted that that possibility, although remote, exists in the current protocol submission process and that a well-developed tool could include a means for validating certain types of inputs to assess accuracy.
The final rule does not adopt the NPRM proposal at this time. Therefore, the final rule does not require that exemption determinations be documented, as had been proposed in the NPRM, and continues to permit flexibility in how exemption determinations are made. We recognize it was difficult to provide detailed feedback in the absence of an exemption decision tool to evaluate. However, we continue to believe that a well-designed, tested, and validated exemption decision tool could offer an expedient mechanism for determining whether research studies are exempt. Thus, we will continue to explore development of an exemption decision tool. If and when an exemption decision tool is developed, we would issue a subsequent (separate)
The following sections describe the categories of exempt research found in the final rule. Note that several categories of activities proposed in the NPRM as exclusions appear in the final rule as exemptions.
Under the pre-2018 rule, a research activity qualified for exemption from the Common Rule if it fell into one or more of six categories at § __.101(b)(1)-(6). Such studies were fully exempt from the regulations. That is, so long as a study did indeed fall within a category, it did not need to satisfy any other regulatory requirements that it needed to satisfy under the pre-2018 rule.
The NPRM proposed that all exemption language would be found at § __.104. The NPRM proposed retaining all of the exemption categories in the pre-2018 rule in one form or another except for the exemption pertaining to research involving the use of educational tests, survey or interview procedures or observation of public behavior if the subjects are elected or appointed officials, or if the confidentiality of the information were protected by statute. However, the NPRM proposed re-classifying some of the pre-2018 rule's exemptions as exclusions under the NPRM (and thus they would not have been subject to administrative or IRB review), while retaining some of the pre-2018 rule's
The NPRM proposed eight exemptions divided into three categories: (1) Low-risk interventions for which there would have been no other requirement (
The NPRM proposed retaining exemption categories § __.101(b)(1), (5), and (6) from the pre-2018 rule. The NPRM proposed clarifying the exemption for research on public benefit programs or demonstration projects in the pre-2018 rule and explained that OHRP's guidance would be changed to include the applicability of the exemption to cover research on public benefit and service programs that an agency does not itself administer through its own employees or agents. The NPRM proposed requiring federal departments or agencies conducting such studies to publish a list of studies under this exemption.
The NPRM proposed that new exemptions would be created for:
• Certain research involving benign interventions;
• Certain research involving educational tests, survey or interview procedures, or observation of public behavior where identifiable private information was recorded, so long as data protection standards are met;
• Secondary research use of identifiable private information originally collected for nonresearch purposes;
• Activities relating to storing and maintaining biospecimens and identifiable private information for secondary research use, if subjects provided broad consent;
• Secondary research studies that would use the biospecimens and identifiable private information stored or maintained under the above exemption.
The NPRM asked for public comment on several aspects of these proposals, as they appeared as either exemptions or exclusions and whether their placement in the NPRM was appropriate with regard to protecting human subjects in research. Comment was requested on whether guidance would be needed to help make exemption determinations and whether the scopes of the proposed exemptions or proposed exclusions were appropriate. That is, whether particular exclusions or exemptions were either too narrow or too broad. For example, several questions were posed about whether research should be exempt if it involved psychological risks. The NPRM asked about whether notice should be given to subjects for any of the activities. The public was asked to comment on whether and how exempt activities could comply with the NPRM's proposed privacy safeguards.
The NPRM also inquired whether the exemption category related to research conducted in established or commonly accepted educational settings should apply only to research activities in which notice is given to prospective subjects or their legally authorized representatives as a regulatory requirement, when not already required under the Privacy Act of 1974. If so, comment was sought on the type of information to include in the notice and on how such notice should be delivered.
The NPRM asked for feedback on whether the proposed privacy safeguards should apply to research included in the proposed exempt category related to research conducted in established or commonly accepted educational setting, given that such research may involve risk of disclosing identifiable private information. The public was also asked to comment on whether the protections provided by the HIPAA Rules for identifiable health information used for health care operations, public health activities, and research activities are sufficient to protect human subjects involved in such activities, and whether the current process of seeking IRB approval meaningfully adds to the protection of subjects involved in such research studies.
The NPRM asked about the extent to which the HIPAA Rules and the Health Information Technology for Economic and Clinical Health (HITECH) Act
With regard to the proposed exemption related to research and demonstration projects conducted or supported by a federal department or agency, the public was asked to comment on: (1) Whether notice should be given to prospective subjects and the nature of such notice; (2) whether such activities can involve greater than minimal risk and whether they are appropriate as exemptions; and (3) whether existing privacy safeguards for such activities were sufficient.
A proposed new exemption category was intended to facilitate secondary research using identifiable private information that would have been or would be collected or generated for nonresearch purposes, when prior notice had been given and privacy safeguards and prohibitions on re-use of the information were in place. The public was asked to comment on what types of research should fall under this proposed exemption, whether it should be limited to research in which individuals have been informed of the potential for future research use of their information and given the opportunity to opt out, and whether the exemption would be appropriate for clinical data registries.
Finally, public comment was sought on two related proposed exemptions for research involving the use of biospecimens or identifiable private information that would have been stored or maintained for secondary research use, if consent for the storage and maintenance of the information and biospecimens had been obtained using a broad consent template that the NPRM proposed would be developed by the Secretary of HHS.
All exemption categories, of which there are eight, appear at § __.104 in the final rule. Four of the exemption categories were proposed as exclusions under the NPRM. In addition, the proposed exclusion concerning certain research involving educational tests, survey or interview procedures, or observation of public behavior has been combined with the exemption regarding additional research activities using the same research methods. The rule includes four exemptions for research involving normal educational practices, research involving benign behavioral interventions, research involving public benefit or service programs, and research involving taste and food quality, all of which were also proposed in the NPRM.
Three exemptions pertain to secondary research uses of identifiable private information or identifiable
In the final rule, similar to what was proposed in the NPRM, “exempt” does not always mean exempt from all of the requirements of the Common Rule; the activity must fit the description of the exempt category and not include nonexempt research activities. For example, the exemption categories in the final rule at § __.104(d)(7) and (8) identify specific regulatory requirements that must be met (
Public comments, responses to comments, and explanations of the final rule for each exemption category follow.
Approximately 50 comments discussed this exemption, which was a slight modification of an exemption that existed in the pre-2018 rule. The NPRM asked two questions about this exemption: (1) whether it should require some type of notice and if so, how notice should be delivered; and (2) whether the proposed privacy safeguards should apply to this exemption.
One commenter (a research dean from a university) suggested that the wording of the exemption be modified from “research conducted in established or commonly accepted educational settings” to “research conducted in established or commonly accepted educational or other settings” in order to allow more flexibility in how this exemption could be applied.
Other commenters noted a need for guidance on how this exemption should be interpreted. For example, one comment suggested that a wide array of “normal” educational practices exists, and the intention of this language was difficult to discern. Another comment noted that clarification was needed about permissible data collection methods under this exemption.
One commenter discussing the addition of the limitation that the study should not be likely to adversely affect students' opportunity to learn noted that it might be difficult to predict ahead of time if the research contemplated under this exemption might have this adverse impact.
Several commenters discussed whether notice should be required. The majority of these comments indicated that some type of notice should be required. A few specifically discussed the importance of notifying subjects of these activities (with one commenter stating that parental consent should be required), stating that lack of notice could erode public trust in research.
Groups representing AI/AN tribal interests argued that notice for this type of research should be required. Specifically, they asserted that transparency around research-related activities and policies, especially in school settings, can build trust among AI/AN populations and ensure that individual and community benefits of participation in research are achieved. They also noted that tribal consultation facilitates decisions about appropriate ways to implement such notices, and observed that the rural nature of many AI/AN communities requires the use of multiple modes of communication and more time spent reaching the intended audience. The commenter also noted that potential subjects should be given the opportunity to opt out of research activities.
One commenter argued that notice is generally an insufficient standard for this type of research and is not a suitable substitute for informed consent.
Approximately 20 comments discussed whether the proposed privacy safeguards that appeared at § __.105 in the NPRM should apply to this exclusion. Comments were generally mixed about whether this would be appropriate, with a small majority indicating that the privacy safeguards should not apply. These comments generally argued that if an activity is exempt, no additional requirements should be placed on that research activity.
A privacy advocacy organization that supported both notice and attaching the proposed privacy safeguards to this provision, stated that notice in this context is also important because other federal standards (
The final rule includes an exemption at § __.104(d)(1) for research conducted in established or commonly accepted educational settings that specifically involves normal educational practices, so long as the research is not likely to adversely affect students' opportunity to learn required educational content or the assessment of educators who provide instruction. This includes most research on regular and special education instructional strategies, and research on the effectiveness of, or the comparison among, instructional techniques, curricula, or classroom management methods.
This exemption is a revised version of the first exemption in the pre-2018 rule and a modified version of the exemption as proposed in the NPRM. This change is based on concerns about whether the conduct of some research projects of this type might draw enough time and attention away from the delivery of the regular educational curriculum that they could have a detrimental effect on student achievement. The wording of the exemption has been modified to include a condition that the research is not likely to have these adverse impacts. This was the original intent of the NPRM proposal, and it is an important qualification that should apply to any research activity that is exempt under this provision. It also drops the phrase “in that educational setting,” because that phrase is redundant.
The exemption is retained to allow for the conduct of education research that may contribute to the important public good of improving education, consistent with the principle of beneficence. The
We recognize that providing notice for this type of research could involve a significant administrative burden and that it is not always appropriate, and therefore have decided not to include it as a regulatory requirement at this time. We note that making these activities exempt does not mean that there ought not to be tribal consultation about the research activities, and that such consultation may lead to a notice requirement. Where appropriate or mandated by tribal law, tribal consultation should take place irrespective of whether the activity has to meet the requirements of this final rule. Such consultation would represent a free-standing legal obligation, as is referred to in § __.101(f).When appropriate, investigators may provide notice in a manner that is appropriate to the research activity and the cultural context in which it occurs.
This exemption is largely unchanged from the pre-2018 rule, and does not add requirements for safeguarding privacy at this time.
This exemption in the final rule is a revised version of an exemption in the pre-2018 rule, and is a combination of a provision proposed as an exclusion in the NPRM, and a provision proposed as an exemption in the NPRM. Thus, public comments on both of these proposals follow here.
Approximately 80 comments discussed this proposed exclusion, which was an exemption in the pre-2018 rule. Public comments were mixed. Some felt that moving these activities from the exemption to exclusion category would streamline this type of low-risk, common research activity and allow IRBs to focus time and attention on more complicated and higher risk activities. Others, including SACHRP and many research universities, argued that based on their experience, investigators have difficulty making the assessments required to determine whether an activity falls under this exemption. For example, investigators have a difficult time determining whether disclosure outside of the research context might put someone at risk of criminal or civil liability.
Commenters also expressed concern about whether the three statutes cited in the third prong of the proposed exclusion would provide a comparable level of protections to human subjects as does the Common Rule. Many of these commenters noted that they simply were not sure what types of protections would be afforded to subjects under the Privacy Act, the Paperwork Reduction Act, and the E-Government Act of 2002. Others noted that the main protections provided by these statutes involved notice and not ethics review.
The NPRM requested comment on the extent to which covering educational tests, survey procedures, interview procedures, or observation of public behavior under the Common Rule would substantially add to the protections provided to human subjects. Public comment was mixed, but the majority of commenters felt that these activities should be exempt rather than excluded. One commenter indicated that contrary to the primary justification for excluding these categories of research, these activities cannot always be considered to be low risk and could pose significant risks depending on the nature of the research and sensitivity of the data collected.
One commenter expressed strong opposition to excluding these activities from Common Rule protections, indicating that excluding them would compromise the rights and welfare of research subjects. The commenter emphasized that consent cannot be inherent to participation in the activity because researchers cannot know with certainty that participants are familiar with common forms of educational tests, surveys, and interview procedures and the potential risks inherent to information disclosure. In addition, the commenter pointed out, assuming that even vulnerable subjects know the risks associated with participation in surveys and interviews is contrary to the
Some comments were mixed, for example, suggesting that observation of public behavior might be an acceptable exclusion, whereas surveys and interviews ought to remain exempt. One commenter indicated that it might be reasonable for these activities to be excluded if an exclusion determination tool was available to help investigators make the decision. Another commenter suggested that whether the activities are exempt or excluded, notice should be required, to indicate the purpose of the activity, describe privacy safeguards, state that participation is voluntary, and provide information on opting out.
Other commenters expressed concern that investigators might not be able to effectively make these determinations, and pointed out that IRBs, with a broad range of experience and expertise in data identifiability, provide a check for researchers' judgment and are better placed to make consistent and informed decisions about exemptions.
Even so, some other commenters felt that Common Rule protections do not substantially add to the protection of human subjects in these categories of activities. Thus, categorizing them as an exemption just adds administrative burden.
The NPRM asked whether this exclusion should apply only to research activities in which notice is given to prospective subjects or their legally authorized representatives as a regulatory requirement, and if so, what information should be included in the notice. Some commenters supported a requirement for notice or at a minimum, some sort of tracking system for these activities. One emphasized that the ethical principle of respect for persons demands some sort of notice. Some indicated that requiring notice prevents these activities from being excluded and might necessitate including them on the list of activities for expedited review rather than deeming them exempt activities.
Other commenters expressed concern about the proposed exclusion. For example, one indicated that it might not be correct to assume that people agree to participate, and understand that they can opt out, by virtue of their participation, and another reiterated concern about assuming that these activities are inherently low risk and expressed a desire to keep these activities in the exempt category to maintain a level of IRB oversight.
The NPRM asked whether it is reasonable to rely on investigators to make self-determinations for the types of research activities covered in this particular exclusion category, and if so, whether documentation of any kind should be generated and retained. One commenter expressed a strong opinion that investigators should be allowed make these self-determinations. However, the majority of comments responding to this question felt that investigators should not be solely responsible for making these determinations.
Some commenters felt that self-determination might work in certain cases or with certain groups but that there would be too much variability to allow it generally. One suggested a screening system that might check whether determinations were being made correctly.
Many commenters pointed out that it is unreasonable to expect investigators to be able to reliably discern levels of risk inherent to disclosure of information, and that what might seem innocuous to researchers could cause real harm to others. Other commenters expressed concern about conflicts of interest, and that investigators might be more likely to make a determination to not delay their research. Another commenter emphasized that oversight is necessary to avoid situations in which investigators inaccurately assume that subjects understand that they are participating in research, or that they are being recorded, for example.
The NPRM requested comment on whether some or all of these activities should be exemptions rather than exclusions. Response to this question was mixed. Some commenters felt that these activities should be excluded. Others felt that surveys and interview should be considered exempt while educational tests and observation of public behavior should be excluded. Still others felt that all should be exemptions except for observations of public behavior, which could be excluded.
The NPRM asked whether these exclusions should be narrowed such that studies with the potential for psychological risk are not included and whether certain topics that involve sensitive information should not be covered by this exclusion. There was general agreement among responses to this question that the exclusions should be narrowed so that studies with the potential for psychological risk were not included in the exclusion. Some commenters, however, indicated that it would be unrealistic to expect investigators to make this determination reliably, that it might be challenging to implement such a policy, and that guidance would be required from regulatory bodies.
Commenters felt that these activities should be exemptions rather than exclusions, to preserve a level of IRB oversight. One commenter pointed out that circumstances that occur in research for which psychological risks are possible are fairly common in this category of activities and that excluding them would leave the risk unaddressed. One professional organization emphasized that the “potential for serious psychological harms that may be associated with participation in nonbiological research . . . [is] not merely the result of inappropriate disclosure of information.” It also indicated that “the probability and magnitude of this risk may vary by characteristics of individual participants, clinical expertise of the interviewer(s), as well as the risk-minimizing protections that are in place.”
The NPRM requested comment on whether for activities captured under the third element of this exclusion, the statutory, regulatory, and other policy requirements cited provide enough oversight and protection that being subject to expedited review under the Common Rule would produce minimal additional subject protections. If so, the NPRM asked whether the exclusion should be broadened to also cover secondary analysis of information collected pursuant to such activities. Of the few responses to this question, one commenter felt that existing protections are sufficient if information is stored in a secure information technology (IT) infrastructure.
Other organizations expressed strong sentiments that neither the Paperwork Reduction Act nor the Privacy Act were protective in the research context and that current privacy protections are inadequate. They stressed the importance of safeguarding IT and cyber infrastructure and provided examples of large data breaches.
The NPRM asked about the extent to which excluding any of these research activities from the Common Rule could result in an actual or perceived reduction or alteration of existing rights or protections provided to human subjects. That is, does excluding these research activities from the Common Rule pose any risks to scientific integrity or public trust? Commenters who responded to this question generally felt that excluding any of these research activities could result in an actual or perceived reduction or alteration of existing rights or protections provided to human subjects. One indicated that reduction in oversight would lead to subjects being exposed to unintended risks that otherwise would be preventable. Other commenters felt that improper assumptions about low levels of risk in these activities and allowing for self-determination could lead to a reduction in protections for human subjects.
Approximately 50 comments discussed the proposal to exempt educational tests, surveys, interviews, or observation of public behavior if the information is recorded with identifiers and even if the information is sensitive. Public comment here was mixed, with some agreeing that by mandating privacy safeguards, the proposal effectively addresses the primary risk that occurs in this type of research. Others argued that this type of research still benefits from some type of IRB review and thus should be considered covered rather than exempted research. Yet other comments noted that it was impossible to make a determination about this proposed exemption without seeing the proposed privacy safeguards that were proposed in the NPRM.
Several commenters noted that the parameters of this exclusion might be acceptable if it excluded sensitive topics or if it excluded research studies that posed psychological harm to potential subjects. One comment by a professional organization of psychology professionals noted that IRBs often misunderstand and overstate psychological risks in research. Because of this, this group argued that the rule should not include a limitation based on psychological risks because IRBs are not able to effectively assess psychological risks.
The NPRM also asked whether this exemption should be extended to research involving children. The majority of those who responded to this question were opposed to such an extension.
The final rule includes an exemption at § __.104(d)(2) that is a revised version of an exemption in the pre-2018 rule. The exemption applies to research that only includes interactions involving educational tests (cognitive, diagnostic, aptitude, achievement), survey procedures, interview procedures, or observation of public behavior (including visual or auditory recording) uninfluenced by the investigator if at least one of three criteria is met:
• The information obtained is recorded by the investigator in such a manner that the identity of the human subject cannot readily be ascertained, directly or through identifiers linked to the subjects;
• Any disclosure of the human subjects' responses outside the research would not reasonably place the subjects at risk of criminal or civil liability or be damaging to the subjects' financial standing, employability, educational advancement, or reputation; or
• The information obtained is recorded by the investigator in such a manner that the identity of human subjects can readily be ascertained, directly or through identifiers linked to the subjects, and an IRB conducts a limited IRB review to make the determination required by § __.111(a)(7) (which relate to there being adequate provisions for protecting privacy and maintaining confidentiality).
The final rule does not include the language proposed in the NPRM that offered as one prong of the exemption (proposed as an exclusion) that the research be subject to the Privacy Act, the Paperwork Reduction Act, or the E-Government Act of 2002. The final rule simply includes § __.104(d)(2)(iii), which requires limited IRB review as described at § __.111(a)(7) if identifiable private information will be obtained and recorded in such a way that the identity of human subjects can readily be ascertained, either directly or through identifiers linked to the subject.
This exemption is based on the assumption that the potential risks raised by this category are largely informational and that subjects are aware of them, and thus the most important role that an IRB might play with respect to reducing potential harms is to ensure the application of privacy safeguards. Under this assumption, the exemption is consistent with the principle of respect for persons and the preservation of autonomy. In the case of observation of public behavior, even if the subject does not know that an investigator is watching his or her actions, the subject's behavior is public and could be observed by others, and thus the research observation is not inappropriately intrusive.
The term “survey” as used here refers to information collected about individuals through questionnaires or similar procedures (
This exemption includes the research activities that appeared at § __.101(b)(2) in the pre-2018 rule, as well as some additional information collection research activities using the same methods. As in the pre-2018 rule, this exemption includes research studies whose methods consist of the use of educational tests, survey or interview procedures, or observation of public behavior that does not involve an intervention, if the data are recorded anonymously, or the information is recorded with identifiers, but is not sensitive such that its disclosure could result in harm to the subjects. The exemption provides a list of the specific harms that must be considered, as did the pre-2018 rule, with the addition of the specific harm of potential damage to the subjects' educational advancement. This potential harm has been added because of the obvious relevance to the effects of the disclosure of responses in research involving educational tests.
This exemption has been expanded to include research using the same methods involving identifiable private information that might be sensitive or potentially harmful if disclosed, so long as the investigators adhere to the limited IRB requirements outlined in § __.111(a)(7), and the research is not subject to Subpart D. The limited IRB review requirements are designed to provide privacy safeguards to reduce the chances that the disclosure of identifiable private information will occur and lead to harm.
The wording of the exemption is clarified to indicate (consistent with the interpretation of § __.101(b)(2) in the pre-2018 rule) that the research cannot include interventions in addition to the educational tests, survey or interview procedures, or observation of public behavior. Research involving interventions that are distinct from those information collection methods allowable under this exemption do not satisfy the conditions of this exemption. For example, if a research study were to randomly assign students to take an educational test in a quiet room or in a room with a moderate level of noise, or to consume a snack (or not) before taking the test, this research would not be exempt under this exemption. It should be noted, however, that educational tests may include exposing test takers to certain materials as part of the test, and that such materials do not constitute interventions distinct from the test. For example, reading comprehension tests may direct test takers to read a passage, and a geography test may present test takers with a map, and ask them to draw information from that map. Likewise, survey procedures may contain some information that the respondents are asked questions about, which would not be considered distinct interventions. However, research in which the purpose of the research is to see whether respondents answer survey questions differently depending on the gender of the interviewer would not satisfy the conditions of the exemption, because the manipulation of the interviewer would be a distinct intervention. Research involving observation of public behavior does not qualify for this exemption if the investigator intervenes with subjects, for example, by offering them an ostensibly lost wallet to see if they will accept it.
Part of the rationale for exempting the research activities at § __.104(d)(2) from the Common Rule, even when the research is not otherwise subject to additional federal controls, is that for education tests, survey or interview procedures, agreement to participate is inherent in participation and that for much of this research the risks most likely to be experienced by subjects are related to disclosure of anonymous, nonsensitive information and are thus categorized as “low.” In general, it is reasonable to expect that individuals, including vulnerable populations (other than children), would understand that actively providing responses to educational tests, surveys, or interview procedures constitutes agreement to participate and that the risks associated with such participation would be related to disclosure of the information they provided. The exemption of this type of activity rests in large part on the idea that all individuals, regardless of the setting or context in which the activity will take place, are generally familiar with common forms of educational tests and survey and interview procedures that they experience in their daily lives, and do not need additional measures to protect themselves and their privacy from investigators who seek their involvement in research activities involving these procedures. They can decline to participate, or to answer some questions. In addition, if the information collected is both identifiable and sensitive or potentially harmful, the safeguards offered by the limited IRB review requirements at § __.111(a)(7) apply. This is accomplished through the added provision at § __.104(d)(2)(iii).
Concerns have also been raised about psychological risks of participating in
With respect to applying this exemption to research with children, two subcategories of this exemption—concerning information recorded so that subjects cannot be identified (§ __.104(d)(2)(i)), and concerning disclosures of the subjects' responses that would not place them at certain kinds of risk or create certain kinds of damage (§ __.104(d)(2)(ii))—may apply to research involving children under subpart D if the research involves educational tests or observation of public behavior and the investigator does not participate in the activities being observed. The final subcategory of this exemption (§ __.104(d)(2)(iii)), which allows for obtaining and recording identifiable private information, may not be applied to research involving children under subpart D.
Approximately 50 comments discussed the NPRM proposed exemption involving benign interventions in conjunction with collecting information from an adult subject. Public comments here were mixed, with a majority favoring this exemption, and with the majority of commenters indicating that guidance will be needed for this exemption to be implemented properly. For example, one large research university stated, “The proposed category involving benign interventions needs further revision. While we are supportive of this category in general, the words `benign intervention' without definition leaves too much room for different interpretations and these terms are not easily applicable to social science research, a context in which these types of activities are likely to occur.” Those that favored this exemption generally agreed with the argument put forth in the NPRM that these activities were low in risk and IRB review did not provide subjects meaningful additional protections in this context.
Several comments requested clarification on the extent to which medical interventions might be covered under this exemption. For example, to what extent could proven diagnostic methods that introduce energy but are not invasive (
Those who did not support this exemption offered a variety of reasons. One comment from a research university indicated that it did not support this exemption because it could cause studies like the “Milgram Obedience Experiment”
One comment from a research ethics, public education, and professional organization noted that if the final rule includes an expansion of exemption categories such as the proposed benign intervention exemption in the NPRM, then investigator education on human subjects protection should be mandated.
Another comment noted that it should be clarified in the regulatory text that withholding the investigator's hypothesis from subjects is not deception.
The majority of commenters indicated that no additional requirements, be it notice or the proposed privacy safeguards, should be applied to this exemption category. A minority of comments indicated that some kind of notice should be required with this provision, generally asking for that notice to include the purpose of the study, the privacy and confidentiality protections in place, a statement that participation is voluntary, information on how to opt out of the study, and information about who to contact for more information. Comments that favored notice suggested that the notice should be study-specific.
Although commenters generally felt the examples of activities that would satisfy this exemption included in the regulatory text were sufficient, commenters also indicated that many of the terms used in this exemption needed additional explanation, for example, “brief in duration,” “painless,” and “physically invasive.” A large research university noted that the proposed language raised questions about what sorts of impact are significant and how long is “lasting.”
One large professional organization representing research universities and organizations noted that the term “benign intervention” did not seem to encapsulate the types of activities that the NPRM contemplated. Specifically, this organization argued that “benign intervention” connotes a medical procedure, when the NPRM preamble suggested that this exemption encompasses nonmedical “benign interventions” generally. This organization also suggested that the activities contemplated by this exemption are more like interactions than interventions.
In response to a question about whether the decision tool could be relied on for making this exemption determination, a majority of those who responded indicated that it would be impossible to answer this question without first seeing the decision tool. Others indicated that without better definition of terms like “benign intervention,” “prospectively agree,” “long lasting,” and “significant impact,” it would be impossible for a tool to provide accurate determinations for this exemption.
This exemption at § __.104(d)(3) was not in the pre-2018 rule, but was proposed in the NPRM. In response to public comments that expressed concern over the need to further clarify the term “benign interventions,” the word “behavioral” has been inserted to modify the type of intervention which may be included. The intent of this change is to exclude the use of medical interventions (including medical tests, procedures and devices). The exemption being finalized is specifically for research involving benign “behavioral” interventions in conjunction with the collection of information from an adult subject through verbal or written responses (including data entry) or audiovisual recording if the subject prospectively agrees to the intervention and information collection and at least one of the following is met:
• The information obtained is recorded by the investigator in such a manner that the identity of the human subjects cannot readily be ascertained
• Any disclosure of the human subjects' responses outside the research would not reasonably place the subjects at risk of criminal or civil liability or be damaging to the subjects' financial standing, employability, educational advancement, or reputation; or
• The information obtained is recorded by the investigator in such a manner that the identity of the human subjects can readily be ascertained, directly or through identifiers linked to the subject, and an IRB conducts a limited IRB review to make the determination required by § __.111(a)(7).
For the purpose of this provision, the exemption describes benign behavioral interventions as being brief in duration, harmless, painless, not physically invasive, not likely to have a significant adverse lasting impact on the subjects, and the investigator has no reason to think the subjects will find the interventions offensive or embarrassing. Provided all such criteria are met, examples of such benign behavioral interventions include having the subjects play an online game, solve puzzles under various noise conditions, or decide how to allocate a nominal amount of received cash between themselves and someone else.
Unlike the exemption at § __.104(d)(2), this exemption allows for the intervention to be distinct from the data collection method; for example, a research study comparing test performance of test takers in quiet or noisy surroundings would qualify for this exemption. Also subjects could be asked to perform cognitive tasks, and audiovisual recording could be used to collect the data, without any educational test, survey or interview procedure occurring, and this research would qualify for this exemption.
If the research involves deceiving the subjects about the nature or purposes of the research, this exemption would not be applicable unless the subject authorizes the deception. For the purpose of this provision, authorized deception would be prospective agreement by the subject to participate in research where the subject is informed that he or she will be unaware of or misled regarding the nature or purposes of the research. The final rule allows this type of research to occur without the requirements of informed consent because the intervention is not likely to result in harm or offense to the subject, and the subject must prospectively agree to the intervention and the data collection.
Subjects must be adults, but the provision does not specify that they must be competent, and therefore tests of competency are not necessary. However, the presumption is that, in keeping with the principle of respect for persons, such subjects will not be exploited.
This new exemption category is added because respect for persons is accomplished through the prospective subject's forthcoming agreement or authorization to participate, the research activities pose little risk to subjects, and the use of this exemption for many social or behavioral studies will enable IRBs to devote more time and attention to research studies involving greater risks or ethical challenges. We note that the requirement for the agreement of the subject effectively serves as a kind of notice, because the subject is asked to agree to participate in the research, and the request will be tailored to the nature of the specific research study.
The final rule includes another condition that was not included in the NPRM, which broadens the type of research that may meet this exemption. The final rule at § __.104(d)(3)(i)(C) permits investigators to obtain and record information in such a manner that the identity of the human subjects can readily be ascertained, directly or through identifiers linked to the subject, provided the research has undergone limited IRB review in accord with § __.111(a)(7). This alternative condition was added to the final rule for reasons similar to the exemption at § __.104(d)(2), as a way of providing additional protections when investigators obtain and record information in such a manner that human subjects can be identified directly or through identifiers linked to the subject. Because the risk associated with enabling investigators to obtain and record identifiable private information can be addressed by requiring adherence to the privacy safeguards provided through limited IRB review, we believe it is appropriate to allow such research to be exempt.
In addition, the final rule permits the collection of data through audiovisual recording, not just video recording, as was proposed in the NPRM. We believe that broadening the exemption in this way provides more flexibility to the permissible data collection methods without creating greater risk of harm to research subjects.
We acknowledge that guidance may be useful for interpreting some of the terms in this exemption, and that some cases will be debatable. However, we also believe that a substantial number of research activities will plainly fit this exemption, and should be allowed to proceed without IRB review. We agree that investigator education is often desirable, but that the provisions of the exemption are not difficult to understand. We believe that Milgram's obedience experiments and the Stanford Prison Experiment would obviously not qualify for this exemption, because investigators had reason to think some subjects would find the interventions offensive or embarrassing. We acknowledge that in this exemption the word “deception” is used to include withholding the purpose of the research, which is consistent with how the term is often used in this context.
The final rule exemption at § __.104(d)(4) is for secondary research use of identifiable private information and identifiable biospecimens for which consent is not required. This particular exemption combines several NPRM exclusion proposals. It exempts secondary research use of identifiable private information and identifiable biospecimens when:
• The identifiable private information or identifiable biospecimens are publicly available;
• The information is recorded by the investigator in such a way that the identity of subjects cannot readily be ascertained, and the investigator does not contact subjects or try to re-identify subjects;
• The secondary research activity is regulated under HIPAA; or
• The secondary research activity is conducted by or on behalf of a federal entity and involves the use of federally generated nonresearch information provided that the original collection was subject to specific federal privacy protections and continues to be protected.
By “secondary research,” this exemption is referring to re-using identifiable information and identifiable biospecimens that are collected for some other “primary” or “initial” activity. The information or biospecimens that are covered by this exemption would generally be found by the investigator in some type of records (in the case of information) or some type of tissue repository (such as a hospital's department for storing clinical pathology specimens).
It is important to recognize that this exemption does not cover any primary collections of either information or biospecimens. For example, if an investigator wants to collect information directly from research subjects by asking them to complete a questionnaire, that would not be covered by this exemption. If an investigator wants to collect biospecimens by having subjects swab their cheek, that would similarly not be covered by this exemption. On the other hand, an investigator who wants to use information that is in some databank, or use biospecimens that are in a pathology laboratory, or use the “excess” portion of blood that was drawn for clinical purposes, could use this exemption assuming all of the relevant conditions are met.
Also, note that unlike the pre-2018 rule's exemption relating to certain secondary uses of information and biospecimens, the final rule has no requirement that the information and biospecimens must be pre-existing at the time that the investigator begins a particular research study. For example, an investigator could start a study that involves using biospecimens from clinical pathology laboratories, and could include specimens that are added to the laboratories during the course of the study (again assuming that the other conditions of the exemption are met).
Public comments on each of the exclusions proposed in the NPRM and combined in this exemption follow.
Approximately 50 commenters discussed this proposed exclusion about identifiable private information or identifiable biospecimens that are publicly available or recorded by the investigator without identifiers. Public comments were mixed, with many indicating that investigators should not themselves be allowed to determine whether their research fits under this exclusion, and many indicating that this should be an exemption rather than an exclusion. A majority supported the clarifying language that this category of activities could include information that will be collected.
One commenter indicated that the prohibition on re-identification should apply to activities in publicly available data sets. This commenter also indicated that any research involving re-identification should undergo IRB oversight. Another commenter suggested that there should also be a prohibition in this category against the release or publication of information that would lead to re-identification.
One commenter indicated that the terminology used in this provision needed clarification. Specifically, the commenter wondered how one should interpret the term “recorded by the investigator” with respect to electronic data?
In response to a question posed in the NPRM about whether any of the exclusion categories should include biospecimens, a majority of those who responded to the question indicated that biospecimens should be included in this category.
The NPRM also asked whether this exclusion should apply to activities involving prisoners. Of those who responded to this question, responses were mixed with some indicating that this exclusion should apply to research with prisoners and others indicating that it would be inappropriate for research with prisoners to be allowed. One commenter indicated that allowing prisoners in this type of research would be a weakening of protections in activities involving vulnerable populations.
Approximately 50 comments discussed the NPRM proposal to exclude certain activities subject to HIPAA. Public comments were mixed, with many indicating that the protections required under HIPAA for “health care operations,” “research,” and “public health activities,” were sufficient, and that for the types of activities identified by the exclusion, review under the Common Rule did not provide meaningful protections. In contrast, others argued that because the scope of a privacy review board is narrower than for an IRB, these activities should not receive a blanket exclusion from the Common Rule.
Under the HIPAA Privacy Rule, health information is de-identified and thus exempt from that rule only if it neither identifies nor provides a reasonable basis to believe that the information can be used to identify an individual. The HIPAA Privacy Rule provides two ways to de-identify information: (1) A formal determination by a qualified expert that the risk is very small that an individual could be identified; or (2) the removal of all 18 specified identifiers of the individual and of the individual's relatives, household members, and employers, as long as the covered entity has no actual knowledge that the remaining information could be used to identify the individual (45 CFR 164.514(b)).
Otherwise, the HIPAA Privacy Rule addresses some informational risks by imposing restrictions on how individually identifiable health information collected by health plans, health care clearinghouses, and most health care providers (“covered entities”) may be used and disclosed, including for research. In addition, the HIPAA Security Rule (45 CFR parts 160 and subparts A and C of part 164) requires that these entities implement certain administrative, physical, and technical safeguards to protect this information, when in electronic form, from unauthorized use or disclosure. However, the HIPAA Rules apply only to covered entities (and in certain situations to their business associates). Not all investigators are part of a covered entity and thus some investigators are not required to comply with those rules. Moreover, the HIPAA Rules do not apply specifically to biospecimens in and of themselves.
One commenter proposed that the exclusion be expanded so that investigators from noncovered entities (as defined in the HIPAA Rules) would be eligible for the exclusion as well. Another commenter suggested that the HIPAA exclusion should be expanded to cover business associates and researchers that comply with HIPAA.
The NPRM asked whether the protections provided by the HIPAA Rules for identifiable health information used for health care operations, public health activities, and research activities are sufficient to protect human subjects involved in such activities, and whether the current process of seeking IRB approval meaningfully adds to the protection of human subjects involved in such research studies. Approximately half of the comments that addressed this question suggested that HIPAA protections are sufficient and that no additional safeguards were needed. Others expressed concern, and suggested that in some, if not all, of the categories in the HIPAA exclusion, HIPAA protections would not be sufficient.
One commenter suggested that this exclusion might be appropriate for health care operations or public health activities, but that the HIPAA rules were not sufficiently protective for research activities. Specifically, one commenter expressed concern that excluding from the Common Rule the use of PHI for research activities in HIPAA-covered entities would weaken protections for patients, because HIPAA's privacy safeguards were never intended to
One commenter also noted that other HHS preambles to rules have discussed the differences between the Common Rule and HIPAA, and these preambles noted that HIPAA was not intended to replace the Common Rule. This commenter suggested that given the language included in previous HHS preambles, additional justification for this exclusion would be needed before being included in a final rule.
One commenter felt that the HIPAA rules and HITECH adequately address the
Other commenters felt that this set of exclusions violates the protective mandate because HIPAA's provisions are narrow and do not reflect research ethics concerns. They noted that HITECH addresses technical data security for covered PHI for health care use but not for research use, especially if the data are sent elsewhere. Commenters felt that data used for research should be subject to HITECH data security standards and should not be excluded from Common Rule coverage.
Few commented on whether additional collections (
The NPRM asked whether additional or fewer activities regulated under the HIPAA Privacy Rule should be included in this exclusion. One commenter expressed concern that the HIPAA Privacy Rule was not appropriate because it both underregulates and overregulates research. Another commenter felt that the exclusion creates confusion because HHS has, in other contexts, discussed the differences between the Common Rule and HIPAA and the differing needs in separate contexts.
Approximately 20 comments discussed this proposed exclusion. Public comment was mixed, with several commenters suggesting that they did not understand the full scope of the information generated or collected by the government that would fall under this exclusion. A minority of comments indicated that this category of activities should be exempt rather than excluded.
The NPRM also asked whether this or a separate exclusion should also include research involving information collected for nonresearch purposes by nonfederal entities where comparable privacy safeguards have been established by state law or regulation. Few responded to this question. Of these, several indicated that this exclusion should not be expanded to cover nonresearch data, and should not be expanded to cover activities conducted by nongovernmental investigators using government-generated or -collected data. Several comments indicated that this category was acceptable as an exclusion, with a few commenters suggesting that the category could be further broadened.
One commenter suggested that this provision should apply to nonfederal entities if state laws are as protective as the federal laws cited. This commenter indicated that for these types of activities, the Common Rule protections did not provide meaningful additional protections to subjects. In contrast, several other commenters expressed concern that the privacy safeguards identified in this exclusion were not as protective of subjects as the Common Rule. One commenter indicated that clarifying what constitutes appropriate nonfederal use of this exclusion would be needed.
One commenter suggested that this exclusion might be reasonable as an exclusion if there were a public posting requirement for activities conducted under this exclusion. If this were the case, this commenter indicated that investigator self-determination of whether an activity fit under this exclusion would be reasonable.
In response generally to the question of whether any of the exclusions should apply to activities involving prisoners, a small number of comments addressed this question in the context of this exclusion. Of these responses, comments were mixed.
This exemption at § __.104(d)(4) is for secondary research uses of identifiable private information or identifiable biospecimens when consent is not required, if at least one of the following criteria is met:
• The identifiable private information or identifiable biospecimens are publicly available;
• Information, which may include information about the biospecimens, is recorded by the investigator in such a manner that the identity of human subjects cannot readily be ascertained directly or through identifiers linked to the subjects, the investigator does not contact the subjects, and the investigator will not re-identify subjects;
• The research involves only information collection and analysis involving the investigator's use of identifiable health information when that use is regulated under 45 CFR parts 160 and 164, subparts A and E, for the purposes of “health care operations” or “research” as those terms are defined at 45 CFR 164.501 or for “public health activities and purposes” as described under 45 CFR 164.512(b); or
• The research is conducted by, or on behalf of, a federal department or agency using government-generated or government-collected information obtained for nonresearch activities, if the research generates identifiable private information that is or will be maintained on information technology that is subject to and in compliance with section 208(b) of the E-Government Act of 2002, 44 U.S.C. 3501 note, if all of the identifiable private information collected, used, or generated as part of the activity will be maintained in systems of records subject to the Privacy Act of 1974, 5 U.S.C. 552a, and, if applicable, the information used in the research was collected subject to the Paperwork Reduction Act of 1995, 44 U.S.C. 3501
The criteria for this exemption were proposed in the NPRM as three exclusions. The final rule modifies the NPRM proposal to allow this exemption to apply to secondary research involving identifiable biospecimens, provided that the exemption's conditions are met. Note that because the NPRM proposal to alter the definition of a human subject to extend to research involving nonidentified biospecimens was not adopted, an exemption for research with such biospecimens is not needed. Accordingly, this exemption is only
The goal of the exemption at § __.104(d)(4) is to facilitate secondary research using identifiable private information or identifiable biospecimens that have been or will be collected or generated for nonresearch purposes or from research studies other than the proposed research study. Unlike two other new exemptions that also relate to secondary research (the ones at § __.104(d)(7) and § __.104(d)(8), discussed below), this exemption does not depend on any consent requirements imposed by the Common Rule being met.
The first two provisions of this exemption (§ __.104(d)(4)(i) and (ii)) are a modified version of the fourth exemption under the pre-2018 rule. The modified provisions allow the exemption to include research with information and biospecimens that do not yet exist when the research study is proposed for exemption (
The third and fourth provisions of the exemption have no precursors in the pre-2018 rule. The third provision applies the exemption to secondary research using identifiable private information covered under HIPAA, and the fourth provision applies the exemption to secondary research using identifiable private information collected for nonresearch purposes by the Federal Government, if compliant with the three cited federal statutes. These new rules will allow investigators to see identifiable private information, and also allow them to retain and record that information (including the identifiers) as part of their research records.
We also note that, according to new language at § __.104(b)(2) adopted as part of this final rule, this exemption permits the secondary research use of identifiable private information or identifiable biospecimens obtained from subjects who are prisoners, if the research is not designed in a way that seeks to recruit prisoners as a population but rather only incidentally (
The exemption criterion at § __.104(d)(4)(i) is for secondary research if the identifiable private information or identifiable biospecimens are publicly available. This would apply to secondary research use of archives in a public library, for example, or to government or other institutional records where public access is provided on request, or from a commercial entity if the information is provided to members of the public on request or if the only requirement for obtaining the information is paying a user fee, registering or signing in as a visitor to an archive. It would also apply if a commercial entity made identifiable biospecimens publicly available to anyone on request or for a fee. This exemption effectively acknowledges that for secondary research with publicly available information or biospecimens, IRB review would not reduce the risk.
The provision at § __.104(d)(4)(ii) exempts research involving identifiable private information, which may include information about biospecimens, if information is recorded by the investigator in such a manner that the identity of human subjects cannot readily be ascertained directly or through identifiers linked to the subjects, the investigator does not contact the subjects, and the investigator will not re-identify subjects. As with the provision at § __.104(d)(4)(i), this provision is related to an exemption that existed in the pre-2018 rule. In this instance, that prior exemption is being extended to now also cover research with information for which identifiers have been removed when the original collection of information or biospecimens occurs in the future.
The provision at § __.104(d)(4)(iii) permits the secondary research use of identifiable private information or identifiable biospecimens when the research involves only information collection and analysis involving the investigator's use of identifiable health information when that use is regulated under 45 CFR parts 160 and 164 (the HIPAA Privacy Rule), subparts A and E, for the purposes of “health care operations” or “research” as those terms are defined at 45 CFR 164.501, or for “public health activities” as described under 45 CFR 164.512(b).
With regard to the criterion at § __.104(d)(4)(iii), HIPAA also provides protections in the research context for the information that would be subject to this exemption (
This provision was not part of the pre-2018 rule, and was proposed as an exclusion in the NPRM. It is included as a component of an exemption in the final rule, consistent with public comments supporting the proposal.
The provision at § __.104(d)(4)(iv) did not exist in the pre-2018 rule and was proposed as an exclusion in the NPRM. It appears as a component of an exemption in the final rule. The exemption permits the use of identifiable private information or identifiable biospecimens for secondary research conducted by, or on behalf of, a federal department or agency using government-generated or government-collected information obtained for nonresearch activities, if the information originally involved a collection that adheres to the federal standards for safeguarding privacy as described in this part of the exemption.
We believe that the privacy protections are adequate for this type of research, and that it is unduly burdensome and confusing to require these protections and an additional set of protections. This provision has been modified to apply the federal statutory privacy safeguards identified in the exemption provision to both the original collection of the information, and to the secondary research use of the information to which the exemption applies.
Approximately 35 comments discussed the changes proposed in the public benefit or service program exemption. Few of the comments discussed the proposed expansion in OHRP's interpretation of this exemption to include the applicability of the exemption to cover research on public benefit and service programs that an agency does not itself administer through its own employees or agents, with a majority supporting the NPRM proposed expansion. One research university indicated that OHRP should not expand its interpretation of this exemption, and that it should be limited to “federally funded studies evaluating federal programs.” This institution did not offer justification for its comment.
Few comments were received about the proposed requirement for exemption designation of research or demonstration projects to be posted to a publicly available federal Web site. The comments discussing this proposed requirement supported it.
The majority of comments indicated that no additional requirements or limitations should be imposed on this exemption. These institutions argued that because this exemption represented a mechanism through which the Federal Government evaluated its own programs, additional limitations and restrictions in the Common Rule did not seem appropriate.
Specifically, with respect to whether or not some sort of notice should be required here, several commenters noted that any notice would need to be meaningful. One commenter indicated that because meaningful notice would be difficult, a notice requirement should not be imposed. One comment suggested that notice should only be required if opt-out would be permitted, and if not, no notice requirement should be imposed. Groups representing AI/AN populations supported the notice requirement and indicated that it should be required at a minimum.
The final rule includes this exemption as a modified version of an exemption proposed in the NPRM. The exemption at § __.104(d)(5) in the final rule applies to research and demonstration projects involving public benefit or service programs, and is a slightly revised version of the exemption in the pre-2018 rule. This revision is designed to clarify the scope of the exemption so that more research studies would be eligible, and to make the exemption easier to apply. It is also designed to allow the Federal Government to carry out important evaluations of its public benefit and service programs to ensure that those programs are cost effective and provide the intended benefits or services, consistent with the principle of beneficence. The wording of the exemption has added “improve” to the purposes of these activities, to make more explicit the idea that the Federal Government conducts these activities in order to enable them to make the public benefit and service programs better, and not just to gauge their current quality.
This exemption is for research and demonstration projects that are conducted or supported by a federal department or agency, or otherwise subject to the approval of department or agency heads. It applies to activities that are designed to study, evaluate, improve, or otherwise examine public benefit or service programs, including, but not limited to: Procedures for obtaining benefits or services under those programs; possible changes in or alternatives to those programs or procedures; or possible changes in methods or levels of payment for benefits or services under those programs.
In addition, the final rule clarifies the language of the exemption to conform to OHRP's previous interpretation of public benefit and service programs that are being evaluated as part of the research. This interpretation includes public benefit or service programs that a Common Rule department or agency does not itself administer or conduct through its own employees or agents, but rather supports through a grant or contract program. Therefore, the exemption applies to research and demonstration projects supported through, for example, federal grants or cooperative agreements. These changes would bring the regulatory language into conformance with other provisions of the rule that refer to research “conducted or supported” by federal departments and agencies. These methods of administration are, of course, always subject to department or agency head approval, either directly or by delegation. In addition, some of these research and demonstration projects are conducted through waivers, interagency agreements, or other methods that also require agency head approval. Accordingly, both the previous and revised language allow for the full panoply of methods by which research and demonstration projects on public benefit or service programs can be carried out.
The wording of the exemption also is clarified to specifically include projects involving waivers of otherwise mandatory requirements using authorities such as sections 1115 and 1115A of the Social Security Act, in order to make it plain that such research projects on public benefit or service programs qualify for the exemption. The relevant sections of the Social Security Act were also cited when this exemption was published in 1983.
In the interest of transparency, as was proposed in the NPRM, the final rule requires that each federal department or agency conducting or supporting the research and demonstration projects must establish, on a publicly accessible federal Web site or in such other manner as the department or agency head may determine, a list of the research and demonstration projects the federal department or agency conducts or supports under this provision. The research or demonstration project must be published on this list before beginning the research involving human subjects. The department or agency head can determine what sort of information will be included on this list and maintains its oversight. Departments and agencies that already publish research and demonstration projects on a publicly accessible Web site could satisfy this proposed requirement if the existing Web site includes a statement indicating which of the studies were determined to meet this exemption.
The goal of this proposed requirement is to promote transparency of federally conducted or supported activities affecting the public that are not subject to oversight under the Common Rule. It should not cause any delay to the research. HHS will develop a resource that all Common Rule departments and agencies may use to satisfy the requirement at § __.104(d)(5)(i). Alternatively, an agency can create or modify its own Web site for this purpose.
The exemption is not modified to require notice, to apply only to minimal risk research activities, or to require the privacy safeguards, for reasons reflected in the public comments. We agree with the public comments that argued that in many cases notice would be difficult or impossible to achieve effectively, and that this exemption enables the Federal Government to conduct important evaluations of its own programs that provide significant benefits to the public. In addition, federal departments
Approximately 20 comments discussed this exemption for taste and food quality evaluation and consumer acceptance studies. The NPRM did not propose changes to this exemption from what appeared in the pre-2018 rule. However, it did ask whether this exemption should be narrowed to apply only to activities for which prospective subjects have been given prior notice, and if so, how that notice should be issued. The NPRM further asked whether subjects should be allowed to opt out of exempt research.
A majority of comments received indicated that the final rule should maintain this exemption without any additional requirements. Commenters generally did not include explanation of this position. A small minority of commenters indicated that subjects should explicitly be provided the opportunity to opt out of this type of activity. In addition, a small minority of commenters indicated that subjects should be given notice before participation. One comment suggested that this exemption include “odor” evaluations as well.
The final rule retains the exemption from the pre-2018 rule, which was proposed in the NPRM without any change, for taste and food quality evaluation and consumer acceptance studies. This exemption applies if wholesome foods without additives are consumed, or if a food is consumed that contains a food ingredient at or below the level and for a use found to be safe, or agricultural, chemical or environmental contaminant at or below the level found to be safe by FDA or approved by the Environmental Protection Agency or the Food Safety and Inspection Service of the U.S. Department of Agriculture. This exemption is retained unchanged from the pre-2018 rule.
The final rule includes two exemptions related to the secondary research use (including storage or maintenance for such use) of identifiable private information and identifiable biospecimens that require a subject's broad consent.
The first of these exemptions is in the final rule at § __.104(d)(7), and applies to storing and maintaining identifiable private information or identifiable biospecimens for secondary research use.
The second of these exemptions is in the final rule at § __.104(d)(8) and applies to the secondary research use of identifiable private information and identifiable biospecimens for specific secondary research studies. Secondary research under this exemption would generally be conducted with the information or biospecimens stored and maintained under the exemption at § __.104(d)(7).
Both of these exemptions for the secondary use of identifiable private information and identifiable biospecimens require broad consent and are discussed in detail below. As with the secondary use exemptions that do not require the subject's broad consent (discussed above in Section V.3.d. of the preamble), the two exemptions at § __.104(d)(7) and (8) are also limited to “secondary research.” These exemptions pertain only to research that involves re-using information or biospecimens that were or will be collected for some other “primary” or “initial” activity distinct from using them in secondary research. These exemptions do not cover any primary collections of either information or biospecimens. In other words, if an investigator wants to collect information directly from research subjects, for example, by asking them to complete a questionnaire, that would not be covered by these exemptions. Or if an investigator wants to collect biospecimens by having subjects swab their cheeks, that collection would similarly not be covered by these exemptions. On the other hand, an investigator who wants to use information that is in some databank, or to use biospecimens that are in a pathology laboratory, could use these exemptions, assuming all of the relevant conditions of the exemptions were met.
In combination, approximately 150 comments discussed these proposals. Although commenters generally supported creating a pathway for low-risk research with biospecimens to occur without IRB review, a majority opposed the overarching proposal that these exemptions would, for the most part, be the only way (besides study-specific consent) for research with biospecimens to occur. Many of the arguments for and against these exemptions were outlined in section III.D, summarizing public comments received on the proposal to define “human subject” as including all biospecimens used in research, regardless of identifiability.
Many commenters opposed the idea that the exemption should allow specific secondary studies involving biospecimens retained with identifiers to occur without IRB review. These commenters noted that IRBs are required to assess more than privacy and confidentiality protections, and whether informed consent was sought and obtained. Other commenters noted that by effectively encouraging the retention of identifiers with biospecimens (which would likely be required to track which specimens could be used in research at an institution), the NPRM proposals effectively introduced new privacy and confidentiality risks to subjects that did not exist under the pre-2018 rule.
Some commenters who supported the expanded definition of human subject to include all biospecimens did not support these exemptions. These comments were mostly from members of the public and they generally argued that study-specific consent should be sought and obtained from subjects for every study involving that person's biospecimens. These comments expressed concern that, with broad consent, investigators could still engage in research activities without the individuals' knowledge.
Several commenters expressed opposition to the NPRM proposal that the exemption could not be used if the investigator intended to return research results to subjects. These commenters saw this as a disincentive to return research results and also noted that it seemed at odds with existing law (
The NPRM inquired about whether the proposed exemption was the best option, or whether there is a better way to balance respect for persons with facilitating research. Responses to this question were mixed, with a majority indicating that the proposed exemptions were not the best option. One comment indicated that broad consent would be reasonable if the consent was meaningful.
Other commenters opposed the proposal as written. One felt it provided too little information and another found the language too complex and subject to misinterpretation. One institution asserted that the exemption would pose a burden on the research enterprise, would make a significant subset of studies impracticable, and would increase costs.
Still other commenters indicated that consent should not be required for secondary research with biospecimens, noting that it was contradictory to determine that a type of research was exempt but still require consent, or that this exemption should not apply to state-mandated newborn DBS programs. One commenter suggested, “A far better option would be to include an exemption for the secondary research use of de-identified or nonidentified biospecimens, without the caveat of requiring a broad consent.”
The NPRM requested public comment on whether and how the provision regarding the return of research results should be revised. Public comment was mixed in response to this question. Several comments indicated that the provision was too complex to follow.
Comments that supported the provision about the return of research results in the proposed exemption stressed the complexity of decisions around returning results and many indicated support for required IRB review of investigators' plans for returning research results. One professional organization also emphasized the need to communicate to potential participants during the informed consent process the policies concerning the return of individual research results. Many commenters also called for detailed OHRP guidance on this provision.
One commenter suggested that the broad consent required when biospecimens are collected for storage for future research use include an indication as to whether potential subjects would like to be re-contacted with individual research results if applicable.
Other commenters were opposed to the provision as written. One large health system indicated that the provision discourages researchers from returning research results to participants and from providing participants with easy access to their individual research data. The commenter emphasized that “Respecting research participants as partners obligates us to avoid the assumptions that researchers, an IRB, or even a panel of experts . . . know best.” The commenter went on to say: “While the NPRM suggests researchers cannot use the Common Rule as a shield from a request to deliver a designated record set upon request, the policy seems to discourage equitable research practices and allows informational disparities to continue. This does not serve the interest of justice.”
In addition, one professional organization indicated concern that the provision might be interpreted by some to say that IRBs should not allow return of results, which it felt would create a bad situation.
The NPRM sought comment on whether there should be an additional exemption that would permit the collection of biospecimens through minimally invasive procedures (
Section __.104(d)(7) is an exemption for the storage or maintenance for secondary research use of identifiable private information or identifiable biospecimens. It requires that an IRB conduct limited IRB review to make the following determinations (required by § __.111(a)(8)):
• Broad consent for storage, maintenance, and secondary research use of identifiable private information or identifiable biospecimens is obtained in accordance with the requirements of § __.116(a)(1)-(4), and (a)(6), and (d);
• Broad consent is appropriately documented or waiver of documentation is appropriate, in accordance with § __.117; and
• If a change is made for research purposes in the way the identifiable private information or identifiable biospecimens are stored or maintained, adequate provisions must be in place to protect the privacy of subjects and to maintain the confidentiality of data.
This exemption is similar to the exemption proposed in the NPRM at § __.104(f)(1), but it has been modified in some respects, and the operation of this exemption is also affected by other changes in the final rule that are different from the NPRM. Namely, the exemption has been modified to apply only to storage or maintenance for secondary research use of identifiable private information or identifiable biospecimens, because the final rule does not incorporate the NPRM proposal to alter the definition of a human subject to extend to research involving biospecimens regardless of their identifiability. This exemption was also modified given the decision not to adopt the privacy safeguards proposed in the NPRM at § __.105.
In addition, the Secretary's template for broad consent is not being finalized for this exemption. Instead, institutions will have the flexibility to create their own consent forms that satisfy requirements at § __.116(a)(1)-(4), (a)(6) and (d) (see Section XIV). The consent form may be electronic.
Given these changes from the NPRM proposal, the limited IRB review requirement for this exemption provided at § __.111(a)(8) has been expanded in the final rule to require that the IRB make the following determinations, some of which are similar to those proposed in the NPRM.
The final rule requires that for the exemption to apply, the IRB must determine that broad consent for storage, maintenance, and secondary research use of identifiable private information or identifiable biospecimens is obtained in accordance with the requirements of § __.116(a)(1)-(4), (a)(6), and (d); This includes the requirement proposed in the NPRM that there be IRB review of the process through which broad consent will be obtained.
Also, given that we are not finalizing the proposed requirement to use the Secretary's template for broad consent, the final rule includes in this requirement that an IRB determine that the broad consent includes the requirements and elements of consent in accordance with § __.116(a)(1)-4), (a)(6), and (d).
The final rule also requires that the IRB determine that broad consent is appropriately documented or waived in accordance with § __.117. Although written broad consent generally will be required for this exemption to apply, the final rule also permits the exemption to apply when broad consent is obtained and an IRB has waived the documentation requirement for written informed consent under § __.117(c)(1).
And because the proposed privacy safeguards proposed in the NPRM at § __.105 are not included in the final rule, if a change will be made for research purposes in the way the identifiable private information or identifiable biospecimens are stored or maintained, the IRB must determine that when appropriate, adequate provisions are in place to protect the privacy of subjects and to maintain the confidentiality of data. This is the same IRB determination related to privacy and confidentiality that is required for nonexempt research. Importantly, this IRB determination is required only when a change is made for research purposes in the way the identifiable private information or identifiable biospecimens are stored or maintained, and only pertains to the aspects of storage and maintenance that are changed for research purposes. In this circumstance, the investigators are assuming responsibility for the manner in which the information and biospecimens are stored and maintained, and the IRB should be required to ensure that appropriate protections for the subjects are place with regard to the aspects of storage or maintenance that were changed for research purposes.
If, on the other hand, no changes are being made for research purposes to the storage or maintenance, then this IRB determination does not apply. The institution storing and maintaining the information or biospecimens of course still has its responsibility to determine what protections distinct from those required by the Common Rule are appropriate, which may include other legal or regulatory safeguards or institutional policies. In light of application of such additional safeguards, it appears unnecessary to require additional protections through a requirement of this final rule simply because the individuals providing broad consent have agreed that their biospecimens or information could be used for research at some point in the future. And of course this provision regarding changes made for research purposes applies only when a Common Rule department or agency supports or conducts the research activity.
Note that in many instances the only change that results from a person having signed a broad consent form for research relating to storing and maintaining that person's biospecimens or information is that the institution that is already holding the biospecimens or information (for clinical purposes, for example) merely creates a record indicating that this person has signed such a consent form. The biospecimens and information could remain stored in whatever way (and for whatever period of time) that the institution had previously been storing them, based on the legitimate nonresearch or research-related reasons that the institution has used for initially collecting and storing those biospecimens and information. Any privacy and security protections (outside of the Common Rule) that already may apply to the institution's information record-keeping or biospecimen preservation activities would continue to apply. The Common Rule's protections would not apply before a change in storage or maintenance occurs for research purposes, but rather the institution would continue to operate in accordance with its pre-existing legitimate reasons for having and storing the biospecimens and information. The fact that the broad consent form has been signed does not by itself mean that there needs to be any alteration of what the institution is already doing with the biospecimens or information.
Examples of changed aspects of storage or maintenance for research purposes that would require the IRB to find, before those changes go into effect, whether there are adequate provisions to protect the privacy of subjects and maintain the confidentiality of data include the following: If information or biospecimens are moved from one electronic or physical storage location to another due to considerations related to research plans; if information or biospecimens will be stored for longer than they otherwise would have been for the original purpose; if information or biospecimens are placed in a research registry or repository created to serve as a resource for investigators; or investigators are given electronic or physical access to the information or biospecimens. The relevant changes do not necessarily involve moving information or biospecimens from one location to another. Rather, the relevant changes include any change for research purposes that introduces or alters risks to the privacy or security of the stored information or biospecimens, including giving access to or transferring information or biospecimens for research purposes to someone who otherwise would not have access.
The rationale for this exemption is that with the requirement for limited IRB review and the specified required IRB determinations, including subjects' broad consent, this exemption respects subjects' autonomy and provides appropriate privacy safeguards. More specifically, we believe that broad consent provides some measure of autonomy for individuals to decide whether to allow the research use of their identifiable private information or identifiable biospecimens, without imposing the kind of burden on investigators that would result from a requirement for specific informed consent for each secondary research study. We believe that it is appropriate to create a mechanism for broad consent for secondary research use, even if it involves the potential risk of having identifiers associated with the identifiable private information or identifiable biospecimens. We believe the administrative burden is also acceptable in order to allow for broad consent for secondary research use.
Section __.104(d)(8) is an exemption that also requires that broad consent has been obtained, and is for research involving the use of identifiable private information or identifiable biospecimens. This exemption will frequently be paired with the exemption at § __.104(d)(7), which permits the storage and maintenance of identifiable private information and identifiable biospecimens for secondary research use. The exemption at § __.104(d)(8) would apply to a specific secondary research study, provided that the following criteria are met:
• Broad consent for the storage, maintenance, and secondary research use of the identifiable private information or identifiable biospecimens was obtained in accordance with § __.116(a)(1)-(4), (a)(6), and (d);
• Documentation of informed consent or waiver of documentation of consent
• An IRB conducts a limited IRB review to make the determination required by § __.111(a)(7), and to make the determination that the research to be conducted is within the scope of the broad consent; and
• The investigator does not include returning individual research results to subjects as part of the study plan. However, it is permissible under this exemption to return individual research results when required by law regardless of whether or not such return is described in the study plan.
This exemption could also apply if the investigator obtains appropriate broad consent from the subject in addition to the consent to an original specific study, and then proceeds to use the information or biospecimen in a secondary study.
The exemption at § __.104(d)(8) is similar to the exemption proposed in the NPRM, but it has been modified in some respects. As with the exemption at § __.104(d)(7), the operation of the exemption at § __.104(d)(8) is also affected by other provisions in the final rule that are different from what was proposed in the NPRM. Namely, the exemption has been modified to apply only to storage or maintenance for secondary research use of identifiable private information or identifiable biospecimens because the final rule does not incorporate the NPRM proposal to alter the definition of a human subject to extend to research involving biospecimens regardless of their identifiability.
Due to the decision not to adopt the proposed privacy and security safeguards proposed in the NPRM at § __.105, this exemption was also modified to require that limited IRB review include an IRB determination that, when appropriate, adequate provisions are in place to protect the privacy of subjects and the confidentiality of data (§ __.111(a)(7)). This is the same IRB approval criteria related to privacy and confidentiality that is required for nonexempt human subjects research.
In addition, because the final rule does not include a broad consent template when a specific study has been proposed, it is required that the study be reviewed by an IRB to determine whether the proposed secondary analysis fits within the parameters of the broad consent that was obtained for secondary research use.
We believe that the final rule's requirement for limited IRB review of the privacy and confidentiality protections and the adequacy of the broad consent is responsive to commenters who believe that IRB oversight should be retained for the secondary research use of identifiable private information and identifiable biospecimens.
We recognize commenters' point that this exemption does not provide an incentive to investigators to provide individual research results to subjects, but we believe that the challenges of how and when to return such results warrant consultation with the IRB. We note that with the other revisions to the NPRM proposals, other options for research involving identifiable private information and identifiable biospecimens exist, which would be consistent with having plans for returning individual results. Although broad consent may include a statement that clinically relevant research results might be returned to subjects, we believe that when specific secondary studies include such a plan to return research results, it would almost always be appropriate for the study to be reviewed by an IRB, in part to better ensure that research results are disclosed to subjects in an appropriate manner. The only exceptions would be if the research qualified for another exemption, an IRB waived informed consent under § __.116(e) or (f), or the research was carried out under a Secretarial waiver at § __.101(i). We expect that as part of the IRB's review, the IRB would consider what subjects were told in the broad consent regarding the return of research results.
It should be noted that the two exemptions in the final rule at § __.104(d)(7) and (8) create additional options for investigators to conduct secondary research studies with identifiable private information. The final rule retains, largely unchanged, the options previously available to investigators in the pre-2018 rule. For instance, the final rule retains the pre-2018 criteria for requesting a waiver of consent in order to carry out those studies without obtaining consent. Moreover, secondary research using nonidentified biospecimens would not have to meet these requirements, because the final rule does not finalize the NPRM proposal to alter the definition of a human subject to include research involving nonidentified biospecimens under the rule.
The NPRM proposed to delete language found in the pre-2018 rule that exempted surveys and interviews with public officials. Approximately 100 comments discussed this proposed deletion and it was almost universally opposed. Political science professors, students, researchers, and academics from other disciplines generally addressed this deletion.
Comments argued that this deletion would have a chilling effect on political science research and might make political science researchers more vulnerable to law suits. Other comments noted that public officials are generally treated differently in numerous laws, and it is in fact appropriate for the Common Rule to have a different standard for surveys and interviews with public officials. Comments also suggested that this deletion could negatively affect the public's ability to hold public officials accountable for their actions. One commenter suggested that instead of deleting this exemption, a final rule might consider explicitly limiting this exemption to studies that relate to the public officials in their official capacity.
The final rule removes the exemption category in the pre-2018 rule at § __.101(b)(3)(i), which pertained to research involving the use of educational tests, survey procedures, interview procedures, or observation of public behavior, if the human subjects are elected or appointed public officials or candidates for public office, or if federal statute requires without exception that the confidentiality of the personally identifiable information will be maintained throughout the research and thereafter. We note that many of the public comment concerns are addressed by other provisions in the final rule. Almost all of the research activities in this category would already be exempted under the final rule at § __.104(d)(2), without needing to single out elected or appointed officials as being treated differently in this way. If the research is designed to provide sensitive generalizable knowledge about officials, then the identifiable private information obtained should be kept confidential as required by this final rule. If the purpose of the activity is in fact designed to hold specific elected or appointed officials up for public scrutiny, and not keep the information confidential, such an activity is not considered research under the provision at § __.102(l)(2).
Thus, the final rule adopts the NPRM proposal.
One exemption proposed in the NPRM is not included in the final rule. Note that exclusions proposed in the
The NPRM proposed to exempt certain secondary research activities involving identifiable private information where notice of such use had been given. The proposed exemption was included, in part, to be responsive to section 511 of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), which requires the Secretary to issue a clarification or modification with respect to the application of these regulations to certain activities involving clinical data registries. The preamble for the Common Rule NPRM noted “. . . this exemption category might allow certain research activities of these clinical data registries not otherwise covered by the proposed HIPAA-related exclusion (
Approximately 70 comments discussed this proposal, with the vast majority from institutions. A minority of commenters (14) supported the NPRM proposal as drafted. In addition, 11 commenters who did not indicate whether they supported the inclusion of this proposal in a final rule asked questions about implementation and the meaning of “notice” under this proposal.
A majority of commenters (41) opposed the proposal as drafted in the NPRM, citing a variety of conflicting reasons:
• Sixteen commenters felt that the NPRM proposal was too permissive as drafted, and that it would not provide adequate protections to prospective subjects. Many of these commenters also suggested that the proposal as drafted did not respect subject autonomy interests sufficiently in not providing subjects with an ability to opt out. They indicated that the exemption might be acceptable if additional requirements (such as subject opt out), or additional limitations (such as limiting the nonresearch information to which this exemption applies to data governed by certain privacy-oriented laws) were implemented.
• Fourteen commenters felt that the NPRM proposal was too restrictive, and that as drafted it would not achieve the stated goal of reducing administrative burden on IRBs. These commenters specifically discussed the implementation burdens involved in providing notice to prospective subjects. These commenters also noted that providing an option to opt out would be very burdensome to IRBs and investigators, an outcome that seemed counter to the justifications the NPRM provided for this exemption.
• Five commenters felt that the type of research encompassed by this proposal should not be exempted from the Common Rule, and that IRB review or informed consent should be required instead.
Approximately 25 comments discussed whether the NPRM proposal was necessary to enable activities involving qualified clinical data registries. A majority of these comments indicated that because the activities would be subject to the HIPAA regulations, protection of subjects would not be enhanced by the proposed NPRM exemption. Several commenters pointed out that qualified clinical data registries also might qualify for exclusion under the NPRM proposal at 101(b)(2)(ii). Additional comments suggested that other NPRM exemptions and exclusions would cover activities with qualified clinical data registries without commenting on which exemptions and exclusions applied.
The NPRM included the exemption at § __.104(e)(2), in part, to be responsive to section 511 of MACRA, but commenters expressed little support for this exemption, even for activities carried out by clinical data registries. Section 511 of MACRA has directed the Secretary of HHS to issue a clarification or modification with respect to the application of the Common Rule to activities involving clinical data registries, including quality improvement activities. With this final rule, the Secretary of HHS is providing that clarification here. Because clinical data registries are created for a variety of purposes, and are designed and used in different ways, there is no simple, single answer regarding how the Common Rule applies to clinical data registries. The Secretary of HHS has received advice from SACHRP on this topic, and SACHRP recommended that the pre-2018 rule was adequate to apply to clinical data registries without those registries being given any distinctive status. The Secretary of HHS believes that the same is true for the final rule, and so has not created a specific provision for clinical data registries.
The final rule does not impose any requirements on a large portion of the activities related to clinical data registries. The following points are important: First, the rule does not apply to clinical data registry activities not conducted or supported by a Common Rule department or agency. Second, many clinical data registry activities, including many quality improvement activities, do not meet the definition of research, and so the Common Rule does not apply. For example, the creation of a clinical data registry designed to provide information about the performance quality of institutional care providers, and whose design is not influenced or altered to facilitate research, is not covered by this rule even if it is known that the registry will be used for research studies. Third, the Common Rule does not apply to a clinical data registry research study that only involves obtaining and analyzing nonidentified information because that activity would not involve a “human subject” as defined by the rule. Fourth, some clinical data registry research activities may qualify for exemption under the proposed provision at § __.104(d). Fifth, if an institution solely releases identifiable private information that was obtained in the course of patient clinical care to a clinical data registry for research, that institution is considered to be not engaged in human subjects research, and no requirements of the rule apply to that institution.
In contrast, if investigators receive funding from a Common Rule department or agency to design a clinical data registry for research purposes and the registry includes identifiable private information, or involves interacting with individuals (
Increasing research use of genetic information, information obtained from analysis of biospecimens, and the ability to more easily merge multiple sources of
Based on questions from and conversations with members of the regulated community, we are aware that IRBs are not always equipped with the expertise needed to evaluate risks to privacy and confidentiality, specifically regarding sophisticated IT security. However, we note that no data suggest that IRBs are currently approving research without requiring appropriate privacy and confidentiality safeguards. Despite this, we recognized that setting standards could assure appropriate privacy and confidentiality consideration and consequent protections to all research subjects, without the administrative burden of needing a specific committee review of the privacy and confidentiality protections of each study. To that end, the 2011 ANPRM suggested establishing mandatory data security and information protection standards for all studies that involve the collection, generation, storage, or use of identifiable or potentially identifiable information that might exist electronically or in paper form or be contained in a biospecimen. It put forward the idea that these standards might adopt the categories used in the HIPAA Rules and asked a series of questions about how best to protect private information.
A goal of the NPRM was to ensure that researchers protect the privacy of their participants and the security of the data, calibrated to the likelihood of identifiability and sensitivity of the information being collected. The NPRM proposed to require that investigators and institutions conducting research subject to the Common Rule implement reasonable safeguards for protecting against risks to the security or integrity of biospecimens or identifiable private information. Given the significant concerns of public commenters about an idea discussed in the 2011 ANPRM of adopting the standards solely modeled on certain standards of the HIPAA Rules, the NPRM proposed several sets of standards, and allowed a choice about which set to use.
First, the NPRM proposed that the Secretary of HHS could publish a list of specific measures that an institution or investigator could use to meet the security requirements. The list would be evaluated and amended, as appropriate, after consultation with other Common Rule departments and agencies. The proposed list would be published in the
The specific safeguards that would be identified by the Secretary would be designed so that they could be readily implemented by the individual investigator, and could build on existing safeguards already in place to protect research data. These standards would include security safeguards to assure that access to physical biospecimens or data is limited only to those who need access for research purposes. The standards would also assure that access to electronic information is authorized only for appropriate use. Finally, the safeguards, collectively referred to as “privacy safeguards,” would assure that information and biospecimens posing informational risks to subjects would be protected according to appropriate standards.
Second, the NPRM proposed that if an institution or investigator is currently required to comply with the HIPAA rules, then the safeguards required by the Common Rule would be satisfied. No additional requirements were proposed to protect information subject to the HIPAA Rules. The NPRM also proposed to clarify that the proposed provisions would not amend or repeal the requirements of 45 CFR parts 160 and 164 for the institutions or investigators to which these regulations apply pursuant to 45 CFR 160.102. Institutions or investigators that are not required to follow HIPAA could voluntarily implement the HIPAA Rules and be considered as satisfying the proposed requirements. The NPRM also proposed that for federal departments and agencies that conduct research activities that are or will be maintained on information technology that is subject to and in compliance with section 208(b) of the E-Government Act of 2002, 44 U.S.C. 3501 note, if all of the information collected, used, or generated as part of the activity will be maintained in systems of records subject to the Privacy Act of 1974, 5 U.S.C. 552a, and the research will involve a collection of information subject to the Paperwork Reduction Act of 1995, 44 U.S.C. 3501
For purposes of informing the development of the proposed privacy safeguards, the NPRM sought comment on the types of safeguards that would be appropriate for the Secretary's list. The NPRM also noted that additional statutes or acts mandate the protection of privacy and confidentiality of identifiable private information. It might be reasonable to include these as additional standards that would meet the proposed requirement if they were met in research that is subject to those standards or for which an investigator or institution has voluntarily elected to comply. Public comment was sought on whether any of these existing statutes or acts would serve the goals of proposed privacy safeguards.
The NPRM also included conditions for use and disclosure of research information to other entities. It required that protections be in place when a biospecimen or identifiable private information is shared for appropriate research or other purposes. Unless required by law, the NPRM proposed to limit the re-disclosure of identifiable private information or release of biospecimens obtained for research.
The NPRM asked for feedback on whether limiting re-disclosure to four specific circumstances unless such a disclosure was “required by law” would be too restrictive, or whether more permissive standards would better facilitate the NPRM goal of fostering the secondary research use of information. The NPRM also whether the proposed limitations on re-disclosure were more or less restrictive than necessary and whether there should be additional purposes for which release of biospecimens or re-disclosure of identifiable private information would be permitted should be allowed.
The NPRM justified this change by arguing that its benefit would be that IRBs would not be required to review the individual plans for safeguarding information and biospecimens for each research study. Although the NPRM presumed that the proposed privacy safeguards would be sufficient, an IRB could determine that a particular activity would require more than what was proposed. Once IRBs became familiar with standard institutional and investigator-adopted protections, the NPRM anticipated that they would become more comfortable with the fact that they need not review every protocol for privacy safeguards. In addition, it was expected that if the proposed privacy safeguards were adopted, overall reduction in regulatory burden would occur because IRBs would not
Finally, as discussed in Section V, the NPRM contained proposed exemptions that would have permitted a larger number of protocols to proceed without IRB review if specific conditions were met, conditioned on investigators and institutions also meeting the proposed privacy and security requirements. Note that there was no requirement for an IRB to determine whether investigators were adhering to the privacy safeguards for such exempt research.
Approximately 130 comments addressed the privacy safeguards, with a majority generally supporting the proposal. Both those who supported the proposal and those who opposed it indicated that it was difficult to comment on the adequacy of privacy standards that had yet to be developed.
Those who supported the proposal stated that having standardized, minimum safeguards would create more consistency across IRBs in how biospecimens and identifiable private information are protected. Those who were opposed to the proposal stated that patient information is already covered by HIPAA security standards and student records are already covered by FERPA, arguing that these plus an array of other standards cover financial and various other types of sensitive information, making inclusion in the Common Rule redundant.
However, several comments asserted that the HIPAA standards, while appropriate for health information, would not be appropriate for other types of research data. Others noted that the wide range and nature of research makes it too challenging to develop a blanket standard. With regard to applying the standards to exempt research, one large association of research universities, medical centers, and independent research institutes argued that research covered by the proposed exempt or excluded categories should be low risk and therefore third party evaluation of privacy safeguards was not needed. Several academic research institutions urged that if the security and privacy requirements were included in the final rule, then the measures should be as simple as possible. For example, they suggested developing a single set of standards for all identifiable data rather than calibrating the safeguards to the sensitivity of the information to be collected.
A few comments addressed the proposed re-disclosure criteria. Of these, a majority indicated concerns with the NPRM redisclosure provision. Most of the opposition was specifically aimed at imposing the sharing criteria for nonidentified biospecimens. These commenters indicated that for sharing nonidentified biospecimens, imposing HIPAA-like privacy safeguards was unnecessary and would be extremely burdensome. Several comments suggested that the Common Rule adopt the same permissible uses and disclosures of information without authorization that exists under HIPAA.
One scientific professional organization and more than 60 institutions endorsing its comments noted that specific redisclosure considerations should exist for identifiable biospecimens, stating that redisclosure of the identity of the source of a biospecimen is appropriate in rare situations in which a confirmed research finding may have a significant impact on the health of the donor of the specimen. A large, private higher education institution noted that the limitations on use, release, and disclosure as proposed seemed at odds with the permissible uses and disclosures allowed under HIPAA.
Others suggested that the language stating that biospecimens or identifiable private information could be released for any lawful purpose with the consent of the subject was too open-ended and permissive. One data privacy and security advocacy group also noted that the introductory language to the proposed safeguards could be read as requiring an investigator to release research biospecimens or disclose identifiable private information upon receipt of a valid request, as opposed to simply permitting an institution to do so. One academic research organization suggested an alternative approach—that the Federal Government clarify that institutions and networks may designate specialized privacy and security boards to review safeguards.
The final rule does not adopt the privacy and security protections proposed in the NPRM, but rather retains and acknowledges the IRB's role in ensuring that privacy safeguards are appropriate for the research studies that require IRB review. To better ensure that appropriate privacy protections are required by IRBs, the final rule includes a new provision in the IRB review and approval criteria at § __.111(a)(7)(i) that requires the Secretary of HHS in consultation with OMB and the Common Rule departments and agencies to issue guidance o assist IRBs in assessing what provisions are adequate to protect the privacy of subjects and to maintain the confidentiality of data. This requirement is discussed in more detail in Section XI.
Although we continue to believe that appropriately protecting the privacy of human subjects who provide identifiable private information and identifiable biospecimens as well as preventing security breaches is critically important, we agree with the public's concerns about requiring adherence to privacy and security standards when the safeguards to be issued by the Secretary of HHS have yet to be developed. The federal privacy and security laws would apply only to certain federally conducted research. Rather than promulgate a regulation that lacked sufficient specificity, we determined it would be preferable to maintain the requirement that IRBs review research studies to ensure that appropriate privacy and security safeguards are in place to protect research subjects, but include a commitment that the Secretary of HHS will issue guidance to assist IRBs in appropriately protecting subjects' privacy and confidentiality. This guidance would take into consideration, among other things, the level of identifiability and sensitivity of the information being collected. Although IRBs were not specifically designed to evaluate risk to privacy and confidentiality and the adequacy of safeguards to protect against those risks, IRBs have been responsible for evaluating such risks under the pre-2018 rule. We believe that guidance in this complex and evolving area will assist IRBs to identify appropriate protections, and may be better able than standardized protections, to address the variety of privacy and confidentiality concerns that arise in the broad range of research studies that are being carried out now and those that will be conducted in the years to come.
As discussed in Section V, certain NPRM exemption proposals required the application of the NPRM's proposed safeguards in whole or in part. To accommodate the fact that the final rule does not include the privacy safeguards, exemption categories in the final rule that are predicated on the need for some type of privacy safeguards will instead require that an IRB conduct a limited review to ensure that adequate provisions are in place to protect the privacy of subjects and to maintain the confidentiality of data.
The final rule exemptions subject to this limited IRB review requirement are:
• The exemption for research that includes only interactions involving
• The exemption for research involving benign behavioral interventions in conjunction with the collection of information from an adult subject through verbal or written responses or video recording (regardless of the identifiability or sensitivity of the information collected/recorded (§ __.104(d)(3)(i)(C));
• The exemption for the storage or maintenance of identifiable private information or identifiable biospecimens for which broad consent is required, when there is a change specific to the research activity in how the identifiable private information or identifiable biospecimens are stored and maintained (§ __.104(d)(7)); and
• The exemption for the secondary research use of identifiable private information or identified biospecimens for which broad consent is required (§ __.104(d)(8))
The pre-2018 rule stipulated a condition of IRB membership at § __.107(a) stating that IRBs should aim for membership that does not consist entirely of individuals of one gender, race, or cultural background. It referred again to the characteristics of IRB members at § __.107(b), stating that efforts should be made to ensure that no IRB consists entirely of members of one gender or one profession.
The pre-2018 rule also referred to the concept of vulnerability and consideration of vulnerable populations in three provisions, one of which pertained to IRB membership (§ __.107(a)), one with regard to selection of subjects (§ __.111(a)(3)), and one with regard to additional protections needed for subjects vulnerable to coercion or undue influence (at § __.111(b)). Under the pre-2018 rule, only § __.111(b) of the three provisions specifically referred to
The NPRM proposed eliminating the pre-2018 rule stipulation that IRBs should aim for membership that does not consist entirely of individuals of one gender or profession because the requirement that IRB membership reflect members of varying backgrounds and diversity, including gender, accomplishes the same goal.
Further, the NPRM proposed that the criterion at § __.111(a)(3) be revised to align with the language of § __.111(b) to reflect that the vulnerability of the populations in these research studies should be considered to be a function of the possibility of coercion or undue influence, and that this vulnerability alone should be the IRB focus of concern with respect to this criterion. The proposed change was intended to provide greater consistency and clarity in IRB consideration of vulnerability of subject populations in research activities and appropriate protections. A comparable change was also proposed at § __.107(a), pertaining to IRB membership.
In addition, the NPRM proposed that the term “handicapped” be changed to “physically disabled” individuals. Therefore, to enhance consistency and clarity among these three provisions, it was proposed that the term “physically disabled” be inserted at § __.111(a)(3) and (b). This would mean that physically disabled persons would be among the individuals that the IRB may consider in determining that the selection of subjects is equitable (§ __.111(a)(3)), and that the IRB may consider to be vulnerable to coercion or undue influence (§ __.111(b)). Public comment was sought on whether pregnant women and those with physical disabilities should be characterized as vulnerable to coercion or undue influence. Whether or not these subpopulations are considered vulnerable to coercion or undue influence would not affect the applicability of subpart B.
Finally, the NPRM proposed a change in § __.107(a), involving the insertion of “economically or educationally disadvantaged persons” as an example of a vulnerable population, and requiring an IRB to give consideration to membership expertise in this area. This language was already included in the pre-2018 rule at § __.111(a)(3) and § __.111(b). Adding this category of individuals to those who may be considered vulnerable to coercion or undue influence at § __.107(a) was intended to create greater consistency among these three provisions.
Between 40 and 50 NPRM comments discussed the language describing vulnerable populations found in §§ __.107(a), __.111(a)(3), and (b). A majority of these comments only discussed the inclusion of pregnant women as an example of a population that might be vulnerable. Typically, comments addressed only one of the three questions posed in the NPRM about these provisions. The questions asked whether the § __.111(a)(3) and (b) focus on issues related to coercion or undue influence in research with vulnerable populations, and no other considerations related to vulnerability, was appropriate; whether pregnant women and those with physical disabilities should be included in the category of subpopulations that may be vulnerable to coercion or undue influence; and, whether populations should be considered vulnerable for reasons other than vulnerability to coercion or undue influence.
A majority of the comments stated that the inclusion of pregnant women as an example of a group that might be vulnerable to coercion or undue influence was inappropriate. These commenters noted that to suggest that noncognitive limitations make individuals inherently vulnerable is insulting to those populations. Of those comments that addressed these proposals, a minority discussed whether individuals with physical disabilities should be included as an example of a group that might be vulnerable to coercion and undue influence. As with pregnant women, these commenters stated that the insinuation that groups with physical disabilities might be inherently vulnerable to coercion and undue influence was insulting. One commenter noted that a physical condition might make one vulnerable to coercion or undue influence in the research context, but typically only when the research activity targets that vulnerability (as opposed to those populations always being vulnerable).
In terms of whether other types of vulnerabilities should be considered by IRBs, public comment was mixed. Some commenters indicated that in the research context, the specific concerns with respect to vulnerable populations are limited to vulnerability to coercion and undue influence, while others noted that the regulations do not preclude an IRB from considering other types of vulnerability and that because of this flexibility, additional regulatory text was not necessarily needed. Groups specifically concerned with issues related to research involving Native
Commenters who disagreed with this change generally felt that a history of societal marginalization, such as that experienced by LGBT groups or AI/AN tribes, should be a basis for determining vulnerability, and that a focus on only coercion or undue influence may be insufficient for IRB consideration.
Several comments discussed the fact that using the term mentally disabled is potentially patronizing. One commenter suggested that instead of listing mentally disabled individuals as a group that might be vulnerable to coercion and undue influence, the regulations should use the term “populations with impaired decision making ability.” This suggestion echoes a recommendation made by SACHRP in 2009 as well.
Another commenter stated that vulnerability status should be based on situational context, not on membership in a population, which potentially promotes stigmatization. Rather, focus should be more on the risk of the research and the situation of each subject when asked to participate in research. Finally, it was suggested that terminally ill patients who have exhausted all standard therapies, and possibly other research interventions, should be considered vulnerable.
A majority of comments agreed that the focus on issues related to coercion or undue influence, and no other considerations related to vulnerability, was appropriate. We agree with this assessment, and have retained this language in the final rule. We believe this change will help guide IRBs when assessing the type of vulnerability that should be the focus of review. We note that the § __.111(a)(3) approval criterion retains the reference to the purposes of the research and the setting in which it is conducted because these considerations are also relevant to the assessment of the equitable selection of subjects, and may include factors such as societal marginalization or discrimination.
The language at the three provisions (§ __.107(a), § __.111(a)(3), and § __.111(b)) has been made identical in referring to vulnerability as meaning vulnerability to coercion and undue influence, in recognition that coercion or undue influence refers to the ability to make an informed decision about participating in research.
We agree with comments that said that the list of example vulnerable populations listed in the pre-2018 rule is out of date.
In agreement with the majority of comments, the final rule no longer includes pregnant women or “handicapped” or physically disabled individuals as examples of populations that are potentially vulnerable to coercion or undue influence. Adopting a suggestion from public comment and SACHRP, the final rule uses the term “individuals with impaired decision-making ability” to replace the term “mentally disabled persons.”
The pre-2018 rule outlined IRB functions and operations at §§ __.103 and __.108.
The NPRM contained several proposals for changes in IRB functions and operations. Of relevance here, the requirements for recordkeeping by IRBs would no longer appear in § __.103 of the rule but in § __.108. Much of the discussion related to these changes appears in Section IV regarding the assurance process. The issues are summarized here.
The NPRM proposed that the requirement that a written assurance include a list of IRB members for each IRB designated under the assurance process be replaced. In its place, the NPRM proposed that the assurance include a statement for each designated IRB, prepared and maintained by the institution, or when appropriate the IRB, with a current detailed list of the IRB members including information sufficient to describe each member's chief anticipated contributions to IRB deliberation; and any employment or other relationship between each member and the institution. The regulatory requirement at § __.103(b)(3) that changes in IRB membership be reported to the department or agency head, or to OHRP when the existence of an HHS-approved assurance is accepted, would be deleted, eliminating the requirement. Instead, an institution would be required under proposed § __.108(a)(2) to maintain a current IRB roster, but such a roster would not need to be submitted to OHRP or other agency managing the assurance of compliance process.
The NPRM also proposed to eliminate the requirement in § __.103(b)(2) that an institution designate one or more IRBs on its FWA established in accordance with the Common Rule. The requirement in the pre-2018 Common Rule at § __.103(b)(2) that IRBs have sufficient meeting space and staff to support IRB reviews and record keeping requirements was moved in the NPRM to § __.108(a)(1). Note that under this proposal federal departments or agencies would retain the ability to ask for information about which IRBs review research conducted at an institution as part of the assurance process.
Approximately 10 comments were received on these proposals. Of those, all supported the NPRM proposal that changes in IRB membership no longer needed to be reported to the funding department or agency. All commenters supported the proposal that IRBs would simply need to prepare and maintain a current list of IRB members. Commenters agreed that the proposed changes to the IRB roster requirement would reduce administrative burden without having any significant impact on the protection of human subjects. Those who commented on the proposed deletion of the requirement to designate one or more IRBs on an institution's FWA generally supported the proposal.
No comments were received on the proposed movement of IRB policy and recordkeeping requirements from § __.103 to § __.108.
The final rule adopts the NPRM proposals to move the IRB recordkeeping requirements from § __.103(b)(3), (4), and (5) to § __.108(a)(2), (3), and (4). (See Section IV regarding changes to § __.103 as well.) The final rule also adopts the NPRM proposal that IRBs must maintain an accurate list of IRB members but are not required to submit changes to that roster to the funding department or agency. The final rule also adopts the NPRM proposal to delete the requirement in the pre-2018 rule
The pre-2018 rule listed four areas of responsibility for IRBs in the review process concerning their authority to approve, request modification, or disapprove research activities; ensure informed consent requirements are met (including documentation or waiver, as relevant); notify investigators of their determinations; and conduct continuing review of research. The rule at § __.109(a) stated that IRBs have the authority to carry out these responsibilities for all research activities covered by the policy.
In particular, the pre-2018 rule at § __.109(e) required that IRBs conduct continuing review of research covered by this policy at intervals appropriate to the degree of risk, but not less than once per year. Except when an expedited review procedure was used, continuing review of research was to occur at convened meetings at which a majority of the IRB members are present, including at least one member whose primary concerns are in nonscientific areas.
An IRB could use an expedited review procedure to conduct continuing review of research for some or all of the research appearing on the list of research eligible for expedited review
The NPRM proposed clarifying that the Common Rule does not give IRBs the authority to review or approve, require modification in or disapprove research that qualifies for the exemptions proposed in the NPRM.
The NPRM also proposed to eliminate continuing review for many minimal risk studies (namely those that qualify for expedited review), unless the reviewer documents why continuing review should take place, which would be required according to the NPRM. Moreover, for studies initially reviewed by a convened IRB, continuing review would not be required, unless specifically mandated by the IRB, after the study reaches the stage where it involves only one or both of the following: (1) Analyzing data (even if it is identifiable private information); or (2) accessing follow-up clinical data from procedures that subjects would undergo as part of standard care for their medical condition or disease.
In addition, the NPRM proposed that continuing review would not be required for research involving certain secondary research using information and biospecimens that requires limited IRB review in order to qualify for an exemption proposed in the NPRM.
Further, the NPRM proposed that an IRB must receive annual confirmation that research is ongoing and that no changes have been made that would require the IRB to conduct continuing review (that is, the study still qualifies for expedited review because it still meets the criteria listed above and still involves no greater than minimal risk).
The NPRM also proposed a new requirement for IRBs to maintain records of continuing reviews. Because the NPRM proposed a new provision that eliminates the need for continuing review under specific circumstances, it also proposed that IRBs need to justify the need for continuing review in cases where it was not required. If an IRB chooses to conduct continuing review even when these conditions are met, the NPRM stated that the rationale for doing so must be documented.
Approximately four comments addressed the clarification proposed in the NPRM that IRBs were not authorized by this policy to review exempt research. All who commented opposed the proposed modification. Those who commented were concerned that IRBs and institutions would interpret the modifications to mean that IRBs were precluded from ever reviewing such research and pointed to the possibility, although rare, that there might be a need to do so, particularly if the initial exemption determination was flawed.
With regard to continuing review, approximately 120 comments discussed this proposal. A strong majority of comments (approximately 95) supported this proposal and approximately 15 opposed it. Other comments were mixed. Those who supported the proposal said that it would indeed alleviate IRB administrative burden without diminishing the protections afforded to human subjects. Those who did not support this proposal believed the continuing review process served an important role in allowing an institution to periodically re-evaluate the benefits, risks, methods, and procedures used in research activities, and whether the research had been modified without approval. Some commenters who supported the proposal were opposed to the requirement for annual confirmation to the IRB that such research is ongoing and that no changes have been made that would require the IRB to conduct continuing review. They stated that the burden alleviated by eliminating the need for continuing review was offset by the requirement to submit an annual confirmation.
The final rule at § __.109(a) modifies the language of the pre-2018 rule to state that IRBs review and have the authority to approve, require modifications in, or disapprove all research activities covered by this policy, including exempt research activities under § __.104 for which limited IRB review is a condition of exemption (§ __.104(d)(2)(iii), § __.104(d)(3)(i)(C), § __.104(d)(7), and § __.104(d)(8)). Since the final rule requires limited IRB review for certain categories of exempt research, the provision at § __.109(a) has been modified to clarify that IRBs have the authority needed to conduct limited IRB review.
As proposed in the NPRM, and as generally supported in public comments, continuing review is eliminated for all studies that undergo expedited review, unless the reviewer explicitly justifies why continuing review would enhance protection of research subjects (§ __.109(f)(1)(i) and § __.115(a)(3)). For studies initially reviewed by a convened IRB, once certain specified procedures are all that remain for the study, continuing review would not be required, unless specifically mandated by the IRB. These activities include: (1) Research eligible for expedited review in accordance with § __.110; or (2) Research that has progressed to the point that it involves only one or both of the following, which are part of the IRB-approved study: (a) Data analysis, including analysis of identifiable private information or identifiable biospecimens, or (b) Accessing follow-up clinical data from procedures that subjects would undergo as part of clinical care (at § __.109(f)). In addition, the final rule states at § __.109(f)(1)(ii) that continuing review is not required for research reviewed in accordance with the limited IRB review procedure described in § __.104(d)(2)(iii),
The final rule does not require investigators to provide annual confirmation to the IRB that such research is ongoing and that no changes have been made that would require the IRB to conduct continuing review. Institutions that choose to require some accounting of ongoing research not subject to continuing review have significant flexibility in how they implement their own requirements. Note that under the final rule, investigators would still have the current obligations to report various developments (such as unanticipated problems or proposed changes to the study) to the IRB.
Under the pre-2018 rule, a research study could receive expedited review if the research activities to be conducted appear on the list of activities published by the Secretary of HHS that are eligible for such review,
The NPRM proposed changes regarding expedited review, to allow expedited review to occur for studies on the Secretary's list unless the reviewer(s) determine(s) that the study involves more than minimal risk. This was in contrast to the pre-2018 regulations, which required that an IRB use the expedited review procedure only if the reviewer determines (and documents) that the research involves no more than minimal risk. In addition, OHRP has indicated that the activities on the current list should not be deemed to be of minimal risk simply because they are included on the list. In a related change, the NPRM contained a requirement that IRBs document the rationale for an expedited reviewer's determination that research appearing on the expedited review list is more than minimal risk (
The NPRM proposed that IRBs reviewing the consent process (and, when required, the privacy safeguards) for studies eligible for the proposed exemption at § __.104(f)(1) could use the expedited review procedure.
As discussed in Section III of this preamble, the NPRM did not propose to modify the definition of minimal risk, but rather proposed adding to the definition a requirement that the Secretary of HHS create and publish a list of activities that qualify as “minimal risk”. This Secretary's list would be re-evaluated periodically, but at least every 8 years, based on recommendations from federal departments and agencies and the public. Note that this would not be an exhaustive list of all activities that would be considered minimal risk under the Common Rule, but would allow IRBs to rely on the determination of minimal risk for activities appearing on the list. IRBs would still need to make minimal risk determinations about activities that do not appear on this list.
In addition, the NPRM proposed to eliminate the parenthetical phrase “of one year or less” when referring to the IRB approval period, since annual continuing review of research eligible for expedited review would no longer be required.
The NPRM also proposed that the regulations be revised to require evaluation of the list of expedited review categories every 8 years, followed by publication in the
Approximately 50 comments were received regarding the proposal to update the Secretary's list of expedited review categories every 8 years. A strong majority supported this proposal although some recommended that the mandatory period of review occur more frequently than every 8 years.
Approximately 10 comments discussed the NPRM proposal that an IRB may use the expedited review procedure to satisfy limited IRB review of the consent process as required under the proposed NPRM exemption. A strong majority of these comments supported this proposal.
Under the final rule, a study is deemed to be minimal risk and thus eligible for expedited review if the study only involves activities on the Secretary's list, unless the reviewer determines and documents that the study involves more than minimal risk (§ __.110(a) and (b)(1)). Thus, we anticipate that more studies that involve no more than minimal risk will undergo expedited review, rather than full review, which will relieve burden on IRBs.
Further, IRBs will be required to document their rationale when they override the presumption that studies on the Secretary's expedited review list involve greater than minimal risk (at § __.115(a)(8)). Although public comments argued that this documentation represented an unjustified burden on IRBs, we believe that such documentation could provide a basis for the Secretary's future determinations about the appropriateness of the list, and allow for greater consistency across institutions, and thus make the Common Rule more just.
At § __.110(b)(1)(iii) the final rule adopts the NPRM proposal that an IRB may use the expedited review process when conducting limited IRB review as required by the exemptions at § __.104(d)(2)(iii), § __.104(d)(3)(i)(C), § __.104(d)(7), and § __.104(d)(8).
Finally, as proposed in the NRPM, evaluation of the list of expedited review categories will occur every 8 years, followed by publication in the
The determinations that an IRB must make before it can approve a study were spelled out in the pre-2018 rule at § __.111. These relate, among other things, to minimizing risks to subjects, determining that an appropriate relationship exists between risks and benefits, and ensuring the equitable selection of subjects. The regulations generally required all of these determinations to be made for any study that must undergo IRB review.
The NPRM proposed a number of changes regarding the criteria for IRB approval of research, including (1) creating a new form of IRB review for activities relating to storing or maintaining data and biospecimens for later secondary use; (2) revising two of the existing criteria for approval of
The first set of changes concerned updating the IRB review criteria for research activities relating to storing or maintaining information and biospecimens, and to the secondary use of such information and biospecimens. Paragraph (a)(9)(i) of proposed § __.111 would have applied to a proposed exemption at § __.104(f)(1) for storing or maintaining biospecimens or identifiable private information for use in secondary research. This provision would have eliminated the need for an IRB to make the usual determinations about such an activity. Instead, the IRB would have been required to determine that the procedures for obtaining broad consent to storing or maintaining the biospecimens or information were appropriate, and met the standards included in the introductory paragraph of § __.116. In addition, if these storage and maintenance activities involved a change for research purposes from the way the biospecimens or information had been stored or maintained, then the IRB would have needed to determine that the proposed biospecimen and privacy safeguards at § __.105 were satisfied for the creation of any related storage database or repository.
The second proposed change was related to the NPRM privacy safeguard proposal and clarified that it would not be an IRB responsibility to review the security plans for biospecimens and identifiable private information for every protocol (
The third proposed change was the addition of section (a)(8) to § __.111 clarifying that if an investigator submits as part of the protocol a plan for returning clinically relevant research results to subjects, the IRB would have to evaluate the appropriateness of the plan. This criterion was proposed in response to public discussions, including SACHRP, recommending that IRBs consider returning individual results to subjects.
Approximately 20 comments discussed the proposed modifications in § __.111 related to the criteria for IRB approval of research. Of these comments, a majority discussed the proposal that an IRB be required to review the adequacy of plans to return research results, should a proposed study include such a plan. Comments on this proposal were mixed, with both those opposing and supporting the proposal indicating that HHS and other Common Rule departments and agencies would need to issue detailed guidance addressing what is considered an adequate plan in this context. Several commenters suggested deleting this provision due to the lack of clarity surrounding the IRB's role in such a review.
The final rule does not adopt all of the NPRM proposals. It does not include the NPRM proposal regarding IRB review of plans to review the return of clinically relevant results to subjects. This proposal was deleted due to concern over the criteria that would be required for an IRB to appropriately consider this area, the need for particular IRB expertise to appropriately assess the return of results, and ambiguity over the meaning of “clinically relevant.”
The final rule does, however, revise two of the existing criteria for approval of research: (1) Special considerations related to the involvement of vulnerable populations, and (2) privacy and confidentiality of data provisions.
As discussed in more detail in Section VII, the language regarding vulnerable populations at § __.111(a)(3) and (b) has been revised to reflect the current understanding of which populations should receive special consideration due to potential vulnerabilities specific to the purposes and context of human subjects studies and to parallel other references to vulnerable populations found at § __.107(a).
Section __.111(a)(7) in the final rule retains the pre-2018 language, but also adds an additional requirement, thereby serving a dual function as both the primary regulatory provision requiring IRB review of the adequacy of protections for the privacy of subjects and confidentiality of identifiable private information (including that obtained from the analysis of biospecimens), and as the primary limited IRB review requirement needed to satisfy certain exemption determinations in § __.104(d).
In § __.111(a)(7)(i) the Secretary of HHS commits to issuing guidance to assist IRBs in assessing what provisions are adequate to protect the privacy of subjects and to maintain the confidentiality of information, after consultation with OMB's privacy office and other federal departments and agencies that have adopted this policy. This modification is intended to serve a similar function as the privacy safeguards proposed in the NPRM (but not adopted in the final rule). The guidance might address the following considerations such as:
• The extent to which identifiable private information is or has been de-identified and the risk that such de-identified information can be re-identified;
• The use of the information;
• The extent to which the information will be shared or transferred to a third party or otherwise disclosed or released;
• The likely retention period or life of the information;
• The security controls that are in place to protect the confidentiality and integrity of the information; and
• The potential risk of harm to individuals should the information be lost, stolen, compromised, or otherwise used in a way contrary to the contours of the research under the exemption.
The final rule at § __.111(a)(8) modifies the NPRM proposal on the limited IRB review required by § __.104(d)(7). Section __.111(a)(8) specifies that for the purposes of conducting the limited IRB review required by § __.104(d)(7), the IRB must determine that broad consent for storage, maintenance, and secondary research use of identifiable biospecimens or identifiable private information is obtained in accordance with the requirements of § __.116(a)(1)-(4), (a)(6), and (d). As part of its review of these requirements for broad consent, the IRB would review the appropriateness of the process proposed for obtaining broad consent, and ensure that the required elements of broad consent were appropriately included in the broad consent form (or process, if broad consent is to be obtained orally). Additionally, the IRB must determine that consent is appropriately documented, or that a waiver of documentation is appropriate, in accordance with § __.117. Finally, if a change is made for research purposes in the way identifiable private information or identifiable biospecimens are stored or maintained, the IRB must determine that adequate provisions are in place to protect the privacy of subjects and to maintain the
The pre-2018 rule required that each institution engaged in a cooperative research study obtain IRB approval of the study, although it did not require that a separate local IRB at each institution conduct such review. In many cases, however, a local IRB for each institution would independently review the research protocol, and informed consent forms and other materials, often resulting in multiple reviews for one study. When any one of these IRBs would require changes to the research protocol that are adopted for the entire study, investigators would have to re-submit the revised protocol to all of the reviewing IRBs. This process could take many months and significantly delay the initiation of research projects and recruitment of subjects into studies. More importantly, little evidence has suggested that the time and effort put into these activities by investigators (in providing materials to IRBs) and IRBs have significantly increased the well-being of research subjects.
Taking into consideration the history of public debate on this topic and various sources of public comments, the NPRM proposed a requirement mandating that all institutions located in the United States engaged in cooperative research rely on a single IRB as their reviewing IRB for that study. Under this proposal, this requirement would not apply to: (1) Cooperative research for which more than single IRB review is required by law; or (2) research for which the federal department or agency supporting or conducting the research determines and documents that the use of a single IRB is not appropriate for the particular study. Public comment was sought on whether it would be useful for this requirement to include criteria that federal departments or agencies would need to apply in determining whether to make exceptions to the use of a single IRB requirement and what those criteria might be. Further the public was asked whether the exceptions proposed were appropriate and sufficient, or whether this mandate should have additional exceptions for single IRB review than those proposed in the NPRM.
The change proposed by the NPRM would apply only to U.S.-conducted portions of studies because the flexibility to make use of local IRB reviews at international sites should be maintained. It might be difficult for an IRB in the United States to adequately evaluate local conditions in a foreign country that could play an important role in the ethical evaluation of the study.
This policy would apply regardless of whether the study underwent convened review or expedited review. Under the NPRM, the IRB of record would be expected to be selected either by the funding agency or, if there is no funding agency, by the lead institution conducting the study. An agency may, but is not required, to solicit input regarding which IRB would be most appropriate to designate as the IRB of record. Public comment was sought on how this would work in practice.
This policy would not relieve any site of its other obligations under the regulations to protect human subjects. Nor would it prohibit institutions from choosing, for their own purposes, to conduct additional IRB or other administrative reviews, though such reviews would no longer have any regulatory status in terms of compliance with the Common Rule.
Some concerns about a mandated single IRB review for cooperative research point to implementation logistics, and the time necessary to establish new policies, procedures, and agreements. Recognizing this concern, the proposed compliance date was 3 years from the publication of the final rule. Public comment was sought on whether this was a realistic timeframe.
The public was asked to comment on whether mandated single IRB review for all cooperative research was a realistic option, and what the likely costs and benefits to institutions might be. Further, the public was asked to comment on whether additional resources would be necessary to meet this requirement in the short term and whether savings might be anticipated in the long run. Finally, public comment was sought regarding in what areas guidance would be needed for institutions to comply with this requirement and whether the Common Rule departments and agencies could take actions to address concerns about institutional liability, such as developing model written agreements.
This proposal was one of the most commented on in the NPRM, receiving more than 300 comments. Public comment was divided on whether a final rule should implement the proposal to mandate one IRB of record in domestic cooperative research studies. Of those who commented on this proposal, approximately 130 supported the proposal, and approximately 140 opposed it. Others had mixed views.
Research institutions tended to oppose this proposal, while individuals (
Some who supported the proposal stated that it would decrease administrative burdens and inefficiencies for investigators and institutions. Conversely, some commenters stated that the proposal should not be implemented because it would ultimately increase burdens and inefficiencies for investigators and institutions.
In addition to the broad themes for and against this proposal, some commenters such as SACHRP noted that the proposed requirement seems premature at this time and suggested that more data are needed before such a provision could be implemented. Others said the scope of the proposal seemed overly broad. Many cited the alternative, narrower approach discussed in SACHRP's public comment as a reasonable option.
Commenters also noted that long review times for prospective research studies are not solely related to the IRB review and approval itself. Rather, commenters noted that long review times are caused by the sum total of the many different types of reviews either mandated by other regulations or by institutional policy (
Several commenters expressed concern that according to the NPRM proposal, the supporting federal department or agency would select the IRB of record as required by the provision. These commenters were concerned that the provisions did not seem to allow for grantee or awardee input on what IRB should be the IRB of record nor did they seem to suggest that funding departments or agencies should consult with the institutions receiving funding about the IRB of record. Several public comments also expressed concern about the burden this provision would place on nonfederally supported studies subject to the rule solely based on the clinical trials expansion proposed in the NPRM.
Representatives of AI/AN tribes also provided comments emphasizing the sovereign status of their governments, and stating that nonlocal review would be inappropriate for their communities.
The final rule adopts the NPRM proposal with modifications that are responsive to public comment. We agree with commenters who speculated that mandated single IRB review would ultimately decrease administrative burdens and inefficiencies for investigators and institutions, while acknowledging that the transition to this model would require significant time and an adjustment to institutional structures and policies. We concur that, rather than offering additional protections, in many cases multiple IRB approvals increase burden and frequently delay the implementation of studies, increasing the costs of clinical trials and potentially stalling access to new therapies. We note comments that expressed frustration with the frequent occurrence of central IRB participating sites insisting on separate institutional reviews. One comment noted that these additional IRB reviews generally reach the same conclusions, or conclusions with minor changes, that are then imposed solely on that site. When working optimally, we expect the central IRB model will work more efficiently and require less personnel time and fewer resources for tracking and implementing IRB changes and approvals, thereby eliminating the potential for unnecessarily duplicative reviews.
Although a large number of comments believed that single IRB review should be encouraged rather than mandated, we feel that this incentivized approach would ultimately fail to yield substantive positive change in the system. Rather, systematic efficiencies have the best chance of occurring if single IRB review is required for all review in domestic research involving more than one institution. We acknowledge that further guidance for this requirement will need to be developed and that initial cost projections may have been low. However, we feel this change supports the best interests of the research infrastructure through increasing efficiency. Note that the final rule permits appropriate flexibilities that will assist in implementation. Institutions may still choose to conduct additional internal IRB reviews for their own purposes, though such reviews would no longer have any regulatory status in terms of compliance with the Common Rule.
We agree with comments recommending that a greater role should be provided for grantee input on choosing the IRB of record, and have modified the language accordingly. The language at § __.114(b)(1) now states that the reviewing IRB (
This final rule adopts (in § __.114(b)(2)(i)) the NPRM's proposal that cooperative research for which more than single IRB review is required by law is not subject to the requirements of § __.114. The rule also adds clarifying language providing that this provision extends to tribal laws passed by the official governing body of an AI/AN tribe. Thus, if the official governing body of an AI/AN tribe passes a tribal law that requires more than single IRB review for certain cooperative research, the requirement for single IRB review does not apply to such cooperative research. In addition, we highlight that § __.114(b)(2)(ii) allows a federal department or agency the flexibility to determine that the use of a single IRB is not appropriate for certain contexts, thereby permitting additional IRB review and consideration of local and regional variations in some circumstances.
Finally, the final rule adopts the NPRM proposal for this provision to have a delayed compliance date of 3-years from the date the final rule is published in the
The pre-2018 rule at § __.115 outlined requirements for IRBs in preparing and documenting its activities and for maintaining records.
As discussed in Section IV, the NPRM proposed to revise the pre-2018 requirement that an up-to-date list of the IRB members and their qualifications be included in an institution's assurance. Instead, the NPRM proposed the requirement that an IRB or the institution prepare and maintain a current list of IRB members.
As discussed in Section IX, the NPRM proposed a new requirement for IRBs to maintain, as part of their records of continuing reviews, the rationale for conducting continuing review of research that was deemed eligible for elimination of continuing review per proposed changes at § __.109(f)(1)(ii). Specifically, this would apply to research that had progressed to the point that it involves only one or both of the following, which are part of the IRB-approved study: (1) Conducting data analysis, including analysis of identifiable private information, or (2) accessing follow-up clinical data from procedures that subjects would undergo as part of standard care for their medical condition.
Also, as discussed in Section IX, the NPRM proposed eliminating continuing review for many minimal risk studies (namely those that qualify for expedited review), unless the reviewer finds and documents why continuing review should take place for the study. Finally,
New in the NPRM was a proposal to require that an IRB maintain records of exemption determinations. Additionally, the NPRM proposed that the use of the proposed exemption determination tool would satisfy the proposed documentation requirement.
In addition, a new provision was proposed to require that the institution or IRB that retains IRB records should safeguard, if relevant, individually identifiable private information contained in those records in compliance with the proposed privacy safeguards.
Finally, the NPRM proposed a modification of the pre-2018 rule clarifying that IRB records may be maintained in print or electronic form.
The proposed modifications to § __.115 received approximately 25 comments. A majority focused on three proposed revisions. The NPRM proposed to require that reviewers document why an IRB required continuing review when continuing review was not required as proposed in the NPRM. The majority of commenters opposed this requirement stating that it merely shifted administrative burden from one activity to another with no increase in protections.
The NPRM also proposed to require that a reviewer document why a research activity appearing on the expedited review list is more than minimal risk, and thus should be subject to full IRB review. This was opposed by the majority of commenters who indicated that this proposal was an unjustified administrative burden.
One commenter stated that the proposed documentation requirements would be punitive to IRBs. Several others suggested that this requirement served as a disincentive to institutions who wanted to implement additional protections than those required by the Common Rule. These commenters noted that this seemed in contrast to the longstanding policy articulation that the Common Rule served as a “floor” for protections and that institutions could require additional protections for research conducted at their institutions.
A majority of the changes proposed in the NPRM in § __.115 have been retained in the final rule without alteration. However, the final rule differs from the NPRM in a few ways. First, the NPRM included two provisions requiring documentation of continuing review activities; these have been merged into one provision in the final rule at § __.115(a)(3). Second, the NPRM required that the IRB keep records of the IRB reliance agreements between an institution and the IRBs not operated by that institution that review said institution's nonexempt research activities. Instead, the final rule includes language at § __.115(a)(9) that requires each institution to maintain adequate documentation of the responsibilities that each entity will undertake to ensure compliance with this policy. This provision differs from the NPRM proposal to correspond to the more flexible provision included at § __.103(e), which does not require the creation of a written agreement between an institution and a reviewing IRB that said institution does not operate.
Because the final rule does not include an exemption determination requirement, the exemption documentation requirement proposed in the NPRM is not included in the final rule. Additionally, because the final rule does not include specified privacy safeguards, the NPRM proposal for an IRB to safeguard records as required by the proposed privacy safeguards is not included.
The final rule includes the NPRM proposal that IRBs document decisions to require continuing review or full board review even in circumstances when such review is not required because we believe it is important to document why an IRB is making a determination that differs from the regulatory baseline. This also helps to promote the principle of justice (as applied to IRB operations). Note that nothing in these regulations prevents an institution from authorizing an IRB to apply standards that exceed those in the regulations, if indeed the institution has chosen to do so.
In addition, while the NPRM proposed to require that IRB records that contain identifiable private information be safeguarded through compliance with the proposed privacy safeguards, the final rule does not require such safeguards. Although no public comments were received on this provision, in deciding not to include the NPRM's proposed privacy safeguard requirements in the final rule, we determined that it was unnecessary for the Common Rule to impose additional privacy requirements on IRB records as we are unaware of instances in which IRB records were breached. In addition, IRB records are not the regulatory equivalent of research records, which should be adequately secured or safeguarded against inappropriate uses or disclosures of identifiable private information. IRB records will generally be secured for a variety of reasons. These include not only protecting identifiable private information, but also, for example, protecting discrete information and intellectual property that might be included in a protocol. There are other means for ensuring institutions and IRBs protect their records beyond what is required by the Common Rule.
The final rule contains several major revisions to the requirements for informed consent, specifically with respect to: (1) New requirements relating to the content, organization, and presentation of information included in the consent form and process to facilitate a prospective subject's decision about whether to participate in research; (2) the basic and additional elements of consent; (3) the elements of broad consent for the storage, maintenance, or secondary research use of identifiable private information and identifiable biospecimens; (4) attendant changes in the waiver or alteration criteria for consent; (5) a new provision that allows IRBs to approve a research proposal for which investigators obtain information or biospecimens without individuals' informed consent for the purpose of screening, recruiting, or determining the eligibility of prospective human subjects of research, provided certain conditions are met; and, (6) a new requirement to post to a federal Web site a copy of an IRB-approved version of the consent form that was used for enrollment purposes for each clinical trial conducted or supported by a federal department or agency. Each of the final rule provisions are discussed separately below.
Under the pre-2018 rule, many fundamental requirements applicable to all informed consents were set forth in
In considering changes to the general requirements set forth in § __.116(a), we considered arguments put forth by some that consent forms have evolved to protect institutions rather than to provide potential research subjects with the most important pieces of information that a person would need in order to make an informed decision about whether to enroll in a research study.
The NPRM proposed adding new language to the introductory text of § __.116 to emphasize the need to first provide essential information that a reasonable person would want to know in order to make an informed decision about whether to participate in research, and to provide an opportunity to discuss that information. Furthermore, in recognition of complaints that consent forms are too often complicated documents primarily used to protect sponsors from legal liability, the NPRM proposed requiring that the information in these forms be organized and presented in a way that does not merely provide lists of isolated facts, but rather facilitated the prospective subject's or representative's understanding of the reasons why one might or might not want to participate in the research.
The NPRM also proposed that an investigator seeking to obtain informed consent be required to present first the information required by § __.116, which has been recognized by the Common Rule departments and agencies as the most fundamental and required content of informed consent, before providing other information, if any, to the subject. As proposed under the NPRM, the main portion of a consent document could include only the elements of informed consent that were required by the Common Rule, with any other information included in an appendix. This change was intended to lead to substantially shorter “core” sections of consent forms, with prospective subjects receiving the most important information in the body of these relatively short forms, instead of that key information being buried in long and overly complex documents. As proposed, additional information could be set forth in appendices to consent forms.
Given the consensus that informed consent forms should be written in appropriate language, this proposal reinforced the need to include information using language understandable to the subject. This goal was consistent with Federal Plain Language guidelines and the Federal Plain Writing Act of 2010. The NPRM proposed that the Secretary publish guidance at a later time to explain how consent forms could be written to comply with this regulatory requirement. Public comments were sought on what topics should be addressed in future guidance on improving the understandability of informed consents. As explained in the NPRM, it was not envisioned that the revised Common Rule would require a formal assessment to evaluate an individual's competency, but we acknowledged that such a practice might be appropriate for certain populations or studies.
In addition, the NPRM proposed to clarify in the introductory language at § __.116 that if a HIPAA authorization is combined with a consent form, the authorization elements required by 45 CFR 164.508 (part of the HIPAA Privacy regulations) must be included in the consent document and not the appendices. In other words, when informed consent for research under the Common Rule is combined with a HIPAA authorization, the NPRM proposed that the authorization elements would be considered to constitute one of the required elements of informed consent.
Approximately 200 comments discussed the proposal to include information required by the Common Rule in the consent form and place other information in appendices. A majority of those (approximately 140) supported the proposal and approximately 35 commenters opposed this proposal. Those who expressed support for this proposal generally noted agreement with the NPRM's rationale for the proposed revisions. Even those who supported the proposal stated that guidance would be needed for the proposal to be implemented and for the proposal to have the desired effect. Among those who opposed this proposal, all indicated support for the intention behind it. Reasons for opposing this proposal included:
• Concern that having a “dual document” system (with a primary consent form and appendices) would not actually improve subjects' understanding specifically and the informed consent process generally.
• Concerns that in some circumstances, the information that one might require to make an informed decision about research participation may not always be information required under the Common Rule when seeking and obtaining informed consent.
• Concern that the proposed language for the § __.116 introductory paragraph should not be promulgated as regulatory text (and would be more appropriate as guidance).
• Concern that because the proposed language does not include specific standards and specific criteria, the provision would ultimately be impossible to implement and enforce.
• Concern that the language as proposed would not reduce the complexity and length of consent forms because much of the information generally contained in an informed consent document is required by various regulatory agencies. To this end, several commenters noted that the NPRM proposed an additional four required elements of consent, which would add to the quantity of information that is required to be discussed in an informed consent document.
Some comments noted that although they liked the general idea of the proposal for the introductory paragraph of § __.116, they felt that the proposal should not focus on the length of a consent form, but rather on clarity and understandability. One comment expressed a need for guidance on how to implement the proposed language in the introductory paragraph of § __.116 and the requirement at § __.109(b) of the pre-2018 rule.
The NPRM asked about what topics should be addressed in future guidance on improving the understandability of informed consent. Approximately 35 commenters answered this question, a majority of which were universities and research institutions. Several commenters questioned whether the proposals in the introductory paragraph of § __.116 would be enforceable, and how Common Rule departments and agencies would assess and enforce compliance.
Several commenters indicated that mandating the order in which the content of consent forms should be presented may not always facilitate increased understanding by potential subjects because the best way to facilitate understanding is likely to be study specific. In other words, the order of importance of issues could be dependent on unique aspects of a given study. Others noted that most information in consent forms is there because the regulations require it to be included. Thus, the proposal to include the information required by the regulations up front, with all other information included as an appendix, is not a requirement that will inherently improve consent forms. Some commenters suggested that more research was needed on the informed consent process before prescribing specific approaches.
Many commenters asked that future guidance be developed to assist in drafting consent forms that addresses language level, literacy, risk communication, and best practices in use of alternative media in the informed consent process (
Several commenters noted that guidance should focus on how to foster understanding rather than focusing on mandatory length limitations on consent forms. However, a few comments endorsed a recommended page length maximum, citing it as perhaps the only way to force investigators and institutions to be brief and concise in the presentation of relevant information.
Before addressing how the general requirements for informed consent proposed in the NPRM have been adopted and altered in the final rule, it is important to note that the structure for this regulatory text has been altered. In the pre-2018 rule, the general requirements were included in an unnumbered introductory paragraph. The NPRM proposed the same approach. To emphasize the fact that this paragraph includes multiple independent and important regulatory requirements, and to enable stakeholders and Common Rule departments and agencies to more easily reference particular requirements, these general requirements have been redesignated into a new § __.116(a). In addition, the general requirement for consent in the final rule at § __.116(a)(6) removes the reference to oral or written consent that was in the pre-2018 rule. This is the provision that addresses the prohibition on including exculpatory language through which the subject or the legally authorized representative is made to waive or appear to waive any of the subject's legal rights, or releases or appears to release the investigator, the sponsor, the institution, or its agents from liability for negligence. The reference to oral or written consent was removed from this provision in the final rule. In its place, a similar reference was included in to § __.116(a) to clarify that all the requirements set forth in § __.116(a) apply to written and oral consent.
Another change made in the final rule, as compared with the pre-2018 rule and the language proposed in the NPRM, is that § __.116(a) contains introductory language summarizing each paragraph of § __.116 and the relationship between those paragraphs. Given that the framework for informed consent has been altered and reorganized through this regulation, this introductory language is intended to explain the overall approach set forth in revised § __.116, as well as the significance of each paragraph. This introductory language is also intended to explain the role of broad consent under revised § __.116. The introductory paragraph explains that the general requirements for informed consent are now set forth in § __.116(a) and that these general requirements apply with respect to informed consent obtained pursuant to § __.116(b), (c), and (d) (except, as described later, § __.116(a)(5) does not apply to broad consent obtained under § __.116(d)). This introductory language also explains that the basic elements of informed consent (which were described in § __.116(a) of the pre-2018 rule) are included in § __.116(b) of this final rule and that additional elements of informed consent that pertain only to certain studies (which were described in § __.116(b) of the pre-2018 rule) are included in § __.116(c) of this final rule.
In addition, this introductory language explains that the requirements for broad consent (a concept not specifically addressed in the pre-2018 rule) are described in § __.116(d) of this final rule. As discussed below, broad consent under this final rule differs from the broad consent approach proposed for § __.116(c) in the NPRM. The introductory language of § __.116(a) explains that broad consent may be obtained in lieu of informed consent obtained under § __.116(b) and § __.116(c) (which describe basic elements of informed consent as a general matter and additional elements of informed consent that apply only to certain studies, respectively) for certain purposes. Specifically, in lieu of obtaining study-specific informed consent in accordance with § __.116(b) and (c), broad consent may be obtained under § __.116(d) for the use of identifiable private information or identifiable biospecimens collected for either research studies other than the proposed research or nonresearch purposes for: (1) storage and maintenance for secondary research use; and (2) secondary research. For those purposes (and no others), broad consent under § __.116(d) may be obtained instead of specific consent under § __.116(b) and (c).
New introductory language at § __.116(a) also summarizes the provisions describing circumstances in which waiver or alteration of the requirements of informed consent are permitted. These circumstances pertain to research involving public benefit and service programs conducted by or
Another change reflected in the final rule is that specific requirements for informed consent have been included in subparagraphs for clarity and emphasis. For example, the requirement that information that is given to the subject or the legally authorized representative shall be in language understandable to such subject or representative is no longer included as part of a general introductory paragraph and is instead included as § __.116(a)(3). Except as noted here, these requirements remain the same as they were under the pre-2018 rule.
The final rule adopts, almost verbatim, all of the proposals made in the NPRM to improve and clarify the general requirements for informed consent. For example, the final rule adopts the proposed requirement specifying that the information provided in an informed consent form must be presented in sufficient detail relating to the research, and must be organized and presented in a way that does not merely provide lists of isolated facts, but rather facilitates the prospective subject's or legally authorized representative's understanding of the reasons why one might or might not want to participate. The final rule also adopts new language clarifying that this requirement applies to the informed consent as a whole. In addition, the final rule adopts the NPRM's proposal that prospective subjects or legally authorized representative must be provided with key information that is most likely to assist a prospective subject or legally authorized representative in making a decision about participating in research, and to provide an opportunity to discuss that information. Moreover, the final rule adopts an approach, consistent with many public comments, emphasizing efforts to foster understanding overall rather than imposing specific length limitations on the entire consent forms.
The final rule also includes language slightly different from that proposed in the NPRM for clarity or for conformance with other language in the final rule. For example, the final rule replaces references to a subject's representative with references to a subject's legally authorized representative (a term defined in § __.102) for clarity.
As discussed above, a significant proposal in the NPRM was that in obtaining informed consent, investigators would first have to present the information required by § __.116, before presenting any other information, if any. In addition, the NPRM proposed mandating that consent forms must include only the required information under § __.116 and that any other information be included in appendices. The final rule does not adopt a requirement that certain information be included only in appendices. This approach is responsive to public comments expressing concerns that such a mandate might sometimes undermine the informed consent process. The final rule adopts a slight variation of that approach in response to public comments about perceived lack of flexibility in the proposed language. Whereas the NPRM referred to the “body” of the consent form as opposed to appendices to the consent form, the final rule replaces those concepts with references to material that must be at the beginning of the consent form, versus material that can appear after that beginning section. The final rule does not limit the information that can be provided in the beginning of a consent form to
In particular, the final rule imposes a new requirement (set forth in § __.116(a)(5)(i)) that the informed consent begin with a concise and focused presentation of the key information that is most likely to assist a prospective subject or legally authorized representative in understanding the reasons why one might or might not want to participate in the research. This provision further requires that this beginning portion of the informed consent must be organized and presented in a way that facilitates comprehension. This requirement applies to all informed consents, except for broad consents obtained pursuant to § __.116(d), which may warrant a different presentation.
This new requirement included at § __.116(a)(5)(i) is somewhat similar to the proposal advanced in the NPRM insofar as both emphasize the importance of presenting the information that would be most important to a subject (or a legally authorized representative) before presenting other information. However, the requirement included in § __.116(a)(5)(i) is more specific, detailed, and flexible. First, this provision requires that key information be included in the beginning of the informed consent in a concise and focused presentation. We recognize that how this requirement applies will depend on the nature of the specific research study and the information presented in the informed consent and believe that this requirement strikes an appropriate balance between facilitating the comprehension of subjects of key issues and allowing study-specific flexibilities. In general, our expectation is that this initial presentation of the key pieces of information will be relatively short. This section of the consent could, in appropriate circumstances, include a summary of relevant pieces of information that are explained in greater detail later in the consent form.
The requirement that key information be presented in a concise and focused way will require an assessment that is specific to a study and its informed consent. For example, for most complicated clinical trials involving cancer patients with long (
In such cases, for example, we would not consider a 10-page description of elements such as potential risks, accompanied by lengthy and complex charts and graphs, to satisfy the “concise and focused” requirement of § __.116(a)(5)(i). With regard to risks in the type of cancer trial mentioned above, for example, instead of needing to mention every reasonably foreseeable risk, which would be required by § __.116(b)(2), this beginning section of the consent form should identify the most important risks, similar to the information that a doctor might deliver in the clinical context in telling a patient how sick the chemotherapy drugs will make them, but with a particular emphasis on how those risks are changed by participating in the study.
We recognize the advantages of allowing institutions to design informed consents, consistent with § __.116(a)(5)(i), that are tailored to particular research studies to assist prospective subjects in understanding the most fundamental aspects of the
We also recognize that for some relatively simple research studies with limited risks or benefits, the entire informed consent document may be relatively brief and still satisfy § __.116. In such circumstances, an institution may determine that virtually all of the information required by § __.116 would also satisfy § __.116(a)(5)(i). In such cases, the informed consent document could include the concise and focused presentation of § __.116(a)(5)(i) at the beginning of the informed consent document, followed by limited additional information required to satisfy § __.116.
In all circumstances (those involving lengthy and complex informed consents as well as short and relatively simple informed consents), if information included at the beginning of the informed consent satisfies both § __.116(a)(5)(i) and the elements of informed consent under § __.116(b) and § __.116(c) more generally, the information included at the beginning need not be repeated later in the body of the informed consent. Thus, with respect to the example provided above concerning a clinical trial with cancer patients, the most important reasonably foreseeable risks to subjects would be summarized at the beginning of the informed consent as part of § __.116(a)(5)(i)'s concise and focused presentation, but that a more comprehensive and detailed description of reasonably foreseeable risks to subjects would be included later in the body of the informed consent. In contrast, with respect to a relatively simple research study with limited risks, we would expect that all of the information provided to potential subjects concerning such risks might satisfy both § __.116(a)(5)(i) (as part of a concise and focused presentation of key information) and § __.116(b)(2) (a description of any reasonably foreseeable risks or discomforts to the subject). In such circumstances, the information provided at the beginning of the informed consent would not need to be repeated or further detailed in the informed consent and the entire informed consent could be relatively short.
In general, we would expect that to satisfy § __.116(a)(5)(i), the beginning of an informed consent would include a concise explanation of the following: (1) the fact that consent is being sought for research and that participation is voluntary; (2) the purposes of the research, the expected duration of the prospective subject's participation, and the procedures to be followed in the research; (3) the reasonably foreseeable risks or discomforts to the prospective subject; (4) the benefits to the prospective subject or to others that may reasonably be expected from the research; and (5) appropriate alternative procedures or courses of treatment, if any, that might be advantageous to the prospective subject. As a general matter, a brief description of these five factors would encompass the key information most likely to assist a reasonable person (or legally authorized representative) in understanding the reasons why one might or might not want to participate in research, as required by § __.116(a)(5)(i) and § __.116(a)(4). However, we recognize that this determination is necessarily fact-specific and that IRBs and institutions may require that somewhat different (or additional) information be presented at the beginning of an informed consent to satisfy § __.116(a)(5)(i).
The NPRM also proposed adding a new requirement to the general introductory paragraph of § __.116, which would provide that if an authorization required by 45 CFR parts 160 and 164 (parts of the HIPAA Privacy Rule) is combined with a consent form, the authorization elements required by 45 CFR 164.508 must be included in the consent form (and not the appendices). Because this final rule does not incorporate the distinction proposed in the NPRM between the informed consent and appendices, the final rule does not incorporate this language.
We are satisfied that the approach adopted in this final rule will enable regulated entities and individuals to pursue different and innovative approaches to obtaining informed consent, as recommended in some public comments, while ensuring that the important aspects of informed consent are clearly communicated to prospective subjects and subjects.
Under the pre-2018 rule, investigators were generally required to obtain the subjects' informed consent to participate in research.
In the NPRM it was proposed that research with nonidentified data continue to be considered not to involve “human subjects.” However, to better ensure that subjects are informed of the possibility that identifiers collected as part of a research study could be removed from the data and then be used for secondary research studies without the protections provided by this policy, it was proposed that a new element of informed consent be required. The new basic element of consent proposed in the NPRM at § __.116(a)(9) would apply to all research collecting identifiable private information. Based on the investigator's plans, the informed consent form and process would need to inform subjects either that: (1)
Approximately 40 public comments were received on the proposed new required element of informed consent found in the NPRM at proposed § __.116(a)(9). A large majority favored this proposal. Those who supported this proposal indicated that it provided useful information to prospective subjects about how private information obtained from a study might be used in the future. They also commented that it enhanced transparency in research, providing potential subjects with the information they need to decide whether to participate. Those who opposed this proposal suggested that it would increase the length of consent forms without appreciably improving potential subjects' understanding of a specific research activity.
The final rule, at § __.116(b)(9), adopts the NPRM proposal to inform potential subjects about the possible use of their identifiable private information with two clarifying changes. First, because the final rule at § __.102(e)(1) now states that the definition of human subject, in part, includes research in which an investigator obtains, uses, studies, analyzes, or generates
We agree with the public comments that indicated this new element of consent will provide useful information to prospective subjects about whether their identifiable private information or identifiable biospecimens might be stripped of identifiers and used for future research studies or distributed to another investigator for future research studies without additional informed consent from the subject or the legally authorized representative.
We expect that this information can usually be provided in a brief statement, and disagree with the commenters that suggested that this new basic element of consent would increase the length of consent forms without appreciably improving potential subjects' understanding of a specific research activity. This new requirement is intended to give the potential subject a right to know that identifiers might be removed from information or biospecimens and be used for future research without additional consent, when such a possibility exists, so he or she can make a fully informed decision about whether to participate in the research. If subjects' identifiable private information or identifiable biospecimens will not be used for future research studies, even if identifiers are removed, this new element of consent requires that subjects be informed of this as well. Finally, if a specific technology or technique determined to be capable of generating identifiable private information or identifiable biospecimens through the consultative process described at § __.102(e)(7) will be used, that information should be included in the description of the research at § __.116(b)(1).
The pre-2018 rule contained six additional elements of consent required when appropriate: (1) A statement that the particular treatment or procedure may involve risks to the subject (or to the embryo or fetus, if the subject is or may become pregnant) which are currently unforeseeable; (2) anticipated circumstances under which the subject's participation may be terminated by the investigator without regard to the subject's consent; (3) any additional costs to the subject that may result from participation in the research; (4) the consequences of a subject's decision to withdraw from the research and procedures for orderly termination of participation by the subject; (5) a statement that significant new findings developed during the course of the research which may relate to the subject's willingness to continue participation will be provided to the subject; and (6) the approximate number of subjects involved in the study.
The NPRM proposed adding three additional elements of consent that, when appropriate, would be required to be included in the informed consent form and process. These proposed additional elements of consent pertain to issues that have become more relevant in recent years as science has advanced and the nature of research has changed. One proposed new element would require that prospective subjects be informed that their biospecimens may be used for commercial profit and whether the subject will or will not share in this commercial profit. A second proposed element would require that prospective subjects be informed of whether clinically relevant research results, including individual research results, will be disclosed to subjects, and if so, under what conditions. A third proposed new element would provide subjects or their legally authorized representatives with an option to consent, or refuse to consent, to investigators re-contacting the research subject to obtain additional information or biospecimens, or for future research.
Each of the proposed additional elements of informed consent found in the NPRM at § __.116(b)(7)-(9) received approximately 50 comments. All three proposals were generally favored by the public. With respect to the proposed element of consent at § __.116(b)(7), requiring that prospective subjects be informed that their biospecimens may be used for commercial profit and whether the subject will or will not share in this commercial profit, comments, especially from individual members of the public not identified with any institution or organization, indicated that the extent to which an investigator might profit from information or biospecimens collected or used during a study was an important decision point as to whether a prospective subject would want to participate in a study. In response to proposed element § __.116(b)(8)—requiring that prospective subjects be informed of whether clinically relevant research results, including individual research results, will be disclosed to subjects, and if so, under what conditions—several public comments stated that knowing whether or not
Finally, comments discussing § __.116(b)(9) regarding the potential to be contacted for future studies noted that allowing an individual to indicate whether or not he or she might be contacted for future research studies respected subject autonomy. Those who opposed the provision noted that while the intent of the provision was laudable, the ensuing tracking system that would need to be developed by institutions to track who had said “yes” or “no” to being re-contacted, and in what circumstances, would be difficult to develop and maintain, and would also represent significant costs to institutions without a corresponding tangible increase in the protections afforded to human subjects.
The final rule contains two of the three proposed additional elements of consent. The final rule does not include the additional element proposed in the NPRM relating to providing subjects or their legally authorized representatives the option to consent or refuse to consent to being re-contacted to obtain additional information or biospecimens, or for future research.
New additional elements included in the final rule are: (1) A statement that the subject's biospecimens (even if identifiers are removed) may be used for commercial profit and whether the subject will or will not share in this commercial profit (§ __.116(c)(7)); and (2) a statement regarding whether clinically relevant research results, including individual research results, will be disclosed to subjects, and if so, under what conditions (§ __.116(c)(8)). Because many public comments addressed a desire to share in the profits of successful products developed using their biospecimens, we believe that investigators, when appropriate, should inform prospective subjects about whether they might or might not benefit commercially from future products resulting from the research, should that possibility be important in their decision making process. Also, several comments received from individuals who reported participation in research studies described disappointment that research results were not returned to them. We believe that potential subjects should be aware of the possibility that they might not receive research results, as well as the possibility that they might, so that they can factor that information into their decision about whether to consent to research. This provision is intended to pertain to all clinically relevant research results, including general or aggregate research findings and individual research results.
We are also including in the final rule an additional element that when appropriate for research involving biospecimens, subjects be informed of whether the research will (if known) or might include whole genome sequencing (WGS) (§ __.116(c)(9)). This provision of the final rule describes WGS as the sequencing of a human germline or somatic specimen with the intent to generate the genome or exome sequence of that specimen. WGS generates an extremely large amount of information about people, including factors that will contribute to their future medical conditions. As was recognized in the NPRM's Alternative Proposal A to expand the definition of “human subject” to include WGS (discussed in Section III), data obtained through WGS can provide important insights into the health of individuals as well as their biological family. It is also possible that WGS data gathered for one purpose may reveal important information, perhaps unanticipated and unplanned for, years later. Given the unique implications of the information that can be developed through WGS, if it is either known that a specific research study will include this technique, or might include it, we believe that this aspect of the research must be disclosed to prospective subjects as part of the informed consent process. It is recognized that under the pre-2018 rule, if a research study were to involve WGS, this research procedure would have almost always been included in the description of the research. However, to remove any ambiguity about whether such information would need to be included in the informed consent, the final rule makes this requirement explicit through this new element of consent.
The information that would have to be disclosed under these additional elements of consent is often relevant to an individual's decision of whether to participate in a research study. Such information may have been included in informed consent forms under the pre-2018 rule. However, the final rule now requires inclusion of these additional elements, when appropriate.
The additional element of consent proposed in the NPRM that was not included in the final rule would have required providing subjects or their legally authorized representatives with an option to consent, or refuse to consent, to investigators re-contacting the subject to seek additional information or biospecimens or to discuss participation in another research study. Although for some research studies, it will be desirable to inform prospective subjects about investigators' plan to re-contact subjects for certain purposes, and give them the option to agree or disagree to such re-contact, we agree with the public comments that questioned the importance of requiring that such information be included in the consent form. Although the final rule does not include this additional element of consent, this information can be included in the consent form.
Under the pre-2018 rule, if identifiers are removed from information and biospecimens such that the identity of the subject could not be readily ascertained by an investigator or associated with the information or biospecimens, then such information and biospecimens that have been collected for purposes other than the proposed research could be used without any requirement for informed consent. Similarly, under the HIPAA Privacy Rule, if data are de-identified or HIPAA identifiers do not accompany biospecimens, then the Privacy Rule does not apply. When identifiers have not been removed, under the pre-2018 rule investigators were allowed in certain situations to obtain a consent that is broader than for a specific research study, such as for creating a research repository that involves obtaining biospecimens from living individuals for use in future research studies. In these cases, an IRB could determine that the original consent for the creation of the research repository satisfied the requirements of the Common Rule for the conduct of the future research, provided that the elements of consent continue to be satisfied for the future research. Despite this flexibility in the Common Rule, stakeholders and the Common Rule departments and agencies believe that the elements of consent required under § __.116 of the pre-2018 rule often were not satisfied in the case of broad consent for future unspecified research use of identifiable private information or identifiable biospecimens.
With respect to HIPAA, HHS's pre-2013 interpretation of the HIPAA Privacy Rule was that authorizations for research needed to be study-specific, and thus, that such authorizations could not authorize certain future unspecified research. However, in January 2013, the Office for Civil Rights modified its prior interpretation.
Because biospecimens and information that have been collected for clinical use or purposes other than for the proposed research are often an important source of information and material for investigators, and the re-use of existing information and materials can be an efficient mechanism for conducting research without presenting additional physical or psychological risks to the individual, it seemed prudent to consider changes to current regulations relating to those issues.
The NPRM proposed to allow broad consent to cover the storage or maintenance for secondary research use of all biospecimens (regardless of identifiability) and identifiable private information. Broad consent would be permissible for the storage or maintenance for secondary research of such information and biospecimens that were originally collected for either research studies other than the proposed research or nonresearch purposes. The broad consent document would also meet the consent requirement for the use of such stored biospecimens and information for individual research studies. The NPRM made a separate case for nonidentified private information than it did for biospecimens, stating that consent would not be required for the secondary research use of nonidentified private information, such as the research use of medical records that have had all identifiers removed. Because the NPRM proposed that the definition of human subject be expanded to include all biospecimens, it also proposed to facilitate research using biospecimens by permitting broad consent to be obtained for their storage or maintenance for secondary research.
It was envisioned that the proposed broad consent provision would be used by institutions and investigators to give individuals the choice to either allow or disallow the use of their biospecimens and identifiable private information for secondary research. In some cases, institutions would be expected to seek broad consent as part of a research protocol to create a research repository of biospecimens or information. However, in other cases it was expected that institutions, particularly those that do not typically conduct human subjects research, might not develop a research protocol to create a research repository, but still choose to seek broad consent from individuals for the research use of their biospecimens or identifiable private information. In such cases, these institutions might simply “tag” biospecimens and information as either available or not available for secondary research.
Because broad consent is a different form of consent than the consent that is obtained for a specific research study, the NPRM proposed required elements for broad consent that would include several of the basic and additional elements of informed consent, but not all, and would include several additional required elements. The NPRM proposed to require that the information included in broad consent describe the biospecimens and identifiable private information that would be covered by the consent, recognizing that the biospecimens and information to be used in future research studies might be collected after the consent was obtained. Further, the NPRM proposed that broad consent for the research use of biospecimens or identifiable private information obtained for nonresearch purposes would be limited to covering either or both of the following: (1) Biospecimens or identifiable private information that exist at the time at which broad consent is sought; and (2) biospecimens or identifiable private information that will be collected up to 10 years after broad consent is obtained for adult subjects, and, for research involving children as subjects, biospecimens or identifiable private information that will be collected up to 10 years after broad consent is obtained or until the child reaches the legal age of consent to the treatments or procedures involved in the research, whichever comes first.
The NPRM proposed to include the standard concerning who is a child based upon the definition of “children” as defined at 45 CFR 46.402(a). At the time the child becomes an adult, the broad consent or permission would no longer be valid and either broad consent would need to be sought from the child-turned-adult, or the investigator would need to seek a waiver of informed consent in order to use the individual's biospecimens or identifiable private information for research, unless one of the exclusions or exemptions were applicable.
A proposed element of broad consent in the NPRM included a requirement that subjects be informed that they may withdraw consent, if feasible, for research use or distribution of the subject's information or biospecimens at any time without penalty or loss of benefits to which the subject is otherwise entitled. However, information that has been stripped of identifiers might not be traceable. Thus, it might not be feasible to withdraw consent for future use or distribution in this case. If, however, an investigator committed to permitting a subject to discontinue the use of such information, it was expected that the investigator would honor this commitment by not stripping identifiers and using the information or biospecimens in research. The proposed regulations would not require investigators to make such a commitment.
Another proposed element of broad consent in the NPRM related to the public posting of nonidentified data about a subject. This proposed element of broad consent would include an option, when relevant, for an adult subject or the subject's legally authorized representative to consent or refuse to consent to the inclusion of the subject's data with removal of the identifiers listed in the HIPAA Privacy Rule at 45 CFR 164.514(b)(2)(i)(A) through (Q), in a database that is publicly available and openly accessible to anyone. This provision was proposed in the context of increasing interest in inviting study participants to allow their study data, in some cases including genomic data, to be made publicly available in order to maximize the potential for research that spurs increased understanding of disease processes. Under this provision, the consent document would be required to prominently note the option for the participant to allow the investigator to publically post (
To facilitate the use of broad consent, the NPRM proposed that the Secretary of HHS would publish in the
Public comment was sought on whether broad consent to secondary research use of information and biospecimens collected for nonresearch purposes should be permissible without a boundary, or whether a time limitation or some other type of limitation should be imposed on information and biospecimens collected in the future that could be included in the broad consent as proposed in the NPRM. If a time limit should be required, public comment was sought on whether the NPRM proposal of up to 10 years was a reasonable limitation and whether a limitation related to an identified clinical encounter would better inform individuals of the clinical information and biospecimens that would be covered by a broad consent. Public comment was also sought on whether all of the elements of broad consent proposed in the NPRM should be required for the secondary use of biospecimens or identifiable private information originally collected as part of a research study that was conducted without consent because (1) either the original research study met an exclusion or exempt category of research, or (2) a waiver of consent was approved by an IRB.
Public comment was sought on how likely investigators are to seek broad consent for the use of identifiable private information (as contrasted with biospecimens), given that provisions within the NPRM would make it easier to do such research without consent. In this regard, the NPRM proposal to prohibit waiver of consent by an IRB if a person has been asked for broad consent and refused to provide it could create a disincentive on the part of investigators from choosing to seek broad consent for research involving secondary use of identifiable private information. Given the costs and time and effort involved in implementing the system for obtaining broad consent for the use of identifiable private information and tracking when people provide consent or refuse to do so, the public was asked to comment on whether the benefits to the system were likely to outweigh the costs, and if so, whether the broad consent provisions should be limited to obtaining broad consent for research use of biospecimens.
Approximately 475 comments addressed broad consent, a majority of which expressed opposition to broad consent as proposed and discussed in the NPRM. The basis of this opposition was largely related to the NPRM proposal that some type of consent (broad or specific) would be required for research with nonidentified biospecimens. A smaller number of comments (approximately 150) addressed the adequacy or inadequacy of broad consent as a concept, or the proposed broad consent templates to be created by HHS.
Public comment on the proposed, but not yet developed, broad consent templates was mixed, with a majority of comments stating that it was impossible to comment on a template that had not yet been created. Even among those who supported the use of broad consent, some had questions about whether broad consent provided at one institution would be sufficient for research ultimately conducted at another institution. Many comments further noted that the entire regulatory schema around broad consent (
Several commenters suggested that institutions needed to retain the ability to create and amend broad consent forms tailored to a variety of situations rather than rely on a federal template. These comments also generally stressed the importance of retaining an IRB's active role in reviewing the broad consent process and specific secondary research studies to ensure that interests other than autonomy and concerns other than those related to privacy were considered in a proposed study. A minority of commenters additionally expressed concern with the Federal Government's ability to develop broad consent templates that the regulated community might feel were sufficiently informative.
Public comments were also mixed on whether or not broad consent as proposed in the NPRM would constitute meaningful consent. Many comments noted that a consent form sufficiently broad to cover all potential future secondary research uses of biospecimens or identifiable private information might be so broad and vague as to be not meaningful or informative to prospective research subjects. Others doubted the meaningfulness of broad consent obtained in the clinical setting. One academic research institution questioned whether it was really consent at all, but rather an agreement or permission, and another commenter questioned whether broad consent would increase subjects' autonomy.
Many of the commenters who opposed broad consent also argued against any requirement to obtain consent for the use of nonidentified biospecimens. One academic research institution raised serious concerns about obtaining meaningful broad consent, which undermines existing privacy and other protections for subjects in research. Others noted that requiring broad consent for all secondary use of all biospecimens would require that there always be a link or code between the biospecimen and the subject's identity, which ultimately would result in an overall increase in privacy risks. Many commenters favored an opt-out system for broad consent (especially with respect to broad consent for use of nonidentified biospecimens). An AI/AN organization expressed overall concern about the concept of broad consent, noting that many AI/AN people believe that specimens and blood are considered sacred and recommending that all secondary uses of collected specimens and data should require an additional consent process, including tribal consent when specimens and data are obtained from AI/AN populations.
Few comments were received on the actual proposed elements of broad consent. Of these, a majority expressed confusion with the proposals related to the duration of the consent and the scope of the biospecimens and identifiable information that could be collected.
The NPRM also asked whether broad consent to secondary research use of information and biospecimens collected for nonresearch purposes should be permissible without a boundary, or whether a time limitation or some other
Most who commented were opposed to the 10-year limitation on the period of time that an institution could collect biospecimens and information from an individual once broad consent had been sought and obtained. They stated that the limitation was arbitrary, not supportable by anything discussed in the NPRM, and presented an administrative burden for institutions and investigators to time stamp and track the 10-year limit for each subject. A few commenters stated that a 10-year limit is a reasonable boundary, but were concerned about the need to re-consent people once they reach the legal age of consent. In large data sets, identifying such people could be very challenging as people often move locations during such lengths of time, which would create an administrative barrier. A few commenters suggested that 10-year boundary was too long and one research institution commented that in its experience individuals seem to prefer shorter time limits tied to specific periods (
A few comments stated that any time limit could have a negative effect on rare disease research as the numbers of affected people are so small and, as discoveries are made, there is often a need to go back to years' worth of information or stored biospecimens to search for markers, mutations, or clinical information that is related to the new discovery. Such commenters expressed concern that this could be deleterious to individuals with rare disease seeking a diagnosis.
Some commenters were confused about how the 10-year boundary proposed in the NPRM was supposed to function. Some comments assumed that one could only use the biospecimens or data for a 10-year period and after that period one would be required to get consent again for the use of those items. Others assumed that investigators would have to re-consent people every 10 years, but the information and biospecimens could be used indefinitely. For these reasons, many comments on the 10-year boundary said it was unreasonable and unworkable operationally. Some suggested that instead of 10-year boundary, patients could be routinely reminded that they gave consent and can be reminded that they can opt out at any time. Several large research institutions commented that the time limit would necessitate a lot of tracking for institutions and could lead to smaller health care institutions ceasing their collection of biospecimens for research, which would ultimately have a negative impact on research.
The NPRM also asked whether all of the elements of consent proposed at § __.116(c) should be required for the secondary use of biospecimens or identifiable private information originally collected as part of a research study that was conducted without consent because either the original research study met an exclusion or exempt category of research, or a waiver of consent was approved by an IRB. Approximately 30 comments answered this question. Responses ranged from those saying the elements are not as relevant as the burden of having to seek consent every 10 years. Many stated that the elements of consent appeared to be growing in the proposed rule at the same time that the rule was requiring simpler and shorter consent forms. As such, efforts should not be made to include all of the elements required in specific consent to broad consent; otherwise the intent of broad consent would be lost.
The NPRM also asked whether oral consent should be permissible in limited circumstances as proposed under the exemption for the storage and maintenance of biospecimens and identifiable private information. More than 60 pathologists, pathology departments, and pathology organizations suggested that oral consent should not be allowed in this context because it raises too many administrative challenges and may undermine public trust. A few commenters felt oral consent should be permitted but generally did not provide a rationale.
Finally, some comments indicated that broad consent as a concept should not be included in a final rule, and that the standards that exist under the pre-2018 rule for secondary research (
The final rule includes an option to obtain broad consent for the storage, maintenance, and secondary research use of identifiable private information or identifiable biospecimens, as defined at § __.102(e)(5) and (6), but several significant changes were made in response to public comments. Although in some ways the final rule's broad consent provision resembles the provision that was proposed in the NPRM, it is important to recognize a very fundamental difference between the role that this provision will play under the final rule, as compared to the role it was intended to play under the NPRM. This key difference relates to the fact that the provisions in the NPRM that would have generally required consent for secondary research use of nonidentified biospecimens, including imposing narrow stringent criteria for IRB waiver of consent with respect to such research, are not being implemented because the NPRM's proposal that all biospecimens, regardless of their identifiability, be covered under the Common Rule has not been adopted. Importantly, under the final rule, broad consent is permissible only for secondary research and no other types of research.
Thus, had all of those NPRM provisions been implemented, investigators who wanted to conduct secondary research with biospecimens would in most instances have found themselves essentially forced to use the new broad consent provisions as their only practical option for conducting such research. This is because generally, under the NPRM proposals, they would no longer have had the option to de-identify information or biospecimens, or to use them in coded form, to avoid application of the Common Rule's requirements. Under the NPRM's proposals, had investigators not obtained broad consent, they would often not practicably be able to meet the informed consent requirements relating to such research (which would have been covered under the Common Rule). Therefore, it would generally have been the case that they would have had little choice but to obtain broad consent, assuming they did not want to undertake the alternative of obtaining study-specific consent from subjects each and every time they conducted a study involving secondary use of biospecimens.
Given that we did not adopt the NPRM's proposal to cover all biospecimens regardless of their
For these reasons, the broad consent provisions at § __.116(d) afford investigators wishing to conduct secondary research on identifiable private information or identifiable biospecimens an additional alternative to obtaining an IRB waiver of consent or to obtaining study-specific consent. Given that these new broad consent provisions are essentially a new alternative to other options that are very similar to those that existed under the pre-2018 rule, these provisions are not increasing any regulatory burden or making it more difficult to do research. Indeed, just the opposite is the case. The changes made in the final rule are responsive to the significant criticisms expressed by many of the commenters about what the NPRM proposed, under which obtaining broad consent would have imposed substantial new burdens on a vast amount of secondary research with biospecimens. In contrast, when investigators choose to use the broad consent provisions under the final rule, they will presumably be doing so because this new option is less burdensome to them than their other (largely unchanged) options for conducting such research.
Although we recognize public commenters' concern that broad consent might not be as meaningful or informative as study-specific consent, it is also important to note that when an investigator chooses to use this new option, doing so will generally provide increased protection to the autonomy of research subjects. It will give them a choice to say no to such research, in contrast to most of the other routes by which an investigator might generally choose to conduct this type of research, such as with a waiver of informed consent, which allows research to take place regardless of the wishes of the person whose information or biospecimens are being studied, and without their knowledge. In addition, in response to the public's concerns that broad consent would not be meaningful, some of the elements of broad consent have changed from what was proposed in the NPRM to require more specific information about the research that may be conducted. As discussed in the NPRM, one of the main purposes of the final rule is to facilitate the conduct of minimal risk research, while enhancing subjects' autonomy. We believe that the option to obtain broad consent furthers this goal.
It is important to recognize that broad consent is a permissible option only for secondary research. Secondary research is limited to research using identifiable private information or identifiable biospecimens that are collected for either research studies other than the proposed research or nonresearch purposes. It is not permissible to obtain broad consent for any other type of research (
When broad consent is obtained, the general requirements for informed consent in § __.116(a) apply, except that the requirements at § __.116(a)(5) (imposing certain requirements concerning the presentation of information for informed consent and prescribing the order in which consent information is presented) do not apply to broad consent.
We expect that, given the different requirements set forth for study-specific consent and broad consent, some institutions and investigators may elect to pursue study-specific consents for the storage, maintenance, and secondary research uses of identifiable private information and identifiable biospecimens (or for some subset of such research) whereas other institutions and investigators may elect to pursue broad consent for the same types of research (or for some subset of such research). For instance, with regard to the public comments raising concern about broad consent being sought from AI/AN peoples, it is expected that institutions, investigators, and IRBs will consider these concerns when determining when it might be appropriate to seek study-specific consent for the secondary research use of identifiable biospecimens, as well as the need for tribal consent, when appropriate.
Perhaps even more commonly, however, given that the NPRM proposal regarding generally requiring consent for research use of nonidentifiable biospecimens has not been adopted, many investigators may choose to use the routes that previously existed under the pre-2018 rule, and will continue to exist, for conducting such research without informed consent under the Common Rule. Those options include using nonidentifiable biospecimens, including perhaps having a code maintained that will allow the investigator to obtain additional information about the subjects, or obtaining a waiver from an IRB of the need to obtain informed consent.
The broad consent provision in the final rule is different in three main ways from what was proposed in the NPRM. First, consistent with the decision not to revise the definition of human subject to include biospecimens regardless of identifiability, the broad consent provision in § __.116(d) only applies to secondary research using identifiable private information and identifiable biospecimens.
Second, the elements of broad consent have been strengthened and simplified in response to public comments. The final rule strengthens the element of broad consent proposed in the NPRM regarding the need to provide a general description of the types of research that may be conducted with identifiable private information and identifiable
As proposed in the NPRM, the final rule permits broad consent to be sought for either a narrow type of research to be conducted in the future (
While strengthening the broad consent requirements, the final rule also adopts simplified and more flexible elements of broad consent than what was proposed in the NPRM. For example, the final rule requires that the broad consent include a description of the identifiable private information or identifiable biospecimens that might be used in research, whether sharing of such information or biospecimens might occur, and the types of institutions or investigators that might conduct research with such information or biospecimens. However, the final rule does not adopt the NPRM's proposed limitations on the research use of biospecimens or identifiable private information obtained for nonresearch purposes, that would have only permitted a broad consent to cover either or both of the following: (1) Biospecimens or identifiable private information that exist at the time at which broad consent is sought; and (2) biospecimens or identifiable private information that will be collected up to 10 years after broad consent is obtained or until the child reaches the legal age of consent to the treatments or procedures involved in the research, whichever comes first. We were persuaded by the public comments that raised concerns about the complexity and tracking burden that such limitations would impose, without clearly offering individuals a more meaningful way to control the use of their information or biospecimens.
In addition, the broad consent requirements have been simplified to avoid creating redundant requirements with the basic elements of informed consent under § __.116(b) that must also be included in broad consent obtained under § __.116(d). For example, in the final rule, it is required that broad consent include a statement that participation is voluntary, refusal to participate will involve no penalty or loss of benefits to which the subject is otherwise entitled, and the subject may discontinue participation at any time without loss of benefits to which the subject is otherwise entitled ((§ __.116(d)(1), incorporating § __.116(b)(8) for broad consent). Therefore, the comparable element of broad consent that was proposed in the NPRM is not included in the final rule.
As discussed in the NPRM, we expect that, when appropriate, this element of broad consent will inform subjects that information that has been stripped of identifiers might not be traceable, and thus it might not be feasible to withdraw consent for future use or distribution in this case. However, if an investigator commits to permitting a subject to discontinue use of the subject's identifiable private information or identifiable biospecimens, it is expected that the investigator will honor this commitment by not removing identifiers.
Similarly, the final rule also does not include the element of broad consent proposed in the NPRM that, when relevant, would have required the broad consent to include an option for an adult subject or the representative to consent, or refuse to consent, to the inclusion of the subject's data, with removal of the identifiers listed in 45 CFR 164.514(b)(2)(i)(A) through (Q), in a database that is publicly and openly accessible to anyone, and that this option be prominently noted and include a description of the risks of public access to the data. We believe this proposed requirement is unnecessary because it overlaps with the broad consent elements included in the final rule requiring a statement describing the extent, if any, to which confidentiality of records identifying the subject will be maintained (§ __.116(d)(1), incorporating § __.116(b)(5) for broad consent), and a description of any reasonably foreseeable risks or discomforts to the subject (§ __.116(d)(1), incorporating § __.116(b)(2) for broad consent).
The final rule includes a slightly different provision relating to the return of research results than that proposed in the NPRM. As set forth in § __.116(d)(6) of the final rule, unless it is known that clinically relevant research results, including individual research results, will be disclosed to the subject in all circumstances, a statement that such results may not be disclosed to the subject must be included in the broad consent. This element of broad consent differs from the related requirement in § __.116(c)(8) that pertains when an investigator is seeking consent for a specific study, since unlike the circumstances under which broad consent is likely to be sought, investigators seeking consent for a specific study will know if the study includes a plan to return research results to subjects. The NPRM proposed that a general element of informed consent be included as part of a broad consent, namely that the consent include a statement regarding whether clinically relevant research results, including individual research results, would be disclosed to subjects, and if so, under what conditions. The language adopted in the final rule is intended to provide transparency, but is tailored to the broad consent context as those seeking broad consent may not know whether clinically relevant research results, including individual research results, will always be disclosed to subjects, and if so, under what conditions. Nonetheless, unless investigators know that such results will
Finally, the third main difference between the NPRM and final rule provision on broad consent is that the final rule does not include broad consent templates to be established by the Secretary of HHS. We agree with the public comments that favored allowing institutions to create their own broad consent forms that could be tailored to a variety of circumstances. Therefore, under the final rule, investigators and institutions may develop broad consent forms, which, provided specified conditions are satisfied, would meet the exemption for the storage and maintenance for secondary research use of identifiable biospecimens or identifiable private information (§ __.104(d)(7)). This exemption is further discussed in Section V. At a later time, the Secretary of HHS expects to develop guidance on broad consent, which could include broad consent templates.
In addition, we are also including in the final rule an element that for research involving biospecimens, when appropriate, the broad consent must state whether the research will (if known) or might include whole genome sequencing (WGS) (§ __.116(d)(1), incorporating § __.116(c)(9)). The reasons for requiring this element in the broad consent are similar to those discussed above regarding the addition of this requirement in the additional elements of consent at § __.116(c)(9). WGS generates an extremely large amount of data, which when analyzed can yield information about an individual, including factors that could contribute to their future medical conditions. Therefore, given the implications of WGS information for an individual and his or her biological family, if it is known that the broad consent will or might permit the use of individuals' biospecimens for WGS, we believe that this aspect of the research must be disclosed to prospective subjects as part of the broad consent process. The broad consent must include a general description of the types of research that may be conducted with the identifiable private information or identifiable biospecimens, with sufficient information to allow a reasonable person to expect that the broad consent would permit the types of research conducted (§ __.116(d)(2)). Including an additional element of broad consent that specifically addresses WGS makes it clear that such information must be disclosed to prospective subjects.
Under the final rule, if the subject or the subject's legally authorized representative is asked to provide broad consent, the broad consent must satisfy the general informed consent requirements at § __.116(a)(1)-(4), and (a)(6), and must include all of the following 12 elements that are applicable:
• A description of any reasonably foreseeable risks or discomforts to the subjects (§ __.116(d)(1), incorporating basic elements of informed consent in § __.116(b)(2));
• A description of any benefits to the subject or to others that may reasonably be expected from the research ((§ __.116(d)(1), incorporating basic elements of informed consent in § __.116(b)(3);
• A statement describing the extent, if any, to which confidentiality of records identifying the subject will be maintained ((§ __.116(d)(1), incorporating basic elements of informed consent in § __.116(b)(5));
• A statement that participation is voluntary, refusal to participate will involve no penalty or loss of benefits to which the subject is otherwise entitled, and the subject may discontinue participation at any time without penalty or loss of benefits to which the subject is otherwise entitled ((§ __.116(d)(1), incorporating basic elements of informed consent in § __.116(b)(8));
• If applicable, a statement that the subject's biospecimens (even if identifiers are removed) may be used for commercial profit and whether the subject will or will not share in this commercial profit ((§ __.116(d)(1), incorporating additional elements of consent in § __.116(c)(7));
• When appropriate, for research involving biospecimens, whether the research will (if known) or might include WGS (
• A general description of the types of research that may be conducted with identifiable private information or identifiable biospecimens. This description must include sufficient information to permit a reasonable person to expect that the broad consent would permit the types of research conducted (§ __.116(d)(2));
• A description of the identifiable private information or identifiable biospecimens that might be used in research, whether sharing of such information or biospecimens might occur, and the types of institutions or investigators that might conduct research with such information or biospecimens (§ __.116(d)(3));
• A description of the period of time allowed that the identifiable private information or identifiable biospecimens may be stored and maintained (which period of time could be indefinite), and a description of the period of time that such information or biospecimens may be used for research purposes (which period of time could be indefinite (§ __.116(d)(4));
• Unless the subject or legally authorized representative will be provided details about specific research studies, a statement that they will not be informed of the details of any specific research studies that might be conducted using the subject's identifiable private information or identifiable biospecimens, including the purposes of the research and that they
• Unless it is known that clinically relevant research results, including individual research results, will be disclosed to the subject in all circumstances, a statement that such results may not be disclosed to the subject; (§ __.116(d)(6)); and
• An explanation of whom to contact for answers to questions about the subject's rights about storage and use of the subject's identifiable private information or identifiable biospecimens, and whom to contact in the event of a research-related harm (§ __.116(d)(7)).
The elements of broad consent described in the first six bullet points above are not unique to broad consent, while the elements described in the last six bullet points are specific to the requirements of broad consent.
The pre-2018 rule permitted an IRB to waive the requirements for obtaining informed consent, or to alter such requirements, under two sets of circumstances described at § __.116(c) or (d) of the pre-2018 rule. The first set of circumstances, described at § __.116(c) of the pre-2018 rule was more narrow and was limited to certain research or demonstration projects conducted by or subject to the approval of state or local government officials. These projects are similar in some ways to the projects identified in the exemption at § __.104(d)(5) of this final rule. The broader provisions concerning waivers or alterations of the requirements of informed consent that apply beyond the circumstances described in § __.116(c) of the pre-2018 rule are discussed below in the section concerning § __.116(f).
The NPRM proposed retaining the waiver and alteration of informed consent provisions included in the pre-2018 rule with respect to research involving public benefit and service programs conducted by or subject to the approval of state or local officials, with two exceptions. First, the NPRM proposed (for proposed § __.116(e)(2)), additional criteria for waiver or alteration of consent for biospecimens. This was tied to the NPRM's proposal that all biospecimens, regardless of their identifiability, be covered under the Common Rule. Under these proposed criteria, IRBs would be able to approve waivers or alterations of the required informed consent elements only if an IRB found and documented both that there were compelling scientific reasons to conduct the research and that the research could not be conducted with other biospecimens for which informed consent was obtained or could be obtained. Second, the NPRM proposed new language (for proposed § __.116(e)(3)), providing that if an individual was asked to consent to the storage or maintenance for secondary research use of biospecimens or identifiable private information in accordance with the proposed broad consent provisions and that individual refused to consent, the IRB would be prohibited from waiving consent for the storage, maintenance, or the secondary research use of the biospecimens or information.
Public comments on this proposal are described in section F below because the comments submitted generally addressed the waiver and alteration criteria under both proposed § __.116(e) and § __.116(f).
The final rule adopts one of the two proposals made in the NPRM for proposed § __.116(e). The final rule adopts (in § __.116(e)(1)) the language proposed in the NPRM providing that if an individual was asked to consent to the storage or maintenance for secondary research use of identifiable private information or identifiable biospecimens in accordance with the proposed broad consent provisions and such individual refused to consent, the IRB would be prohibited from waiving consent for the storage, maintenance, or the secondary research use of such biospecimens or information. The references in this provision to biospecimens are changed to refer specifically to identifiable biospecimens as the final rule does not apply to the research use of nonidentifiable biospecimens. This change is intended to honor the autonomy of individuals and to further the
The final rule does not incorporate the NPRM's proposed additional waiver criterion to apply to research involving the use of biospecimens. This change is not necessary given that the proposal in the NPRM that the Common Rule extend to
The format and organization of § __.116(e) in the final rule is different from that included in the pre-2018 rule or proposed in the NPRM. These changes were implemented to be clearer about the effect of each requirement. Most significantly, § __.116(e) in the final rule provides separate paragraphs concerning the applicable criteria for waiver and the applicable criteria for alteration of the requirements for informed consent. This differs from the approach proposed in the NPRM, and the approach included in the pre-2018 rule, that did not separate those discussions. We concluded that separating the discussion of waiver and the discussion of alteration would help clarify the applicable criteria, particularly given that the final rule addresses broad consent.
Section __.116(e)(1) describes the general framework for an IRB to waive the requirements for informed consent. This paragraph explains that an IRB may waive the requirement to obtain informed consent under § __.116(a) (general requirements for informed consent), § __.116(b) (basic elements of informed consent), or § __.116(c) (additional elements of informed consent that apply to certain research) if the IRB satisfies the criteria set forth at § __.116(e)(3) (discussed below). As explained above, the ability to satisfy the requirement to obtain informed consent of a subject or a subject's legally authorized representative through use of a broad consent in particular circumstances is a flexibility offered to institutions, but institutions are never required to obtain informed consent through a broad consent process. For this reason, § __.116(e)(1) does not provide that an IRB may waive the requirement to obtain informed consent under § __.116(d) (broad consent) because use of broad consent is not a requirement. As noted above, and to honor the autonomy of individuals, § __.116(e)(1) prohibits an IRB from
Section __.116(e)(2) describes the general framework for an IRB to alter the requirements for informed consent. An IRB may omit or alter some or all of the elements of informed consent under § __.116(b) (basic elements of informed consent) or § __.116(c) (additional elements of informed consent that apply to certain research) if the IRB satisfies the criteria set forth at § __.116(e)(3) (discussed below). This is consistent with the proposal made in the NPRM. This paragraph further explains that an IRB may not omit or alter any of the requirements described in § __.116(a) (general requirements for informed consent). This is also consistent with the proposal made in the NPRM (which proposed permitting an IRB to omit or alter elements of informed consent, but did not propose permitting omissions or alterations of the general requirements of informed consent that were included in the unnumbered introductory paragraph in the pre-2018 rule at § __.116). This paragraph also specifies that if a broad consent is used, an IRB may not omit or alter any of the elements required under § __.116(d). We determined that it would not be appropriate to permit the omission or alteration of any of the broad consent elements given the fact that the required elements of broad consent are limited and given our view that each of these elements (described at § __.116(d)) is critical for the purpose of soliciting broad consent that is both informed and ethically appropriate. This approach is different from what was proposed in the NPRM because of the NPRM's different approach to broad consent than that adopted in the final rule.
Section __.116(e)(3) sets forth the specific criteria that an IRB must find and document to waive or alter the requirements for informed consent, consistent with the limitations set forth in § __.116(e)(1) and § __.116(e)(2). These criteria are the same as those proposed in the NPRM. First, the IRB must find and document that the research or demonstration project is to be conducted by or subject to the approval of state or local government officials and is designed to study, evaluate, or otherwise examine public benefit or service programs; procedures for obtaining benefits or services under those programs; possible changes in or alternatives to those programs or procedures; or possible changes in methods or levels of payment for benefits or services under those programs. Second, the IRB must find and document that the research could not practicably be carried out without the waiver or alteration.
Beyond the circumstances addressed in § __.116(c) of the pre-2018 rule (which is limited to certain research conducted by or subject to the approval of state or local government officials), the pre-2018 rule includes a more general provision that is not limited to any particular type of research and that permits an IRB to either waive the requirements for obtaining informed consent, or to alter such requirements. Waiver or alteration of the requirements of informed consent under this general provision requires that the following four criteria be satisfied: (1) the research involves no more than minimal risk to the subjects; (2) the waiver or alteration will not adversely affect the rights and welfare of the subjects; (3) the research could not practicably be carried out without the waiver or alteration; and (4) whenever appropriate, the subjects will be provided with additional pertinent information after participation.
Concerns have been expressed that requirements for obtaining waivers of informed consent or waivers of documentation of informed consent were confusing and inflexible, resulting in inconsistent application and a lack of uniformity in interpretation, which led to the proposals in the NPRM.
The NPRM offered three substantive proposals related to the general waiver or alteration of informed consent provisions. First, the NPRM proposed to add a new waiver criterion that would require that for research involving access to or use of identifiable biospecimens or identifiable private information, the requirements of informed consent could only be waived or altered if the research could not practicably be carried out without accessing or using identifiers. This criterion was modeled on the comparable criterion in the HIPAA Privacy Rule, which requires as a condition of waiver of the requirement to obtain an individual's authorization that the research could not practicably be conducted without access to and use of protected health information. The principle embodied in this additional proposed criterion was that nonidentified information should be used whenever possible in order to respect subjects' interests in protecting the confidentiality of their data and biospecimens.
Second, the NPRM proposed two additional waiver criteria for research involving the use of biospecimens. For such research, the NPRM proposed that the requirements of informed consent could only be waived or altered if an IRB found and documented that: (1) there were compelling scientific reasons for the research use of the biospecimens; and (2) the research could not be conducted with other biospecimens for which informed consent was or could be obtained.
Third, the NPRM proposed that the Common Rule prohibit IRBs from waiving informed consent if individuals were asked and refused to provide broad consent to the storage and maintenance for secondary research use of biospecimens and identifiable private information. If a subject refused to provide broad consent, it was proposed that this refusal would need to be recorded by the investigator to better ensure that the subject's wishes would be honored.
Approximately 975 public comments discussed the NPRM proposals found at § __.116(f) either directly, or as related to linked provisions related to the definition of human subject, the broad consent proposal, or proposed exemptions. A majority of these discussed the NPRM proposals related to the more stringent waiver criteria for research involving biospecimens. A majority of these comments were from patients (including family members of patients) and other individuals who commented anonymously. Patients tended to oppose these proposals because they believed they would severely restrict access to biospecimens, which would slow research. Some commenters were opposed to waiver of consent under any conditions, whether specific or broad consent.
Approximately 40 comments were received on the NPRM's proposal to prohibit an IRB from waiving consent for the storage, maintenance, or secondary research uses of identifiable biospecimens or identifiable private information if an individual was asked to provide broad consent for such purposes and refused to provide such consent. Public comment was mixed. Those who supported it indicated that this requirement made sense in order to respect subject autonomy. Those who
The NPRM sought comments concerning language in the pre-2018 rule (that the NPRM proposed retaining) that waiver or alteration of informed consent only occur if the IRB finds that the research could not practicably be carried out without the requested waiver or alteration. Several commenters recommended further defining or clarifying the meaning of “practicably.” Some members of the public felt that this criterion was too open-ended and that greater emphasis should be placed on respect for persons over other ethical concerns and scientific validity. Several commenters favored SACHRP's recommendations on this topic, including that this requirement be interpreted to mean that it would be impracticable to perform the research, not impracticable to obtain consent due to financial or administrative burdens, without the waiver or alteration. Another commenter argued that because of a lack of clarity as to the meaning of terms including “minimal risk,” “practicably,” and “the rights and welfare of subjects,” as well as the potential that IRBs may not apply the criteria uniformly, IRBs should not be able to waive or alter consent. The following suggestions were offered as replacement language: “reasonably done without excessive time or financial constraints to the researcher that would delay the project so significantly as to make it impossible to conduct the research,” “capable of being done or accomplished with available means or resources,” “reasonably feasible,” “capable of being effective,” and “could practicably be obtained.” Several commenters favored retaining the term “practicably” and were satisfied that it was clear.
Other comments raised different issues about waiver or alteration. Many commenters who opposed all classified research conducted without consent recommended that waivers be prohibited with respect to classified research involving humans. One commenter recommended a reorganization of the waiver and alteration provisions to clarify the different standards that apply to waivers and alterations. Another commenter expressed concern that the NPRM's proposed waiver provision would unreasonably limit the flexibility of IRBs. One commenter believed that the § __.116(f) alteration criteria were too rigid and that the final rule should incorporate a notion of risk adjustment. Another commenter (a professional medical organization) supported SACHRP's proposed revisions to the waiver criteria at § __.116(f) to allow an IRB to approve the storage, maintenance, and secondary research use of identified data.
The NPRM sought public comment on the proposed differences between the criteria for waiving informed consent for the research use of biospecimens versus identifiable information. Approximately 60 comments stated that no justification exists for treating biospecimens and information differently. Some also noted that the proposed criteria for waiver of consent for use of biospecimens is so high as to be virtually impossible to meet and asked why biospecimens should have a higher standard than information (which theoretically could be more easily identifiable). One commenter noted that the proposed waiver criteria promotes “biospecimen exceptionalism” and that data and biospecimens should be treated the same.
A request in the NPRM for public comment on whether the proposal to permit an IRB to waive consent for research involving the use of biospecimens should be included in the regulations received few comments. One commenter noted that it seemed incongruous to include biospecimens in the definition of “human subject,” but then allow waiver based on different criteria. Others stated that IRBs should continue to have the ability to waive consent.
The NPRM sought public comment regarding how likely investigators are to seek broad consent for the use of identifiable private information (as contrasted with biospecimens), given that the NPRM contains provisions that would make it easier to do such research without consent (such as the new exemption proposed for § __.104(e)(2)). Approximately 30 commenters responded to this question. A majority said they would not use the broad consent mechanism for secondary use of information if other options were available. Some said that they suspected that investigators would continue to seek consent waivers for secondary use of identifiable private information instead of seeking broad consent.
The NPRM also sought public comment on several aspects of the proposed prohibition on waiving consent when an individual has been asked to provide broad consent and refused, including the following questions: In particular, how would this prohibition on waiving consent affect the secondary research use of identifiable private information? If an individual was asked to provide such consent, should the absence of a signed secondary use consent be considered a refusal? Does this prohibition on waiving consent for the secondary use of identifiable private information create a disincentive for institutions to seek broad consent for secondary use and instead seek a waiver of consent from an IRB? Under what circumstances, if any, would it be justified to permit an IRB to waive consent even if an individual declined or refused to consent?
Approximately 35 comments were received on this set of questions. Approximately half of these stated that “no means no.” If someone was asked to give broad consent and the person specifically said no, researchers should not be allowed to obtain a waiver of consent. Those who opposed the idea of a prohibition on waiver argued that it would be very difficult for institutions to understand why someone said no to providing broad consent. In other words, a blanket prohibition does not accurately address all the issues that can occur in this situation.
A majority of the responses did not address the questions of how a broad consent form with no indication either way should be treated. The responses we received to this question suggested that absence of a signed form should not be treated as if the individual explicitly said no to broad consent (
A majority of the responses that we received on the question of whether the prohibition on waiver in the broad consent context created a disincentive for the use of broad consent with identifiable private information answered in the affirmative.
Overall, two of the three proposals made in the NPRM for proposed § __.116(f) have been retained. The final rule adopts (in § __.116(f)(3)(iii)) a new waiver criterion very similar to that proposed in the NPRM, which now mandates that for research involving access to or use of identifiable private
The final rule also adopts (in § __.116(f)(1)) the language proposed in the NPRM (for § __.116(f)(3)) prohibiting IRBs from waiving informed consent if individuals were asked and declined to provide broad consent to the storage and maintenance for secondary research use of identifiable private information or identifiable biospecimens (except that the final rule's formulation is limited to identifiable biospecimens, consistent with changes made in the final rule). We considered public comments that opposed this prohibition and understand that IRBs may not always understand the reason that individuals refused to sign a consent form and that the effects of this broad prohibition could be significant in the context of broad consent (given the broad scope of research that such a broad consent could potentially extend to). Nonetheless, we determined that it is important to prevent an individual's refusal to consent to additional research use of such information or biospecimens from being overridden. This change to the Common Rule is intended to honor the autonomy of individuals and to further the
The final rule does not incorporate the NPRM's proposed additional waiver criteria (proposed for § __.116(f)(2)) to apply to research involving the use of biospecimens. This change is not necessary given that the proposal in the NPRM that the Common Rule extend to
The format and organization of § __.116(f) in the final rule are different from the proposed § __.116(f) described in the NPRM. We made these changes in an effort to be clear about the effect of each requirement. Most significantly, § __.116(f) in the final rule provides separate paragraphs concerning the applicable criteria for waiver and the applicable criteria for alteration of the requirements for informed consent. This differs from the approach proposed in the NPRM, and the approach included in the pre-2018 rule that did not separate those discussions. We conclude that separating the discussion of waiver and alteration will help clarify the applicable criteria, particularly given that the final rule addresses the application of the waiver and alteration provisions in the context of broad consent.
Section __.116(f)(1) describes the general framework for an IRB to waive the requirements for informed consent. This paragraph explains that an IRB may waive the requirement to obtain informed consent under § __.116(a) (general requirements for informed consent), § __.116(b) (basic elements of informed consent), or § __.116(c) (additional elements of informed consent that apply to certain research) if the research satisfies the criteria set forth at § __.116(f)(3) (discussed below). As explained above, the ability to satisfy the requirement to obtain informed consent of a subject or a subject's legally authorized representative through use of a broad consent in particular circumstances is a flexibility offered to institutions, but institutions are never required to obtain informed consent through a broad consent process. For this reason, § __.116(f)(1) does not provide that an IRB may waive the requirement to obtain informed consent under § __.116(d) (broad consent) because use of broad consent is a regulatory flexibility, and not a requirement. Consistent with the proposal made in the NPRM (proposed § __.116(f)(3)), § __.116(f)(1) provides that if an individual was asked to provide broad consent for the storage, maintenance, and secondary research use of identifiable private information or identifiable biospecimens and refused to consent, an IRB cannot waive consent for either the storage, maintenance, or secondary research use of such biospecimens or information.
Section__.116(f)(2) describes the general framework for an IRB to alter the requirements for informed consent. This paragraph explains that an IRB may omit or alter some or all of the elements of informed consent under § __.116(b) (basic elements of informed consent) or § __.116(c) (additional elements of informed consent that apply to certain research) if the IRB satisfies the criteria set forth at § __.116(f)(3) (discussed below). This is consistent with the proposal made in the NPRM. This paragraph further explains that an IRB may not omit or alter any of the requirements described in § __.116(a) (general requirements for informed consent). This is also consistent with the proposal made in the NPRM (which proposed permitting an IRB to omit or alter elements of informed consent, but did not propose permitting omissions or alterations of the general requirements of informed consent that were included in the unnumbered introductory paragraph in the pre-2018 rule at § __.116). This paragraph also specifies that when reviewing a broad consent, an IRB may not omit or alter any of the elements required under § __.116(d). As with § __.116(e)(2), we determined that it would not be appropriate to permit the omission or alteration of any of the broad consent elements in § __.116(f). The elements of broad consent reflected in this NPRM are limited. We have concluded that each of these elements (which are included at § __.116(d)) is critical to the solicitation of an informed and ethically appropriate broad consent. For that reason, none of the elements of broad consent may be omitted or altered if broad consent is solicited. This prohibition is different than the NPRM's proposal given the different formulation of broad consent represented in this final rule.
Section 116(f)(3) sets forth the specific criteria that an IRB must find and document in order to waive or alter the requirements for informed consent. These criteria are the same as those proposed in the NPRM, except that the third criterion includes minor wording changes that were made for clarity: (1) the research involves no more than minimal risk to the subjects; (2) the
The pre-2018 rule required an IRB to determine that informed consent can be waived under § __.116(d) before investigators could record identifiable private information for the purpose of identifying and contacting prospective subjects for a research study. This requirement to waive informed consent has been viewed as burdensome and unnecessary for protecting subjects, and is not consistent with FDA's regulations, which do not require informed consent or a waiver of informed consent for such activities.
The NPRM proposed a new provision at § __.116(g) that would authorize an IRB to approve a research proposal in which investigators obtain identifiable private information without individuals' informed consent for the purpose of screening, recruiting, or determining the eligibility of prospective human subjects of research. The IRB would be permitted to approve a research proposal only in such circumstances if the proposal included an assurance that the investigator would implement standards for protecting the information obtained, in accordance with and to the extent required by proposed § __.105. This proposal was intended to address concerns that the pre-2018 rule required an IRB to determine that informed consent can be waived before investigators could record identifiable private information for the purpose of identifying and contacting prospective subjects for a research study.
Few comments were received regarding this proposal. All were generally supportive. One academic institution noted that “This review is unnecessary considering the low potential risk to subjects and will expedite research endeavors and ensure harmonization between FDA`s expectations and the Common Rule.” However, one commenter thought that prospective subjects should be notified that this might be a possibility. Another commenter said that it should be clear that this is not an IRB waiver of consent, but rather it is an exception to the consent requirement.
The final rule adopts the NPRM proposal at § __.116(g), with minor changes made for clarity, and without a requirement that investigators adhere to the proposed privacy safeguards at § __.105, since this provision is not included in the final rule. The provision at § __.116(g) addresses concerns that the pre-2018 regulations required an IRB to determine that informed consent can be waived before investigators may record identifiable private information for the purpose of identifying and contacting prospective subjects for a research study. This change is intended to address these concerns by eliminating the requirement for the IRB to waive informed consent for these activities. In response to public comments, we are clarifying that this is not a waiver of the consent requirement but rather an exception to the requirement. This change is also responsive to SACHRP's recommendation regarding how the Common Rule should apply to activities that are conducted before subjects provide consent to participate in research, such as identifying potential subjects, contacting subjects, and recruiting subjects.
The final rule includes some minor changes from the NPRM proposal, to clarify the circumstances in which the IRB may approve the investigator's proposal to obtain information directly from a prospective subject, or to obtain already collected identifiable private information or identifiable biospecimens by accessing records or stored biospecimens, for purposes of screening, recruiting, or eligibility assessment, without the informed consent of the prospective subject or the subject's legally authorized representative. The final rule also adds a reference to the subject's legally authorized representative at § __.116(g)(1) to clarify that this exception to informed consent will also apply in circumstances in which the prospective subject has a legally authorized representative who will provide information about the prospective subject through oral or written communication with the investigator.
We note that in approving this exception to informed consent for the purpose of screening, recruiting, or determining the eligibility of prospective subjects, the IRB will be reviewing and approving the entire research proposal. Therefore, all of the IRB approval criteria at § __.111 will need to be satisfied, including that when appropriate, there are adequate provisions to protect the privacy of subjects and to maintain the confidentiality of data (§ __.111(a)(7)). Thus, as part of its review and approval of the research, the IRB must determine that there are adequate privacy and confidentiality safeguards for information obtained by investigators for these preparatory-to-research activities.
We believe that these preparatory-to-research activities are critical means by which to identify subjects that do not involve additional risks, given their limited nature. If prospective subjects are identified through these “screening” activities, then all other relevant requirements of this rule must be met if they are subsequently recruited to participate in the research.
The pre-2018 rule did not have a requirement to post consent forms from clinical trials.
The NPRM proposed a new provision that would require that a copy of the final version of the consent form (absent any signatures) for each clinical trial conducted or supported by a Common Rule department or agency be posted on a publicly available federal Web site that will be established as a repository for such consent forms. The name of the protocol and contact information would be required to be included with the submission of the consent form. Under the NPRM proposal, the consent form would have to be published on the Web
The NPRM proposal received approximately 130 comments, most of which opposed the proposal in whole or in part. Many commenters expressed concern that the proposal represented administrative burden without a corresponding increase in protections to human subjects or benefit to the research community. Some commenters felt that the proposal represented a waste of resources that would not increase compliance with the regulations, and might result in longer consent forms if researchers felt the need to include an abundance of additional information to protect against perceived regulatory noncompliance or legal challenge. These commenters expressed concern that the repository of posted consent forms might be used to seek out instances of noncompliance. For example, one large medical school indicated that the posting requirement creates a rich environment for litigation and represents an effort to publicly shame investigators to improve quality of documents that will not work.
Other commenters, including some private research firms, were concerned that the proposal as drafted would not allow for the redaction of proprietary or institutionally sensitive information from consent forms before they would be posted to the Web site, and allow competing research entities access to detailed information about investigational drug or research programs beyond what is publicly available already. Additional concern was expressed about the proposed timeframe in which consent forms needed to be posted. Some felt that more time was needed. Other commenters felt it would be more beneficial to research participants if consent forms were posted before or during recruitment. In addition, some commenters felt that researchers should be allowed or encouraged to update posted consent forms if they are updated for the study. Others felt that requiring that consent forms be posted once (even if the forms were updated after being posted) would lead to potential confusion among research participants. For example, several commenters noted that should a subject participating in a trial see a consent form for a particular study that differed from the form that he or she originally signed, that discrepancy could cause unnecessary concern and confusion.
Still other commenters expressed concern that the high volume of consent forms that would be posted as a result of this requirement would make the collection cumbersome and difficult to use, negating any potential benefit gained by increased transparency. Others expressed a concern that requiring all studies to post consent forms might lead to the perpetuation of poorly written forms, as researchers might use poor examples from the database to write their own informed consent documents in addition to excellent ones. A few major research universities suggested that guidance, best practices, or exemplary informed consent forms should be selected and shared publicly, rather than all informed consent forms. Some commenters suggested limiting the posting requirement to a subset of research studies, for example, to only high risk or large multi-institution studies.
Those who supported the proposal agreed that it would help increase accountability and promote transparency in informed consent forms. To that end, a minority of commenters said that this proposal should be extended to all research that is subject to the Common Rule, not just to studies meeting the definition of a clinical trial. Some commenters supported the idea of publicly sharing informed consent documents but felt it would be best accomplished through guidance or optional posting. One federal level advisory committee supported the proposal and recommended the creation of robust guidance with the goal of minimizing confusion and misuse of the posted documents, and facilitating the use of the posted forms to educate investigators, institutions, and regulators to improve future informed consent documents and the informed consent process generally. Others felt it would be helpful to post additional information and documents along with consent forms. For example, one investigator suggested that copies of IRB proposals and decisions be made public along with approved informed consent documents to provide additional transparency and accountability. Another commenter suggested that investigators be given the option to post assessment tools for evaluating prospective subjects' understanding of important study information.
Both those who supported and opposed the proposal indicated that in terms of implementing this proposal, consent forms should be posted to
The final rule adopts the NPRM proposal with some modifications and clarifications. The primary purpose of this provision is to improve the quality of consent forms in federally funded research by assuring that—contrary to current practices, under which it is often very difficult to ever obtain a copy of these documents—they eventually would become subject to public scrutiny and that they will provide useful models for others. The consent form plays a key role in making sure that someone asked to enter a clinical trial receives the information they need to be making an informed decision about whether to enroll in that trial. Accordingly, it also plays a key role in supporting and justifying the public's trust in the integrity of our clinical trial enterprise.
We are not persuaded by the arguments of those commenters who suggest that potential negative consequences of this proposal outweigh its benefits. Fundamentally, this proposal is about increasing the transparency of one of the most important aspects of our human subjects protection system. Increased transparency is in general a good thing, and in this instance, as in many others, it offers multiple benefits—including increased trust—at very low cost. This provision is not a form of shaming, but rather an effort to ask people to work together to create a system that will improve the quality of informed consent. Moreover, the new standards for determining the acceptable content of a consent form—including § __.116(a)(5), which will require a concise presentation of key information at the beginning of the consent form—should counter any consequences of attempts to pad consent forms with additional information as a response to the posting requirement.
We agree with the conclusions of SACHRP that implementing this proposal will indeed result in better consent forms. Having a repository of such forms freely available for analysis and public discussion will create multiple opportunities for improving these forms. In an era in which we have previously unheard of capabilities for analyzing textual material and processing large amounts of data, the fact that there will be a high volume of consent forms posted should be a minor impediment, if any, to the ability to learn from the content of this database.
With regard to those who suggested that it would indeed be desirable to
With regard to the commenters who were concerned that posting consent forms would create a rich environment for litigation, it is noteworthy that the existing evidence fails to suggest that there has been much of a problem with regard to inappropriate litigation over clinical trials. Whatever disincentives currently exist for such litigation, it seems unlikely that the mere fact that consent forms would now be more available will dramatically alter such disincentives. With regard to the commenters who were concerned about the added regulatory burden, we note that this change, compared to the traditional costs of clinical trials, will add a relatively small amount of additional burden, one that is well justified in comparison to the likely increase in transparency. This new provision has specifically been designed to minimize that burden. And the final rule has been modified in a number of respects from the NPRM proposal in response to public comments. As discussed below in detail, the time by which a consent form must be posted has been greatly extended. That change would also address the concerns of some commenters that the posted consent forms might create confusion among research subjects. Furthermore, provisions have been added that allow for redaction, as necessary, of portions of consent forms.
As a means of increasing transparency and facilitating the development of more informative consent forms, the final rule accordingly requires at § __.116(h)(1) that for clinical trials conducted or supported by a Common Rule department or agency, a copy of an IRB-approved version of a consent form that was used to enroll subjects would need to be posted by the awardee or the federal department or agency conducting the trial on a publicly available federal Web site that will be established as a repository for such forms. Unlike the NPRM, which required that the “final version” of the consent form be posted, the final rule adds flexibility in merely requiring that it be an IRB-approved consent form that was used for enrollment purposes. There is accordingly no further restriction as to which version of a consent form (which might have been subject to many modifications over the course of time) must be posted. The final rule also gives greater flexibility than the NPRM proposal in terms of when that posting needs to be done. It can take place any time after the trial is closed to recruitment, so long as the posting is no later than 60 days after the last study visit by any subject (as required by the protocol). If the federal department or agency supporting or conducting the clinical trial determines that certain information should not be made publicly available on a federal Web site (
The final rule differs from the NPRM proposal in that it no longer specifies that certain information needs to be posted in addition to the consent form. This change eliminates the need for mandatory posting of information that might not be justified by the purposes of this provision.
Only one posting would be required for each multi-institution study. There is accordingly no expectation that a version would need to be posted for each class of subjects in the study (for example, a posting both for adults and for minors), nor for each study site.
We also note that this provision applies only to those clinical trials that are conducted or supported by a federal department or agency.
A Web site will be developed by HHS, which could be used by other federal departments or agencies, or the other federal departments or agencies could create their own Web sites for the posting of these consent forms. Public posting of consent forms is intended to increase transparency, enhance confidence in the research enterprise, increase accountability, and inform the development of future consent forms. It is anticipated that the Web site will be searchable. With regard to the comments suggesting that
The pre-2018 rule at § __.117 described the requirements for documenting informed consent and when the waiver for obtaining a written and signed consent form was allowable.
The NPRM proposed to alter the language at § __.117(b)(1) to specify that the consent document should include only the language required by § __.116, with appendices included to cover any additional information.
In addition, the NPRM would make it explicit in the regulatory language at proposed § __.117(c)(1)(iii) that if the subjects are members of a distinct cultural group or community for whom signing documents is not the norm, so long as the research presents no more than minimal risk of harm to subjects and provided there is an appropriate alternative mechanism for documenting that informed consent was obtained, the requirement to obtain a signed consent form may be waived. Documentation must include a description as to why signing forms is not the norm for the distinct cultural group or community.
Additionally, to facilitate the tracking of broad consent to storage or maintenance for secondary research use of biospecimens or identifiable private information, and to provide information to IRBs should IRB review be required, the NPRM proposed that waiver of documentation of consent for the research use of such biospecimens would not be allowed based upon a new provision at § __.117(c)(3).
The NPRM also introduced the term “oral consent” in the context of the various provisions related to the broad consent for the storage, maintenance, and secondary use of biospecimens and identifiable private information. As a general matter, under the pre-2018 rule, individuals wanting to obtain oral
• An investigator used the proposed broad consent template;
• Investigators only sought oral broad consent only for the storage, maintenance, and secondary research use context for the use of identifiable private information, not for biospecimens;
• If broad consent for the storage, maintenance, and secondary research use was obtained only as part of a separate, primary research study; and
• The oral broad consent was sought as part of the consent process in a study eligible for one specific exclusion or three specific exemptions related to the collection of identifiable information.
Finally, the regulatory language proposed at § __.117(c)(4) was intended to clarify that waivers of documentation may not be permitted for research subject to regulation by FDA.
Approximately 15 comments were received on the proposals found in the NPRM at § __.117. Several commenters discussing the proposed requirement at § __.117(b)(1) indicated that even if consent forms are split into a primary document and appendices, there should be an expectation that the content included in the appendices are discussed with prospective subjects as part of the informed consent process. Although very few comments discussed the requirements of proposed § __.117(b)(1) specifically, many of the comments discussing the NPRM proposal found in the introductory paragraph of § __.116 discussed the concept of including only the required information in the main body of a consent form, and all additional information in appendices.
Few comments were received on the proposal found in § __.117(c)(1)(iii) that documentation of informed consent may be waived if consent is being sought amongst subjects who are members of a distinct cultural group or community in which signing forms is not the norm. Comments received on this proposal were generally favorable.
Those who commented on the proposals related to oral broad consent indicated that the provisions were confusing and difficult to understand. We note that these proposals were found in the NPRM through a series of interrelated cross references in §§ __.116(d), __.117(c), and __.104(f)(1)-(2).
Several commenters discussed the statement found in § __.117(c)(4) that waiver of documentation of consent is generally not permitted for research subject to regulation by the FDA. These commenters noted that this would be true regardless of whether this was included in the Common Rule. Additionally, commenters noted that if the FDA regulations ever permitted waiver of documentation of consent, the existence of this provision in the Common Rule might result in confusion and contradictory requirements for dually regulated research.
The language at § __.117(b)(1) and (2) are altered in the final rule to conform to the requirements included at § __.116, which are discussed above. The goal in §§ __.116 and __.117 of the final rule is to facilitate a prospective subject's or legally authorized representative's understanding of the reasons why one might or might not want to participate in the research, in part by requiring that only the key information essential to decision making receive priority by appearing at the beginning of the consent document. In the final rule, these requirements also apply when a short form written informed consent process is used, or the requirement for written informed consent is waived.
We agree with the majority of public comments that favored adding a new provision allowing a waiver of the requirement for a signed consent form if the subjects are members of a distinct cultural group or community for whom signing documents is not the norm, provided that the research presents no more than minimal risk of harm to subjects and there is an appropriate alternative method for documenting that informed consent was obtained. Therefore, this new provision is added at § __.117(c)(1)(iii). The final rule includes a reference to the subject's legally authorized representative to clarify that this provision applies when a subject has a legally authorized representative who is a member of a distinct cultural group or community in which signing forms is not the norm.
The final rule does not include the NPRM's proposal at § __.117(c)(3) to prohibit a waiver of documentation of broad consent for the storage, maintenance, or secondary research use of biospecimens.
Some of those who commented on the NPRM proposals related to oral broad consent found it to be unnecessarily confusing. In response to these comments, the final rule permits waiver of documentation of informed consent under § __.117(c) when a broad consent procedure is used. No additional criteria or special restrictions apply. Additionally, the final rule removes all NPRM references to “oral consent” to reduce confusion.
However, we expect that it will rarely be permissible to waive documentation of broad consent for the secondary research use of medical records or stored biospecimens because there will likely be a need to track which individuals have provided broad consent and which have not, so the informed consent would not be the only record linking the subject and the research as required for a waiver under § __.117(c)(1)(i). Additionally, when identifiable information and identifiable biospecimens are shared for a nonresearch purposes, the person's consent is usually required, so we expect that documentation of consent often could not be waived under § __.117(c)(1)(ii), which requires that the research involves only procedures for which written consent is not normally required outside of the research context.
One instance when we believe it may be appropriate for the IRB to waive the requirement for a signed broad consent form is when the initial activity involved obtaining information from a person through oral communication, such as a phone survey, because there might not be an opportunity to obtain written broad consent from such individuals for the secondary research use of their information. In this scenario, documentation of broad consent could be waived under § __.117(c)(1)(ii) if the research presents no more than minimal risk of harm to subjects and involves no procedures for which written consent is normally required outside of the research context. In addition, it might be appropriate for an IRB to waive the requirement for a signed broad consent document under the provision included in the final rule related to when the subjects or their legally authorized representatives are members of a distinct cultural group or community for whom signing documents is not the norm, provided that the research presents no more than minimal risk of harm to subjects and an appropriate alternative method is available for
The final rule also does not include the NPRM's proposed clarification that waivers of documentation may not be permitted for research subject to regulation by FDA. Because this is not the only difference between what is permitted under the Common Rule and the FDA regulations, we determined that clarifying only this specific difference in the final rule is likely to create more confusion rather than provide clarification.
This provision of the pre-2018 rule stated that while an award or grant may be made for a project with indefinite plans to involve human subjects, that project must be reviewed by an IRB before human subjects may be involved.
The NPRM language clarified that IRB review and approval was required before human subjects could be involved in a study unless the study was excluded under § __.101(b), waived under § __.101(i), or exempted under § __.104(d), (e) or (f)(2).
No comments were received.
The final rule adopts the language of the NPRM, with updated citations. This provision makes explicit that it applies only to nonexempt human subjects research.
This provision of the regulations outlines the process that an institution must undergo when a federally funded research project that was designed without the intention of involving human subjects later involves human subjects as defined by this policy.
The NPRM proposed to add language to make clear that this provision applies only to nonexempt human subjects research. It also clarifies its reference to department or agency to mean a federal department or agency component supporting the research.
No comments were received.
The final rule adopts the language of the NPRM, with updated citations. This provision makes explicit that it applies only to nonexempt human subjects research, and clarifies the reference to department or agency to be a federal department or agency component supporting the research.
This provision of the regulations allows departments and agencies to impose additional requirements on human subjects research when such requirements are deemed necessary for the protection of human subjects.
The NPRM provided more specific language at § __.124, stating that with respect to any research project or any class of research projects the department or agency head of either the conducting or the supporting federal department or agency may impose additional conditions prior to or at the time of approval when in the judgment of the department or agency additional conditions are necessary for the protection of human subjects.
One commenter discussed this NPRM proposal, arguing that this would increase variance in implementation of the Common Rule, rather than promote harmonization as the NPRM suggested.
The final rule adopts the NPRM language, which clarifies the pre-2018 rule by stating that the head of either the conducting or the supporting federal department or agency may impose additional conditions on research, when necessary for the protection of human subjects.
HHS has examined the impacts of this final rule under Executive Order 12866 on Regulatory Planning and Review (September 30, 1993); Executive Order 13563 on Improving Regulation and Regulatory Review (January 18, 2011); the Regulatory Flexibility Act of 1980, Pub. L. 96-354 (September 19, 1980); the Unfunded Mandates Reform Act of 1995, Pub. L. 104-4 (March 22, 1995); and Executive Order 13132 on Federalism (August 4, 1999).
Executive Order 12866 directs agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects; distributive impacts; and equity). Executive Order 13563 is supplemental to and reaffirms the principles, structures, and definitions governing regulatory review as established in Executive Order 12866. HHS expects that this rule will have an annual effect on the economy of $100 million or more in any one year and therefore is a significant regulatory action as defined by Executive Order 12866.
The Regulatory Flexibility Act (RFA) requires agencies that issue a regulation to analyze options for regulatory relief for small businesses if a rule has a significant impact on a substantial number of small entities.
Section 202(a) of the Unfunded Mandates Reform Act of 1995
Executive Order 13132 establishes certain requirements that an agency
This final rule is being issued to modernize, strengthen, and make more effective the regulations for protecting human subjects in research. Although professional organizations have codes of conduct and guidelines for members conducting research, only the Federal Government has the authority to regulate the activities of institutions using public funds for human subjects research. Since the Common Rule was developed, the volume of research has increased, evolved, and diversified.
Thus, the final rule includes a number of measures to address the issues described above. Provisions that strengthen the requirements for informed consent and promote transparency in the informed consent process include: (1) Requiring that the informed consent form be designed and presented in such a way that facilitates a prospective subject's understanding of why one would want to participate in a research study or not; (2) revising and adding to the required elements of consent; (3) requiring for certain clinical trials the posting of a copy of at least one version of a consent form on a publicly available federal Web site; and (4) clarifying the conditions and requirements for waiver or alteration of consent to remove ambiguity, including a new provision that, under specific conditions, an IRB may approve a research proposal in which investigators obtain information without individuals' informed consent for the purpose of screening, recruiting, or determining eligibility of prospective human subjects of research.
Provisions that strengthen the extent to which regulations promotes the principle of respect for persons include: (1) Requiring that informed consent forms present the key information to potential subjects at the beginning of a consent process; (2) allowing investigators the option of obtaining broad consent from a potential subject for future, unspecified research use of identifiable private information and identifiable biospecimens; and (3) adding a provision that would prohibit a waiver of consent if someone has been asked to provide their broad consent for the storage, maintenance, and secondary research use of identifiable biospecimens or identifiable private information and refused to do so.
New provisions that would allow IRBs greater flexibility to focus resources on higher-risk research include: (1) Distinguishing categories of activities that are deemed not to be research; and (2) expanding and clarifying categories of exempt research.
Provisions that streamline or reduce burden for IRBs or institutions include: (1) Requiring consultation among the Common Rule agencies for the purpose of harmonizing guidance (to the extent appropriate); (2) eliminating an administrative requirement for reporting IRB membership; (3) removing the requirement that IRBs must review and approve grant applications; (4) eliminating, under certain circumstances, continuing review; (5) mandating the use of a single IRB for multi-institutional studies; and (6) holding IRBs not operated by an FWA-holding institution directly responsible for compliance when appropriate.
Table 1 summarizes the quantified and nonquantified benefits and costs of all changes to the Common Rule. Over the 2017-2026 period, present value benefits of $1,904 million and annualized benefits of $223 million are estimated using a 3 percent discount rate; present value benefits of $1,494 million and annualized benefits of $213 million are estimated using a 7 percent discount rate. Present value costs of $528 million and annualized costs of $62.0 million are estimated using a 3 percent discount rate; present value costs of $474 million and annualized costs of $67.0 million are estimated using a 7 percent discount rate. Nonquantified benefits include improved human subjects protections in research; enhanced oversight of research reviewed by IRBs not operated by an FWA-holding institution; and increased uniformity in regulatory requirements among Common Rule departments and agencies. Nonquantified costs include the time needed for consultation among Common Rule agencies before federal guidance is issued.
Table 2 summarizes the quantified present value benefits and costs of each change to the Common Rule using a 3 percent discount rate.
Approximately 50 comments discussed the specific cost estimates provided in the NPRM's Regulatory Impact Analyses (RIA). Several commenters strongly suggested that the final rule eliminate the proposals related to biospecimens, cooperative research, and expanding coverage to nonfederally funded clinical research because the NPRM failed to appreciate the cost and burden that would result from implementing these proposals. Although a majority of the comments received on the RIA suggested that several of the cost estimates were significantly underestimated, few commenters described specific changes to the cost and benefit estimates included in the NPRM RIA.
One commenter noted that the NPRM cost estimates are derived from a 1998 NIH-sponsored evaluation of the implementation of Section 491 of the Public Health Service Act and “because of the lack of available data about IRB effectiveness and how IRBs function operationally, many of the estimations in this analysis are based on anecdotal evidence.” This commenter stated that reliance on outdated and anecdotal “evidence” means that the NPRM assumptions seriously underestimate predictable costs, such as those derived from current salary data for health care workers who would have at least some background sufficient to explain consent, and the time needed to obtain consent. They also claimed that the NPRM analysis also seriously overestimates cost savings because excluding an activity from the Common Rule does not necessarily remove it from the purview of the IRB pursuant to other laws, such as the HIPAA regulations, and may simply shift the economic burden of responsible oversight to personnel elsewhere within the organization. This commenter also noted that the initial transition costs estimated in the NPRM are staggering, mostly due to costs related to biospecimen provisions.
One commenter stated that a review of the tables indicates that the costs used for hourly wages of individuals affected by the proposed changes may be underestimated by as much as 12 to 139 percent. Similarly, the hours associated with the proposed changes are substantially underestimated.
One commenter stated that an institutional official must be administratively high enough to insist on any necessary institutional changes, most likely a Vice President or higher, and felt that such an official would make at least $250 per hour. This commenter stated that the $48.20 estimate in the proposed rules may apply to liberal arts colleges, but the proportion of medical research conducted at such institutions is small and strongly recommends that salary data from medical institutions (published for public institutions) be used to generate a revised cost estimate. One commenter stated that the estimates of the salary rates presented in the NPRM for institutional officials, IRB members and staff, and investigators are far below the national average for these roles. Likewise, they state that the anticipated benefits of the new proposed rule appear to be grossly overstated.
One commenter stated that the rule as proposed was officially estimated to add $1.4 billion a year to the cost of the current system, but the true cost increase will be at least triple that due to egregious underestimates of wage costs, substantial underestimates of time spent on red tape by investigators, and many underestimated or omitted costs, as well as some estimates that misrepresent the effects of the rule. They claim that the rule is likely to impose about $5 billion a year in needless costs, while reducing rather than improving protection of human subjects. One commenter stated that, at their institution, analysts average far greater pay levels than $15 per hour, and many of the tasks will have to be borne by faculty whose salaries exceed what is identified in the current cost analyses.
One commenter proposed to mandate instead that institutions sufficiently resource their IRBs so as to protect 10 percent of their IRBs' and IRB administrators' time (about 1 meeting/year for an IRB that meets monthly; about 200 hours/year for a full-time equivalent IRB administrator with 2 weeks' vacation and 40-hour work weeks) to devote to finding efficiencies and innovations in the IRB review process.
We note that the NPRM discussed the fact that data about IRB effectiveness and how IRBs function operationally
We note that the NPRM RIA used a national average for the salary estimates. We received no compelling evidence to change cost estimates because we must account for the fact that personnel and salaries in affected categories vary widely.
One commenter stated that coverage of this subset of projects will extend requirements, such as the single IRB requirement, without any consideration or mechanism for how to implement or fund this requirement and they do not believe that they should be required to accept added cost and burdens without any meaningful or measureable benefit to the welfare of human subjects.
One commenter stated that the inclusion of nonregulated, unfunded trials under the regulations for the subset of organizations that receive federal grants would lead to a significant increase in burden, delay, ambiguity, and cost, and a loss of valuable research without increasing protections for human subjects.
One commenter stated that an unintended burden would be the increased administrative costs of requiring reporting of all clinical trial Unanticipated Problems Involving Risks to Subjects or Others (unanticipated problems) to OHRP. They estimated requiring all unanticipated problems to be reported would increase their institution's necessary reporting by 25 percent.
The final rule does not adopt this proposal.
With respect to expanding the definition of human subject to include nonidentifiable biospecimens and creating an exemption for secondary research on these specimens and identifiable information, many commenters claimed the NPRM significantly underestimated the cost of including nonidentified biospecimens under human subjects regulations and the consequent requirement for informed consent. Comments of a professional association, which were endorsed by numerous other commenters, stated that the NPRM has underestimated the financial impact of the Common Rule changes by a factor of at least 10, failing to account for the significant volume of specimens gathered outside of the federally funded environment, vastly underestimating the required time commitment and the requirements of administering a database to track consents, failing to include the expense incurred should an individual withdraw his or her consent for future research, and not including the potential expenditures required to develop a robust database that may be queried by researchers to identify biospecimens for use in future research projects. This association, and the numerous commenters who endorsed their comments, also felt that the increased administrative and cost burden to obtain informed consent for nonidentified biospecimens will disproportionately affect departments of pathology and laboratory medicine and will further increase indirect costs, which will eventually be built into the cost recovery rate from NIH, thereby reducing funds available for research when the NIH budget is fixed. One commenter stated that a major operations issue, and the one most necessary to ensure compliance with such a change, is the appropriate cataloging of biospecimens. Inherent in this new process are costs that will vary greatly based on the size of the stock of biospecimens held. Another commenter stated that the estimate for these costs was not plausible given the costs of developing or re-designing electronic systems.
As noted above in the preamble, the provisions relating to making nonidentified biospecimens subject to the Common Rule have been entirely eliminated. The final rule RIA does include impact estimates related to this proposal in Section XIX.E of this preamble, discussing the impact of regulatory alternatives considered.
One commenter wrote that the NPRM stated that institutions would need to obtain broad consent from only a third of the 30 million individuals who are estimated to provide research and clinical biospecimens each year.
Several commenters stated that this assertion fails to recognize that broad consent would need to be obtained from most individuals, not just those identified as research subjects, and underestimates the amount of time needed to revise consent processes and obtain such consent. For one institution, assuming staff time to obtain broad consent averages 20 minutes and the minimal staff salary is $25 per hour, this cost alone would be $2.54 million per year. Several commenters noted that the NPRM estimates that, per subject, the investigator or dedicated health care professional will spend 5 to 10 minutes obtaining broad consent, but this institution believes that a more appropriate standard for obtaining broad consents, particularly in the initial years, would be 20 to 30 minutes. One commenter stated that literally hundreds of employees would need extensive training and periodic retraining in research ethics to obtain broad consent, and they calculate that every procedure that involves any tissue collection should take a minimum of 10 to 15 minutes of additional staff time to be able to even attempt to make the process meaningful.
Many other commenters stated that tracking broad consent would impose significant costs, and require significant resources and infrastructure restructuring, given the complicated framework proposed by the NPRM.
One of these commenters also stated that a significant cost absent from the NPRM analysis is the potential need for rebuilding existing biorepositories and databanks that may be invalidated under the NPRM because: (1) The samples were collected without initial broad consent; (2) the samples are coded and thus not eligible for the transition provisions; (3) consenting all human sources would not be feasible; and (4) the revised and limited waiver mechanism would not be available. One commenter estimated that it will require millions of dollars to build and support the necessary IT and infrastructure required to keep track of the consents. One commenter stated that, if the NPRM's concern for “respect for persons” is really sincere, then the cost estimates involved should be increased by a factor of 4 to 10 times what is
As noted above in the preamble, the provisions relating to making nonidentified biospecimens subject to the Common Rule have been entirely eliminated. Eliminating that proposal largely addresses the concerns regarding costs of the Broad Consent proposal. Note that in response to public comments, we have modified our estimates of the time it would take to seek, obtain, and document broad consent under the regulatory alternatives section of the RIA.
One commenter stated that even if a decision tool is used, IRBs will likely still need to review protocols to confirm the exempt classification, which will therefore not result in any cost savings.
The final rule does not include the exemption determination and documentation requirement proposed in the NPRM.
One commenter stated that mandatory use of HIPAA or alternative, but yet-to-be determined, data security provisions would lead to a significant increase in burden, delay, ambiguity, and cost; this commenter also asserted that these safeguards might result in a loss of valuable research without increasing protections for human subjects.
One commenter noted that a large component of the data security safeguards is only necessary because of the 10-fold increase in the number of identified biospecimens due to tracking informed consent and that this adds significantly to the cost of this requirement, well beyond what was represented in the NPRM RIA.
The final rule does not adopt the NPRM's proposal to implement standardized privacy safeguards.
One commenter applauded the NPRM for recognizing the cost-benefit value of eliminating continuing review for many studies. This will have a positive impact on the workload of investigators and IRBs.
Several commenters stated that mandated single IRB review would not decrease the burden for investigators but would, in fact, increase the burden in both the long and short term. They stated that investigators who currently work only with a single IRB (their institution's IRB) will now have to work with multiple IRBs, adding to burden. Further, the resources needed to use a commercial IRB would be beyond the capacity of small trials, which often have limited resources. One of these commenters estimated that, an investigator who has 50 protocols and currently two IRBs of record, would have a minimum of 10 different IRBs of record under the regulations proposed in the NPRM. As a result, the investigator would need to work with at least an additional 8 IRBs (10 in total), each with unique and complex requirements.
One commenter stated that the NPRM grossly underestimates in its assumption that a central IRB administrator would cost $15 per hour.
One commenter stated that developing the infrastructure to support this effort will involve significant financial costs. Although using single IRBs for multi-institutional studies has the potential for long-term cost savings and reduction of burden when implemented well, reaching that point requires a substantial initial investment. Many other commenters agreed that the NPRM underestimated these initial costs. They stated that these “start-up costs” include but are not limited to: The creation of electronic management systems that are interoperable among institutions; the adaptation of automated processes to multiple institutions; the communications tools necessary to link investigators and IRBs; the staff time necessary to develop agreements, consensus documents, or standard operating procedures; and the interaction necessary to build and maintain trusting relationships among institutional officials. One university received an estimate from the vendor of such a system that costs to accommodate this change would be in excess of $220,000 for the initial changes, with increased maintenance costs thereafter. In addition, the university would need to hire at least one full-time-equivalent (FTE) to handle the interface with all of the potential central IRBs and this position has a salary mid-point of $54,000, to which would be applied fringe benefits costs of $19,500. Several commenters noted that, even for institutions not serving as the IRB of record, there are real financial implications of participating in the centralized process in terms of adapting existing software systems and protocols.
One commenter noted that the RIA section of the NPRM assigned nearly one-third of the total financial benefit of the revised Common Rule to savings achieved by the use of single IRBs for cooperative research. The RIA arrived at its estimate by assuming that when a single IRB of record reviews a protocol, all institutional costs are eliminated. The commenting institution uses numerous single IRBs, and they say they know from experience that the assumptions in the RIA are erroneous and no net savings accrue for IRB staff when using single IRBs of record. This same commenter noted that the NPRM states that its authors believe that, over time, standardization of agreements will occur so that all issues that currently take weeks or months to negotiate will be resolved. This commenter stated that no data to support this assumption and that, with each new single IRB required by NIH, they find a new set of requirements that requires the negotiation of hundreds of agreements with other institutions. They believe that study initiation will often be delayed because of this requirement and will result in additional software system needs and costs that are not even contemplated in the NPRM. They also stated that the vast majority of research-intensive universities are already over the federal mandated 26 percent facilities and administrative cap. Therefore, the commenter noted, the universities have no mechanism for funding the additional costs of serving as a central IRB because IRB costs are included in the portion of the facilities and administrative costs.
One commenter estimated the costs of ensuring an appropriate data flow between an institution and each new IRB of record, with respect to research studies conducted, to require an extra 200 hours of IRB administrator time, in addition to software customization, configuration, and development costs. This commenter estimated the true costs far exceed those included in the NPRM by a factor of 1433 percent (2150 hours required in total for 10 IRBs of record, versus 150 hours). Even splitting the difference to only a factor of 767 percent (1150 hours required in total for 10 IRBs of record versus 150 hours), the true costs of this approach virtually eclipse any possible quantified benefits estimated in the NPRM.
Two commenters cautioned that the costs to implement single IRB review in multi-institutional studies should not be factored into the overall cost breakdown of a contract or grant. In other words, federal departments and agencies supporting research should make additional funds available to cover the costs associated with implementing § __.114.
We agree with commenters who felt that mandated single IRB review will ultimately decrease administrative burdens and inefficiencies for investigators and institutions, while acknowledging that the transition to this model will require time and an adjustment to institutional structures and policies. To incorporate this into our estimates, we assume that investigators for which multi-institutional reviews are eliminated will face a reduction in burden associated with the elimination of the site-specific protocol review, but will face increased burden in the form of coordination with investigators at other sites, for example to ensure that the results of the IRB review are effectively communicated. Specifically, we assume that the elimination of multi-institutional reviews will result in investigators spending half as much time engaging with the review process as they would have if IRB review had taken place at all sites. As a result, the estimated quantified benefits associated with the elimination of multi-institutional review have been revised downward by 27 percent.
Several commenters stated that they do not see the utility of the proposed provision to publish consent forms to a public Web site as it creates a new administrative burden without providing any clear additional protection for research subjects or benefit to the public at large. One commenter stated that the cost estimates that the NPRM attaches to this proposed requirement are unrealistically low. One commenter stated that if the site is either
We note that this change, compared to the huge costs of clinical trials, will add a relatively small amount of additional burden. The time by which a consent form must be posted has been greatly extended. Furthermore, provisions have been added that allow for redaction of certain portions of consent forms, including the entire form in appropriate instances. We estimate that the revised rule will not affect the quantified and nonquantified costs summarized in the NPRM.
In this section, we present the analysis of the quantified and nonquantified benefits and costs of the changes to the Common Rule. First, we discuss the common assumptions of the analysis. Then we present the estimated quantified and nonquantified benefits and costs of the specific changes. As discussed above and in the NPRM, because of the lack of available data about IRB effectiveness and how IRBs function operationally, many of the estimations in this analysis are based on anecdotal evidence.
The analysis relies on common data elements and assumptions, detailed below, concerning the domestic entities, individuals, and IRB reviews affected by the changes to the Common Rule. Many of the estimates are derived from a 1998 NIH-sponsored evaluation of the implementation of Section 491 of the Public Health Service Act, which involved nationally representative surveys of IRBs, institutions, and investigators. Based on a review of the literature, this study contains the best available data on the time spent on protocol reviews as well as the characteristics of the reviews themselves. Additionally, OHRP processes the majority of FWAs and IRB registrations for all Common Rule departments or agencies. Thus, using information from the OHRP database of assured institutions and registered institutions or organizations and their IRBs is a reasonable way to estimate the number of institutions and IRBs regulated by all Common Rule departments or agencies that will be affected by these changes. OHRP's IRB registration process requires institutions and organizations to provide information about the approximate number of active protocols reviewed by IRBs during the preceding 12 months. Thus, OHRP's IRB database is the best source for determining the total number of protocols reviewed by IRBs at this time.
According to the OHRP database of assured institutions and registered institutions or organizations and their IRBs, approximately 8,035 institutions in the United States have an FWA, of which 2,871 have an IRB. Some institutions have multiple IRBs and some IRBs are not affiliated with an institution with an FWA. In total, 3,499 registered IRBs are in the United States.
The OHRP database of assured institutions and registered institutions or organizations and their IRBs shows that 675,390 annual reviews of nonexempt protocols involving human subjects are conducted. It is estimated that of this total, 324,187 are initial protocol reviews (48 percent) and 351,203 are continuing protocol reviews (52 percent) based on estimates reported in Bell et al.
It is estimated that 472,773 reviews of single-site protocols (70 percent) and 202,617 reviews of multi-institutional protocols (30 percent) take place, based on estimates reported in Bell et al. This analysis also assumes that, on average, 5 IRB reviews take place per multiple-site protocol. This implies 472,773 single-site protocols and 40,523 multi-institutional protocols, for a total of 513,296 protocols. The above also implies approximately 246,382 new protocols each year.
Based on queries of
Many individuals in various occupations would be affected by the changes to the Common Rule. We estimated that an average of one institution official at each institution with an FWA would be affected by these changes, for a total of 2,871 institution officials. The OHRP database of registered IRBs shows that IRBs have 10,197 full-time equivalents (FTEs) staff persons working as administrators or administrative staff, and that 89.8 percent of IRBs have an administrator. It is assumed that these individuals work full-time, implying a total of 3,193 IRB administrators and 7,004 IRB
We estimated the hourly wages of individuals affected by the changes to the Common Rule using information on annual salaries provided by the U.S. Bureau of Labor Statistics and the U.S. Office of Personal Management. The salary of postsecondary education administrators is used as a proxy for the salary of institution officials; the salary of lawyers is used as a proxy for the salary of institution legal staff and IRB administrators; the salary of office and administrative support workers is used as a proxy for the salary of IRB administrative staff; the salary of postsecondary health teachers is used as a proxy for the salary of IRB chairs and IRB voting members; the salary of postsecondary teachers is used as a proxy for the salary of investigators; the salary of database and systems administrators and network architects is used as a proxy for the salary of database administrators; and the salary of all occupations, as a proxy for the salary of prospective human subjects. The federal employees affected by the changes to the Common Rule are assumed to be Step 5 within their GS-level and earn locality pay for the District of Columbia, Baltimore, and Northern Virginia. Annual salaries are divided by 2,087 hours to derive hourly wages. To project wages over 2017-2026, wages are adjusted for growth over time using the average annual per capita growth in real wage income over 1929-2012 reported by the U.S. Bureau of Economic Analysis, which is 2.1 percent. The total dollar value of labor, which includes wages, benefits, and overhead, is assumed to be equal to 200 percent of the wage rate.
We calculated person-hours by occupation per initial protocol review and per continuing protocol review based on each occupation's share of total person-hours reported in Bell et al. In particular, Bell et al. reports that institution officials account for 4 percent, IRB administrators account for 28 percent, IRB administrative staff account for 30 percent, IRB chairs account for 7 percent, and IRB voting members account for 31 percent of total person-hours. We assumed that the average number of person-hours spent per review equals the weighted average of the person-hours spent per convened review and the person-hours spent per expedited review. We further assumed that convened review requires twice as many person-hours as expedited review.
Table 3 shows the number of entities affected by the changes to the Common Rule and other common assumptions of the analysis (described above).
We present below an analysis of the quantified and nonquantified benefits and costs of the changes to the Common Rule. For each change, we describe the change, provide a qualitative summary of the anticipated benefits and costs, describe the methods we use to quantify benefits and costs, and then present estimates.
Domestic institutions, IRBs, and investigators would need to spend time learning the changes to the Common Rule once training materials become available to them. In addition, IRBs and OHRP would need to update training materials for investigators. OHRP also would need to develop guidance, templates, and a number of electronic resources.
We estimate that institution officials, IRB administrators, IRB administrative staff, IRB chairs, IRB voting members, and investigators would each spend 5 hours to learn the changes to the Common Rule. We also estimate that institution officials would spend 2
In order to develop the resources required by the final rule, we anticipate that OHRP would need:
• Three staff people at the GS-14 level and three staff people at the GS-13 level to: (1) Promote harmonization efforts to issue guidance across Common Rule agencies and departments; (2) develop guidance for the regulated community; (3) develop template agreements for use by the regulated community; (4) manage the administrative transition to the new processes in the final rule; and, (5) develop web-based posting portals.
• One staff person at the GS-13 level to manage process changes in the final rule, and assist with implementation for the web-based portals.
• One staff person at the GS-11 level to provide technical support for the web-based portals in the final rule.
In addition, the first year after the final rule is published staffing resources beyond what is described above would be necessary:
• Three staff people at the GS-14 level to draft new guidance and revise old guidance.
• One staff person at the GS-14 level to conduct educational seminars.
OHRP also anticipates the following in nonpersonnel costs:
• Technical development of two Web-based portals for investigators to post final consent forms for HHS-funded clinical trials, and for investigators who conduct certain types of demonstration projects to post information about said projects ($350,000)
• Developing five educational seminars (including travel) to educate the public about the requirements of the new rule ($150,000)
• Upgrading equipment for education activities ($50,000)
We also note that additional staff time throughout the Common Rule departments and agencies will be needed to fulfill the consultation requirement found in § __.102(e)(7). As we assume that this consultation will not involve the hiring of additional personnel to fulfill, we consider this a nonquantified cost.
Present value costs of $214 million and annualized costs of $25.0 million are estimated using a 3 percent discount rate; present value costs of $204 million and annualized costs of $29.1 million are estimated using a 7 percent discount rate. Table 4 summarizes the quantified and nonquantified benefits and costs to learn new requirements and develop training materials.
As outlined in the NPRM, and as generally supported by public commenters, the final rule includes a new provision at § __.101(a) that gives Common Rule departments and agencies the authority to enforce compliance directly against IRBs that are not operated by an assured institution. We anticipate that this change will encourage institutions to rely on IRBs not operated by an FWA-holding institution more often and also will assist in the implementation of the requirements at § __.114. Here, we estimate the impact that this proposal will have on IRBs that are not operated by an FWA- holding institution. The estimated impact of this and other related proposals on FWA- holding institutions is addressed in Section XIX.D.2.f of this RIA.
The OHRP database of assured institutions and registered IRBs shows that approximately 449 IRBs not affiliated with an institution holding an FWA will now be subject to oversight. These IRBs will develop an estimated average of 10 written agreements with other institutions each year as a result of this rule. It is further estimated that each agreement will require an average of 10 hours of institution legal staff time and 5 hours of IRB administrator time to complete.
The estimated costs to institution officials, IRB administrators, IRB administrative staff, IRB chairs, IRB voting members, and investigators of conducting these reviews are based on the estimates presented in Table 3. The dollar value of their time is calculated by multiplying hours by their estimated 2017-2026 wages and adjusting for overhead and benefits.
Present value costs of $85.6 million and annualized costs of $10.0 million
The final rule includes four categories that are explicitly deemed to be not research (final rule at § __.102(l)(1)-(4)). These categories include: (1) Scholarly and journalistic activities (
Institutions, investigators, and IRBs involved in supporting, conducting, or reviewing these activities will no longer incur the costs of IRB review and approval and continuing review. Activities that were not intended to be subject to the regulations will clearly be removed from the definition of research, allowing such activities to proceed without delays caused by the need for IRB submission, review, and approval.
We estimate that 3,376 annual reviews of protocols (0.5 percent) will no longer be conducted as a result of the activities deemed not to be research in § __.102(l)(1)-(4). Of these reviews, 1,118 will have undergone convened initial review, 502 will have undergone expedited initial review, 1,212 will have undergone convened continuing review, and 544 will have undergone expedited continuing review based on the distribution of reviews presented in Table 3.
The estimated costs to institution officials, IRB administrators, IRB administrative staff, IRB chairs, IRB voting members, and investigators of conducting these reviews are based on the estimates presented in Table 3. The dollar value of their time is calculated by multiplying hours by their estimated 2017-2026 wages and adjusting for overhead and benefits.
Present value benefits of $36.2 million and annualized benefits of $4.24 million are estimated using a 3 percent discount rate, and present value benefits of $29.6 million and annualized benefits of $4.22 million are estimated using a 7 percent discount rate. Table 6 summarizes the quantified and nonquantified benefits and costs of excluding these activities from the requirements of the Common Rule.
The final rule at § __.101(j) requires consultation among the Common Rule departments and agencies for the purpose of harmonization of guidance (to the extent appropriate) before federal guidance on the Common Rule is issued, unless such consultation is not feasible.
As this change likely will not affect staffing requirements in the Federal Government, no costs are quantified here. It is possible however, that the harmonization requirement could result in it taking longer for Common Rule department or agency guidance to be approved and issued to the public. Similarly, as the extent to which this change will reduce the time IRBs spend on reviewing protocols is unclear, benefits are also not quantified. Table 7 summarizes the nonquantified benefits and costs of clarifying and harmonizing regulatory requirements and agency guidance.
The final rule modifies the requirements of the assurance process in the following ways. First, the final rule does not include the pre-2018 requirement of identifying a statement of principles governing all research at an institution. The requirement for institutions to designate a set of ethical principles by which that institution will abide in all research activities was generally not enforced. Further, for international institutions that received U.S. Government funding for research activities, it created the impression that these international institutions must modify their internal procedures to comport with the set of principles designated on the FWA for activities conducted at those institutions that received no U.S. Government funding. This provision was deleted from the final rule to provide clarity to these international institutions that such measures are not required for activities that receive no Common Rule department or agency support.
The requirement in the pre-2018 rule that a written assurance include a list of IRB members for each IRB designated under the assurance has been moved to § __.108(a)(2) and modified. The final rule requires that an institution, or when appropriate the IRB, prepare and maintain a current detailed list of the IRB members with information sufficient to describe each member's chief anticipated contributions to IRB deliberation, and any employment or other relationship between each member and the institution. The final rule also deletes the pre-2018 requirement that changes in IRB membership be reported to the department or agency head, or to OHRP when the existence of an HHS-approved assurance is accepted.
The changes to the IRB roster requirement are expected to reduce administrative burden without having any significant impact on the protection of human subjects:
Finally, the requirement in the pre-2018 rule that a department or agency head's evaluation of an assurance take certain factors into consideration has been deleted. These factors include the adequacy of the proposed IRB in light of the anticipated scope of the institution's activities and the types of subject populations likely to be involved, the appropriateness of the proposed initial and continuing review procedures in light of the probable risks, and the size and complexity of the institution. Deletion of that provision eliminates an administrative process that was no longer meaningful given the purpose and design of the FWA and OHRP's processes for reviewing IRB registrations and reviewing and approving FWAs. This change also harmonizes the Common Rule with FDA's human subjects protection regulations by eliminating the requirement to submit IRB membership lists.
We estimate that administrative staff at each IRB would spend 5 fewer hours complying with the assurance requirements. Based on the estimates presented in Table 3, the dollar value of their time is calculated by multiplying hours by their estimated 2017-2026 wages and adjusting for overhead and benefits.
Present value benefits of $5.93 million and annualized benefits of $0.69 million are estimated using a 3 percent discount rate; present value benefits of $4.18 million and annualized benefits of $0.60 million are estimated using a 7 percent discount rate. Table 8 summarizes the quantified and nonquantified benefits and costs of the proposed change to the IRB roster requirement.
The final rule contains a requirement at § __.103(e) that, to ensure compliance with the requirements of the Common Rule, nonexempt human subjects research subject to this policy that takes place at an institution in which IRB oversight is conducted by an IRB that is not operated by the institution, the institution and the organization operating the IRB shall document the institution's reliance on the IRB for oversight of the research and the responsibilities that each entity will undertake. This requirement could be satisfied, for example, by: (1) Developing a written agreement between the institution and the IRB; (2) implementing an institution-wide policy directive providing the allocation of responsibilities between the institution and an IRB that is not affiliated with the institution; or (3) describing the allocation of responsibilities in a research protocol. In addition, a requirement is added at § __.115(a)(9) of the final rule that institutions or IRBs retain this written agreement or other procedures undertaken to ensure compliance with the requirements of this policy, as described in § __.103(e).
Initially, costs would be involved in drafting, revising, and conducting managerial review of agreements to ensure they satisfy these new requirements. Anticipated benefits include greater reliance on IRBs not operated by the institutions as the IRB of record for cooperative research.
Table 3 shows that 5,164 FWA-holding institutions do not have an IRB and 2,871 FWA-holding institutions have an IRB. We assume that the 5,164 FWA-holding institutions without an IRB have an average of 1 IRB authorization agreement that will need to be modified as a result of the new requirements for agreements between institutions and IRBs not operated by the institutions in 2017. In addition, we assume that the 2,871 FWA-holding institutions with an IRB have an average of 0.20 IRB authorization agreements that would need to be modified in 2017. We estimate that each agreement will require an average of 10 hours of institution legal staff time and 5 hours of IRB administrator time to complete. The dollar value of their time is calculated by multiplying hours by their estimated 2017 wages and adjusting for overhead and benefits.
Present value costs of $11.4 million and annualized costs of $1.33 million are estimated using a 3 percent discount rate; present value costs of $10.9 million and annualized costs of $1.56 million are estimated using a 7 percent discount rate. Table 9 summarizes the quantified and nonquantified benefits and costs of the requirement for written procedures and agreements for reliance on IRBs not operated by the FWA-holding institution (§§ __.103(e) and __.115(a)(9) in the final rule).
The final rule eliminates the requirement in the pre-2018 rule that grant applications undergo IRB review and approval for the purposes of certification. The grant application is often outdated by the time the research study is submitted for IRB review and contains detailed information about the costs of a study, personnel, and administrative issues that go beyond the mission of the IRB to protect human subjects. Therefore, experience suggests that review and approval of the grant application is not a productive use of IRB time, and the change likely will not reduce protections for human subjects or impose other costs.
We estimate that 324,187 initial reviews of protocols occur annually, of which 223,689 involve convened review and 100,498 involve expedited review based on the distribution of reviews presented in Table 3. For the purpose of this analysis, we assume that each protocol reviewed by an IRB is associated with one grant application or other funding proposal. We estimate that investigators spend an average of 15 minutes compiling their grant applications when they submit a protocol for initial review. Further, we estimate that IRBs typically use two primary reviewers for convened review and one primary reviewer for expedited review, and that primary reviewers spend an average of 30 minutes reviewing the grant application. Based on the estimates in Table 3, the dollar value of their time is calculated by multiplying hours by their estimated 2017-2026 wages and adjusting for overhead and benefits.
Present value benefits of $326 million and annualized benefits of $38.2 million are estimated using a 3 percent discount rate and present value benefits of $230 million and annualized benefits of $32.7 million are estimated using a 7 percent discount rate. Table 10 below summarizes the quantified and nonquantified benefits and costs of eliminating the requirement that the grant application undergo IRB review and approval.
The final rule includes eight exemption categories. Some of these categories include subcategories of exemptions.
We note that one pre-2018 exemption does not appear in the final rule (exemption for educational tests, survey procedures, interview procedures, or observation of public behavior where a statute requires confidentiality of the information collected, or where the human subjects involved in the activity are public figures). We also note that several of the final rule exemptions were proposed in the NPRM as exclusions. Finally, we note that only one pre-2018 exemption has been unmodified in the final rule (the exemption for taste and food quality evaluations).
The exemptions included in the final rule are:
• Certain research involving normal educational practices
• Certain research that involves the use of educational tests, survey procedures, interview procedures, or observation of public behavior
• Research involving benign behavioral interventions in conjunction with the collection of information from an adult subject through verbal or written responses or video recording
• Research involving the secondary use of identifiable private information or identifiable biospecimens provided that:
○ The sources are publicly available
○ The information is recorded in such a manner that the identity of subjects is not readily ascertainable by the investigator
○ The research is regulated as “health care operations,” “public health activities,” or “research” under HIPAA
○ The research is conducted by or on behalf of a federal department or agency using government-generated or government-collected nonresearch information, provided that certain conditions are met
• Research and demonstration projects conducted or supported by a federal department or agency
○ In addition to OHRP's interpretation of this exemption expanding under the final rule, and language being modified in this exemption to reflect that expanded interpretation, the final rule also includes a requirement that federal departments or agencies conducting or supporting demonstration projects post information about these studies on a publicly accessible federal Web site
• Taste and food quality evaluation and consumer acceptance studies
• The storage and maintenance of identifiable biospecimens or identifiable private information for unspecified secondary research studies
• The secondary research use of identifiable biospecimens or identifiable private information where broad consent has been sought and obtained
The goal of the posting requirement in the exemption for research and demonstration projects (final rule at § __.104(d)(5)) is to promote transparency in federally conducted or supported activities affecting the public that are not subject to oversight under the Common Rule. It should not create any delay in research. HHS will develop a resource that all Common Rule departments and agencies may use to satisfy the posting requirement (accounted for in Section XIX.D.2.a of this RIA). Alternatively, an agency can create or modify its own Web site for this purpose. Thus, increased transparency in federally funded or supported demonstration projects is a non-quantified benefit of the final rule modifications.
Other nonquantified benefits of the expansion to the modifications of exempt research include clearer instructions to the regulated community about the extent to which creating a system for storing and maintaining identifiable biospecimens and identifiable private information for future, unspecified secondary research activities is governed by this rule. Additionally, by reducing the IRB burden associated with approving this type of activity, the new exemption for storing and maintaining identifiable biospecimens and identifiable private information also incentivizes the creation of institution-wide, comprehensive systems for storing and maintaining such biospecimens and information. We anticipate that this will, in turn, foster research while also giving human subjects increased control over how their identifiable biospecimens and identifiable private information will be used (promoting the principle of respect for persons).
Consistent with the NPRM, we estimate that 70,916 annual reviews of protocols (10.5 percent) would no longer be conducted as a result of the changes at § __.104(d). Of these reviews, 23,487 will have undergone convened initial review, 10,552 will have undergone expedited initial review, 25,445 will have undergone convened continuing review, and 11,432 will have undergone expedited continuing review based on the distribution of reviews presented in Table 3.
Further, we estimate that that 1,000 exempt research and demonstration studies are currently conducted each year.
Present value benefits of $798 million and annualized benefits of $93.6 million are estimated using a 3 percent discount rate, and present value benefits of $653 million and annualized benefits of $93.0 million are estimated using a 7 percent discount rate. Present value costs of $0.37 million and annualized costs of $0.04 million are estimated using a 3 percent discount rate; present value costs of $0.30 million and annualized costs of $0.04 million are estimated using a 7 percent discount rate. Table 11 summarizes the quantified and nonquantified benefits and costs of amending an exempt category.
The final rule eliminates continuing review for many minimal risk studies, as detailed at § __.109(f). Unless an IRB determines otherwise, continuing review of research is not required if: (1) The research is eligible for expedited review in accordance with § __.110; (2) the research is reviewed by the IRB in accordance with the limited IRB review procedure described in several of the exemption categories (specifically, § __.104(d)(2)(iii), § __.104(d)(3)(i)(C), § __.104(d)(7), or § __.104(d)(8)); or (3) the research has progressed to the point that it only involves data analysis (including analysis of identifiable information or identifiable biospecimens) or access to follow-up clinical data from procedures that subjects would undergo as part of clinical care. If an IRB chooses to conduct continuing review even when these conditions are met, the rationale for doing so must be documented according to a new provision at § __.115(a)(3).
We estimate that 108,873 expedited continuing reviews of protocols occur annually, based on the distribution of reviews presented in Table 3. Of these reviews, we further estimate that 81,546 reviews (75 percent) will not be eliminated by other changes to the Common Rule (such as the modifications at § __.104(d)). It is estimated that 40,773 of these 81,546 reviews (50 percent) will be discontinued under § __.109(f), and the remaining 40,773 reviews (50 percent) will still require documentation of the rationale for doing so (as required under § __.115(a)(3)). We also estimate that IRB voting members will spend 1 hour per review providing the necessary documentation. In addition, administrative staff at each IRB will spend an estimated 10 hours in 2017 updating their communication systems to no longer send continuing review reminders to affected investigators.
The estimated costs to institution officials, IRB administrators, IRB administrative staff, IRB chairs, IRB voting members, and investigators of conducting these reviews are based on the estimates presented in Table 3. The dollar value of their time is calculated by multiplying hours by their estimated 2017-2026 wages and adjusting for overhead and benefits.
Present value benefits of $148 million and annualized benefits of $17.4 million are estimated using a 3 percent discount rate, and present value benefits of $121 million and annualized benefits of $17.3 million are estimated using a 7 percent discount rate. Present value costs of $41.0 million and annualized costs of $4.80 million are estimated using a 3 percent discount rate; present value costs of $33.7 million and annualized costs of $4.80 million are estimated using a 7 percent discount rate. Table 12 summarizes the quantified and nonquantified benefits and costs of the elimination of continuing review of research under specific conditions.
The final rule changes the default position such that any research activity appearing on the expedited review list is presumed to be minimal risk. Additionally, the final rule requires that, in consultation with other Common Rule departments or agencies, the expedited review categories be reviewed every 8 years and amended as appropriate, followed by publication in the
Changes to the expedited review procedures are expected to reduce IRB workload by decreasing the amount of time IRB voting members spend making minimal risk determinations and documenting such determinations. Nonquantified benefits include a reduction in the number of studies that require full, convened IRB review should more categories of activities be added to the expedited review list.
According to the estimates presented in Table 3, 209,371 protocols undergo expedited review each year. For these protocols, we estimate that, as a result of these changes, IRB voting members will spend an average of 15 fewer minutes per protocol developing and documenting a rationale for why certain activities that are permitted to be reviewed under the expedited review procedure are minimal risk.
The dollar value of IRB voting member time is calculated by multiplying hours by their estimated 2017-2026 wages and adjusting for overhead and benefits.
Present value benefits of $51.0 million and annualized benefits of $5.98 million are estimated using a 3 percent discount rate, and present value benefits of $41.7 million and annualized benefits of $5.94 million are estimated using a 7 percent discount rate. Table 13 summarizes the quantified and nonquantified benefits and costs of amending expedited review procedures.
The final rule requires under § __.114 that any institution located in the United States that is engaged in cooperative research shall rely on approval by a single IRB for that portion of the research that is conducted in the United States. This policy has two exceptions (detailed in § __.114(b)(2)): (1) Cooperative research for which more than single IRB review is required by law (including tribal law passed by the official governing body of a American Indian or Alaska Native tribe); and (2) research for which any federal department or agency supporting or conducting the research determines and documents that the use of a single IRB is not appropriate for the particular study. Nonquantified benefits of this change include standardization of human subjects protections in multi-institutional studies.
Ultimately, these revisions are expected to lower costs associated with multiple reviews for investigators, institutions, and IRBs. Some cost shifting may occur as certain IRBs assume the role of reviewing IRB. However, these will be offset by savings at other IRBs that are no longer required to conduct additional reviews of the same research study. Initially, IRBs and institutions will have to draft and revise their policies regarding their reliance on single IRBs. It is expected that, over time, reliance agreements and other methods of documenting external reliance will become standardized, which will result in reduced costs associated with multiple reviews and time savings for investigators who no longer must wait for multiple reviews.
The OHRP database of registered institutions and IRBs shows that 8,035 institutions have an FWA. We estimate that these institutions will develop an average of 10 written joint review agreements with other institutions in 2019 before the first year of compliance. We further estimate that each agreement will require an average of 10 hours of institution legal staff time and 5 hours of IRB administrator time to complete. The dollar value of their time is calculated by multiplying hours by their estimated wages and adjusting for overhead and benefits.
We estimate that 202,617 annual reviews of multi-institutional protocols take place, and an average of 5 reviews per multi-institutional protocol,
In response to comments on the NPRM RIA, we have modified our assumptions of how much time would ultimately be saved by the implementation of this proposal (see Section XIX.C of this RIA). We assume that investigators for whom multi-institutional reviews are eliminated will face a reduction in burden associated with the elimination of the site-specific protocol review, but will face increased burden in the form of coordination with investigators at other sites, for example, to ensure that the results of the IRB review are effectively communicated. Specifically, we assume that the elimination of multi-institutional reviews will result in investigators spending half as much time engaging with the review process as they would have if IRB review had taken place at all sites.
The estimated costs to institution officials, IRB administrators, IRB administrative staff, IRB chairs, IRB voting members, and investigators of conducting these reviews are based on the estimates presented in Table 3, adjusted accordingly to account for our assumption that the time savings for these eliminated reviews is reduced by half for investigators. The dollar value of their time is calculated by multiplying hours by their estimated 2020-2026 wages and adjusting for overhead and benefits.
Present value benefits of $538 million and annualized benefits of $63.1 million are estimated using a 3 percent discount rate, and present value benefits of $414 million and annualized benefits of $59.0 million are estimated using a 7 percent discount rate. Present value costs of $157 million and annualized costs of $18.3 million are estimated using a 3 percent discount rate; present value costs of $140 million and annualized costs of $19.9 million are estimated using a 7 percent discount rate. Table 14 summarizes the quantified and nonquantified benefits and costs of cooperative research.
The final rule imposes a new requirement at § __.116(a)(5)(i) that informed consent must begin with a concise and focused presentation of the key information that is most likely to assist a prospective subject or legally authorized representative in understanding the reasons why one might or might not want to participate in the research. This provision further mandates that this part of the informed consent must be organized and presented in a way that facilitates comprehension. This requirement applies to all informed consent processes, except for broad consent obtained pursuant to § __.116(d), which may warrant a different presentation.
The final rule includes a new element of consent at § __.116(b)(9) that requires one of the following statements be included for any research that involves the collection of identifiable private information or identifiable biospecimens:
• A statement that identifiers might be removed from the identifiable private information or identifiable biospecimens and that, after such removal, the information or biospecimens could be used for future research studies or distributed to another investigator for future research studies without additional informed consent from the subject or the legally authorized representative, if this might be a possibility; or
• A statement that the subject's information or biospecimens collected as part of the research, even if identifiers are removed, will not be used or distributed for future research studies.
This new requirement is intended to give the potential subject the knowledge that identifiers might be removed from information or biospecimens for their use in future research without additional consent, when such a
The final rule's three additional elements of consent are in § __.116(c)(7), (8), and (9). These require that a subject be informed of the following, when appropriate:
• That the subject's biospecimens (even if identifiers are removed) may be used for commercial profit and whether the subject will or will not share in this commercial profit;
• Whether clinically relevant research results, including individual research results, will be disclosed to subjects, and if so, under what conditions.
• For research involving biospecimens, whether the research will (if known) or might include whole genome sequencing (
These three additional elements of consent will promote respect for persons and greater transparency in the research enterprise. Additionally, including the information referenced in these provisions in a consent form will help ensure that prospective subjects are given information necessary for understanding why one might want to participate (or not) in a research study.
The language at § __.117(b)(1) in the final rule was modified to reference § __.116(a)(5)(i) and state that if a short form consent process is used, the key information required by § __.116(a)(5)(i) must be presented first to the prospective subject, before other information, if any, is provided.
We estimate that 246,382 new protocols annually use identifiable information. For each protocol, we estimate that investigators will spend an average of 15 minutes in 2017 updating consent forms to comply with the new requirements found in the final rule at § __.116(a)(5), (b)(9), (c)(7), (c)(8), or (c)(9). Based on the estimates presented in Table 3, the dollar value of investigators' time is calculated by multiplying hours by their estimated 2017 wages and adjusting for overhead and benefits.
We assume that few additional investigators will elect to offer the second option at § __.116(b)(9), and that the investigators who currently offer equivalent options already track the permissible and impermissible uses of information in line with the requirements discussed above. As a result, we estimate that no additional costs are associated with tracking.
Present value costs of $4.62 million and annualized costs of $0.54 million are estimated using a 3 percent discount rate; present value costs of $4.32 million and annualized costs of $0.62 million are estimated using a 7 percent discount rate. Table 15 summarizes the quantified and nonquantified benefits and costs of changes in the basic elements of consent, including documentation.
Because the final rule does not adopt the NPRM proposal to consider all biospecimens as human subjects regardless of identifiability, the costs associated with seeking, obtaining, and tracking broad consent are reduced significantly. As noted above, comments on the NPRM suggest that the costs associated with building systems to track broad consent are very burdensome. Therefore, we expect that broad consent and institution-wide tracking systems will be pursued only in situations where it generates net benefits. As a result, in the short term, we are unsure of the extent to which institutions will adopt institution-wide mechanisms to seek, obtain, and track broad consent. We anticipate in the short term that broad consent (and the attendant tracking and maintenance obligations) will be a system used and managed by investigators or teams of investigators in their research portfolios. However, we believe that it will be adopted more over time at an institutional level as IT systems evolve at research institutions through normal practice. We lack data to estimate the number of research studies for which this option will be adopted. Each of these studies will have some variable costs (
The final rule will allow an IRB to approve a research proposal in which investigators obtain information or biospecimens without individuals' informed consent for the purpose of screening, recruiting, or determining the eligibility of prospective human subjects of research in certain circumstances.
This addresses concerns that the pre-2018 regulations required an IRB to determine that informed consent could be waived before investigators could record identifiable private information for the purpose of screening, recruiting, or determining the eligibility of prospective subjects for a research study. The pre-2018 rule requirement was viewed as burdensome without providing meaningful protections to subjects.
The policy adopted in the final rule should result in time and cost savings for investigators and IRBs, but they likely will be small. The savings will come from IRBs no longer needing to consider whether informed consent can be waived for such preparatory-to-research activities. Savings will accrue for investigators who can proceed with such activities in less time.
We estimate that 1,620 annual initial reviews of protocols (0.5 percent) involve a waiver of consent for recruitment activities that will not be required as a result of these changes. Of these reviews, 1,118 will have undergone convened initial review and 502 will have undergone expedited initial review based on the distribution of reviews presented in Table 3. We estimate that investigators spend an average of 15 minutes requesting a waiver of consent for recruitment activities when they submit a protocol for initial review. We further estimate that IRBs typically use two primary reviewers for convened review and one primary reviewer for expedited review, and that primary reviewers spend an average of 15 minutes determining whether informed consent can be waived. Based on the estimates in Table 3, the dollar value of their time is calculated by multiplying hours by their estimated 2017-2026 wages and adjusting for overhead and benefits.
Present value benefits of $1.25 million and annualized benefits of $0.15 million are estimated using a 3 percent discount rate, and present value benefits of $0.88 million and annualized benefits of $0.13 million are estimated using a 7 percent discount rate. Table 17 summarizes the quantified and nonquantified benefits and costs of eliminating the requirement to waive consent in certain subject recruitment activities.
The final rule requires that for each clinical trial conducted or supported by a Federal department or agency, one IRB-approved form used to recruit subjects must be posted by the awardee or the federal department or agency component conducting the trial on a publicly available federal Web site that will be established as a repository for such informed consent forms. The consent form must be posted after the clinical trial is closed to recruitment and no later than 60 days after the last study visit by any subject, as required by the protocol. This provision permits federal departments or agencies to require or permit redactions to these consent forms. As described in Section XIV.H, federal departments or agencies have great latitude in what they may permit or require be redacted.
We believe that public posting of consent forms will increase transparency, enhance confidence in the research enterprise, increase accountability, and inform the development of future consent forms, possibly resulting in future savings in time for investigators developing consent forms. Costs to the Federal Government in creating and maintaining such a repository are described in Section XIX.D.2.a of this RIA.
According to queries of ClinicalTrials.gov, estimated 5,270 clinical trials are conducted or supported by Common Rule agencies, of which an estimated 575 are regulated by provisions in the Federal Food, Drug, and Cosmetic (FD&C) Act and Trade Secrets Act based on the information presented in Table 3. For the purpose of this analysis, it is assumed that each clinical trial is associated with one consent form that must be submitted to the federal system by an investigator.
It is unknown at this time in what other circumstances federal departments or agencies might permit or require redaction, thus the RIA calculates redaction time only in those studies for which the FD&C Act and Trade Secrets Act applies. For the 575 clinical trials regulated by provisions in the FD&C Act and Trade Secrets Act, it is estimated that investigators will spend an average of 30 minutes redacting information before submission. We estimate that investigators will spend an average of 15 minutes submitting each consent form.
Based on the estimates presented in Table 3, the dollar value of investigator time is calculated by multiplying hours by their estimated 2017-2026 wages and adjusting for overhead and benefits.
In addition, submitted consent forms must be reviewed and made accessible to persons with disabilities in compliance with Section 508 Amendment to the Rehabilitation Act of 1973. We estimate that each consent form contains an average of 10 pages and that making each page 508-compliant costs an average of $30 per page.
Present value costs of $15.4 million and annualized costs of $1.80 million are estimated using a 3 percent discount rate; present value costs of $11.0 million and annualized costs of $1.56 million are estimated using a 7 percent discount rate. Table 18 summarizes the quantified and nonquantified benefits and the requirement for posting of consent forms for Common Rule department or agency-supported clinical trials.
The final rule adds a provision allowing a waiver of the requirement to obtain a signed informed consent form if the subjects are members of a distinct cultural group or community in which signing documents is not the norm. This will be allowed only if the research presents no more than minimal risk of harm to subjects and provided an appropriate alternative method is available to document that informed consent was obtained.
Under the pre-2018 rule, IRBs could waive the requirement for the investigator to obtain a signed consent form for some or all subjects. The pre-2018 criteria for such a waiver may not have been flexible enough for dealing with a variety of circumstances, such as when federally sponsored research is conducted in an international setting where, for example, cultural or historical reasons suggest that signing documents may be viewed as offensive and problematic.
This should not involve cost as its intent is to improve the informed consent process by providing more flexibility regarding the documentation of consent (an ethical gain) while reducing administrative requirements for investigators and research subjects in specific circumstances. Thus, benefits and costs of this new provision are not quantified. Table 19 summarizes the nonquantified benefits and costs of alteration in waiver for documentation of informed consent in certain circumstances.
We carefully considered the option of not pursuing regulatory action. However, because of shifts in science, technology, public engagement, and public expectations in the past 2 decades, a wide range of stakeholders have raised concerns about the limitations of the existing ethical framework in research, arguing for a re-evaluation of how the fundamental principles that underlie the Common Rule—respect for persons, beneficence, and justice—are applied in practice to the myriad new contexts in which U.S. research is conducted in the 21st century.
The final rule addresses these concerns through three aims. The first aim is to increase human subjects' ability and opportunity to make informed decisions. The second aim is to reduce potential for harm and promote justice by increasing the uniformity of human subject protections. The third aim is to facilitate current and evolving types of research that offer promising approaches to treating and preventing medical and societal problems by reducing ambiguity in interpretation of the regulations, increasing efficiencies in the review system, and reducing requirements on investigators when said requirements do not appear to provide meaningful protections to human subjects. We hope that these changes will also build public trust in the research system. We estimate that the benefits of this regulatory action exceed its costs, and as a result we have chosen to pursue this regulatory action.
The NPRM proposed to expand the definition of human subjects to include research in which an investigator obtains, uses, studies or analyzes a biospecimen. This would have applied regardless of the identifiability of the biospecimen. Generally, investigators would not have been allowed to remove identifiers from biospecimens without obtaining informed consent or a waiver of consent. The NPRM also proposed to modify the criteria for waiver of consent in research involving biospecimens such that a waiver would be very rare. Written consent would generally have been required for such activities. Thus, this change would have significantly expanded the amount of research subject to the Common Rule. This requirement would not have applied to biospecimens and information already collected at the time the final rule is published. The NPRM proposed to exclude from its scope research activities involving nonidentified biospecimens where no new information about an individual is generated. Although activities such as developing new testing assays could have been excluded under this provision, it is anticipated that under the NPRM proposals, most research with biospecimens would have come under the rule.
In addition to promoting respect for persons in the research enterprise, the alternative regulatory structure for research with biospecimens (whereby consent is sought for almost all research activities involving biospecimens) would have encouraged investigators to retain identifiers, which can enhance research by preserving the ability to link biospecimens to important additional information about the subject. Additionally, members of the regulated community have reported situations
Though this proposal would promote the ethical principle of respect for persons, it also would have significantly increased the volume of studies for which investigators must seek and document informed consent (unless more stringent waiver criteria were met). Additionally, the NPRM acknowledged, and the regulated community reiterated, during the public comment period, that the majority of the studies that the NPRM proposal would have newly regulated were studies involving no more than minimal risk to human subjects.
As an example of the tradeoffs between the NPRM proposal and the ultimate position taken in the final rule, some commenters noted that the proposal to cover all biospecimens under the Common Rule regardless of identifiability might privilege the
The benefit and cost estimations presented below are based upon the proposals and structure presented in the NPRM, not the provisions included in the final rule.
We estimate that each year 250,000 studies are not currently subject to oversight by either the Common Rule or FDA regulations because they use biospecimens that have been stripped of identifiers. Extrapolations from 1999 data
Approximately 9 million individuals' biospecimens (30 percent of those collected) are collected for research purposes. Approximately 6.3 million individuals' biospecimens (30 percent) could potentially be used in future research studies. Thus, it is possible that investigators would have had to seek consent to secondary use of biospecimens or a waiver of consent for an additional 15 million individuals annually for secondary use of biospecimens.
In the absence of comprehensive data, to calculate the number of protocols that would have been covered, we proposed two approaches. Under method one, we estimated that approximately 50 biospecimens would have been used on average per research protocol involving biospecimens. This gave a potential 300,000 new research protocols using nonidentified biospecimens. This estimate of 300,000 new research protocols was rounded down to 250,000 new studies based on ANPRM comments and industry data, because it seemed reasonable to assume that the number of new biospecimen studies covered by the alternative proposal would equal the total number of new protocols conducted each year (
Under method two, biospecimen repository representatives reported that roughly 90 percent of their collections were used in nonidentified form in research activities that did not fall under the pre-2018 rule. Thus, only 10 percent of biospecimen studies were covered under the pre-2018 rule, representing a 9:1 ratio of studies involving nonidentified biospecimens to studies involving identifiable biospecimens. Of the 246,382 new protocols each year that were nonexempt (Table 3), we assumed that 10 to15 percent used identifiable biospecimens. This equated to between 24,638 and 36,957 new studies each year using identifiable biospecimens. We estimated that the number of biospecimen studies that occurred on nonidentified biospecimens each year was approximately 9 times the number of studies using identifiable biospecimens, or between 221,742 and 332,613 studies each year. Thus, under method two, an estimate of 250,000 new studies on nonidentified biospecimens each year was also reasonable.
To facilitate research with biospecimens, the NPRM proposed to create separate elements of broad consent such that investigators and institutions could seek, and individuals could grant, consent for future unspecified research activities. The NPRM also proposed an exemption that relied on obtaining broad consent for future, unspecified research studies. To be eligible for the proposed exemption for specific secondary studies, broad consent must have been sought and obtained using the proposed Secretary's template for broad consent, and the investigator must not have anticipated returning individual research results to subjects.
The NPRM proposed to allow broad consent to secondary research use of biospecimens or identifiable private information for unspecified research purposes. Such broad consent would
The proposed exemption was specifically for secondary research studies involving biospecimens and identifiable private information that had been or would have been acquired for purposes other than the currently proposed research study. If a secondary research study did not meet the requirements of this exemption, the investigator would have needed to seek IRB review of the study, and would have needed to obtain either study-specific consent or a waiver of informed consent. Note that for biospecimens, an IRB would have applied the more stringent waiver criteria under which waiver of informed consent in research involving biospecimens would have been rare. For identifiable private information, an IRB would have applied the waiver criteria almost identical to the criteria in the pre-2018 rule.
We anticipated that a majority of studies that would have used this exemption would have been biospecimen studies. The extent to which individuals conducting secondary research studies involving identifiable private information would have used this exemption is unknown, given the proposed rule provided additional pathways to facilitate such studies. To that end, the benefits and costs associated take into consideration only secondary research involving biospecimens. We further anticipated that the NPRM proposals would have resulted in higher value research with biospecimens being conducted with subjects' consent and without the need for full IRB review, or the need to go back to subjects to obtain consent for every secondary research study, as long as certain conditions were met.
Because the estimated 250,000 biospecimen studies each year that would have been newly covered under the rule as a result of the proposed modification to the definition of human subject would likely have been minimal risk, we assume that all of these would have been eligible for the exemption for secondary use as long as broad consent had been sought and obtained.
Benefits and costs associated with obtaining and tracking broad consent under this alternative proposal are discussed below.
Because the compliance date for the expansion to the definition of human subject would have been 3 years after the date of publication of a final rule, the benefits and costs described below assume a start date of 2020. In the absence of the proposed exemption for secondary research studies, but taking into consideration the expansion to the definition of human subject, we estimate that each year, all 250,000 of these studies would undergo convened initial review. In subsequent years, we estimate that 120,000 protocols would undergo convened initial review, 89,700 would undergo convened continuing review, and 40,300 would undergo expedited continuing review based on the distribution of reviews presented in Table 3. The estimated costs to institution officials, IRB administrators, IRB administrative staff, IRB chairs, IRB voting members, and investigators conducting these reviews are based on the estimates presented in Table 3. The dollar value of their time is calculated by multiplying hours by their estimated 2017-2026 wages and adjusting for overhead and benefits.
To facilitate secondary research using biospecimens and identifiable private information, the NPRM also proposed an exemption for storing and maintaining biospecimens and identifiable private information for future, unspecified, secondary research activities. Given the creation of this exemption, the NPRM envisioned that institutions would need to develop tracking systems to monitor which biospecimens or information could be used in secondary research by investigators. Because both the exemption for secondary research use described above, and the exemption required using the proposed Secretary's broad consent, the NPRM assumed that a majority of investigators and institutions would employ the Secretary's consent template. Thus, the NPRM anticipated that minimal time would have been spent updating consent forms or drafting new broad consent forms.
We estimate that 6,428 FWA-holding institutions (80 percent) would have stored and maintained clinical and nonclinical biospecimens and identifiable private information for unspecified future research studies in the manner prescribed under the NPRM. As also discussed previously, extrapolations from 1999 data suggest that biospecimens are collected from as many as 30 million individuals each year and stored for both clinical and research purposes. Approximately 9 million individuals' biospecimens (30 percent) are collected for research purposes, and thus consent would be sought in the research context for the secondary use of these biospecimens. For these 9 million individuals per year, an investigator would spend an estimated 20 minutes per person conducting the consent process specific to seeking broad consent, and the subjects would spend an estimated 20 minutes engaging in the process of having their broad consent for future research uses of their biospecimens or information sought. This estimate of the investigator's time also includes the time for the investigator to log the information into the appropriate database. We note that the NPRM RIA estimated that it would take 5 minutes for an investigator to seek broad consent in the research setting, and that prospective subjects would spend 5 minutes having their broad consent sought. Based on public comments, we have revised this estimate to better reflect experience in the regulated community about how long it takes to seek and obtain consent. We further estimate that investigators would spend 10 minutes of time per protocol updating their study specific consent form to include the language from the Secretary's consent template.
In the clinical setting, approximately 21 million individuals' biospecimens (70 percent of the estimated 30 million individuals' biospecimens collected each year) are collected for clinical purposes. In the first year that the proposed changes would have been implemented, as many as 21 million broad, secondary use consent forms could have been collected from individuals. We anticipate 30 minutes of a subject's time to engage in the consent process. We further anticipate 30 minutes of an institutional employee's time at the IRB Administrative Staff level to seek consent and put the information in the appropriate tracking system. As with the estimate for seeking and obtaining broad consent in the clinical setting, we have increased the estimate of how long it would take institutional employees to seek broad consent and how long prospective subjects would spend participating in the broad consent process based on public comments.
The NPRM proposed that once an individual gave broad consent to use his or her biospecimens in future, unspecified research studies, that consent could cover any biospecimen collected from that individual over the course of a 10-year period. Note that an institution could retain and use the biospecimens collected indefinitely. This provision merely stated that every 10 years an institution must ask people whether or not they may use newly collected biospecimens in research. Given that an institution needed to seek
To account for this, the RIA alternative approach assumes that after the first year, a fraction of the clinical subjects from whom broad consent was sought in year one would be sought in subsequent years. We anticipate that in year two, secondary use consent would be sought in the clinical context from 10.5 million subjects (50 percent of the number of individuals involved in the year one estimates). We anticipate that in year three and after, secondary use consent would be sought in the clinical context from approximately 6.3 million subjects each year (30 percent of the number of individuals involved in the year one estimates). As in year one, we assume that a prospective subject would spend 30 minutes of time undergoing the consent process and that an institutional employee at the IRB Administrative Staff level would spend 30 minutes of time conducting the consent process with an individual and updating the appropriate tracking system.
To appropriately track biospecimens or identifiable private information for which broad consent had been sought and obtained on an institutional level, an institution would need to develop an institution-wide repository-like schema. The costs include the design, implementation, and operation of the informatics system that would be required to document and keep current thousands of consent documents per year. In addition, the institution would have to come up with a system to mark or otherwise flag which biospecimens and pieces of identifiable private information could be used in future unspecified secondary research studies.
Under the NPRM proposal, we estimate that 80 percent of the 8,035 institutions with FWAs would develop these informatics systems (or modify existing systems) to facilitate research with nonidentified biospecimens. We estimate that under this proposal, institutions on average would require 1.0 database administrator FTE to develop and maintain these systems. We note that as this estimate is a nationwide average, and we expect some institutions would require more database administrators, and others would require fewer.
For all of the estimates described above, the estimated costs to institution officials, IRB administrators, IRB administrative staff, IRB chairs, IRB voting members, database administrators, and investigators of are based on the estimates presented in Table 3. The dollar value of their time is calculated by multiplying hours by their estimated 2017-2026 wages and adjusting for overhead and benefits.
For the alternative proposal (
As discussed above, the RFA requires agencies that issue a regulation to analyze options for regulatory relief of small entities if a rule has a significant impact on a substantial number of small entities. HHS considers a rule to have a significant economic impact on a substantial number of small entities if at least 5 percent of small entities experience an impact of more than 3 percent of revenue.
We calculate the costs of the proposed changes to the Common Rule over 2017-2026 to institutions with an FWA. The estimated annualized cost to institutions with an FWA, on average, is $2,516 using a 3 percent discount rate. The U.S. Small Business Administration establishes size standards that define a small entity. According to these standards, colleges, universities, and professional schools with revenues below $27.5 million and hospitals with revenues below $38.5 million are considered small entities. It is not anticipated that a majority of institutions with an FWA are in any of these categories.
We have determined under 21 CFR 25.30(k) that this action is of a type that does not individually or cumulatively have a significant effect on the human environment. Therefore, neither an environmental assessment nor an environmental impact statement is required.
This final rule contains collections of information that are subject to review and approval by the Office of Management and Budget (OMB) under the Paperwork Reduction Act (PRA), as amended (44 U.S.C. 3501-3520). A description of these provisions is given in this document with an estimate of the annual reporting and recordkeeping burden.
Section __.101 is amended, as described in § __.101(a), to give Common Rule departments and agencies the authority to enforce compliance directly against IRBs that, are not operated by an assured institution. It is anticipated that institutions using an IRB that it does not operate will be reassured because compliance actions can be taken directly against the IRB responsible for the regulatory noncompliance, rather than the institutions that relied on that review. As a result of this change, we anticipate that FWA-holding institutions will increase their reliance on IRBs not operated by an FWA-holding institution when appropriate.
The OHRP database of assured institutions and registered IRBs shows that approximately 449 IRBs not operated by an institution holding an FWA will now be subject to oversight. These IRBs will develop an estimated average of 10 written agreements with other institutions each year as a result of this rule. We further estimate that each agreement will require an average of 10 hours of institution legal staff time and 5 hours of IRB administrator time to complete. We note that elsewhere in the final rule (specifically §§ __.103(e) and __.115(a)(9)) requires that IRBs document the specific responsibilities that an institution and an organization operating an IRB each will undertake, when an institution relies on an IRB that it does not operate. The impact of these provisions on FWA-holding institutions is described below.
To further strengthen the compliance enforcement authority provision in § __.101(a) and provide a record for oversight and compliance purposes, the final rule contains a requirement at § __.103(e), that for nonexempt research involving human subjects covered by this policy (or exempt research for which limited IRB takes place pursuant to § __.104(d)(2)(iii), § __.104(d)(3)(i)(C), § __.104(d)(7), or § __.104(d)(8)) that take place at an institution in which IRB oversight is conducted by an IRB that is not operated by the institution, the institution and the organization operating the IRB shall document the institution's reliance on the IRB for oversight of the research and the responsibilities that each entity will undertake to ensure compliance with the requirements of this policy. This might be accomplished through a written agreement between the institution and the IRB, or by implementing an institution-wide policy directive providing the allocation of responsibilities between the institution and an IRB that is not affiliated with the institution, or as set forth in a research protocol). In addition, a requirement is included at § __.115(a)(9) that an institution include documentation of such arrangements in the IRB records.
Table 3 of the RIA section of the preamble shows that 5,164 FWA-holding institutions do not have an IRB and 2,871 FWA-holding institutions have an IRB. We assume that the 5,164 FWA-holding institutions without an IRB have an average of 1 IRB authorization agreement that will need to be modified as a result of the new requirements for agreements between institutions and IRBs not operated by the institutions in 2017. In addition, we assume that the 2,871 FWA-holding institutions with an IRB have an average of 0.20 IRB authorization agreements that will need to be modified in 2017. We estimate that each agreement will require an average of 10 hours of institution legal staff time and 5 hours of IRB administrator time to complete. The dollar value of their time is calculated by multiplying hours by their estimated 2017 wages and adjusting for overhead and benefits.
Section 104(d)(5)(i) requires each federal department or agency conducting or supporting the research or demonstration projects covered under this exemption to establish, on a publicly accessible federal Web site or in such other manner as the department or agency head may determine, a list of the research and demonstration projects that the federal department or agency conducts or supports under this provision. We estimate that under the pre-2018 rule, approximately 1,000 demonstration projects occurred each year. Under the modifications to this exemption in the final rule, we estimate that an additional 3,376 studies will fall under this exemption. Thus, approximately 4,376 studies will be subject to this posting requirement each year. We anticipate that investigators will spend approximately 15 minutes per study submitting information about these studies to the federal Web site.
The final rule requires any institution located in the United States that is engaged in cooperative research to rely upon approval by a single IRB for that portion of the research that is conducted in the United States, as detailed in § __.114 (b)(1). The following research is not subject to the requirements of this provision, as described in § __.114 (b)(2): (1) Cooperative research for which more than single IRB review is required by law (including tribal law passed by the official governing body of a Native American or Alaska Native tribe); or (2) research for which any federal department or agency supporting or conducting the research determines and documents that the use of a single IRB is not appropriate for the particular study.
The OHRP database of assurances shows that 8,035 institutions in the United States have an FWA. We estimate that these institutions will
We estimate that 202,617 annual reviews of multi-institutional protocols take place, and an average of 5 reviews per multi-institutional protocol, implying that 40,523 multi-institutional protocols are reviewed each year. We further estimate that 16,209 (40 percent) of these multi-institutional studies are funded by NIH and thus will already be subject to NIH's single IRB review policy. Accordingly, we estimate that approximately 97,256 annual reviews of protocols will no longer be conducted as a result of these proposed changes. Of these reviews, 32,211 would have undergone convened initial review, 14,472 would have undergone expedited initial review, 34,896 would have undergone convened continuing review, and 15,678 would have undergone expedited continuing review based on the distribution of reviews presented in Table 3 in the RIA section of the preamble.
The final rule eliminates continuing review for many minimal risk studies, as detailed at § __.109(f). Unless an IRB determines otherwise, continuing review of research is not required if: (1) The research is eligible for expedited review in accordance with § __.110; (2) the research is reviewed by the IRB in accordance with the limited IRB review procedure described in several of the exemption categories (specifically, § __.104(d)(2)(iii), § __.104(d)(3)(i)(C), § __.104(d)(7), or § __.104(d)(8)); or (3) the research has progressed to the point that it involves data analysis (including analysis of identifiable information or identifiable biospecimens) or access to follow-up clinical data from procedures that subjects would undergo as part of clinical care. If an IRB chooses to conduct continuing review even when these conditions are met, the rationale for doing so must be documented according to a new provision at § __.115(a)(3).
We estimate that 40,773 reviews will require documentation of the rationale for doing so (as required under § __.115(a)(3)). We also estimate that IRB voting members will spend 1 hour per review providing the necessary documentation.
The final rule imposes a new requirement at § __.116(a)(5)(i) informed consent must begin with a concise and focused presentation of the key information that is most likely to assist a prospective subject or legally authorized representative in understanding the reasons why one might or might not want to participate in the research. This part of informed consent must be organized and presented in a way that facilitates comprehension. This requirement applies to all informed consent process, except for broad consent obtained pursuant to § __.116(d), which may warrant a different presentation.
The final rule includes a new element of consent at § __.116(b)(9) that requires one of the following statements be included for any research that involves the collection of identifiable private information or identifiable biospecimens: (1) A statement that identifiers might be removed from the identifiable private information or identifiable biospecimens and that after such removal, the information or biospecimens could be used for future research studies or distributed to another investigator for future research studies without additional informed consent from the subject or the legally authorized representative, if this might be a possibility; or (2) a statement that the subject's information or biospecimens collected as part of the research, even if identifiers are removed, will not be used or distributed for future research studies.
The final rule's three additional elements of consent are in § __.116(c)(7), (8), and (9). These require that a subject be informed of the following, when appropriate:
• That the subject's biospecimens (even if identifiers are removed) may be used for commercial profit and whether the subject will or will not share in this commercial profit;
• Whether clinically relevant research results, including individual research results, will be disclosed to subjects, and if so, under what conditions;
• For research involving biospecimens, whether the research will (if known) or might include whole genome sequencing (
These additional elements of consent will promote respect for persons and greater transparency in the research enterprise. Additionally, including the information referenced in these provisions in a consent form will help ensure that prospective subjects are given information necessary for understanding why one might choose whether to participate in a research study.
The language at § __.117(b)(1) in the final rule was modified to reference § __.116(a)(5)(i) and state that if a short form consent process is used, the key information required by § __.116(a)(5)(i) must be presented first to the prospective subject, before other information, if any, is provided.
We estimate that 246,382 new protocols annually will use identifiable private information. For each protocol, we estimate that investigators will spend an average of 15 minutes in 2017 updating consent forms to comply with the new requirements found in the final rule at § __.116(a)(5), (b)(9), (c)(7), (c)(8), or (c)(9) (in Table 3 in the RIA section).
We assume that few additional investigators will elect to offer the second option at § __.116(b)(9), and that the investigators who currently offer equivalent options already track the permissible and impermissible uses of information in line with the requirements discussed above. As a result, we estimate that tracking will have no additional associated impacts.
A new provision in the final rule, § __.116(h), requires that, for each clinical trial conducted or supported by a federal department or agency, one IRB-approved informed consent form used to enroll subjects must be posted by the awardee or federal department or agency component conducting the trial on a publicly available federal Web site that is established as a repository for such informed consent forms. The informed consent form must be published on the federal Web site after the trial is closed to recruitment, and no later than 60 days after the last study visit by any subject, as required by the protocol.
If the federal department or agency supporting or conducting the clinical trial determines that certain information should not be made publicly available on a federal Web site (
We believe that public posting of consent forms will increase transparency, enhance confidence in the research enterprise, increase accountability, and inform the development of future consent forms, possibly resulting in future savings in time for investigators developing consent forms.
According to queries of
The total estimated burden imposed by these information collection requirements is 1,422,968 burden hours.
It should be noted that the burden estimates for the Common Rule include approved information requirements in OMB No. 0990-0260, Protection of Human Subjects: Compliance with Federal Policy/IRB Recordkeeping/Informed Consent/Consent Documentation, approved through May 31, 2018. As such, it will be amended and submitted to OMB as revisions to currently approved collections once the rule is finalized and the collections are due for renewal.
In compliance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)), the information collection provisions of this rule will be submitted to OMB for review. These requirements will not be effective until OMB approves them.
We are committed to consulting with AI/AN tribes and tribal leadership to the extent practicable and permitted by law before promulgating any regulation that has tribal implications. As we developed this rule, we engaged with tribes through tribal consultation and the public comment process. The requirements in this final rule were informed by consultations with and comments from tribal representatives.
On January 5, 2016, HHS conducted a tribal consultation through conference call in accordance with the HHS Tribal Consultation Policy
During the tribal consultation conference call, participants discussed:
• Concern about the NPRM not acknowledging the role of tribal governments in research oversight of research occurring on tribal land or with tribal citizens;
• Concern about the pre-2018 rule and the NPRM not explicitly acknowledging tribal sovereignty. HHS representatives acknowledged an outstanding legal question about whether rules created by tribal governments were encompassed by the provision in the pre-2018 rule and the NPRM's statement that the policy does not affect any state or local laws or regulations that may otherwise be applicable and that provide additional protections for human subjects;
• Concern about the NPRM not acknowledging the unique and significant impact that the proposed changes would have on American Indian and Alaska Native populations;
• Concern that the NPRM does not address risks of research to communities and only addresses individual risks;
• Concern that the NPRM proposals seem to reduce institutional responsibility but increase investigator responsibility. This presents a unique challenge when institutions have entered into agreements with tribal governments or tribal representatives, as opposed to individual investigators entering into these arrangements. The exemption decision tool was cited as an example of the proposals placing more responsibility on the investigators while perhaps reducing responsibility on the institutions; and
• Concern about the single IRB review mandate for multi-institutional studies affecting the ability of tribal communities to conduct local reviews of research involving tribal citizens or research that takes place on tribal land. One commenter noted that a one size fits all approach to addressing American Indian and Alaska Native concerns in human subjects protections might not be appropriate as needs and concerns might vary from tribe to tribe.
HHS reiterated its commitment to engaging in an ongoing dialogue with tribal communities and tribal representatives, and welcomed ongoing discussion and comment on how the Common Rule affects these groups.
In addition to the January 2016 tribal consultation, we reviewed public comments from tribal representatives, and individuals and groups representing tribal interests to the ANPRM and NPRM. We received one comment on the ANPRM from a group representing tribal interests. This group noted “the long and challenging history” of research involving AI/AN populations, and how this history informs current research activities involving these groups. This comment argued that, for research involving AI/AN populations:
• Continuing review should be required;
• IRBs, not investigators or other parties, should determine whether a prospective study is exempt or excluded from the Common Rule;
• IRBs should be required to consider potential harms to populations or groups, not just individuals, when reviewing research activities;
• Incorporating tribal IRBs into the process for multi-institutional studies is a crucial aspect of respecting these populations and ensuring human subjects protections;
• Study-specific informed consent forms should be required, and general, multi-purpose consent forms should be avoided;
• Mandated information and biospecimen privacy safeguards would be a welcome improvement to the current research landscape and would help prevent harm to human subjects; and
• Consultation with tribal representatives would be crucial should a proposed rule or final rule mandate single IRB review for multi-institutional studies.
We received approximately 15 comments on the NPRM from groups representing tribal interests. As described in Section II.E of this preamble, overarching concerns raised by these groups in comments to the NPRM included:
• Lack of group consent requirements proposed in the NPRM;
• Concern about the allowance for broad consent for future unspecified research uses;
• Lack of consideration for research activities involving research with biospecimens or information from individuals who are no longer alive;
• Mandating the use of single IRB review in multi-institutional research activities undermining the ability of tribal groups to conduct local review of studies; and
• Concern about the breadth and depth of exclusions and exemptions proposed in the NPRM exempting or excluding activities that tribal populations might find sensitive and requiring IRB review.
Commenters also raised concerns about the timing of the tribal consultation call and noted that the tribal consultation call occurred one day before the closing of the extended comment period for the NPRM. When HHS received notice that tribal representatives desired to consult on this proposed rule, a consultation was immediately scheduled in accordance with HHS policy.
The final rule includes a modification to the provision requiring single IRB review, and several clarifications specifying that regulatory references to state and local law are intended to include tribal law, in response to concerns raised during the tribal consultation and in the NPRM public comments. As described in this preamble, the final rule clarifies in § __.101(f) that tribal governments can develop laws related to the protection of human subjects that are more protective than the Common Rule, and that these laws must be followed by federally funded researches in activities involving these populations. Section __.114 now provides that if a tribal government requires review by more than one IRB by law in multi-institutional research, the single IRB review requirement in § __.114 does not apply. Additional clarification has also been made to § __.116(i) that tribal governments can develop their own informed consent standards that provide additional protections to subjects and that investigators conducting research involving populations under the jurisdiction of the tribal governments would have to follow these rules. Finally, additional language has been added to § __.116(j) noting that nothing in § __.116 is intended to limit the authority of a treating physician to the extent the authority is granted by tribal law.
Additional details of public comments from individuals representing tribal interests are included above in the relevant public comment summaries for the various final rule provisions discussed in Sections II through XVIII of this preamble.
For the reasons set forth in this preamble, the Federal Policy for the Protection of Human Subjects is amended.
The text of the final common rule appears below:
1. Part/subpart __is amended/revised/added to read as follows:
(a) Except as detailed in § __.104, this policy applies to all research involving human subjects conducted, supported, or otherwise subject to regulation by any Federal department or agency that takes appropriate administrative action to make the policy applicable to such research. This includes research conducted by Federal civilian employees or military personnel, except that each department or agency head may adopt such procedural modifications as may be appropriate from an administrative standpoint. It also includes research conducted, supported, or otherwise subject to regulation by the Federal Government outside the United States. Institutions that are engaged in research described in this paragraph and institutional review boards (IRBs) reviewing research that is subject to this policy must comply with this policy.
(b) [Reserved]
(c) Department or agency heads retain final judgment as to whether a particular activity is covered by this policy and this judgment shall be exercised consistent with the ethical principles of the Belmont Report.
(d) Department or agency heads may require that specific research activities or classes of research activities conducted, supported, or otherwise subject to regulation by the Federal department or agency but not otherwise covered by this policy comply with some or all of the requirements of this policy.
(e) Compliance with this policy requires compliance with pertinent federal laws or regulations that provide additional protections for human subjects.
(f) This policy does not affect any state or local laws or regulations (including tribal law passed by the official governing body of an American Indian or Alaska Native tribe) that may otherwise be applicable and that provide additional protections for human subjects.
(g) This policy does not affect any foreign laws or regulations that may otherwise be applicable and that provide additional protections to human subjects of research.
(h) When research covered by this policy takes place in foreign countries, procedures normally followed in the foreign countries to protect human subjects may differ from those set forth in this policy. In these circumstances, if a department or agency head determines that the procedures prescribed by the institution afford protections that are at least equivalent to those provided in this policy, the department or agency head may approve the substitution of the foreign procedures in lieu of the procedural requirements provided in this policy. Except when otherwise required by statute, Executive Order, or the department or agency head, notices of these actions as they occur will be published in the
(i) Unless otherwise required by law, department or agency heads may waive the applicability of some or all of the provisions of this policy to specific research activities or classes of research activities otherwise covered by this policy, provided the alternative procedures to be followed are consistent with the principles of the Belmont Report.
(j) Federal guidance on the requirements of this policy shall be issued only after consultation, for the purpose of harmonization (to the extent appropriate), with other Federal departments and agencies that have adopted this policy, unless such consultation is not feasible.
(k) [Reserved]
(l) Compliance dates and transition provisions:
(1) For purposes of this section, the
(2) For purposes of this section, the
(3) Research initially approved by an IRB, for which such review was waived pursuant to § __.101(i), or for which a determination was made that the research was exempt before January 19, 2018, shall comply with the pre-2018 Requirements, except that an institution engaged in such research on or after January 19, 2018, may instead comply with the 2018 Requirements if the institution determines that such ongoing research will comply with the 2018 Requirements and an IRB documents such determination.
(4) Research initially approved by an IRB, for which such review was waived pursuant to § __.101(i), or for which a
(m) Severability: Any provision of this part held to be invalid or unenforceable by its terms, or as applied to any person or circumstance, shall be construed so as to continue to give maximum effect to the provision permitted by law, unless such holding shall be one of utter invalidity or unenforceability, in which event the provision shall be severable from this part and shall not affect the remainder thereof or the application of the provision to other persons not similarly situated or to other dissimilar circumstances.
(a)
(b)
(c)
(d)
(e)(1)
(i) Obtains information or biospecimens through intervention or interaction with the individual, and uses, studies, or analyzes the information or biospecimens; or (ii) Obtains, uses, studies, analyzes, or generates identifiable private information or identifiable biospecimens.
(2)
(3)
(4)
(5)
(6)
(7) Federal departments or agencies implementing this policy shall:
(i) Upon consultation with appropriate experts (including experts in data matching and re-identification), reexamine the meaning of “identifiable private information,” as defined in paragraph (e)(5) of this section, and “identifiable biospecimen,” as defined in paragraph (e)(6) of this section. This reexamination shall take place within 1 year and regularly thereafter (at least every 4 years). This process will be conducted by collaboration among the Federal departments and agencies implementing this policy. If appropriate and permitted by law, such Federal departments and agencies may alter the interpretation of these terms, including through the use of guidance.
(ii) Upon consultation with appropriate experts, assess whether there are analytic technologies or techniques that should be considered by investigators to generate “identifiable private information,” as defined in paragraph (e)(5) of this section, or an “identifiable biospecimen,” as defined in paragraph (e)(6) of this section. This assessment shall take place within 1 year and regularly thereafter (at least every 4 years). This process will be conducted by collaboration among the Federal departments and agencies implementing this policy. Any such technologies or techniques will be included on a list of technologies or techniques that produce identifiable private information or identifiable biospecimens. This list will be published in the
(f)
(g)
(h)
(i)
(j)
(k)
(l)
(1) Scholarly and journalistic activities (
(2) Public health surveillance activities, including the collection and testing of information or biospecimens, conducted, supported, requested, ordered, required, or authorized by a public health authority. Such activities are limited to those necessary to allow a public health authority to identify, monitor, assess, or investigate potential public health signals, onsets of disease outbreaks, or conditions of public health importance (including trends, signals, risk factors, patterns in diseases, or increases in injuries from using consumer products). Such activities include those associated with providing timely situational awareness and priority setting during the course of an event or crisis that threatens public health (including natural or man-made disasters).
(3) Collection and analysis of information, biospecimens, or records by or for a criminal justice agency for activities authorized by law or court order solely for criminal justice or criminal investigative purposes.
(4) Authorized operational activities (as determined by each agency) in support of intelligence, homeland security, defense, or other national security missions.
(m)
(a) Each institution engaged in research that is covered by this policy, with the exception of research eligible for exemption under § __.104, and that is conducted or supported by a Federal department or agency, shall provide written assurance satisfactory to the department or agency head that it will comply with the requirements of this policy. In lieu of requiring submission of an assurance, individual department or agency heads shall accept the existence of a current assurance, appropriate for the research in question, on file with the Office for Human Research Protections, HHS, or any successor office, and approved for Federal-wide use by that office. When the existence of an HHS-approved assurance is accepted in lieu of requiring submission of an assurance, reports (except certification) required by this policy to be made to department and agency heads shall also be made to the Office for Human Research Protections, HHS, or any successor office. Federal departments and agencies will conduct or support research covered by this policy only if the institution has provided an assurance that it will comply with the requirements of this policy, as provided in this section, and only if the institution has certified to the department or agency head that the research has been reviewed and approved by an IRB (if such certification is required by § __.103(d)).
(b) The assurance shall be executed by an individual authorized to act for the institution and to assume on behalf of the institution the obligations imposed by this policy and shall be filed in such form and manner as the department or agency head prescribes.
(c) The department or agency head may limit the period during which any assurance shall remain effective or otherwise condition or restrict the assurance.
(d) Certification is required when the research is supported by a Federal department or agency and not otherwise waived under § __.101(i) or exempted under § __.104. For such research, institutions shall certify that each proposed research study covered by the assurance and this section has been reviewed and approved by the IRB. Such certification must be submitted as prescribed by the Federal department or agency component supporting the research. Under no condition shall research covered by this section be initiated prior to receipt of the certification that the research has been reviewed and approved by the IRB.
(e) For nonexempt research involving human subjects covered by this policy (or exempt research for which limited IRB review takes place pursuant to § __.104(d)(2)(iii), (d)(3)(i)(C), or (d)(7) or (8)) that takes place at an institution in which IRB oversight is conducted by an IRB that is not operated by the institution, the institution and the organization operating the IRB shall document the institution's reliance on the IRB for oversight of the research and the responsibilities that each entity will undertake to ensure compliance with the requirements of this policy (
(a) Unless otherwise required by law or by department or agency heads, research activities in which the only involvement of human subjects will be in one or more of the categories in paragraph (d) of this section are exempt from the requirements of this policy, except that such activities must comply with the requirements of this section and as specified in each category.
(b) Use of the exemption categories for research subject to the requirements of subparts B, C, and D: Application of the exemption categories to research subject to the requirements of 45 CFR part 46, subparts B, C, and D, is as follows:
(1)
(2)
(3)
(c) [Reserved.]
(d) Except as described in paragraph (a) of this section, the following categories of human subjects research are exempt from this policy:
(1) Research, conducted in established or commonly accepted educational settings, that specifically involves normal educational practices that are not likely to adversely impact students' opportunity to learn required educational content or the assessment of educators who provide instruction. This includes most research on regular and special education instructional strategies, and research on the effectiveness of or the comparison among instructional techniques,
(2) Research that only includes interactions involving educational tests (cognitive, diagnostic, aptitude, achievement), survey procedures, interview procedures, or observation of public behavior (including visual or auditory recording) if at least one of the following criteria is met:
(i) The information obtained is recorded by the investigator in such a manner that the identity of the human subjects cannot readily be ascertained, directly or through identifiers linked to the subjects;
(ii) Any disclosure of the human subjects' responses outside the research would not reasonably place the subjects at risk of criminal or civil liability or be damaging to the subjects' financial standing, employability, educational advancement, or reputation; or
(iii) The information obtained is recorded by the investigator in such a manner that the identity of the human subjects can readily be ascertained, directly or through identifiers linked to the subjects, and an IRB conducts a limited IRB review to make the determination required by § __.111(a)(7).
(3)(i) Research involving benign behavioral interventions in conjunction with the collection of information from an adult subject through verbal or written responses (including data entry) or audiovisual recording if the subject prospectively agrees to the intervention and information collection and at least one of the following criteria is met:
(A) The information obtained is recorded by the investigator in such a manner that the identity of the human subjects cannot readily be ascertained, directly or through identifiers linked to the subjects;
(B) Any disclosure of the human subjects' responses outside the research would not reasonably place the subjects at risk of criminal or civil liability or be damaging to the subjects' financial standing, employability, educational advancement, or reputation; or
(C) The information obtained is recorded by the investigator in such a manner that the identity of the human subjects can readily be ascertained, directly or through identifiers linked to the subjects, and an IRB conducts a limited IRB review to make the determination required by § __.111(a)(7).
(ii) For the purpose of this provision, benign behavioral interventions are brief in duration, harmless, painless, not physically invasive, not likely to have a significant adverse lasting impact on the subjects, and the investigator has no reason to think the subjects will find the interventions offensive or embarrassing. Provided all such criteria are met, examples of such benign behavioral interventions would include having the subjects play an online game, having them solve puzzles under various noise conditions, or having them decide how to allocate a nominal amount of received cash between themselves and someone else.
(iii) If the research involves deceiving the subjects regarding the nature or purposes of the research, this exemption is not applicable unless the subject authorizes the deception through a prospective agreement to participate in research in circumstances in which the subject is informed that he or she will be unaware of or misled regarding the nature or purposes of the research.
(4) Secondary research for which consent is not required: Secondary research uses of identifiable private information or identifiable biospecimens, if at least one of the following criteria is met:
(i) The identifiable private information or identifiable biospecimens are publicly available;
(ii) Information, which may include information about biospecimens, is recorded by the investigator in such a manner that the identity of the human subjects cannot readily be ascertained directly or through identifiers linked to the subjects, the investigator does not contact the subjects, and the investigator will not re-identify subjects;
(iii) The research involves only information collection and analysis involving the investigator's use of identifiable health information when that use is regulated under 45 CFR parts 160 and 164, subparts A and E, for the purposes of “health care operations” or “research” as those terms are defined at 45 CFR 164.501 or for “public health activities and purposes” as described under 45 CFR 164.512(b); or
(iv) The research is conducted by, or on behalf of, a Federal department or agency using government-generated or government-collected information obtained for nonresearch activities, if the research generates identifiable private information that is or will be maintained on information technology that is subject to and in compliance with section 208(b) of the E-Government Act of 2002, 44 U.S.C. 3501 note, if all of the identifiable private information collected, used, or generated as part of the activity will be maintained in systems of records subject to the Privacy Act of 1974, 5 U.S.C. 552a, and, if applicable, the information used in the research was collected subject to the Paperwork Reduction Act of 1995, 44 U.S.C. 3501
(5) Research and demonstration projects that are conducted or supported by a Federal department or agency, or otherwise subject to the approval of department or agency heads (or the approval of the heads of bureaus or other subordinate agencies that have been delegated authority to conduct the research and demonstration projects), and that are designed to study, evaluate, improve, or otherwise examine public benefit or service programs, including procedures for obtaining benefits or services under those programs, possible changes in or alternatives to those programs or procedures, or possible changes in methods or levels of payment for benefits or services under those programs. Such projects include, but are not limited to, internal studies by Federal employees, and studies under contracts or consulting arrangements, cooperative agreements, or grants. Exempt projects also include waivers of otherwise mandatory requirements using authorities such as sections 1115 and 1115A of the Social Security Act, as amended.
(i) Each Federal department or agency conducting or supporting the research and demonstration projects must establish, on a publicly accessible Federal Web site or in such other manner as the department or agency head may determine, a list of the research and demonstration projects that the Federal department or agency conducts or supports under this provision. The research or demonstration project must be published on this list prior to commencing the research involving human subjects.
(ii) [Reserved]
(6) Taste and food quality evaluation and consumer acceptance studies:
(i) If wholesome foods without additives are consumed, or
(ii) If a food is consumed that contains a food ingredient at or below the level and for a use found to be safe, or agricultural chemical or environmental contaminant at or below the level found to be safe, by the Food and Drug Administration or approved by the Environmental Protection Agency or the Food Safety and Inspection Service of the U.S. Department of Agriculture.
(7) Storage or maintenance for secondary research for which broad consent is required: Storage or maintenance of identifiable private information or identifiable biospecimens for potential secondary research use if an IRB conducts a limited IRB review and makes the
(8) Secondary research for which broad consent is required: Research involving the use of identifiable private information or identifiable biospecimens for secondary research use, if the following criteria are met:
(i) Broad consent for the storage, maintenance, and secondary research use of the identifiable private information or identifiable biospecimens was obtained in accordance with § __.116(a)(1) through (4), (a)(6), and (d);
(ii) Documentation of informed consent or waiver of documentation of consent was obtained in accordance with § __.117;
(iii) An IRB conducts a limited IRB review and makes the determination required by § __.111(a)(7) and makes the determination that the research to be conducted is within the scope of the broad consent referenced in paragraph (d)(8)(i) of this section; and (iv) The investigator does not include returning individual research results to subjects as part of the study plan. This provision does not prevent an investigator from abiding by any legal requirements to return individual research results.
(a) Each IRB shall have at least five members, with varying backgrounds to promote complete and adequate review of research activities commonly conducted by the institution. The IRB shall be sufficiently qualified through the experience and expertise of its members (professional competence), and the diversity of its members, including race, gender, and cultural backgrounds and sensitivity to such issues as community attitudes, to promote respect for its advice and counsel in safeguarding the rights and welfare of human subjects. The IRB shall be able to ascertain the acceptability of proposed research in terms of institutional commitments (including policies and resources) and regulations, applicable law, and standards of professional conduct and practice. The IRB shall therefore include persons knowledgeable in these areas. If an IRB regularly reviews research that involves a category of subjects that is vulnerable to coercion or undue influence, such as children, prisoners, individuals with impaired decision-making capacity, or economically or educationally disadvantaged persons, consideration shall be given to the inclusion of one or more individuals who are knowledgeable about and experienced in working with these categories of subjects.
(b) Each IRB shall include at least one member whose primary concerns are in scientific areas and at least one member whose primary concerns are in nonscientific areas.
(c) Each IRB shall include at least one member who is not otherwise affiliated with the institution and who is not part of the immediate family of a person who is affiliated with the institution.
(d) No IRB may have a member participate in the IRB's initial or continuing review of any project in which the member has a conflicting interest, except to provide information requested by the IRB.
(e) An IRB may, in its discretion, invite individuals with competence in special areas to assist in the review of issues that require expertise beyond or in addition to that available on the IRB. These individuals may not vote with the IRB.
(a) In order to fulfill the requirements of this policy each IRB shall:
(1) Have access to meeting space and sufficient staff to support the IRB's review and recordkeeping duties;
(2) Prepare and maintain a current list of the IRB members identified by name; earned degrees; representative capacity; indications of experience such as board certifications or licenses sufficient to describe each member's chief anticipated contributions to IRB deliberations; and any employment or other relationship between each member and the institution, for example, full-time employee, part-time employee, member of governing panel or board, stockholder, paid or unpaid consultant;
(3) Establish and follow written procedures for:
(i) Conducting its initial and continuing review of research and for reporting its findings and actions to the investigator and the institution;
(ii) Determining which projects require review more often than annually and which projects need verification from sources other than the investigators that no material changes have occurred since previous IRB review; and
(iii) Ensuring prompt reporting to the IRB of proposed changes in a research activity, and for ensuring that investigators will conduct the research activity in accordance with the terms of the IRB approval until any proposed changes have been reviewed and approved by the IRB, except when necessary to eliminate apparent immediate hazards to the subject.
(4) Establish and follow written procedures for ensuring prompt reporting to the IRB; appropriate institutional officials; the department or agency head; and the Office for Human Research Protections, HHS, or any successor office, or the equivalent office within the appropriate Federal department or agency of
(i) Any unanticipated problems involving risks to subjects or others or any serious or continuing noncompliance with this policy or the requirements or determinations of the IRB; and
(ii) Any suspension or termination of IRB approval.
(b) Except when an expedited review procedure is used (as described in § __.110), an IRB must review proposed research at convened meetings at which a majority of the members of the IRB are present, including at least one member whose primary concerns are in nonscientific areas. In order for the research to be approved, it shall receive the approval of a majority of those members present at the meeting.
(a) An IRB shall review and have authority to approve, require modifications in (to secure approval), or disapprove all research activities covered by this policy, including exempt research activities under § __.104 for which limited IRB review is a condition of exemption (under § __.104(d)(2)(iii), (d)(3)(i)(C), and (d)(7), and (8)).
(b) An IRB shall require that information given to subjects (or legally authorized representatives, when appropriate) as part of informed consent is in accordance with § __.116. The IRB may require that information, in addition to that specifically mentioned in § __.116, be given to the subjects when in the IRB's judgment the information would meaningfully add to the protection of the rights and welfare of subjects.
(c) An IRB shall require documentation of informed consent or may waive documentation in accordance with § __.117.
(d) An IRB shall notify investigators and the institution in writing of its decision to approve or disapprove the proposed research activity, or of modifications required to secure IRB
(e) An IRB shall conduct continuing review of research requiring review by the convened IRB at intervals appropriate to the degree of risk, not less than once per year, except as described in § __.109(f).
(f)(1) Unless an IRB determines otherwise, continuing review of research is not required in the following circumstances:
(i) Research eligible for expedited review in accordance with § __.110;
(ii) Research reviewed by the IRB in accordance with the limited IRB review described in § __.104(d)(2)(iii), (d)(3)(i)(C), or (d)(7) or (8);
(iii) Research that has progressed to the point that it involves only one or both of the following, which are part of the IRB-approved study:
(A) Data analysis, including analysis of identifiable private information or identifiable biospecimens, or
(B) Accessing follow-up clinical data from procedures that subjects would undergo as part of clinical care.
(2) [Reserved.]
(g) An IRB shall have authority to observe or have a third party observe the consent process and the research.
(a) The Secretary of HHS has established, and published as a Notice in the
(b)(1) An IRB may use the expedited review procedure to review the following:
(i) Some or all of the research appearing on the list described in paragraph (a) of this section, unless the reviewer determines that the study involves more than minimal risk;
(ii) Minor changes in previously approved research during the period for which approval is authorized; or
(iii) Research for which limited IRB review is a condition of exemption under § __.104(d)(2)(iii), (d)(3)(i)(C), and (d)(7) and (8).
(2) Under an expedited review procedure, the review may be carried out by the IRB chairperson or by one or more experienced reviewers designated by the chairperson from among members of the IRB. In reviewing the research, the reviewers may exercise all of the authorities of the IRB except that the reviewers may not disapprove the research. A research activity may be disapproved only after review in accordance with the nonexpedited procedure set forth in § __.108(b).
(c) Each IRB that uses an expedited review procedure shall adopt a method for keeping all members advised of research proposals that have been approved under the procedure.
(d) The department or agency head may restrict, suspend, terminate, or choose not to authorize an institution's or IRB's use of the expedited review procedure.
(a) In order to approve research covered by this policy the IRB shall determine that all of the following requirements are satisfied:
(1) Risks to subjects are minimized:
(i) By using procedures that are consistent with sound research design and that do not unnecessarily expose subjects to risk, and
(ii) Whenever appropriate, by using procedures already being performed on the subjects for diagnostic or treatment purposes.
(2) Risks to subjects are reasonable in relation to anticipated benefits, if any, to subjects, and the importance of the knowledge that may reasonably be expected to result. In evaluating risks and benefits, the IRB should consider only those risks and benefits that may result from the research (as distinguished from risks and benefits of therapies subjects would receive even if not participating in the research). The IRB should not consider possible long-range effects of applying knowledge gained in the research (
(3) Selection of subjects is equitable. In making this assessment the IRB should take into account the purposes of the research and the setting in which the research will be conducted. The IRB should be particularly cognizant of the special problems of research that involves a category of subjects who are vulnerable to coercion or undue influence, such as children, prisoners, individuals with impaired decision-making capacity, or economically or educationally disadvantaged persons.
(4) Informed consent will be sought from each prospective subject or the subject's legally authorized representative, in accordance with, and to the extent required by, § __.116.
(5) Informed consent will be appropriately documented or appropriately waived in accordance with § __.117.
(6) When appropriate, the research plan makes adequate provision for monitoring the data collected to ensure the safety of subjects.
(7) When appropriate, there are adequate provisions to protect the privacy of subjects and to maintain the confidentiality of data.
(i) The Secretary of HHS will, after consultation with the Office of Management and Budget's privacy office and other Federal departments and agencies that have adopted this policy, issue guidance to assist IRBs in assessing what provisions are adequate to protect the privacy of subjects and to maintain the confidentiality of data.
(ii) [Reserved.]
(8) For purposes of conducting the limited IRB review required by § __.104(d)(7)), the IRB need not make the determinations at paragraphs (a)(1) through (7) of this section, and shall make the following determinations:
(i) Broad consent for storage, maintenance, and secondary research use of identifiable private information or identifiable biospecimens is obtained in accordance with the requirements of § __.116(a)(1)-(4), (a)(6), and (d);
(ii) Broad consent is appropriately documented or waiver of documentation is appropriate, in accordance with § __.117; and
(iii) If there is a change made for research purposes in the way the identifiable private information or identifiable biospecimens are stored or maintained, there are adequate provisions to protect the privacy of subjects and to maintain the confidentiality of data.
(b) When some or all of the subjects are likely to be vulnerable to coercion or undue influence, such as children, prisoners, individuals with impaired decision-making capacity, or economically or educationally disadvantaged persons, additional safeguards have been included in the study to protect the rights and welfare of these subjects.
Research covered by this policy that has been approved by an IRB may be subject to further appropriate review and approval or disapproval by officials of the institution. However, those officials may not approve the research if it has not been approved by an IRB.
An IRB shall have authority to suspend or terminate approval of research that is not being conducted in accordance with the IRB's requirements or that has been associated with unexpected serious harm to subjects. Any suspension or termination of approval shall include a statement of the reasons for the IRB's action and shall be reported promptly to the investigator, appropriate institutional officials, and the department or agency head.
(a) Cooperative research projects are those projects covered by this policy that involve more than one institution. In the conduct of cooperative research projects, each institution is responsible for safeguarding the rights and welfare of human subjects and for complying with this policy.
(b)(1) Any institution located in the United States that is engaged in cooperative research must rely upon approval by a single IRB for that portion of the research that is conducted in the United States. The reviewing IRB will be identified by the Federal department or agency supporting or conducting the research or proposed by the lead institution subject to the acceptance of the Federal department or agency supporting the research.
(2) The following research is not subject to this provision:
(i) Cooperative research for which more than single IRB review is required by law (including tribal law passed by the official governing body of an American Indian or Alaska Native tribe); or
(ii) Research for which any Federal department or agency supporting or conducting the research determines and documents that the use of a single IRB is not appropriate for the particular context.
(c) For research not subject to paragraph (b) of this section, an institution participating in a cooperative project may enter into a joint review arrangement, rely on the review of another IRB, or make similar arrangements for avoiding duplication of effort.
(a) An institution, or when appropriate an IRB, shall prepare and maintain adequate documentation of IRB activities, including the following:
(1) Copies of all research proposals reviewed, scientific evaluations, if any, that accompany the proposals, approved sample consent forms, progress reports submitted by investigators, and reports of injuries to subjects.
(2) Minutes of IRB meetings, which shall be in sufficient detail to show attendance at the meetings; actions taken by the IRB; the vote on these actions including the number of members voting for, against, and abstaining; the basis for requiring changes in or disapproving research; and a written summary of the discussion of controverted issues and their resolution.
(3) Records of continuing review activities, including the rationale for conducting continuing review of research that otherwise would not require continuing review as described in § __.109(f)(1).
(4) Copies of all correspondence between the IRB and the investigators.
(5) A list of IRB members in the same detail as described in § __.108(a)(2).
(6) Written procedures for the IRB in the same detail as described in § __.108(a)(3) and (4).
(7) Statements of significant new findings provided to subjects, as required by § __.116(c)(5).
(8) The rationale for an expedited reviewer's determination under § __.110(b)(1)(i) that research appearing on the expedited review list described in § __.110(a) is more than minimal risk.
(9) Documentation specifying the responsibilities that an institution and an organization operating an IRB each will undertake to ensure compliance with the requirements of this policy, as described in § __.103(e).
(b) The records required by this policy shall be retained for at least 3 years, and records relating to research that is conducted shall be retained for at least 3 years after completion of the research. The institution or IRB may maintain the records in printed form, or electronically. All records shall be accessible for inspection and copying by authorized representatives of the Federal department or agency at reasonable times and in a reasonable manner.
(a)
(1) Before involving a human subject in research covered by this policy, an investigator shall obtain the legally effective informed consent of the subject or the subject's legally authorized representative.
(2) An investigator shall seek informed consent only under circumstances that provide the prospective subject or the legally authorized representative sufficient opportunity to discuss and consider whether or not to participate and that minimize the possibility of coercion or undue influence.
(3) The information that is given to the subject or the legally authorized representative shall be in language understandable to the subject or the legally authorized representative.
(4) The prospective subject or the legally authorized representative must be provided with the information that a reasonable person would want to have in order to make an informed decision about whether to participate, and an opportunity to discuss that information.
(5) Except for broad consent obtained in accordance with paragraph (d) of this section:
(i) Informed consent must begin with a concise and focused presentation of the key information that is most likely to assist a prospective subject or legally authorized representative in understanding the reasons why one might or might not want to participate in the research. This part of the informed consent must be organized and presented in a way that facilitates comprehension.
(ii) Informed consent as a whole must present information in sufficient detail
(6) No informed consent may include any exculpatory language through which the subject or the legally authorized representative is made to waive or appear to waive any of the subject's legal rights, or releases or appears to release the investigator, the sponsor, the institution, or its agents from liability for negligence.
(b)
(1) A statement that the study involves research, an explanation of the purposes of the research and the expected duration of the subject's participation, a description of the procedures to be followed, and identification of any procedures that are experimental;
(2) A description of any reasonably foreseeable risks or discomforts to the subject;
(3) A description of any benefits to the subject or to others that may reasonably be expected from the research;
(4) A disclosure of appropriate alternative procedures or courses of treatment, if any, that might be advantageous to the subject;
(5) A statement describing the extent, if any, to which confidentiality of records identifying the subject will be maintained;
(6) For research involving more than minimal risk, an explanation as to whether any compensation and an explanation as to whether any medical treatments are available if injury occurs and, if so, what they consist of, or where further information may be obtained;
(7) An explanation of whom to contact for answers to pertinent questions about the research and research subjects' rights, and whom to contact in the event of a research-related injury to the subject;
(8) A statement that participation is voluntary, refusal to participate will involve no penalty or loss of benefits to which the subject is otherwise entitled, and the subject may discontinue participation at any time without penalty or loss of benefits to which the subject is otherwise entitled; and
(9) One of the following statements about any research that involves the collection of identifiable private information or identifiable biospecimens:
(i) A statement that identifiers might be removed from the identifiable private information or identifiable biospecimens and that, after such removal, the information or biospecimens could be used for future research studies or distributed to another investigator for future research studies without additional informed consent from the subject or the legally authorized representative, if this might be a possibility; or
(ii) A statement that the subject's information or biospecimens collected as part of the research, even if identifiers are removed, will not be used or distributed for future research studies.
(c)
(1) A statement that the particular treatment or procedure may involve risks to the subject (or to the embryo or fetus, if the subject is or may become pregnant) that are currently unforeseeable;
(2) Anticipated circumstances under which the subject's participation may be terminated by the investigator without regard to the subject's or the legally authorized representative's consent;
(3) Any additional costs to the subject that may result from participation in the research;
(4) The consequences of a subject's decision to withdraw from the research and procedures for orderly termination of participation by the subject;
(5) A statement that significant new findings developed during the course of the research that may relate to the subject's willingness to continue participation will be provided to the subject;
(6) The approximate number of subjects involved in the study;
(7) A statement that the subject's biospecimens (even if identifiers are removed) may be used for commercial profit and whether the subject will or will not share in this commercial profit;
(8) A statement regarding whether clinically relevant research results, including individual research results, will be disclosed to subjects, and if so, under what conditions; and
(9) For research involving biospecimens, whether the research will (if known) or might include whole genome sequencing (
(d)
(1) The information required in paragraphs (b)(2), (b)(3), (b)(5), and (b)(8) and, when appropriate, (c)(7) and (9) of this section;
(2) A general description of the types of research that may be conducted with the identifiable private information or identifiable biospecimens. This description must include sufficient information such that a reasonable person would expect that the broad consent would permit the types of research conducted;
(3) A description of the identifiable private information or identifiable biospecimens that might be used in research, whether sharing of identifiable private information or identifiable biospecimens might occur, and the types of institutions or researchers that might conduct research with the identifiable private information or identifiable biospecimens;
(4) A description of the period of time that the identifiable private information or identifiable biospecimens may be stored and maintained (which period of time could be indefinite), and a description of the period of time that the identifiable private information or identifiable biospecimens may be used for research purposes (which period of time could be indefinite);
(5) Unless the subject or legally authorized representative will be provided details about specific research studies, a statement that they will not be informed of the details of any specific research studies that might be conducted using the subject's identifiable private information or identifiable biospecimens, including the purposes of the research, and that they might have chosen not to consent to some of those specific research studies;
(6) Unless it is known that clinically relevant research results, including individual research results, will be
(7) An explanation of whom to contact for answers to questions about the subject's rights and about storage and use of the subject's identifiable private information or identifiable biospecimens, and whom to contact in the event of a research-related harm.
(e)
(2)
(3)
(i) The research or demonstration project is to be conducted by or subject to the approval of state or local government officials and is designed to study, evaluate, or otherwise examine:
(A) Public benefit or service programs;
(B) Procedures for obtaining benefits or services under those programs;
(C) Possible changes in or alternatives to those programs or procedures; or
(D) Possible changes in methods or levels of payment for benefits or services under those programs; and
(ii) The research could not practicably be carried out without the waiver or alteration.
(f)
(2)
(3)
(i) The research involves no more than minimal risk to the subjects;
(ii) The research could not practicably be carried out without the requested waiver or alteration;
(iii) If the research involves using identifiable private information or identifiable biospecimens, the research could not practicably be carried out without using such information or biospecimens in an identifiable format;
(iv) The waiver or alteration will not adversely affect the rights and welfare of the subjects; and
(v) Whenever appropriate, the subjects or legally authorized representatives will be provided with additional pertinent information after participation.
(g)
(1) The investigator will obtain information through oral or written communication with the prospective subject or legally authorized representative, or
(2) The investigator will obtain identifiable private information or identifiable biospecimens by accessing records or stored identifiable biospecimens.
(h)
(2) If the Federal department or agency supporting or conducting the clinical trial determines that certain information should not be made publicly available on a Federal Web site (
(3) The informed consent form must be posted on the Federal Web site after the clinical trial is closed to recruitment, and no later than 60 days after the last study visit by any subject, as required by the protocol.
(i)
(j)
(a) Except as provided in paragraph (c) of this section, informed consent shall be documented by the use of a written informed consent form approved by the IRB and signed (including in an electronic format) by the subject or the subject's legally authorized representative. A written copy shall be given to the person signing the informed consent form.
(b) Except as provided in paragraph (c) of this section, the informed consent form may be either of the following:
(1) A written informed consent form that meets the requirements of § __.116. The investigator shall give either the subject or the subject's legally authorized representative adequate opportunity to read the informed consent form before it is signed; alternatively, this form may be read to the subject or the subject's legally authorized representative.
(2) A short form written informed consent form stating that the elements of informed consent required by § __.116 have been presented orally to the subject or the subject's legally authorized representative, and that the key information required by § __.116(a)(5)(i) was presented first to the subject, before other information, if any, was provided. The IRB shall approve a written summary of what is to be said to the subject or the legally authorized representative. When this method is used, there shall be a witness to the oral presentation. Only the short form itself is to be signed by the subject or the subject's legally authorized representative. However, the witness shall sign both the short form and a copy of the summary, and the person actually obtaining consent shall sign a copy of the summary. A copy of the summary shall be given to the subject or the subject's legally authorized representative, in addition to a copy of the short form.
(c)(1) An IRB may waive the requirement for the investigator to obtain a signed informed consent form for some or all subjects if it finds any of the following:
(i) That the only record linking the subject and the research would be the informed consent form and the principal risk would be potential harm resulting from a breach of confidentiality. Each subject (or legally authorized representative) will be asked whether the subject wants documentation linking the subject with the research, and the subject's wishes will govern;
(ii) That the research presents no more than minimal risk of harm to subjects and involves no procedures for which written consent is normally required outside of the research context; or
(iii) If the subjects or legally authorized representatives are members of a distinct cultural group or community in which signing forms is not the norm, that the research presents no more than minimal risk of harm to subjects and provided there is an appropriate alternative mechanism for documenting that informed consent was obtained.
(2) In cases in which the documentation requirement is waived, the IRB may require the investigator to provide subjects or legally authorized representatives with a written statement regarding the research.
Certain types of applications for grants, cooperative agreements, or contracts are submitted to Federal departments or agencies with the knowledge that subjects may be involved within the period of support, but definite plans would not normally be set forth in the application or proposal. These include activities such as institutional type grants when selection of specific projects is the institution's responsibility; research training grants in which the activities involving subjects remain to be selected; and projects in which human subjects' involvement will depend upon completion of instruments, prior animal studies, or purification of compounds. Except for research waived under § __.101(i) or exempted under § __.104, no human subjects may be involved in any project supported by these awards until the project has been reviewed and approved by the IRB, as provided in this policy, and certification submitted, by the institution, to the Federal department or agency component supporting the research.
Except for research waived under § __.101(i) or exempted under § __.104, in the event research is undertaken without the intention of involving human subjects, but it is later proposed to involve human subjects in the research, the research shall first be reviewed and approved by an IRB, as provided in this policy, a certification submitted by the institution to the Federal department or agency component supporting the research, and final approval given to the proposed change by the Federal department or agency component.
(a) The department or agency head will evaluate all applications and proposals involving human subjects submitted to the Federal department or agency through such officers and employees of the Federal department or agency and such experts and consultants as the department or agency head determines to be appropriate. This evaluation will take into consideration the risks to the subjects, the adequacy of protection against these risks, the potential benefits of the research to the subjects and others, and the importance of the knowledge gained or to be gained.
(b) On the basis of this evaluation, the department or agency head may approve or disapprove the application or proposal, or enter into negotiations to develop an approvable one.
Federal funds administered by a Federal department or agency may not be expended for research involving human subjects unless the requirements of this policy have been satisfied.
(a) The department or agency head may require that Federal department or agency support for any project be terminated or suspended in the manner prescribed in applicable program requirements, when the department or agency head finds an institution has materially failed to comply with the terms of this policy.
(b) In making decisions about supporting or approving applications or proposals covered by this policy the department or agency head may take into account, in addition to all other eligibility requirements and program criteria, factors such as whether the applicant has been subject to a termination or suspension under paragraph (a) of this section and whether the applicant or the person or persons who would direct or has/have directed the scientific and technical aspects of an activity has/have, in the judgment of the department or agency head, materially failed to discharge responsibility for the protection of the rights and welfare of human subjects (whether or not the research was subject to federal regulation).
With respect to any research project or any class of research projects the department or agency head of either the conducting or the supporting Federal department or agency may impose additional conditions prior to or at the time of approval when in the judgment of the department or agency head
The adoption of the common rules by the participating agencies, as modified by agency-specific text, is set forth below.
Human research subjects, Reporting and record-keeping requirements, Research.
5 U.S.C. 301; Pub. L. 107-296, sec. 102, 306(c); Pub. L. 108-458, sec. 8306.
Human research subjects, Reporting and record-keeping requirements, Research.
5 U.S.C. 301; 42 U.S.C. 300v-1(b).
Human research subjects, Reporting and record-keeping requirements, Research.
5 U.S.C. 301; 42 U.S.C. 7254; 42 U.S.C. 300v-1(b).
Human research subjects, Reporting and record-keeping requirements, Research.
5 U.S.C. 301;42 U.S.C. 300v-1(b).
Human research subjects, Reporting and record-keeping requirements, Research.
5 U.S.C. 301; 42 U.S.C. 300v-1(b).
Human research subjects, Reporting and record-keeping requirements, Research.
5 U.S.C. 301; 42 U.S.C. 289(a).
Human research subjects, Reporting and record-keeping requirements, Research.
5 U.S.C. 301; 42 U.S.C. 300v-1(b), unless otherwise noted.
Human research subjects, Reporting and record-keeping requirements, Research.
5 U.S.C. 301; 42 U.S.C. 300v-1(b) and 3535(d).
Human research subjects, Reporting and record-keeping requirements, Research.
5 U.S.C. 301; 29 U.S.C. 551.
Human research subjects, Reporting and record-keeping requirements, Research.
5 U.S.C. 301; 42 U.S.C. 300v-1(b).
Human research subjects, Reporting and record-keeping requirements, Research.
5 U.S.C. 301; 20 U.S.C. 1221e-3, 3474; 42 U.S.C. 300v-1(b).
Human research subjects, Reporting and record-keeping requirements, Research.
5 U.S.C. 301; 38 U.S.C. 501, 7331, 7334; 42 U.S.C. 300v-1(b).
Human research subjects, Reporting and record-keeping requirements, Research.
5 U.S.C. 301; 7 U.S.C. 136a(a) and 136w(a)(1); 21 U.S.C. 346a(e)(1)(C); sec. 201, Pub. L. 109-54, 119 Stat. 531; and 42 U.S.C. 300v-1(b).
Human research subjects, Reporting and record-keeping requirements, Research.
5 U.S.C. 301; 42 U.S.C. 289(a); 42 U.S.C. 300v-1(b).
Human research subjects, Reporting and record-keeping requirements, Research.
5 U.S.C. 301; 42 U.S.C. 300v-1(b).
Human research subjects, Reporting and record-keeping requirements, Research.
5 U.S.C. 301; 42 U.S.C. 300v-1(b).
Office of Energy Efficiency and Renewable Energy, Department of Energy.
Final rule.
On March 17, 2016, the U.S. Department of Energy (DOE) published a notice of proposed rulemaking (NOPR) proposing standards for general service lamps (GSLs) pursuant to the Energy Policy and Conservation Act of 1975 (EPCA), as amended. DOE responds to comments received on the NOPDDA in this final rule and adopts a revised definition of GSL and other supplemental definitions.
The effective date of this rule is January 1, 2020.
The docket, which includes
A link to the docket Web page can be found at:
Ms. Lucy deButts, U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Office, EE-2J, 1000 Independence Avenue SW., Washington, DC 20585-0121. Telephone: (202) 287-1604. Email:
Title III, Part B of the Energy Policy and Conservation Act of 1975 (EPCA or the Act), Public Law 94-163 (42 U.S.C. 6291-6309, as codified) established the Energy Conservation Program for Consumer Products Other Than Automobiles, a program covering most major household appliances (collectively referred to as “covered products”).
In particular, amendments to EPCA in the Energy Independence and Security Act of 2007 (EISA 2007) directed DOE to engage in rulemakings regarding GSLs. (42 U.S.C. 6295(i)(6)(A)-(B)) EPCA, as amended by EISA 2007, directs DOE to initiate a rulemaking no later than January 1, 2014, to determine whether standards in effect for GSLs should be amended and determine whether exemptions for certain incandescent lamps should be maintained or discontinued. (42 U.S.C. 6295(i)(6)(A)(i)) The scope of the rulemaking is not limited to incandescent lamp technologies. (42 U.S.C. 6295(i)(6)(A)(ii)) Further, for this first cycle of rulemaking, the EISA 2007 amendments provide that DOE must consider a minimum standard of 45 lumens per watt (lm/W). (42 U.S.C. 6295(i)(6)(A)(ii)) If DOE fails to complete a rulemaking in accordance with 42 U.S.C. 6295(i)(6)(A)(i)-(iv) or a final rule from the first rulemaking cycle does not produce savings greater than or equal to the savings from a minimum efficacy standard of 45 lm/W, the statute provides a “backstop” under which DOE must prohibit sales of GSLs that do not meet a minimum 45 lm/W standard beginning on January 1, 2020. (42 U.S.C. 6295(i)(6)(A)(v))
In March 2016, DOE published a notice of proposed rulemaking (NOPR) that proposed a revised definition of GSL and energy conservation standards for certain GSLs (hereafter the “March 2016 GSL ECS NOPR”). 81 FR 14528 (March 17, 2016). In conjunction with the March 2016 GSL ECS NOPR, DOE also published on its Web site the complete technical support document (TSD) for the proposed rule, which described the analyses DOE conducted and included technical documentation for each analysis. The TSD also included the life cycle cost (LCC) spreadsheet, the national impact analysis spreadsheet, and the manufacturer impact analysis (MIA) spreadsheet.
DOE held a public meeting on April 20, 2016, to hear oral comments on and
After the publication of the March 2016 GSL ECS NOPR, DOE analyzed the data submitted by NEMA and collected additional data where available. DOE published a notice of proposed definition and data availability (hereafter the “October 2016 NOPDDA”) to: (1) Propose a revised definition of GSL; (2) announce the availability of the NEMA data and supplemental data collected by DOE; (3) request public comment on proposed definitions and compiled data; and (4) request any additional data that stakeholders may have in support of this evaluation. 81 FR 71794 (October 18, 2016). DOE also held a public meeting on October 21, 2016 to hear oral comments and solicit information relevant to the October 2016 NOPDDA.
Utility Coalition urged DOE to finalize this rulemaking before the January 1, 2017 deadline set by EISA 2007. Additionally, Utility Coalition recommended that if any of their comments would cause DOE to miss the deadline, then the comments should be deferred to the next GSL rulemaking. (Utility Coalition, No. 95 at pp. 1-2) Philips Lighting (Philips) also urged DOE to complete the rulemaking on time. (Philips, No. 96 at p. 2)
The following sections of this preamble respond to comments received on the October 2016 NOPDDA and during the NOPDDA public meeting, except those specifically related to incandescent reflector lamps, and describe the adopted GSL definition and additional data in more detail. In a separate final rule DOE is responding to comments specifically related to incandescent reflector lamps.
DOE is required under the EISA 2007 amendments to EPCA to undertake the present rulemaking. Under EPCA, DOE shall initiate a rulemaking to determine whether standards in effect for GSLs should be amended to establish more stringent standards; and determine whether exemptions for certain incandescent lamps should be maintained or discontinued. (42 U.S.C. 6295(i)(6)(A)(i)) In addition to that mandate, DOE has the authority to qualify lamps as general service lamps upon determining that they are “used to satisfy lighting applications traditionally served by general service incandescent lamps.” (42 U.S.C. 6291(30)(BB)(i)(IV))
An additional statute relevant to this rulemaking is section 312 of the Consolidated and Further Continuing Appropriations Act, 2016 (Pub. L. 114-113, 129 Stat. 2419; hereafter referred to as the “Appropriations Rider”) that prohibits expenditure of funds appropriated by that law to implement or enforce: (1) 10 CFR 430.32(x), which includes maximum wattage and minimum rated lifetime requirements for GSILs; and (2) standards set forth in section 325(i)(1)(B) of EPCA (42 U.S.C. 6295(i)(1)(B)), which sets minimum lamp efficiency ratings for incandescent reflector lamps (IRLs).
This final rule constitutes a decision on whether to maintain or discontinue various lamp exemptions and, in addition, DOE is determining that certain types of lamps should be included as GSLs because they are used for lighting applications traditionally served by GSILs. This final rule does not determine whether DOE should impose or amend standards for any category of lamps, such as GSILs or GSLs.
As discussed in more detail, DOE is grounding the first of those decisions, namely which exemptions to maintain or discontinue, on an assessment of whether lamps within a given exemption would provide a convenient unregulated alternative to lamps that will be subject to energy conservation standards. In DOE's view, EPCA exempted certain categories of lamps because, on the one hand, some lamps in those categories have specialty applications; and on the other hand, it was not clear, when these lamp provisions were enacted, whether those lamps were part of the broader lamp market to which Congress wished to apply energy conservation standards. The purpose, then, of the decision that Congress entrusted to DOE, to maintain or to discontinue a given exemption, was that DOE should assess the role of lamps of that type in the broader lighting market, bearing in mind the evident statutory purpose of achieving energy conservation by imposing efficiency standards for general lighting.
While the statute does not expressly state a criterion by which DOE should decide which exemptions to maintain—it simply identifies one important evidentiary input, sales data—DOE understands its instruction to be that DOE should maintain an exemption if doing so would be consistent with that statutory purpose, and discontinue the exemption if it would not. To carry out that instruction, DOE has assessed for each exemption whether lamps within that exemption are readily substitutable for lamps that are already categorized as general service lamps. Sales data, as the statute directs, are an important type of evidence informing that assessment.
The discontinuation of certain exemptions will render the lamps within those exemptions GSLs, to the extent they would otherwise qualify as GSLs, and for some lamps GSILs. As the October 2016 NOPDDA observed, DOE will then either impose standards on these lamps pursuant to its authority to develop GSL standards or apply the backstop standard prohibiting the sale of lamps not meeting a 45 lm/W efficacy standard.
Commenters, chief among them LEDVANCE, objected to both the procedures that DOE undertook and the substance of what it proposed to determine. In general, LEDVANCE contended that DOE cannot make lamps subject to a given standard—whether a DOE-developed standard or the backstop—simply by undertaking a definitional exercise such as it proposed in the October 2016 NOPDDA. (LEDVANCE, No. 90 at p. 3) LEDVANCE offered multiple, connected arguments in support of that general position.
First, LEDVANCE pointed out that, in general, section 6295 requires DOE to conduct certain analyses and carry out certain procedures when it amends standards. Under section 6295(o), “[a]ny new or amended energy conservation standard prescribed by the Secretary under this section . . . shall be designed to achieve the maximum improvement in energy efficiency” that is “technologically feasible and economically justified.” 42 U.S.C. 6295(o)(2)(A). DOE cannot generally prescribe a new or amended standard if it has not prescribed a test procedure for the relevant product, or if DOE determines that the standard will not result in “significant conservation of energy.” 42 U.S.C. 6295(o)(3). DOE also generally cannot prescribe a new or amended standard if it finds that the
LEDVANCE observed that DOE is evidently not engaging in comparable substantive analyses with respect to its definition of GSL, and that DOE has not undertaken comparable procedures (including 60 days of comment). (LEDVANCE, No. 90 at pp. 4-6) DOE acknowledges those observations to be correct, and it considers its approach appropriate and consistent with the statute. The requirements that LEDVANCE cited apply, by their terms, only when DOE prescribes a new or amended standard. This final rule does neither. Rather, DOE is deciding which lamp exemptions to discontinue and which to maintain and determining that certain lamps should be GSLs because they are used to satisfy lighting applications traditionally served by GSILs.
DOE acknowledges, of course, that a likely consequence of DOE's including additional lamps in the definition of GSL is that those lamps will be subject to energy conservation standards. DOE has the authority to impose standards for GSLs; and if it does not impose such standards or does not impose standards that meet a certain condition, then EPCA specifies a minimum standard of 45 lm/W. In LEDVANCE's view, this consequence means that DOE must, before including a given lamp as a GSL, carry out the same type of rulemaking (in both procedure and substance) as it would in prescribing a new or amended standard.
DOE sees a difference between the two modes in which GSLs may be subject to standards. Where DOE develops its own energy conservation standards, it carries out the analyses that section 6295(o) calls for and provides the procedure that section 6295(p) mandates. But it does so in the course of developing the standards, just as sections 6295(o) and 6295(p) provide. The decision to include a lamp within the scope of GSLs would only be a precursor to that standards development. If DOE does not develop its own energy conservation standards for GSLs, section 6295(i)(6)(A)(v) requires it to impose a standard of 45 lm/W. If that obligation were to come into force, DOE would not perform the section 6295(o) analyses or follow the section 6295(p) procedure to fulfill it. Because in that circumstance the statute itself would require DOE to prohibit sales of lamps below that standard, DOE would not be “prescrib[ing] a new or amended standard,” the situation in which sections 6295(o) and 6295(p) apply. In addition, reading those provisions harmoniously with section 6295(i)(6), DOE does not believe the section 6295(o) and section 6295(p) requirements were meant to apply to a rulemaking imposing the section 6295(i)(6)(A)(v) backstop. The backstop provision specifies by number a particular efficacy standard and says DOE “shall” prohibit sales of lamps below that standard. If the general standards-setting provisions applied in that context, DOE would have discretion, depending on the evidence, to conclude that the 45 lm/W standard is not technologically feasible or not economically justified (on the basis of the multiple factors, including “other factors the Secretary considers relevant,” that inform that assessment under section 6295(o)). For DOE to retain that discretion would be inconsistent with the mandatory language of the backstop.
Of course, for lamps that will be GSLs only as a consequence of this final rule, DOE is exercising some discretion that will result in those lamps being subject to some standard (potentially the backstop or some standard that DOE develops). Nonetheless, DOE does not believe that fact obligates it to engage in section 6295(o) analyses or section 6295(p) procedures for this rule—either as a matter of law or for the sake of sound decision making.
The scheme that section 6295(i)(6) establishes for GSLs differs in important ways from what is in place for consumer products in general under section 6295. For most products, DOE has discretion to develop the initial standards or to amend, in the course of periodic reviews, standards initially set by statute. Using that authority, DOE could in principle set any type of standard, such as a level of performance or a design requirement, with far-reaching consequences for the products at issue. To guide that exercise of discretion, Congress has laid out various restrictions on the standards-setting authority and substantive factors that DOE must consider. By contrast, in section 6295(i)(6), Congress expressed a strong preference for 45 lm/W as an efficacy standard. If DOE takes no other action, that will be the standard for GSLs. Congress permitted DOE to establish different standards if DOE chooses to do so and can demonstrate that an alternative set of standards would produce at least as much energy savings. But in the rulemaking to consider whether to set different standards, DOE must consider the alternative of effectively setting a 45 lm/W standard for all GSLs, whereby DOE would simply not take the option that Congress provided for setting other standards, and instead adopt Congress's default standard.
At the same time, Congress exempted certain lamps from the GSL definition, and included within the scope of GSLs a category that left room for some additions. In both of these areas, DOE's authority is tightly circumscribed. With respect to the exemptions, DOE maintains or discontinues the exemptions as written. With respect to additions to the scope of GSLs, DOE can include additional lamps only if they satisfy lighting applications traditionally served by GSILs. In DOE's view, Congress simply deferred the last details of the definition of GSL for final assessment by DOE. By postponing the decision in that manner, Congress did not implicitly invoke, with respect to its 45 lm/W, the whole machinery of DOE standards rulemaking under EPCA.
The backstop reflects a congressional determination that a 45 lm/W standard is appropriate. For DOE to conduct an independent assessment of the technological feasibility, economic justification, and other such factors for the 45 lm/W standard as applied to a given set of lamps would risk being inconsistent with that congressional determination. DOE believes that the most important consideration with respect to the scope of GSLs is whether leaving a given set of lamps outside GSLs would undermine the regulation that Congress mandated for GSLs, by making readily available an unregulated substitute for lamps that are subject to the standard. If so, DOE cannot freely conduct its own evaluation of the 45 lm/W standard in the course of defining the scope of GSLs. For DOE to exclude from the definition of GSLs a lamp that consumers can use and do use in the same way they use GSLs, and do so on the ground that the 45 lm/W standard is not sound policy for that type of lamp, would be inconsistent with the policy Congress set in enacting EISA 2007.
DOE acknowledges that paragraph (i)(6)(A) did not, upon enactment, require that the 45 lm/W default or a DOE-developed substitute apply to
Similarly, if DOE were to conclude that a lamp is readily substitutable for GSLs, yet the GSL standard is not technologically feasible for that lamp—in the sense of section 6295(o)—that conclusion would imply that the GSL standard is not technologically feasible overall. While it may not be possible to make incandescent lamps suitable for many current applications that meet a 45 lm/W standard, and consequently the paragraph (i)(6)(A) standards may result in the elimination of incandescent lamps covered by the standards, that outcome is the evident policy set by EISA 2007 regarding energy use in lighting. Therefore it is reasonable not to engage in a section 6295(o) analysis of technological feasibility in reviewing the GSL exemptions.
DOE bases the preceding discussion on the overall structure of section 6295(i)(6). The particular language describing DOE's tasks regarding the definition of GSLs further supports DOE's conclusion. With respect to the exemptions, section 6295(i)(6)(A)(i)(II) says that DOE shall make its decision to maintain or discontinue exemptions “based, in part, on exempted lamp sales collected . . . from manufacturers.” If DOE were supposed to carry out a full section 6295(o) analysis for this decision, lamp sales would be one among very many strands of evidence; under section 6295(o) DOE is to consider factors like the operating costs of a product over its lifetime, the energy savings from a proposed standard, how the standard will affect the utility of the product, the impact on competition, and other factors. 42 U.S.C. 6295(o)(2)(B). It seems odd that, among all the things at issue in a section 6295(o) analysis, section 6295(i)(6)(A)(i)(II) would call out just one specific item, sales data. By contrast, DOE believes its task is to assess whether lamps in a given exemption are a ready substitute for lamps that are not exempt, as that assessment relies upon sales data as an important input. Thus, the statutory reference to a decision “based, in part, on exempted lamp sales” makes much more sense under DOE's reading of the statute.
With respect to the fourth type of GSLs provided for under the statutory definition, the statute requires a specific finding. DOE can include a lamp within GSLs if it determines that such lamps satisfy lighting applications traditionally served by GSILs. 42 U.S.C. 6291(30)(BB)(i)(IV). The particularity of that finding is not consistent with the notion that DOE should, in making that finding, carry out a section 6295(o) analysis. The factual question is whether a lamp satisfies traditional GSIL applications. Questions about, for example, how a given standard would affect the lamp's operating costs do not seem relevant to that factual question.
LEDVANCE offered several arguments against DOE's interpretation of section 6295(i)(6)(A). First, LEDVANCE pointed out that in some other parts of section 6295, a decision about what products are covered is subject to section 6295(o) analysis and section 6295(p) procedures. As examples, LEDVANCE cited sections 6295(g)(7)(B) and 6295(i)(5). The former says that DOE shall publish a rule to determine “whether to amend the standards in effect for fluorescent lamp ballasts, including whether such standards should be amended such that they would be applicable to additional fluorescent lamp ballasts.” The latter requires DOE to begin a rulemaking “to determine if the standards in effect for fluorescent lamps and incandescent lamps should be amended so that they would be applicable to additional” lamps. (LEDVANCE, No. 90 at pp. 4-6)
By their terms, however, these provisions say that certain decisions about scope involve setting standards, and therefore are textually different from sections 6295(i)(6)(A) and 6291(30)(BB). That textual difference is also consistent with the preceding framework. In a section 6295(g)(7)(B) or 6295(i)(5) rule, DOE would be developing its own “amended” standard and simultaneously might be imposing that amended standard on a new set of products. That is the sort of situation in which, pursuant to the preceding explanation, sections 6295(o) and 6295(p) could come into play. Here, by contrast, DOE is conducting a circumscribed coverage decision, in light of considerations coming from sections 6291(30)(BB) and 6295(i)(6)(A), that may result in products being subject to a standard already set by Congress.
LEDVANCE also observed that in final rules in 2009 and 2015, DOE engaged in section 6295(o)-type analysis when deciding what products to subject to the standards set in those rules. (LEDVANCE, No. 90 at p. 5) However, those past situations were different from today's. Both rules were, in relevant part, responses to section 6295(i)(5). Thus, the statutory requirements were different from those at issue in this rule, for the reasons just given. And, apart from the statutory mandate, the substantive factors that were important for the decisions were different, for the preceding reasons.
LEDVANCE offered an additional statutory argument based on EISA 2007. Section 321 of EISA included a provision under which “[a]ny person may petition the Secretary to establish standards for lamp shapes or bases that are excluded from the definition of general service lamps.” DOE “shall grant a petition,” said section 321, if the evidence shows “that commercial availability or sales of exempted incandescent lamp types of have increased significantly . . . and likely are being widely used in general lighting applications” and “significant energy savings could be achieved by covering exempted products.” If DOE were to grant such a petition, then it would have to conduct a rulemaking “to determine standards for the exempted lamp shape or base,” and it would be required to complete that rulemaking “not later than 18 months after the date on which notice is provided granting the petition.” Public Law 110-140, section 321(a)(3), 121 Stat. 1579.
DOE notes that its discretion regarding the exemptions is far from unfettered, and it rejects the notion that it is allowed to remove them, or is removing them, “without any substantive economic or technical analysis.” As laid out in the October 2016 NOPDDA, and as discussed in detail in section III.A.1, DOE's consideration of whether lamps in a
In any case, the language in EISA section 321 is more consistent with DOE's understanding of its current task. DOE notes that the petition process was to proceed in two stages. First, DOE was to decide whether to grant a petition. The statute laid out certain criteria for that decision, including whether a given lamp type is likely being widely used in general lighting applications. Those criteria are different from the considerations described in 42 U.S.C. 6295(o). Second, if DOE granted a petition, it was to conduct a rulemaking to decide what standards to impose. Presumably, DOE would conduct a section 6295(o) analysis in evaluating standards at that point. But the section 321 language clearly distinguishes the two stages: It instructs DOE to do a standards-setting rulemaking “if” it grants a petition, and to complete the rulemaking within 18 months “after the date on which notice is provided granting the petition.” Evidently, the decision on the petition itself is not a rule prescribing standards. Similarly and by analogy, the current rule defines what are GSLs, and is not a rule prescribing standards to which sections 6295(o) and 6295(p) apply.
LEDVANCE further contended that the adoption of the petition process forecloses DOE's authority to maintain or discontinue exemptions as it does in this rule. (LEDVANCE, No. 90 at p. 5) However, section 321 itself provided both mechanisms: The response to petitions and the decision whether to continue or maintain exemptions.
DOE does not read 42 U.S.C. 6295(i)(6)(A)(i)(II) to implicitly invoke the same considerations. The petition process is distinct and independent from the decision to discontinue an exemption. When DOE discontinues an exemption, the previously exempted lamp is included among GSLs. By contrast, the petition provision from EISA section 321 does not suggest that DOE would end an exemption, thus rendering a type of lamp a GSL. To the contrary, the petition process applies only to lamps that
To be sure, the fundamental concerns motivating the petition process and the authority granted to DOE to discontinue exemptions seem to be similar. The purpose of both, DOE believes, was to ensure that unregulated lamps do not present a loophole that would undermine the effect and purpose of energy conservation standards. To fulfill that purpose with respect to the exemptions, DOE is discontinuing an exemption if, considering sales data and technical features, it concludes that lamps within the exemption are already used in general lighting applications or are ready substitutes for GSLs. That analysis is comparable to what the petition provision prescribed. But it is not identical, because the processes are not identical.
The analysis DOE has conducted is more appropriate for the current decision, and indeed, the analysis that EISA section 321 describes would not be appropriate. EISA section 321 states that the Secretary shall grant a petition if “the petition presents evidence that demonstrates that commercial availability or sales of exempted incandescent lamp types have increased significantly since the standards on general service lamps were established.” DOE understands the point of that assessment to be that if lamp sales have increased significantly since the establishment of standards, that increase may show the lamp has become a less regulated alternative to GSLs. Thus, the baseline—the volume of sales when standards were established—is critical for the analysis. At this point, when no standards have yet been established, the sales analysis described in EISA section 321 would not be possible. DOE could assess whether sales of a lamp have increased in recent years, but increases or decreases, without reference to the baseline and the establishment of standards, would not demonstrate in the same way that a lamp has become a loophole to GSL standards.
The other substantive criterion for granting an EISA section 321 petition is whether “significant energy savings could be achieved by covering exempted products.” As explained, the various conditions in the EISA section 321 petition provision do not apply to this final rule, because the paragraph (i)(6)(A)(i) decision about exemptions is different. Nonetheless, DOE acknowledges that it would not choose to discontinue an exemption unless doing so could achieve significant energy savings compared to maintaining the exemption. As discussed in the sections that follow, discontinuing the exemptions described in section III.A.1 could indeed lead to significant energy savings. As shown in Table III.1, six of the lamp categories for which DOE discontinued an exemption have annual sales that are several times the sales of the 15 lamp categories for which DOE maintained the exemption. The seventh lamp exemption that DOE is discontinuing, shatter-resistant lamps, presents a significant risk of lamp switching and maintaining its exemption could otherwise undermine potential standards for general service lamps.
Fourth, LEDVANCE urged that the D.C. Circuit's decision in
LEDVANCE raised a second category of objection to the process by which it anticipated DOE would reach this final rule. Noting that DOE had proposed in March 2016 to amend standards for GSLs, and that the October 2016 NOPDDA seemed to contemplate finalizing a definition for GSLs without finalizing a standards amendment based on the March 2016 GSL ECS NOPR, LEDVANCE stated that DOE cannot bifurcate those procedures. (LEDVANCE, No. 90 at p. 3) In LEDVANCE's view, the statute does not permit DOE to issue multiple notices proposing different aspects of its GSL decisionmaking—whether to amend standards and whether to discontinue the exemptions. LEDVANCE contends that DOE must conclude those determinations in a single final rule, and that by finalizing amendments to the GSL definition, DOE is impermissibly circumventing EPCA rulemaking requirements and the Appropriations Rider. (LEDVANCE, No. 90 at p. 3) (LEDVANCE also argues, in what DOE takes to be an alternative argument, that lamps that qualify as GSLs only because of this final rule will not in fact be subject to the backstop standard; in this line of argument, LEDVANCE says the backstop standard can only apply to lamps that were already subject to standards.) Further, LEDVANCE commented that DOE failed to provide appropriate notice of the standards that would apply to lamps considered under the October 2016 NOPDDA and that DOE must provide, in detail, the content and basis of a proposal to allow for meaningful and informed comment. (LEDVANCE, No. 90 at pp. 11-12)
DOE believes that EPCA does permit flexibility with respect to the rulemaking process it undertakes under section 6295(i)(6)(A)(i). Clause (i) says that DOE “shall initiate a rulemaking procedure” to make two distinct decisions: Whether to amend standards, and whether to maintain or discontinue exemptions. Because the statute says “a . . . procedure,” LEDVANCE appears to believe it permits only a single NOPR and a single final rule. However, the general presumption in interpreting a federal statute is that the singular encompasses the plural. 1 U.S.C. 1. Thus, a reference to “a . . . procedure” would ordinarily permit a single procedure or multiple procedures.
DOE recognizes that context can lead in some instances to a contrary conclusion that a singular word truly means the singular and not the plural. But DOE has not identified any such contextual clues with respect to section 6295(i)(6)(A). Indeed, it would be unusual and counterproductive for a statute to restrict an agency to a single NOPR and a single final rule to achieve a specified objective. The decisions with which section 6295(i)(6)(A) tasks DOE are complex. DOE, like other agencies, often supplements its proposals with additional proposals and notices of further data and analysis. Yet if “a . . . procedure” permitted only a single proposal, then if DOE failed to prepare and assemble all of its analyses into a single proposal document the entire 6295(i)(6)(A) enterprise would fail for lack of authority. It seems unlikely that, having called for the 6295(i)(6)(A) assessments, Congress intended to make it so uncertain whether they could be achieved.
Further, even if “a rulemaking procedure” only permitted a single procedure, the statute leaves unclear what constitutes a “rulemaking procedure.” LEDVANCE appears to take for granted that a “rulemaking procedure” consists of a single notice and a single final rule. But that is not the evident and unambiguous, or even the best, understanding of the phrase. A “rulemaking procedure” may include multiple notices and lead to multiple final rule documents, as and when appropriate under the circumstances. For example, in
LEDVANCE suggests that the entire scheme of section 6295(i)(6) requires DOE to make its decision in a single integrated rulemaking. According to LEDVANCE, DOE is required to decide what standards to apply to GSLs in the same rule in which it decides what lamps will be GSLs. The backstop standard would come into play only if the standards that DOE has set do not “produce savings that are greater than or equal to the savings from a minimum efficacy standard of 45 lm/W.” That savings analysis, LEDVANCE asserts, must be holistic and market-wide rather than product-by-product. In other words, to avoid the backstop standard DOE need not impose a standard of 45 lm/W on each and every GSL. Rather, DOE can impose a more or less stringent standard on various types of lamps so long as the aggregate savings are at least the same as a uniform 45 lm/W standard would have achieved. Because, LEDVANCE says, DOE cannot know what overall savings its standards will achieve unless it knows what lamps will be subject to GSLs, it follows that DOE must define GSLs and set standards in the same final rule.
This argument does not lead to the conclusion LEDVANCE seems to draw. If, indeed, DOE were prohibited from imposing the 45 lm/W backstop standard unless it had conducted an overall market savings analysis, and if that analysis were impossible without defining the scope of GSLs, it would only follow that DOE must define GSLs before imposing the backstop standard. Once DOE had defined GSLs, it could decide what standards to impose, then conduct the savings analysis that
Moreover, LEDVANCE's argument seems premised on a notion that EPCA obligates DOE to develop standards for GSLs and then analyze the overall energy savings from those standards, and that absent the development of standards and an analysis that results in insufficient savings, the backstop standard would not be applicable. The statutory language and structure do not support that premise. Section 6295(i)(6) requires DOE to “initiate” a rulemaking procedure to decide whether to amend the GSL standards and to decide whether to maintain or discontinue lamp exemptions. It does not, by its plain terms, require DOE to conclude that rulemaking procedure via a final rule on either topic, except in one case. If DOE “determines that the standards in effect for [GSILs] should be amended,” then DOE must publish a final rule doing so. (42 U.S.C. 295(i)(6)(A)(iii)) To be clear, DOE infers, from the language instructing it to initiate a rulemaking procedure, that EPCA authorizes it to complete the rulemaking by issuing final rules taking one or more of the actions on which section 6295(i)(6)(A)(i) calls for rulemaking. Otherwise the mandate to initiate a rulemaking would be pointless. It does not follow, and DOE does not infer, that DOE
The structure of section 6295(i)(6)(A) itself is consistent with DOE's interpretation. DOE notes that the statute explicitly and specifically requires DOE to issue a final rule in one particular situation. If the statute were meant to require DOE to issue 6295(i)(6)(A) rules regardless, it would presumably have said so rather than identifying that particular circumstance. (Conversely, reading section 6295(i)(6)(A)(iii) to require DOE to finalize the subparagraph (i) rules in all circumstances would make superfluous the clause in subparagraph (iii) that specifies a particular circumstance.)
The structure of section 6295 overall also supports DOE's interpretation. Repeatedly, the section specifies a point at which DOE must issue a proposed rule, and it follows that instruction with a requirement to publish a final rule. For example, subsection (b)(3) says DOE “shall publish a proposed rule” by a certain date on whether to amend refrigerator standards; it then says DOE “shall publish a final rule” by a second date “which shall contain such amendment, if any.” (42 U.S.C. 6295(b)(3)(A)(i)) Subsection (m) says that within six years after amending a given standard, DOE shall publish either a notice of a determination that the standard does not at that time need to be amended, or “a notice of proposed rulemaking including new proposed standards.” If DOE publishes the second type of notice, then within two years it “shall publish a final rule amending the standard.” (42 U.S.C. 6295(m)) As a third example (among many that could be cited), if DOE receives a petition for an amended standard, it must publish a notice either granting or denying the petition. If it grants the petition, it must within three years publish either “a final rule that contains the new or amended standards” or “a determination that no new or amended standards are necessary.” (42 U.S.C. 6295(n))
Thus, throughout section 6295, the statute distinguishes an obligation to propose a rule from an obligation to publish a final rule. When Congress wanted to require DOE to publish a final rule, it specified the conditions in which the requirement holds; the deadline for the final rule; and something about the content (
LEDVANCE contended that DOE cannot finalize a rule pursuant to section 6295(i)(6)(A)(i)(II)—regarding the exemptions—without finalizing a rule under subclause (I) on amending standards, because it cannot exercise the two authorities independently. (LEDVANCE, No. 90 at p. 8) But LEDVANCE identifies no language in EPCA that would impose such a restriction. As discussed, DOE does not believe paragraph (6)(A) requires it to complete a standards-setting rule at all. The regulatory program that EISA 2007 established was a preference and presumption for a 45 lm/W standard. The statute gives DOE the option to establish an alternative set of standards, on condition that those standards achieve energy savings at least as great as the 45 lm/W standard would. At the same time, Congress set some exemptions from the GSL regulatory scheme, and it authorized DOE to discontinue those exemptions if appropriate. Nothing in this framework would necessitate DOE's exercising the authorities just described in a single final rule. Consistent with that understanding of the policy underlying paragraph (6)(A), the text of the statute does not say DOE must do so.
LEDVANCE did contend that clause (iv) can support an inference that DOE must consider amended standards and discontinued exemptions in a single document. Clause (iv) says that DOE “shall consider phased-in effective dates under this subparagraph after considering” various economic issues such as “the impact of any amendment on manufacturers.” In LEDVANCE's view, Congress would not have required DOE to consider those economic factors in isolation. That Congress specified
DOE regards that inference as inconsistent with the text of subparagraph (A) and with its purposes. Clause (iv) refers to “the impact of any amendment.” Evidently clause (iv) comes into play when DOE is considering an amendment to standards. Consistent with that understanding, clause (iii) says that if DOE decides to amend the standards, the final rule shall be published by January 1, 2017, “with an effective date that is not earlier than 3 years after the date” of publication. 42 U.S.C. 6295(i)(6)(A)(iii). Thus, when DOE establishes amended standards pursuant to subparagraph (A), it has discretion to set the effective date of the amendment (subject to the limitation that the effective date cannot be sooner than three years after publication). Clause (iv), then, instructs DOE, in the exercise of that discretion, to consider phased-in effective dates in light of certain factors like “the impact of [the] amendment.” However, if DOE fails to complete a rulemaking in accordance with clauses (i) through (iv) or if the final rule does not produce savings that are greater than or equal to the savings from a minimum efficacy standard of 45 lm/W, clause (v) says that DOE “shall prohibit” sales of lamps below the backstop standard “effective beginning January 1, 2020.” In that case, DOE would not have discretion regarding the effective date of the backstop standard. It would be odd, then, for the statute to require DOE to consider phased-in dates for the backstop. Clause (iv) can readily be interpreted to avoid that inconsistency.
Thus, all that clause (iv) requires is that DOE consider phased-in effective dates if and when it establishes amended standards under subparagraph (A). It seems like a
As an alternative argument, LEDVANCE suggested that even if DOE can issue this rule discontinuing certain GSL exemptions, the backstop would not apply to the formerly exempted lamps because there were no “standards in effect” for those lamps at the time of the rulemaking. (LEDVANCE, No. 90 at p. 8) DOE notes that the phrase “standards in effect” does not appear in clause (v), the text that describes the backstop. However, DOE takes LEDVANCE's argument to be as follows. Clause (i)(I) instructs DOE to initiate a rulemaking to decide whether to amend “standards in effect for general service lamps.” Under clause (iii), if DOE decides that “the standards in effect” should be amended, it must publish a final rule to that effect by January 1, 2017. Clause (v) imposes the backstop “[i]f the Secretary fails to complete a rulemaking in accordance with clauses (i) through (iv).” Because such a rulemaking would be amending “the standards in effect,” and no standards were previously “in effect” for lamps that are currently exempt from being GSLs, LEDVANCE seems to be saying, the rulemaking “in accordance with clauses (i) through (iv)” cannot be about the standards for the previously exempt lamps. Therefore, LEDVANCE seems to infer, the backstop would not apply to those lamps.
However, the backstop provision does not limit itself to lamps for which standards were in effect. The status and content of the “rulemaking in accordance with clauses (i) through (iv)” determine whether the backstop will apply. But if it does, clause (v) says DOE shall prohibit the sale of “any general service lamp” that does not meet the backstop standard. The word “any” sweeps in all general service lamps, including those that were exempt before DOE discontinued an exemption. Clause (v) describes a prospective standard; it does not limit its scope to lamps that were subject to standards
Moreover, LEDVANCE's argument, as DOE understands it, risks making clause (i)(II) pointless. The argument would logically imply that DOE can only, under clause (i)(I), amend standards that were already “in effect”; thus, on LEDVANCE's argument, DOE would not be able to establish standards applicable to lamps for which it discontinued exemptions. If that were so, and if (as LEDVANCE posits) the backstop would not apply to those lamps either, there would be little point in discontinuing the exemption. DOE considers it more sensible and more consistent with the policies of paragraph (6)(A) to read clause (i) to permit it to establish standards for previously exempt lamps.
As a third category of objection, LEDVANCE stated that paragraph (6)(A) requires DOE to conduct a “fleet-wide analysis” of total energy savings from standards established by DOE. Under clause (v), after DOE sets its own standards pursuant to clauses (i) through (iv), the backstop would come into force if DOE's standards do not “produce savings that are greater than or equal to the savings from” a uniform 45 lm/W standard. 42 U.S.C. 6295(i)(6)(A)(v). According to LEDVANCE, the “fleet-wide energy savings determination is integral to the EISA Rulemaking Proceeding and is a prerequisite to application of the EISA backstop provision.” (LEDVANCE, No. 90 at p. 9)
DOE notes that a “fleet-wide energy savings determination” is not in fact an exclusive prerequisite to the backstop. Under clause (v), DOE will be obligated to effectuate the backstop in either of two circumstances: If the energy savings from standards that DOE develops are insufficient, or “if the Secretary fails to complete a rulemaking in accordance with clauses (i) through (iv).” Thus, clause (v) expressly contemplates the possibility that DOE will not finalize a rule that develops alternative standards for GSLs. In that case, clause (v) by its text does not call for an analysis of energy savings; and of course there would be no energy savings to analyze. This structure is consistent with the understanding of paragraph (6)(A) as laid out before, that it sets 45 lm/W as a default and gives DOE the option—not the obligation—to develop alternative standards for GSLs. Thus, DOE disagrees that it must analyze fleet-wide energy savings from a DOE-imposed standard; and DOE disagrees that a rule defining GSLs is improper without an analysis of hypothetical DOE-imposed standards.
LEDVANCE suggested that it would also be impermissible for DOE to apply the backstop to lamps newly included in the definition of GSLs for a reason arising from the Administrative Procedure Act: That DOE did not provide adequate notice that application of the backstop would be a consequence of defining certain lamps to be GSLs. (LEDVANCE, No. 90 at p. 16) However, the October 2016 NOPDDA said that if DOE does not complete a standards rulemaking pursuant to clauses (i) through (iv), the backstop standard will come into effect for GSLs. 81 FR 71794, 71795 (October 18, 2016). It pointed out that when it discontinues an exemption, the lamps within that exemption will become GSLs (to the extent they otherwise fall within the definition of GSL).
A fourth category of objection, raised by LEDVANCE and by other commenters, was that DOE is not authorized to discontinue the exemptions set forth in section 6291(30)(D)(ii) and (BB)(ii)—the 22 exemptions for particular types of lamp that the notice discussed. (LEDVANCE, No. 90 at pp. 12-13) DOE notes that clause (i)(II) instructs DOE to initiate a rulemaking to decide whether “the exemptions . . . should be maintained or discontinued.” This language, particularly the reference to “
LEDVANCE argued that the “exemptions” at issue are the exemptions that EISA section 321(a)(3) authorized DOE to grant, upon petition. (LEDVANCE, No. 90 at p. 13) DOE does not believe those are the exemptions to which clause (i)(II) refers. Clause (i)(II) calls for a rulemaking, initiated by January 1, 2014, to decide whether “the exemptions” should be maintained or discontinued; that mandate presumes that “the exemptions” at issue existed as of January 2014. But the discretionary exemptions that EISA section 321(a)(3) permitted would only exist if persons had petitioned for exemptions, and if DOE had then granted those petitions. Were clause (i)(II) referring to those exemptions that might or might not exist at the beginning of 2014, a more natural phrasing would have been something like “any exemptions under this subsection.” Further, DOE could only grant an exemption under the process described in EISA section 321(a)(3) if it found, after a hearing, “that it is not technically feasible to serve a specialized lighting application . . . using a lamp that meets the requirements of this subsection,” and also found that “the exempted product is unlikely to be used in a general service lighting application.” Thus, to grant an exemption under that process DOE would have to engage in an assessment of specific technical issues. It seems unlikely, and contrary to the purpose of that petition process, that Congress would have called for DOE to initiate an overall rulemaking to decide whether to continue any exemptions it might have granted. Such a review would seem particularly odd because, given the timing of the requirements set in EISA section 321, DOE would not have received any petitions earlier than 2011. (In fact, DOE has not received any such petitions.) The clause (i)(II) rulemaking was to begin just a few years later. It seems unlikely that the technical facts underlying DOE's decision on a petition would have changed in such a brief time.
Given DOE's understanding of the framework Congress set up for GSLs, as described, DOE believes it is more consistent with the purposes of the statute to read “the exemptions” as referring to the lamp types that the original definition said are not GSILs or are not GSLs. Unlike lamps that DOE might exempt under the EISA section 321(a)(3) petition process, there has been no determination that these lamp types are unlikely to be used for general service lighting. DOE believes Congress deferred that determination for DOE's later assessment under clause (i)(II).
LEDVANCE did not identify any other exemptions to which clause (i)(II) might refer. However, DOE has also considered whether clause (i)(II) might address solely an exemption provided by an amendment in EISA section 322.
One commenter suggested that the clause (i)(II) authority to discontinue exemptions relates only to five types of lamps addressed by section 6295(
DOE does not believe section 6295(i)(6)(A)(i)(II), which requires DOE to initiate a rulemaking on whether to maintain or discontinue “the exemptions for certain incandescent lamps,” refers to this framework of comparisons to forecast sales. The language of section 6295(
The remaining exemptions are those in the definitions of GSIL and GSL at 42 U.S.C. 6291(30)(D)(ii) and (BB)(ii). For the reasons discussed, DOE believes that those are the “exemptions” to which clause (i)(II) applies. It bears emphasis that DOE interprets clause (i)(II) to address both the (D)(ii) and the (BB)(ii) exemptions. DOE recognizes that clause (i)(II) refers to “the exemptions for certain incandescent lamps,” and subparagraph (BB)(ii) relates to GSLs rather than GSILs. However, the first type of exemption in subparagraph (BB)(ii) simply refers back to subparagraph (D)(ii): It says GSL does not include “any lighting application or bulb shape described in any of subclauses (I) through (XXII) of subparagraph (D)(ii).” DOE takes “the exemptions” to encompass the subparagraph (D)(ii) exemptions both as exemptions from the definition of GSIL and through their effect on the definition of GSL.
DOE recognizes that clause (i)(II) is ambiguous on this point because, as previously noted, it does not identify “the exemptions” specifically and does not say what “the exemptions” are exemptions from. However, DOE believes the interpretation described here appropriately fulfills the purposes of subsection (i)(6)(A). DOE notes that clause (i)(II) is a counterpart to clause (i)(I), which instructs DOE to consider developing standards for GSLs. Thus, clause (i) as a whole is about GSL standards, and it would be natural for “the exemptions” involved in subclause (II) to include exemptions from the definition of GSL. If subclause (II) only involved the definition of GSIL, it would be hard to see why Congress would require DOE to initiate a rulemaking on that issue at the same time as it initiated a rulemaking on GSL standards; DOE already maintained GSIL standards and would have reviewed them periodically as for other consumer products.
DOE recognizes that because discontinuing an exemption from being GSILs makes the corresponding lamps GSILs (to the extent they otherwise satisfy the criteria in the GSIL definition), those lamps will also become GSLs. That fact actually further motivates DOE's interpretation. As discussed in the NOPDDA and in section III.A.4.f.i, many of the 22 exemptions in clause (30)(D)(ii) encompass technologies besides incandescent filaments. If “the exemptions” in subclause (II) nonetheless included only exemptions from the GSIL definition, the result of discontinuing an exemption would be that a set of incandescent lamps become subject to GSL standards without the corresponding non-incandescent lamps being subject to the same standards. For example, DOE is discontinuing the exemption for CA shape lamps. If DOE were only permitted to regulate incandescent CA shape incandescent lamps as GSLs, and not other CA shape lamps such as CA shape compact fluorescent lamps, the result would be a skewed regulatory regime that seems inconsistent with the purposes of subsection (i)(6)(A).
Subsection (i)(6)(A) actually instructs DOE to avoid that result: Clause (ii) of subsection (i)(6)(A) specifies that “[t]he rulemaking”—the rulemaking that clause (i) calls for—“shall not be limited to incandescent technologies.” DOE interprets that language to mean that in setting standards and deciding on exemptions under clause (i), it should consider non-incandescent lamps alongside incandescent lamps. With respect to the exemptions, that means addressing the section 6291(30)(BB)(ii) exemptions from the GSL definition.
LEDVANCE, along with other commenters, contended that the definitional provisions—particularly those listing the 22 types of lamp in (D)(ii) and (BB)(ii)—cannot be the subject of the clause (i)(II) rulemaking because they are “exclusions” rather than “exemptions.” (LEDVANCE, No. 90 at pp. 12-13) DOE notes that the texts of section 6291(30)(D)(ii) and (BB)(ii) do not actually state that they provide “exclusions.” That word appears only in the headings of the provisions. Headings “can be a useful aid in resolving a statutory text's ambiguity,”
The texts of those provisions say that the respective defined terms (GSIL and GSL) “do[] not include” certain lamps. 42 U.S.C. 6291(30)(D)(ii); 6291(30)(BB)(ii). The language “does not include” is consistent with stating an exemption. “Exemption,” in ordinary English, simply means freeing or excusing one set of persons or things from an obligation to which others are subject (
LEDVANCE stressed that the words “exclusion” and “exemption” are different, and urged that DOE's interpretation of clause (i)(II) must reflect that difference.
Indeed, Congress used them synonymously in other parts of subsection (i) added by the same provision of EISA 2007 that added both paragraph (6)(A) and the list of 22 lamp types not included as GSILs or GSLs. The provision in EISA section 321(a)(3) allowing the public to petition DOE to regulate additional types of lamps, discussed, reads as follows. “Any person may petition the Secretary to establish standards for lamp shapes or bases that are excluded from the definition of general service lamps.” “The petition shall include evidence that the availability or sales of exempted incandescent lamps have increased significantly.” Surely what Congress had in mind is that when a petitioner asks for standards on a given type of lamp, the petition should demonstrate that the availability or sales of that type of lamp have increased. But in the first sentence refers to the subject of the petition as “lamps excluded from the definition of general service lamps,” and the second calls it “exempted lamps.” Evidently Congress considered the text that “exclude[s]” certain lamps from the definition of GSLs to be an exemption.
A commenter also argued that DOE cannot discontinue exemptions for any set of lamps for which EPCA already imposes standards—or for lamps for which EPCA specifies future standards like the five lamp types addressed by subsection (
DOE believes its interpretation appropriately fulfills the purposes of subsection (i)(6) and of EPCA as a whole. As discussed, DOE believes subsection (i)(6) was meant to establish a particular level of energy savings, namely the amount that could be achieved by imposing a 45 lm/W standard on GSLs. As the fourth category of GSL indicates, Congress left some flexibility about the concept of GSL, so that it could encompass lamps that fulfill the same sorts of functions as GSILs. Consistent with that understanding, DOE believes the purpose of discontinuing exemptions is to ensure that a given type of lamp does not provide a ready substitute for lamps regulated as GSLs, because the availability of such a substitute will significantly erode the savings achieved by GSL regulation. On that understanding, it is straightforward that Congress would want DOE to assess whether a given type of lamps should be exempt from GSL regulation.
By contrast, to leave lamps out—as the commenter suggested—simply because they are subject to other types of regulation and different standards would largely defeat the purpose of GSL regulation just described. For some lamp types, the criterion that commenters label a “standard” is a definitional limit; for example a G shape lamp is exempt only if it has a diameter of 5 inches or more, and a T shape lamp is exempt only if it uses less than 40 watts or has a length of 10 inches or more. Commenters disagree with DOE's characterization of these limits as definitional criteria rather than standards. Regardless, they are not GSL standards, and they are not of the same character or stringency as the GSL backstop that is the default GSL standard, and are presumably less stringent than any standard that DOE might develop to achieve energy savings comparable to those from the 45 lm/W backstop standard. It seems unlikely that Congress would have considered such criteria adequate alternatives to GSL standards. Therefore, DOE considers it more consistent with the scheme of subsection (i)(6) that DOE should assess whether to subject to GSL regulation the lamps within such an exemption. For example, with respect to T shape lamps, DOE must assess whether lamps over 10 inches or lamps under 40 watts are ready substitutes for GSLs.
Commenters also argued that DOE cannot discontinue the exemption for incandescent reflector lamps in particular. DOE will address these comments in a separate rule. This final rule does not include a determination whether to maintain or discontinue the exemption for incandescent reflector lamps and does not include those lamps within the definition of GSLs. This rule does address the exemption for “reflector lamps”; as discussed in section III.A.1.a, the rule addresses only reflector lamps that are not “incandescent reflector lamps” as defined in EPCA.
In the following sections, DOE provides detailed discussions of how the definition of GSL adopted in this final rule is consistent with the authorities discussed in this section.
The term general service lamp (GSL) includes general service incandescent lamps (GSILs), compact fluorescent lamps (CFLs), general service light-emitting diode (LED) and organic light-emitting diode (OLED) lamps, and any other lamps that DOE determines are used to satisfy lighting applications traditionally served by GSILs; however, GSLs do not include any lighting application or bulb shape that under 42 U.S.C. 6291(30)(D)(ii) is not included in the “general service incandescent lamp” definition, or any general service fluorescent lamp or incandescent reflector lamp. (42 U.S.C. 6291(30)(BB)) The October 2016 NOPDDA revisited the proposed definition of GSL from the March 2016 GSL ECS NOPR, including the exemptions contained in the GSIL and GSL definitions, and proposed a revised definition of “general service lamp” in § 430.2 to capture various criteria and delineate the lamp types considered to be GSLs. 81 FR 71806-71807. More specifically, DOE proposed the a definition for GSL in the October 2016 NOPDDA A general service lamp, as proposed, would be a lamp that has an ANSI base, operates at any voltage, has an initial lumen output of greater than or equal to 310 lumens (or 232 lumens for modified spectrum general
DOE received general comments on its proposed definition.
California Energy Commission (CEC), Southern California Edison (SCE), National Resources Defense Council (NRDC), Rutgers Law School Environmental Law Society (RELS), Northeast Energy Efficiency Partnerships (NEEP), Utility Coalition, and Appliance Standard Awareness Project (ASAP) expressed strong support for DOE's proposed definition of GSL. CEC and RELS commented that the revised proposal encourages high performance requirements for technology-neutral GSLs and will result in significant additional energy savings for the nation as well as increased consumer savings. NRDC and NEEP noted that the revised definition addressed stakeholder input including many of their concerns on previous proposals. In particular, NRDC and CEC agreed with DOE's approach of including lamps regardless of shape or base type in order to prevent gaming of the system. Citing reflector lamps as an example, NRDC stated that manufacturers have taken advantage of definitions in the past by creating new lamp shapes outside of the product definition that then increase in sales. NEEP stated its overall support for proposed scope of GSLs, and asserted there will be a wide variety of highly efficacious and low cost lamps that will fill the needs for consumers. ASAP added that with a few minor changes to the definitions, the definitions will be consistent with the statute, and DOE will be able to implement the backstop standard as required by Congress and issue a final rule to complete this critical rulemaking. (CEC, No. 81 at p. 1; SCE, No. 83 at pp. 23-24; NRDC, No. 83 at pp. 9-10; ASAP, No. 83 at pp. 20-21; NEEP, No. 83 at p. 13; NRDC, No. 85 at pp. 1-2; RELS, No. 86 at p. 1; CEC, No. 91 at p. 1)
SCE stated that both utilities and industry played a critical role in transforming the market and added that progress will continue after the rulemaking ends. ASAP also emphasized the role of utilities, noting that utilities have spent billions of dollars to move the market to the level of efficiency available today and remain interested in how to make the transition to a GSL standard successful. (SCE, No. 83 at pp. 23-24; ASAP, No. 83 at pp. 17-19)
In contrast, Avalos stated that the expanded definition simply broadens the scope of GSL and does not clarify what lamps are considered GSLs. Avalos added that several lamps are included under the revised definition that are not general service lamps and suggested defining GSL to include lamps that are used on a regular basis. (Avalos, No. 80 at p. 1)
NEMA also commented that the scope of the proposed GSL definition is too broad. NEMA stated that available sales and market data should be used to determine the scope rather than speculating whether lamp types may become loopholes in the future. NEMA added that the sales data collected from the section 6295(l) rulemaking indicates that some of the lamp types that look like 60 W incandescent lamps, such as rough service and vibration service, are being used as substitutes. However, NEMA also noted that there are very small or large lamps, such as 2,000 lumen sign lamps and G40 lamps, which would fall within DOE's proposed definition but that are not effective substitutes for GSILs because they cannot fit in the same fixtures or applications. (NEMA, No. 83 at pp. 50-52) Westinghouse also expressed concern about DOE's proposed definition, stating that because it is so broad some lamp types will be inadvertently included in the scope of the GSL definition. (Westinghouse, No. 83 at p. 135)
DOE acknowledges that it has proposed a broad definition for general service lamp. However, DOE does not intend for the definition to include lamps that are not properly considered general service lamps. In the following sections, DOE discusses key aspects of the definition and revisions implemented for this final rule.
As stated previously, GSLs include GSILs. (42 U.S.C. 6291(30)(BB)(i)(I)) The current definition of “general service incandescent lamp” is a standard incandescent or halogen type lamp that is intended for general service applications; has a medium screw base; has a lumen range of not less than 310 lumens and not more than 2,600 lumens or, in the case of a modified spectrum lamp, not less than 232 lumens and not more than 1,950 lumens; and is capable of being operated at a voltage range at least partially within 110 and 130 volts; however this definition does not apply to the following incandescent lamps: An appliance lamp; A black light lamp; A bug lamp; A colored lamp; An infrared lamp; A left-hand thread lamp; A marine lamp; A marine signal service lamp; A mine service lamp; A plant light lamp; A reflector lamp; A rough service lamp; A shatter-resistant lamp (including a shatter-proof lamp and a shatter-protected lamp); A sign service lamp; A silver bowl lamp; A showcase lamp; A 3-way incandescent lamp; A traffic signal lamp; A vibration service lamp; A G shape lamp (as defined in ANSI C78.20 and ANSI C79.1-2002) with a diameter of 5 inches or more; A T shape lamp (as defined in ANSI C78.20 and ANSI C79.1-2002) and that uses not more than 40 watts or has a length of more than 10 inches; and A B, BA, CA, F, G16-1/2, G-25, G30, S, or M-14 lamp (as defined in ANSI C79.1-2002 and ANSI C78.20) of 40 watts or less. 10 CFR 430.2.
In the March 2016 GSL ECS NOPR, DOE declined to make a determination about discontinuing the 22 GSIL exemptions from the GSIL definition. DOE initially concluded that, because the Appropriations Rider prohibits DOE from using appropriated funds to implement or enforce standards for GSILs, DOE could not re-evaluate the existing exemptions for GSILs in the GSL rulemaking. 81 FR 14540. Specifically, DOE stated that, by definition, GSL does not apply to any lighting application or bulb shape that, under 42 U.S.C. 6291(30)(D), is not included within the “general service incandescent lamp” definition. (42 U.S.C. 6291(30)(BB)) Therefore, based on the GSL definition, the 22 incandescent lamps that are excluded in EPCA from the definition of GSIL would not be GSLs. Further, DOE stated that the formerly exempted lamp types would have to be considered GSILs in
Upon consideration of the comments received on the March 2016 GSL ECS NOPR and further review of the relevant authorities, DOE revisited its interpretation in the October 2016 NOPDDA with respect to the proposed definition of GSL and application of the Appropriations Rider. DOE noted that the focus of the March 2016 GSL ECS NOPR was to propose new energy conservation standards for GSLs; in that context, DOE did not propose to modify the GSIL exemptions and then impose new standards for GSILs. By contrast, the October 2016 NOPDDA neither implemented nor sought to enforce any standard. Rather, the October 2016 NOPDDA sought to define what constitutes a GSIL and what constitutes a GSL under 42 U.S.C. 6295(i)(6)(A)(i)(II), an exercise distinct from establishing standards. As previously noted, the Appropriations Rider restricts DOE from “implementing or enforcing” the standards imposed on GSILs by 10 CFR 430.32(x). However, it does not preclude DOE from utilizing its authority under EPCA to revisit and alter the scope of GSIL and GSL, even if a consequence of that decision will be that additional incandescent lamps may become subject to the backstop standard.
In the October 2016 NOPDDA, DOE noted it believes this is a reasonable interpretation of the Appropriations Rider because, in evaluating the exemptions, DOE followed a directive related to a GSL rulemaking to define the scope of GSLs. DOE did not conduct any analysis in support of establishing energy conservation standards for GSILs. Although a collateral effect is to broaden the scope of the GSIL definition, DOE simply proposed to define what lamps constitute GSLs so that both manufacturers and DOE can understand how the regulations apply to the market. As discussed, DOE's defining the scope of GSL in light of the 45 lm/W backstop standard set in 42 U.S.C. 6295(i)(6)(A)(v) is not the same as DOE establishing standards. Furthermore, as previously noted, in the event standards were established, leaving certain exemptions in place would diminish the energy savings that would otherwise be achieved because the excluded lamps would provide a less efficient option to meet the same general service lighting application. 81 FR 71797-71798.
Commenters inquired why DOE had apparently changed its interpretation of the Appropriations Rider. As noted, the March 2016 GSL ECS NOPR focused on establishing amended standards. The October 2016 NOPDDA and this final rule are addressed solely to the definition of GSL, recognizing that the additional lamps that DOE includes as GSLs will become subject to either a DOE-developed standard or to the 45 lm/W backstop standard that EPCA set as the default. In this context, interpreting the Appropriations Rider to block DOE from assessing the 22 exemptions would risk undermining the 45 lm/W backstop standard that Congress set. That consequence is quite different from what DOE faced with respect to the March 2016 GSL ECS NOPR, with respect to which a broad interpretation of the Appropriations Rider would only have restricted DOE's ability to develop its own standards. DOE, therefore, interpreted the Appropriations Rider as applying differently in the context of the October 2016 NOPDDA, and similarly does not interpret the Appropriations Rider as precluding its assessment of the exemptions in this final rule.
In the October 2016 NOPDDA, DOE evaluated the 22 lighting applications or bulb shapes exempted under the GSIL definition to determine whether such exemptions should be maintained or discontinued. 81 FR 71798. In the October 2016 NOPDDA, DOE proposed to discontinue eight GSIL exemptions (for reflector lamps, rough service lamps, shatter-resistant lamps, 3-way incandescent lamps, vibration service lamps, and lamps with specific shapes) based on compiled sales data and consideration of additional, applicable factors. DOE proposed to maintain 14 of the GSIL exemptions due to low sales and low potential for use in GSL applications.
In this final rule, DOE is maintaining 15 of the exemptions and discontinuing seven of them. To summarize the analytical approach discussed later with reference to comments, DOE believes the purpose of the decision that subsection (i)(6)(A)(i)(II) calls for is to ensure that a given exemption will not impair the effectiveness of GSL standards by leaving available a convenient substitute that is not regulated as a GSL. Therefore, DOE has based its decision on each exemption on an assessment of whether the exemption encompasses lamps that can provide general illumination and can functionally be a ready substitute for lamps already covered as GSLs.
The technical characteristics of lamps in a given exemption and the volume of sales of those lamps are among the considerations relevant to that assessment. High annual sales indicates that the product is likely used in general lighting applications,
DOE received several comments regarding its authority to reconsider the 22 GSIL exemptions. NEMA stated that DOE was not authorized to redefine GSIL to include any of the 22 lighting applications or bulb shapes exempted from the definition of GSIL. (NEMA No. 93 at p. 3) NEMA further stated that Congress defined GSIL in very specific terms, limiting the term to “standard incandescent or halogen type lamps” and that the 22 listed lamps are not standard incandescent lamps, and are therefore excluded from the GSIL definition. (NEMA No. 93 at p. 3) NEMA stated that in contrast to the “standard” incandescent lamp, some of the 22 excluded lamps lack a “medium screw base,” some have lower lumen output than the minimum lumens for GSILs, and some of them are separately regulated. (NEMA, No, 93 at p. 3) NEMA
EPCA does not define “standard” in the context of incandescent lamp.
Regarding DOE's decision to maintain or discontinue the 22 GSIL exemptions, PG&E supported DOE's decision to bring previously exempted lamp types into the scope of coverage of the GSL rule. PG&E added that these lamp types pose a significant risk to energy savings as they can easily replace GSLs in many applications. Further PG&E stated that LED versions are dropping in price while increasing in efficiency and are available in range of shapes, sizes, lumen outputs, correlated color temperature (CCT), beam angles, and base types. (PG&E, No. 83 at pp. 14-15) CEC, Utility Coalition, NEEP, and NRDC also supported DOE's proposed approach and agreed with the eight lamp types DOE proposed to no longer exempt based on the sales of these lamp types and their potential for lamp switching. NEEP and NRDC added that these categories all have high-efficiency alternatives that produce general illumination. (CEC, No. 81 at p. 1; Utility Coalition, No. 95 at p. 3; NEEP, No. 92 at p. 1; NRDC, No. 85 at pp. 1-2) However, NEMA stated that DOE should maintain all 22 GSIL exemptions except for vibration service lamps and rough service lamps. (NEMA, No. 83 at p. 93)
In support of its analysis of whether to maintain or discontinue the 22 GSIL exemptions, in the October 2016 NOPDDA DOE presented estimated sales data for the 22 exempted lamp types. NEMA stated that sales for most of the 22 exempted lamps are declining and that it was the intent of Congress to require that DOE find sales increasing as a prerequisite to discontinue an exemption. (NEMA, No. 83 at p. 34; NEMA No. 93 at p. 12) NEMA pointed to the petition process established under section 321 of EISA 2007 as indicative of that intent. (NEMA, No. 93 at p. 12-13) NEMA and LEDVANCE noted that Congress required a demonstration of increased sales as a prerequisite for DOE to grant a petition submitted by the public to reconsider an exemption, and that DOE must be guided by the same consideration when determining whether an exemption should be maintained under 42 U.S.C. 6295(i)(6)(A)(i)(II). (NEMA, No. 83 at pp. 33-34; LEDVANCE, No. 90 at pp. 25-27) NEMA and LEDVANCE cited the requirement under 42 U.S.C. 6295(i)(6)(A)(i)(II) for DOE to consider, in part, “exempted lamp sales” collected by DOE as supporting the requirement for increased lamp sales in order to discontinue an exemption. (NEMA, No. 93 at 5; LEDVANCE, No. 90 at p. 26) NEMA and LEDVANCE added that a determination of lamp switching must be driven by data showing increased sales. (NEMA No. 93 at p. 13; LEDVANCE, No. 90 at pp. 25-27) NEMA and LEDVANCE concluded that the October 2016 NOPDDA did not provide data indicating that lamp switching was occurring, and rather data from the Energy Information Administration
While NRDC found the sales data presented by DOE in the October 2016 NOPDDA to be accurate, it commented that historical lamp sales are only one factor for consideration in DOE's determination of whether an exemption should be maintained. The California Investor Owned Utilities (CA IOUs) and NRDC cautioned that the presented data reflected current standards and sales could increase dramatically for exempted lamp types when the next more efficient standards go into effect in 2020. (CA IOUs, No. 83 at pp. 64-65; NRDC, No. 83 at pp. 29-30, 35) NRDC and CA IOUs both commented that the market has previously seen the sales volume of lamps increase when the lamps were exempted from standards or subject to less stringent standards (
As discussed, the petition process from EISA section 321(a)(3) is distinct from the decision that subparagraph (6)(A)(i)(II) calls for about maintaining or discontinuing exemptions. The statute does not require DOE to consider the same factors in the clause (i)(II) decision that it would in reviewing a petition. In particular, it does not restrict DOE to discontinuing an exemption only if sales of lamps within that exemption are increasing. While increases or decreases in lamp sales are an important consideration, DOE believes it can in some circumstances be appropriate to discontinue an exemption even at a time when sales of those lamps are decreasing. As described by GE, LEDVANCE, and Westinghouse, incandescent sales can be decreasing because consumers are purchasing LED versions of the same lamp. Thus, the lamp itself is not unpopular but rather is undergoing a shift in technology. For example, GE stated that sales of reflector lamps that are incandescent have been declining significantly over the last five years but
DOE also considered the potential of lamp switching that may occur in response to any GSL standard. If an exempted lamp has the same utility to lamp users as a lamp subject to a standard as a GSL, DOE considered the potential increase in the use of the exempted lamp in response to a standard. As noted by the comments from CA IOUs and NRDC, prior to the effective date of any new standard the sales trends of exempted lamps do not necessarily capture the potential for lamp switching. As such, current lamp sale trends are only part of the consideration. DOE is permitted to account for future changes in consumer behavior so as to avoid the creation of loopholes.
DOE received several comments regarding whether a lamp could serve as a replacement for a GSL and therefore present a risk of lamp switching. CA IOUs stated that evaluations of the exemptions should be based on whether the exempted lamp type could serve as a replacement for a general service lamp. (CA IOUs, No. 83 at p. 107) Westinghouse stated that there are low-cost products on the market that consumers do not use as replacements for GSLs because they are not the appropriate shape or design. Avalos noted that a couple of exempted lamp types could be considered GSILs but are not due to their lamp structure. (Westinghouse, No. 83 at p. 30; Avalos, No. 80 at p. 1)
GE and LEDVANCE stated that DOE should consider the traditional omnidirectional incandescent lamp when considering the potential for lamp switching. (GE, No. 83 at pp. 37-38; LEDVANCE No. 83 at p. 59) GE stated that the definition of GSIL describes a lamp with a medium screw base, that produces between 310 and 2,600 lumens, and can operate on a voltage between 110 and 130 V, and that in order for a lamp to be considered as having the potential for “lamp switching” the lamp must maintain these same attributes. (GE, No. 88 at pp. 2-3) NEMA further stated that the definition of GSL authorizes DOE to consider “other lamps” and that “other lamps” must be used to satisfy lighting applications traditionally served by GSILs. (NEMA, No. 93 at p. 6) NEMA stated that the use of the word “used,” past tense, establishes that there must be evidence for the basis of a finding that other lamps are operating in applications traditionally served by GSILs. (NEMA, No. 93 at p. 6) Westinghouse stated that consideration of lamp switching should be limited to whether a consumer could use an exempted lamp to replace a lamp that the consumer is currently using, and that consideration of how the use of fixtures may change in response to standards (
Other commenters stated that consideration of lamp switching should include the ability of an exempted lamp to provide similar function as a traditional GSIL, regardless of the fixture traditionally used with GSILs. ASAP stated that the presence of directional lamps in residences in the U.S. has grown significantly over time due to changes in new construction. (ASAP, No. 83 at pp. 38-39) ASAP stated that lighting in homes that traditionally was provided by A shape lamps in floor and table fixtures is being provided in newer construction through reflector lamps in recessed can lighting. (ASAP, No. 83 at pp. 58-59)
As previously noted, DOE understands the purpose of the decision that EPCA calls for on maintaining or discontinuing exemptions to be to ensure that consumers and manufacturers do not switch to readily available substitutes once standards for GSLs come into force. In making this assessment, the potential for an exempted lamp to be placed in a fixture that traditionally used a GSIL, and the potential change in the fixtures used to provide lighting in an application that was traditionally served by a GSIL are important considerations that DOE appropriately takes into account. Separate from the determinations to be made regarding certain exemptions, DOE is authorized to include in the definition of GSL other lamps that are used to satisfy lighting applications traditionally served by GSILs. (42 U.S.C. 6291(30)(BB)(i)(IV)) While 42 U.S.C. 6295(i)(6)(A)(i)(II) does not expressly direct DOE to consider whether an exempted lamp is used to satisfy the lighting applications traditionally served by GSILs, DOE has determined this consideration to be instructive in the overall assessment regarding the exemptions. As noted by commenters, the function traditionally provided by GSILs can, in some instances, be provided by more than one type of fixture. In order to minimize the potential for loopholes, DOE has considered the potential for a consumer to change the type of lamp used in an existing fixture, and the potential change in the type of fixture used to provide the same function as traditionally provided by a fixture using a GSIL.
CA IOUs stated that evaluations of the 22 GSIL exemptions should also be based on whether the exempted lamp type can be made as an LED lamp. (That consideration would be relevant because it is almost certain that incandescent lamps will not be able to satisfy the 45 lm/W backstop standard if it comes into force.) (CA IOUs, No. 83 at p. 107) ASAP further stated that of the 15 lamp types that DOE is proposing to continue to exempt there are LED replacements available for all but the infrared lamp. ASAP noted LED replacements that are able to function in high temperature applications could serve as replacements for appliance lamps. (ASAP, No. 83 at pp. 98-99)
DOE is aware that LED replacements may exist for some of the exempt lamp categories. DOE did consider the existence or absence of LED replacements, though not as the only reason to discontinue or maintain a GSIL exemption. DOE's consideration of lamps for which no equivalent LED replacements exist is discussed in section III.A.4.f.
NEMA provided updated sales information for this final rule. NEMA provided sales data from four members, which represents a significant portion of the market, for each of the exemptions that DOE proposed to discontinue. NEMA stated that although not all members are included, it conferred with other members that did not provide data to confirm the general trend of decreasing sales and shipments of specialty incandescent lamps since standards went into effect for GSILs between 2010 and 2012. (NEMA, No. 93 at pp. 9-10) DOE has updated Table III.1 to reflect this new data. DOE notes that, except with respect to certain lamps discussed in the sections that follow, the data from NEMA are consistent with the estimates and data that the October 2016 NOPDDA presented.
NEMA estimated the annual domestic sales of general service lamps (as defined in 42 U.S.C. 6291(BB)(I)-(III)) to be 600 million units. NEMA noted that this estimate excludes the shipments of the exemption categories proposed to be discontinued noting that each of the exempt lamp categories represents well below 1 percent of the total number of GSLs. NEMA and LEDVANCE stated that the October 2016 NOPDDA appeared to arbitrarily determine that
As discussed previously, DOE is not limited to considering only lamp sales when determining whether to maintain or discontinue an exemption. EPCA states lamps sales are only to be a part of the consideration, signifying that DOE is authorized to include other considerations. (42 U.S.C. 6295(i)(6)(A)(i)) As previously discussed, DOE considered the potential for lamp switching in order to minimize the potential for loopholes to any standard(s) that may be established. Lamp sales are part of that consideration. Again, DOE recognized that historical sales data are not always predictive of future lamp switching. Lamp sales, therefore, were considered in conjunction with the characteristics of a lamp.
Additionally, the specific direction from Congress to consider whether to maintain or discontinue exemptions for certain lamps is separate and distinct from the EPCA requirements for classifying a consumer product as a covered product under 42 U.S.C. 6292(b), which requires minimum energy savings, and from the requirements set out in 42 U.S.C. 6295(o) for establishing new or amended standards. EPCA directs DOE to determine whether to include in the definition of an existing covered product lamps currently excluded. DOE is not designating previously exempt lamps as separate covered products. DOE is determining the scope of an existing covered product pursuant to a specific mandate from section 6295(i)(6)(A), and as such, 42 U.S.C. 6292(b) is inapplicable.
DOE continues to believe it is reasonable to make decisions about the various exemptions without assessing the average household energy consumption of each, as it would if it conducted a separate section 6292(b) analysis for each exemption. For GSLs as a whole, Congress has determined that regulation is appropriate. (Although DOE of course respects Congress's decision as sufficient, DOE notes that average household energy consumption of GSLs is well above the section 6292(b) threshold.) The nature of the exemptions is that most of them currently represent relatively small portions of the overall lamp market. Consistent with the preceding framework, DOE believes the exemption decision is meant to ensure that a given type of lamp does not become a loophole for the GSL standards at the time when manufacturers are required to comply with those standards. If a lamp is a ready substitute for GSLs and DOE leaves that type of lamp exempt, energy consumption for that lamp type would presumably increase in the future; but the average rate of current energy consumption for a particular exempt lamp type is not as important a consideration.
Table III.1 summarizes the exemptions maintained or discontinued in this final rule and the sales data for each exemption.
As shown in Table III.1, based on the revised sales data and a consideration of additional, applicable factors, DOE has determined to discontinue seven GSIL exemptions. As discussed in section II, DOE believes the lamp categories for which it discontinued exemptions represent significant energy savings potential either due to high annual sales or by preventing a loophole from forming. DOE is maintaining 15 of the GSIL exemptions due to low sales and
In the October 2016 NOPDDA, DOE proposed to discontinue eight exemptions from the definition of GSIL. 81 FR 71799. DOE assessed data available for medium screw base reflector lamps that are incandescent and preliminarily concluded that these lamps have high annual sales. To be clear, the following discussion relates only to reflector lamps that are not IRLs. The market includes many reflector lamps that use incandescent technology but do not fall within the statutory definition of IRL, for example, medium screw base reflector lamps with diameters of 2.25 inches or less (
DOE estimated the sales of medium base reflector lamps that are incandescent as approximately 30 million units per year. DOE believed medium screw base reflector lamps are capable of providing overall illumination and could be used as a replacement for GSILs. Therefore, DOE found there was also high potential for lamp switching and subsequently creating a loophole. For these reasons, DOE proposed to discontinue the exemption for reflector lamps in the October 2016 NOPDDA.
DOE received several comments in support of its decision to expand the scope of the GSL definition to include reflector lamps. ASAP commented that they strongly supported covering all reflector lamps in the scope of this rulemaking and noted that hundreds of millions of reflector lamps (including IRLs) are sold each year. ASAP stated that directional lamps of all technology types are a growing presence in homes. ASAP noted that there are more efficient alternatives widely available at affordable prices, and including reflector lamps that are incandescent as GSLs is a step towards technological neutrality which will benefit the environment, industry and consumers. (ASAP, No. 83 at pp. 38-39; ASAP, No. 94 at pp. 1-2) NRDC and Utility Coalition supported DOE's proposal to discontinue the exemption for reflector lamps and noted that there would be a significant impact on energy savings as a result. (NRDC, No. 83 at p. 11; NRDC, No. 85 at p. 2; Utility Coalition, No. 95 at p. 2) Soraa also supported DOE's proposal to include reflector lamps as GSILs noting that they are used or can be used to provide overall illumination. (Soraa, No. 87 at p. 2) CEC also commented in support of DOE's proposal to discontinue the GSIL exemption for reflector lamps due in part to their high lamp sales and potential for lamp switching. (CEC, No. 91 at pp. 4-5)
In contrast, GE recommended that reflector lamps (in GE's comment, primarily IRLs) continue to be regulated separately and that it is not appropriate to evaluate reflector type lamps as GSLs because these products cannot successfully be used to satisfy lighting applications traditionally served by GSILs. (GE, No. 88 at p. 2) GE added that each reflector lamp has unique optical properties that must be considered when applying a minimum efficacy requirement and noted that these products cannot meet the same efficiency limits designed for general service A shape lamps. (GE, No. 88 at p. 2)
In support of their assertion that reflector lamps should be regulated separately, several commenters disagreed with DOE's determination that reflector lamps posed a risk of lamp switching. GE stated that reflector lamps would not fit in most fixtures in which GSILs are used. Even if a reflector lamp could fit in such a fixture it could not deliver the omnidirectional light output provided by the GSIL. Therefore, GE asserted reflector lamps would not be suitable replacements for the standard GSILs and needed to be evaluated in their own rulemaking. (GE, No. 83 at pp. 37-38) LEDVANCE agreed and stated that the consumer will not obtain effective light by putting a reflector lamp in a fixture that does not have some type of directional functionality. (LEDVANCE, No. 83 at pp. 59-61)
CA IOUs stated that while it may not be always be optimal, reflector lamps can be used in general service applications. (CA IOUs, No. 83 at p. 66) NRDC stated that reflector lamps can be used in applications other than down lights. NRDC pointed out that reflector lamps come in various shapes and there was nothing to prevent a manufacturer from altering the reflector lamp design so more light goes in different directions. (NRDC, No. 83 at p. 45) CA IOUs further noted that as the cheaper product, the use of reflector lamps that are incandescent in general service applications may increase due to new market pressures in 2020. (CA IOUs, No. 83 at p. 66) CEC agreed that medium screw base reflector lamps represent a lamp switching risk adding that lamp shape does not determine whether a lamp can provide general service lighting and general service lamps are not limited to omnidirectional lighting. (CEC, No. 91 at pp. 4-5) Utility Coalition also stated that LED lamps are suitable replacements for GSLs in many applications because they have the same base types and therefore represent a significant risk of undercutting the energy savings of the 45 lm/W standard if they are not included. (Utility Coalition, No. 95 at pp. 1-2)
Additionally, Utility Coalition commented that there are LED versions of reflector lamps available in a wide variety of shapes and sizes, lumen outputs, CCT, beam angles, and base types and that decreasing prices and increasing efficiency make these products cost-effective to consumers. NRDC also noted that there are several cost-effective, dimmable LED lamps available that serve as excellent replacements for reflector lamps that are incandescent in a variety of form factors, light outputs, and colors and urged DOE to move forward with its proposal to remove the exemption for these lamps. (NRDC, No. 83 at pp. 45-46; Utility Coalition, No. 95 at pp. 1-2) CEC stated that as of June 15, 2015, 658 models of medium screw base reflector lamps complied with Tier 1 of the adopted California standard thus indicating that cost effective, highly-efficacious LED alternatives exist. CEC added that making incremental improvements to existing LED reflector lamps was extremely cost-effective and technically feasible. (CEC, No. 91 at pp. 4-5) Soraa also stated that LED replacements that provide a wide variety of product features, such as color rendering index (CRI), CCT, beam angle, whiteness rendering, and low flicker, are available for the majority of directional incandescent lamps. Soraa noted that customers in quality-sensitive fields such as high-end retail and hospitality have transitioned from halogen to LED technology. Soraa added while there are still some lamp types that are difficult to replicate in LED technology, such as narrow-beam MR16 lamps with the highest wattages, incremental progress in technology will likely make these products available by 2020. Additionally, Soraa stated that the limit of 45 lm/W can be met by
As discussed previously in this document, DOE did not limit its consideration of lamp switching to the ability to replace a lamp in a fixture currently used by a consumer that had been using a traditional incandescent lamp. As indicated by comments from ASAP previously in this document, the presence of reflector lamps in residences in the U.S. has grown significantly over time due to changes in new construction. (ASAP, No. 83 at pp. 38-39) Lighting in homes that traditionally was provided by A shape lamps in floor and table fixtures is being provided in newer construction through reflector lamps in recessed lighting. (ASAP, No. 83 at pp. 58-59)
The basic design characteristic of a reflector lamp, as defined in the industry standard by the Illuminating Engineering Society of North America (IES) RP-16-10, is that it directs the light. But it is possible to direct the omnidirectional light from an incandescent filament into a somewhat more limited set of angles and still have a lamp that provides general illumination. The reflector lamps now being widely used in recessed can lighting are an important example. In such an application (with the lamp mounted in the ceiling), the reflector redirects light that was initially emitted upward. But the resulting light distribution spreads broadly over the area downward from the lamp, so that a consumer can readily use the lamp to provide general illumination for a room. In light of these observations, DOE concludes that “omnidirectional illumination” is not a prerequisite for the traditional functions of incandescent lamps, as GE suggested. Rather, DOE may consider a lamp a ready substitute for GSILs—for purposes of assessing an exemption—if the lamp can provide the same sort of general illumination that GSILs provide.
As presented in Table III.1, DOE estimates that the sales of medium base reflector lamps that are incandescent (and, as noted, do not meet the definition of IRL) are approximately 30 million units per year. 81 FR 71794, 71800. DOE notes that of the 22 exempted lamp types, the category of medium screw base reflector lamps that are incandescent and do not meet the definition of IRL is the third highest annual unit sales, thus indicating that these lamps are likely used in general lighting applications. In addition, because medium screw base reflector lamps are capable of providing overall illumination and could be used as replacements for GSILs, there is also high potential for lamp switching. For these reasons, DOE is discontinuing the exemption from the GSIL definition for reflector lamps that are incandescent lamps.
While DOE proposed to discontinue the exemption for reflector lamps generally, DOE noted R20 short lamps would continue not to be subject to standards. R20 short lamps are defined as R20 incandescent reflector lamps that have a rated wattage of 100 W; have a maximum overall length of 3 and 5/8, or 3.625, inches; and are designed, labeled, and marketed specifically for pool and spa applications. In a final rule published on November 14, 2013, DOE determined that standards for these lamps would not result in significant energy savings because such lamps are designed for special applications or have special characteristics not available in reasonably substitutable lamp types. 78 FR 68331, 68340. Pursuant to 42 U.S.C. 6291(30)(E), one consequence of DOE's determination is that these lamps are specifically not incandescent lamps and therefore do not become GSILs when the reflector lamp exemption is discontinued. 81 FR 71800.
ASAP stated that DOE's analysis on R20 lamps was performed in 2013, before LED substitutes were available for R20 lamps. ASAP asserted that if DOE performed this analysis again that LED substitutes would be available. (ASAP, No. 94 at p. 2)
DOE acknowledges that the analysis on R20 short lamps was conducted in 2013. DOE did consider available LED substitutes at that time. DOE has not reconsidered the lamps in this rulemaking. The final determination regarding R20 lamps was not based solely on the lack of an available substitute. As provided by EPCA, a lamp may be excluded from the definition of “incandescent lamp” by DOE, by rule, as a result of a determination that standards for such lamp would not result in significant energy savings because such lamp is designed for special applications
In the October 2016 NOPDDA, DOE also provided data for medium screw base incandescent lamps of the following specific shapes: B, BA, CA, F, G16-1/2, G25, G30, S, M-14 lamps (as defined in ANSI C78.20 and ANSI C79.1-2002) of 40 W or less; G shape lamps (as defined in ANSI C78.20 and ANSI C79.1-2002) with a diameter of 5 inches or more; T shape lamps (as defined in ANSI C78.20 and ANSI C79.1-2002) that use not more than 40 W or have a length of more than 10 inches. For B, BA, CA, F, G16-1/2, G25, G30, S, and M-14 lamps of 40 W or less, DOE estimated the annual sales as approximately 42 million. For G shape lamps with a diameter of 5 inches or more, DOE estimated the annual sales as approximately 8 million units. In addition to the sizeable sales of larger globe shape lamps, DOE noted it is likely that larger globe shape lamps may be used as substitutes for the G16.5, G25, and G30 lamps if the exemption is not also discontinued. Regarding T shape lamps that use not more than 40 W or have a length of more than 10 inches, DOE estimated the annual sales of these lamps as roughly 7 million units. Further, the lamps of the specific shapes discussed in this paragraph are frequently used in general lighting applications and thus DOE believed there is a significant risk for lamp switching. Therefore, due to the high potential for lamp switching—reflected in part by high sales—DOE proposed to discontinue the GSIL exemption for these specific shapes in the October 2016 NOPDDA. 81 FR 71800.
Regarding T shape lamps, NEMA and LEDVANCE stated that they are often used in applications such as museum or other display cases and in music stands. NEMA and LEDVANCE stated that 40 W T shape lamps (the maximum allowable wattage for these lamps) have low sales volume, and because the majority of T shape lamps are 15 W and 25 W lamps, applying a 45 lm/W standard to this lamp would not yield significant energy savings. They also noted that there is a continuing need for incandescent T shape lamps in exit sign fixtures designed for T-shaped incandescent lamps, pointing out that the UL-1993
As presented in Table III.1, DOE revised its estimate of the annual sales of T shape lamps of 40 W or less or length of 10 inches or more based on the sales data submitted by NEMA. For the year 2015, the most recent year for which NEMA submitted data, NEMA estimated the annual sales of these T shape lamps as 9,750,395 units. Based on the revised estimate, the T shape lamp category has one of the highest annual sales of the 22 exempted lamp categories, thus suggesting that these lamps are likely used in general lighting applications. In addition to the sizable sales of these T shape lamps, DOE determined that T shape lamps are capable of providing overall illumination and therefore have a high potential for lamp switching. Due to the high potential for lamp switching—reflected in part by high sales—DOE is discontinuing the exemption from the GSIL definition for T shape lamps of 40 W or less or length of 10 inches or more.
Regarding NEMA and LEDVANCE's concern that incandescent T shape lamps are required for use in installed exit signs, DOE was unable to find a UL safety requirement that supported this claim. UL-1993, the standard cited by NEMA and LEDVANCE, states that emergency exit fixtures are outside of the scope of the standard. DOE is aware that certain incandescent lamps, particularly those without equivalent LED replacements, may need to be maintained for safety reasons. DOE has exempted certain specialty lamps as described in section III.A.4.f.
DOE also received feedback on its estimate of sales for the G shape lamp with a diameter of 5 inches or more. NEMA, with LEDVANCE's concurrence, stated that unit sales of G shape lamps with a diameter of 5 inches or more comprise a small portion of the overall unit sales of G shape lamps and noted that DOE's sales estimate of 8 million units attributed to these G shape lamps is inaccurate. NEMA provided data showing that sales of G shape lamps with a diameter of 5 inches have decreased each year since 2012 and were under 1 million units in 2015. (NEMA, No. 83 at pp. 81-82; NEMA, No. 93 at p. 17; LEDVANCE, No. 90 at p. 27)
Several commenters also disagreed with DOE's assessment that G shape lamps with a diameter of 5 inches or more posed a risk for lamp switching. NEMA commented that this lamp type, due to its large shape, will not fit in most fixtures. Therefore, NEMA noted that instead of consumers switching to this lamp type in applications served by GSILs, they will continue to use it in the specialty applications that it is used in currently. NEMA added that for this reason, and the declining annual sales discussed previously, this lamp type does not pose a risk for lamp switching. (NEMA, No. 83 at p. 85; NEMA, No. 93 at p. 17) LEDVANCE agreed, noting that a consumer is unlikely to replace an A19 shape lamp with a 5-inch diameter lamp. (LEDVANCE, No. 83 at pp. 59-61) NEMA and Westinghouse also argued that the G40 shape incandescent lamp typically is more expensive than GSILs, medium screw base CFLs, and many general service LED lamps on the market. They concluded that the higher price point would also decrease the likelihood of lamp switching. (NEMA, No. 83 at p. 85; NEMA, No. 93 at p. 17; Westinghouse, No. 83 at pp. 87-88) Westinghouse added that LED products that are not UL certified or that are failed market attempts may be priced lower and therefore assessments should be based on average prices rather than the lowest price. (Westinghouse, No. 83 at pp. 87-88) ASAP cautioned that lamp prices are fluid and not necessarily tied to the cost of materials; instead they often fluctuate with demand. ASAP also stated that filament-style G shape LED lamps have become popular in retail food establishments and are reasonably priced. ASAP added that if the volume of G shape lamps were to increase, the price of G shape lamps would likely decrease as well. (ASAP, No. 83 at pp. 82-83, 86-87, 89)
In this final rule, DOE has revised its sales estimate for G shape lamps with a diameter of 5 inches or greater based on the data submitted by NEMA. As shown in Table III.1, the estimated annual sales of this lamp category are 859,867 units. In the October 2016 NOPDDA, DOE had estimated the sales of this lamp category to be approximately 8 million units. As described in the October 2016 NOPDDA, in the absence of actual data DOE estimated annual shipments by extrapolating from DOE's product database based on an inventory of available products. DOE accepts the actual data that NEMA submitted as a more accurate representation of the level of sales of these lamps.
These annual sales, which are substantially lower than what DOE had previously estimated, have motivated DOE to maintain the exemption for G shape lamps with diameter of 5 inches or greater. Low annual sales is not, on its own, a dispositive fact. DOE's previous estimate of annual sales suggested to DOE that consumers were using G shape lamps with large diameters in general lighting applications. However, given the low actual sales, DOE believes that the exempt G shape lamps (
DOE also received comments on medium screw base incandescent lamps of the following specific shapes: B, BA, CA, F, G16-1/2, G25, G30, S, M-14 lamps (as defined in ANSI C78.20 and ANSI C79.1-2002) of 40 W or less. NEMA and LEDVANCE stated that medium screw base decorative lamps (
NEMA and LEDVANCE continued that S-shaped lamps are service lamps typically used as sign lamps. They noted that this is a commercial product that is unlikely to be used in residential applications or in general service lamp fixtures. NEMA and LEDVANCE also commented that M-14 lamps are no longer manufactured as it is an outdated
Regarding the other globe shape categories within this list, NEMA and LEDVANCE stated that G16-1/2 shape lamps are the smallest version of a globe shape lamp and that their primary application is in lighting used around dressing room mirrors in theaters. They added that lamp switching is unlikely with this lamp type due to its small size and low lumen output. NEMA and LEDVANCE also noted that the G25 shape is the most popular of the globe shape lamps and that it is used primarily in bathroom vanities and bathroom lamp strips. They argued that lamp switching is also unlikely with this lamp type because of its low lumen output. NEMA and LEDVANCE stated that the G30 shape lamp has declined in popularity in favor of G25 shape lamps, thus its market share has declined significantly. NEMA provided sales data that show sales of these globe shape lamps have been declining over the last four years. (NEMA, No. 93 at p. 19; LEDVANCE, No. 90 at p. 28)
In addition, NEMA disagreed with DOE's decision to include B, BA, CA, F, G16-1/2, G25, G30, S, and M-14 shape lamps all in the same category. NEMA argued that they should be categorized separately because they are used in different lighting applications. NEMA stated that Congress only included these lamps in the same clause of the exclusions list to prevent the list of exclusions from being too lengthy. NEMA added that several of these lamp shape types currently have less than a million units of annual sales with declining sales, which makes lamp switching unlikely. (NEMA, No. 93 at p. 14)
In contrast, NRDC argued that DOE's annual sales estimate of 42 million lamps for the decorative lamps' category is underestimated. NRDC added that the estimate seems low based on DOE's LED adoption report, “Adoption of Light Emitting Diodes in Commercial Lighting Applications,” that estimates an installed base of 1.2 billion decorative shape lamps, which would primarily be 25 W and 40 W decorative shaped lamps. (NRDC, No. 85 at p. 5) Thus, NRDC asked DOE to not only focus on the A shape, 5-inch G shape, or 10-inch T shape lamps but also on the B, BA, CA shape lamps as they are very common and could fit in many applications including table or desk lamps. NRDC commented that the pear shape of these decorative lamps (
Westinghouse elaborated that the challenge for these decorative lamp shapes is lumen range and efficiency scale. Westinghouse noted that there are not many versions of the decorative lamp shapes in halogen technology because it is not easy to put a double-ended halogen burner in a small size lamp due to heat and space issues. (Westinghouse, No. 83 at pp. 87-88)
While NRDC encouraged a conversation regarding potential hardships in making LED replacements for these lamp shapes in larger form factors, it cautioned DOE not to lose sight of the benefits of discontinuing these exemptions. (NRDC, No. 83 at pp. 85-86) ASAP also acknowledged that not every application of the LED version can be technically and economically feasible. However, citing the popularity of the 500 W double-ended halogen lamp ten years ago, ASAP asserted that the selection of products manufactured and their price points are dictated by market demands. (ASAP, No. 83 at pp. 89-90)
DOE revised its estimate in this final rule for the sales of lamps with specific shapes based on the additional data submitted by NEMA. As shown in Table III.1, the estimated annual sales of this lamp category is 71,702,637 units. While DOE understands that some of these lamps are smaller than A shape lamps, they can still be used to provide overall illumination. DOE further notes that the pear shapes and globe shapes characterized by the majority of lamps in this category would not prevent consumers from using them in general service lighting applications. As indicated by the very high sales data of this category, DOE believes that these lamps are very common and can be used in general lighting applications. Regarding the technical limitations of more efficient versions of these products, DOE reviewed product availability to determine which form factor and light output combinations may not be available in fluorescent or LED technology. For more information on DOE's consideration of technical feasibility issues, see section III.A.4.a.
Regarding the comment from NEMA suggesting that DOE consider the lamps excluded under 42 U.S.C. 6291(30)(D)(ii)(XXII) separately, DOE notes that Congress listed these lamps together in paragraph (XXII). If the lamps were grouped merely for the purpose of drafting convenience, as suggested by NEMA, it is not clear why Congress would not have also included G shape and T shape lamps in the grouping as well. Instead, G shape and T shape lamps are each listed separately in paragraphs (XX) and (XXI), respectively. (42 U.S.C. 6291(30)(D)(ii)(XX) and (XXI))
DOE has considered whether to maintain the exemption for these lamps as a group due to its concern with lamp switching. DOE recognizes that the lamps listed in clause (XXII) may each not be substituted for one another in existing fixtures. However, as discussed previously, DOE also considers the potential for lamp switching through the future use of different fixtures. There is the potential that inclusion of some but not all of the lamps in the group would shift the market to the lamp or lamps that remain exempt. Thus, due to the very high sales volume and risk of lamp switching of the lamp types, DOE is discontinuing exemptions for B, BA, CA, F, G16-1/2, G25, G30, S, M-14 lamp of 40 W or less.
Regarding other exempt lamp categories, pursuant to 42 U.S.C. 6295(l)(4), DOE is required to collect unit sales data for rough service, shatter-resistant, 3-way incandescent lamps, and vibration service lamps. Section 321(a)(3)(B) of EISA 2007 in part amends subsection 325(l)(4) of EPCA by adding paragraphs (D) through (H), which direct DOE to take regulatory action if the actual annual unit sales of any of these lamp types are more than 200 percent of the predicted shipments (
NEMA supported the regulation of rough service and vibration service incandescent lamps but opposed treating these lamps as “general service incandescent lamps” because they are specialty lamps that were intended to be regulated using a wattage cap as indicated by the statute (see 42 U.S.C. 6295(i)(4)(D)(ii) and (E)(ii)) rather than a lumens per watt or modified lumens per watt regulation. NEMA encouraged DOE to adopt NEMA's proposal of maximum wattage caps for regulating these two specialty products, which NEMA asserted is consistent with the congressional intent reflected in EISA 2007. (NEMA, No. 93 at p. 12) Additionally, NEMA, LEDVANCE, and Philips asserted that DOE is authorized to establish standards for rough service lamps, shatter-resistant, 3-way incandescent, and vibration service lamps only under the provisions in 42 U.S.C. 6295(l)(4) and that the sales thresholds required under that section to regulate shatter-resistant and 3-way incandescent lamps have not been met. (NEMA, No. 93 at p. 12; LEDVANCE, No. 90 at pp. 19-20; Philips, No. 96 at p. 4) LEDVANCE stated that the more specific reference to regulate rough service lamps, shatter-resistant lamps, 3-way incandescent lamps and vibration service lamps must be read as governing the regulation of these lamps, as opposed to the more general provision in 42 U.S.C. 6295(i)(6)(A)(i)(II). (LEDVANCE, No. 90 at p. 20)
Under 42 U.S.C. 6295(l)(4), DOE is required to undertake a standards rulemaking for rough service lamps, shatter-resistant lamps, 3-way incandescent lamps and vibration service lamps when the sales of these lamps meet specified thresholds. DOE is also required, in consultation with NEMA, to collect sales data for these lamps and construct a model to predict future sales. (42 U.S.C. 6295(l)(4)(B)) DOE must then track the actual sales data, and when sales exceed sales projected by the model by 100 percent, DOE must initiate a rulemaking. (42 U.S.C. 6295(l)(4)(D), (E), (F), (H)) If DOE does not complete the accelerated rulemaking in the specified time period, it must impose a backstop requirement for that lamp. (42 U.S.C. 6295(l)(4)(D)(ii), (E)(ii), (F)(ii), (H)(ii))
However, this is not the only way in which DOE can regulate these lamps. The text of section 6295(i) and 6295(l) does not state that the section 6295(l) process operates to the exclusion of regulating these lamps as GSLs. As commenters noted with respect to the section 6295(i)(6)(A)(v) backstop, GSLs may become subject to a default standard of 45 lm/W; but DOE is authorized to impose alternative standards for GSLs in general so long as the overall savings from such a rule are at least as great as a uniform 45 lm/W standard would achieve. Thus, in regulating the five types of section 6295(l) lamp as GSLs, DOE would be able to establish a range of possible standards. However, for these particular lamps, when sales have increased to a certain point, section 6295(l) requires DOE to conduct an accelerated rulemaking, and absent that rulemaking, specifies certain minimum standards. That requirement is not inconsistent with the regulatory framework applicable to GSLs, and Congress's decision to set a separate backstop for these lamps (conditioned on factual circumstances) does not suggest that Congress meant to exclude them from the broader regulatory program.
Additionally, as DOE explained in the October 2016 NOPDDA, DOE understands the reference to “data collected” by DOE under the GSL rulemaking provision to mean the data collected as required for rough service lamps, vibration service lamps, 3-way incandescent lamps, and shatter-resistant lamps. 81 FR 71794, 71798. As noted, DOE is required to collect sales data for these lamps. (42 U.S.C. 6295(l)(4)(B)) The consideration of sales data collected by DOE in making a determination under 42 U.S.C. 6295(i)(6)(A)(i)(II) further demonstrates that the determination is to include rough service lamps, vibration service lamps, 3-way incandescent lamps, and shatter-resistant lamps.
GE agreed with regulating vibration service lamps and rough service lamps as the sales of these lamps have been increasing and have surpassed the allowed sales threshold. GE added that these lamps resemble and, therefore, are being purchased to replace the standard incandescent A shape lamp. (GE, No. 83 at p. 72; GE, No. 88 at p. 2) However, GE stated that shatter-resistant lamps and 3-way lamps are declining in sales, indicating low risk of lamp switching. GE added that the risk of lamp switching is particularly low for the 3-way lamp. GE explained that these lamps are made in A21 and A23 shapes because the filament must be placed farther from the glass due to the increased heat. Therefore, these lamps may not fit in existing fixtures where A19 shape lamps are used and also may not meet the UL wattage limit on many fixtures in the home. (GE, No. 83 at pp. 72-73; GE, No. 88 at p. 2) NEMA agreed that lamp switching for 3-way lamps is unlikely because the A21 lamp size is larger than the size of the regular A19 lamp and is not a suitable replacement for a regular incandescent lamp. NEMA also added that the safety standard UL 1598 contains a thermal requirement for most common general service lighting fixtures that limits lamp wattage to 100 W and thus higher 150 W 3-way incandescent lamps cannot be used in these fixtures. Further, NEMA commented that many light switches are incapable of controlling the 3-way functionality of a 3-way lamp and it is unlikely a consumer would purchase a more expensive 3-way lamp if the functionality is not desired or cannot be used. (NEMA, No. 93 at p. 16)
NEMA also disagreed with DOE's proposal to consider shatter-resistant lamps as GSILs noting that sales have fallen 50 percent since 1997, did not increase when traditional GSILs were phased out from 2010-2012, and have not exceeded the statutory threshold under section 325(l)(4)(H). NEMA noted that DOE cannot justify regulating shatter-resistant lamps using a potential for lamp switching because Congress established a clear threshold for the regulation of these lamps of exceeding the estimated sales by 100 percent. Thus, NEMA concluded that DOE does not have the discretion to determine that shatter-resistant lamps are GSLs and must adhere to the limits of the statue. (NEMA, No. 93 at p. 15) Additionally, NEMA commented that the coating on the shatter-resistant lamp reduces the lumen output significantly, making it not ideal as a replacement for a GSIL or general service LED lamp. NEMA added that the lumen output of a 60 W shatter-resistant lamp is identical to the lumen output of a 40 W standard incandescent lamp. As a result of the lumen output differences, NEMA noted that lamp switching is not likely to occur as consumer will not treat a lower lumen lamp as an effective substitute. (NEMA, No. 93 at pp. 15-16) Westinghouse noted that when standards from EISA 2007 became effective consumers did not switch to 3-way lamps, rough service lamps, or shatter-resistant lamps at the time. (Westinghouse, No. 83 at pp. 74-76)
In contrast, CA IOUs, NRDC, and Utility Coalition supported the proposal to discontinue exemptions for shatter-
CA IOUs agreed that LED replacements that provide the same functionality are available for these lamp types, in particular the 3-way lamp type. CA IOUs noted that many of the major manufacturers provide 3-way LED replacements and these lamps are highly efficient and reasonably priced in the $10-$14 range. Utility Coalition added that DOE testing confirmed that 3-way LED lamps are highly efficient with an efficiency of 111.4 lm/W at the middle setting. (CA IOUs, No. 83 at p. 77; Utility Coalition, No. 95 at p. 3) Westinghouse disagreed citing a high cost differential for consumers to switch to 3-way LED lamps. Westinghouse stated that a 3-way incandescent lamp costs $2.19 while a 3-way LED lamp is in the $20-$22 range with older versions on clearance at $15-$16. (Westinghouse, No. 83 at pp. 74-76)
DOE reviewed the sales data submitted by NEMA for the shatter-resistant and 3-way incandescent lamps. The sales of shatter-resistant lamps declined between 2012 and 2015. The sales of 3-way incandescent lamps increased between 2012 through 2014 and then decreased in 2015. However, sales of these lamps have declined over a limited time period. Further, NEMA submitted data for 2015 that indicated that almost 32 million
Regarding the lamp switching potential of 3-way lamps, as stated by NEMA and GE, UL 1598 prescribes wattage requirements for certain luminaires. However, UL 1598 is not a comprehensive standard of all fixtures that could be used in general lighting applications. DOE notes that, as stated previously, lamp switching includes shifting to the use of different fixtures in the future and therefore lamp size does not necessarily prevent switching. Regarding the lamp switching potential of shatter-resistant lamps, DOE notes that shatter-resistant lamps are capable of providing overall illumination despite the lower lumen output resulting from the shatter-resistant coating. As noted by NEMA, a 60 W shatter-resistant lamp is still an appropriate replacement for a 40 W standard incandescent lamp.
DOE also expects the sales of these lamps to increase since they could be used as replacements for other regulated lamp types. Shatter-resistant lamps are similar to rough service and vibration service lamps, two lamp categories for which sales have already increased as a result of standards for GSILs. Whereas rough service and vibration service lamps possess a filament strengthened with additional supports, shatter-resistant lamps possess a reinforced outer bulb to contain glass pieces in the event that the bulb breaks. For all three lamp types the consumer may be under the impression that they are purchasing primarily a more durable product rather than a lamp with subpar performance as claimed by NEMA. Some lamps are even offered with more than one of these criteria (
As noted, the sales threshold set by EPCA for vibration service incandescent lamps and rough service incandescent lamps has been exceeded. The increasing sales of these lamp types and industry's feedback on their use indicate that these products are used in general lighting applications as substitutes for GSILs. (Westinghouse, No. 83 at pp. 41-42; NEMA, No. 83 at pp. 52-53; GE, No. 83 at p. 73), Therefore, DOE is also discontinuing the exemptions of rough service and vibration service lamps from GSILs in this final rule.
In summary, DOE is discontinuing the following exemptions from the definition of GSIL in this final rule: Reflector lamps; T shape lamps that use not more than 40 W or has a length of more than 10 inches; B, BA, CA, F, G16-1/2, G25, G30, S, M-14 lamps of 40 W or less; rough service lamps; shatter-resistant lamps; 3-way incandescent lamps; and vibration service lamps.
In the October 2016 NOPDDA, DOE proposed to maintain 14 exemptions from the definition of GSIL. DOE found that medium screw base incandescent lamps that are appliance; black light; bug; colored; infrared; left-hand thread; marine; marine signal service; mine service; plant light; sign service; silver bowl; showcase; and traffic signal lamps had low sales data thus indicating that these are low volume products. DOE estimated that 12 of the 14 exemptions have annual unit sales of 1 million units or less. The remaining two exemptions, appliance lamps and colored lamps, were estimated to have less than 3 million annual unit sales and less than 2 million annual unit sales, respectively. DOE also tentatively concluded that several of these exempted lamp types are unable to serve in general lighting applications and cannot provide overall illumination. Specifically, black light; bug; colored; infrared; and plant light lamps produce radiant power in specific wavelengths of the electromagnetic spectrum that would prevent these lamps from serving in general lighting applications. Further, DOE noted that proposing definitions for these exempted lamp types will help to prevent them from becoming loopholes. (See section III.B for a discussion of the definitions proposed for exemptions.) 81 FR 71801. DOE received comments on the 14 GSIL exemptions proposed to be maintained in the October 2016 NOPDDA.
CEC supported DOE's decision to maintain the 14 exemptions from the GSIL definition that it believes are unable to serve in general lighting applications and cannot provide overall illumination. (CEC, No. 91 at p. 5) NEMA, Philips, and GE also agreed with the 14 exemptions from the GSIL definition that DOE proposed to maintain. (NEMA, No. 93 at p. 22; Philips, No. 96 at p. 3; GE, No. 88 at p. 2) GE commented that sales of the 14 exemption categories are small and decreasing, while offering little opportunity for energy savings. (GE, No. 88 at p. 2) Philips added that these lamps serve many niche applications that currently do not have LED replacements in the same form factor and are unlikely to in the future due to technology limitations. Philips stated that it prefers to leverage improvements in SSL technology to improve performance, reduce cost, and offer innovative versions of mainstream products rather than invest in low volume R&D intensive niche products. Philips concluded that this will encourage consumer adoption and increase energy savings. (Philips, No. 96 at p. 3)
In contrast, ASAP recommended discontinuing several of the 14 exemptions from the GSIL definition noting that the proposed definitions were not specific enough to prevent potential loopholes.
ASAP recommended discontinuing the exemptions for marine and mine lamps because there is little difference in manufacturing or performance of these lamps compared to GSILs, and there are energy-efficient replacements available. (ASAP, No. 94 at p. 5) Utility Coalition also recommended DOE not exempt marine lamps noting that they agreed with DOE's determination that marine lamps provide overall illumination and argued that DOE should not exempt the incandescent versions of these lamps because a potential loophole may result. In addition, Utility Coalition stated that LED versions of marine lamps are now available with substantially higher efficiencies than the incandescent versions. (Utility Coalition, No. 95 at p. 7)
For marine lamps and mine service lamps, as shown in Table III.1, DOE estimates that the annual sales were less than 1 million units for each lamp type and therefore concludes that marine lamps and mine service lamps are low volume products. Further, DOE has adopted definitions in this final rule requiring that these lamps are designed and labeled for their respective applications in order to discourage their use in general lighting applications. (See sections III.B.10 and III.B.4 for the adopted definitions of mine service lamp and marine lamp, respectively.) For these reasons, DOE has maintained the exemptions from the GSIL definition for marine lamps and mine service lamps.
ASAP also recommended discontinuing the exemption for showcase lamps to prevent a potential loophole noting they are widely available, can fit in many light fixtures, and are similar to the T shape lamps that DOE proposed to include. (ASAP, No. 94 at p. 5) DOE determined that showcase applications generally have space constraints and therefore typically require the use of lamps with specific shapes and characteristics to serve in this specialty application. As shown in Table III.1, DOE estimates the annual sales of showcase lamps to be less than 1 million units and thus concludes that these lamps are low volume products. In addition, DOE has adopted a definition in this final rule that includes only specific shapes and wattages and requires that showcase lamps be designed and labeled for their specialty application in order to discourage their use in general lighting applications. (See section III.B.5 for the adopted definition of showcase lamp.) Given the specific characteristics of showcase lamps outlined in the definition, DOE concluded that the continued exemption of showcase lamps is unlikely to create a loophole. Thus, DOE has maintained the exemption for showcase lamps from the GSIL definition in this final rule.
ASAP noted that the exemption for bug lamp should be discontinued because it was found recently in a study presented at the American Academy of Arts and Sciences 2016 Annual Meeting that warm light LED lamps attracted fewer bugs than incandescents, CFLs, halogens, cool light LED lamps, and incandescent bug lamps. (ASAP, No. 94 at p. 5) DOE understands that research has been conducted to assess the most effective sources for preventing bug attraction. The abstract of the study
Regarding plant light lamps, ASAP commented that the LED versions of these lamps are a better alternative to incandescent plant light lamps and less expensive to operate. (ASAP, No. 94 at p.5) DOE acknowledges the potential for LED lamps to be well suited to provide light in specific spectral ranges to encourage plant growth; however, DOE also believes this to be an area of continuing research
ASAP recommended including traffic signal lamps in the definition of GSL. (ASAP, No. 94 at p. 4) NRDC stated that the exemption for traffic signal lamps is not warranted because these lamps are suitable for general lighting applications and are comparable to rough service or vibration service lamps through the use of a sturdier filament. NRDC noted that these lamps available in medium screw bases, have input voltages of 120 V and 130 V, and have significant light output comparable to 40 W or 60 W lamps. NRDC added that LED lamps can serve as suitable replacements for traffic signal lamps, as they are physically durable, have long lifetimes, and already exist at the desired voltages and light output levels. (NRDC, No. 83 at pp. 12, 95; NRDC, No. 85 at p. 8) Utility Coalition also recommended DOE not exempt traffic signal lamps from the GSL definition. Utility Coalition noted that they agreed with DOE's determination that traffic signal lamps provide overall illumination and argued that DOE should not exempt the incandescent versions of these lamps because a potential loophole may result. In addition, Utility Coalition noted that LED versions of traffic signal lamps are now available with substantially higher efficiencies than the incandescent versions. (Utility Coalition, No. 95 at p. 7)
DOE understands that traffic signal lamps may share characteristics with rough service or vibration service lamps; however, DOE also identified a characteristic of traffic signal lamps—a very long lifetime, which indicated they were designed for a specialty application. As shown in Table III.1, DOE estimates the annual sales of traffic signal lamps to be less than 1 million units and thus concludes that these lamps are low volume products. In addition, DOE believes removing the exemption for traffic signal lamps could result in safety concerns or stranded equipment. DOE has adopted a definition in this final rule specifying a minimum lifetime requirement and requiring that these lamps be designed and marketed for their specialty application in order to discourage their use in general lighting applications. (See section III.B.6 for the adopted definition of traffic signal lamp.) For the reasons discussed in this paragraph, DOE has maintained the exemption for traffic signal lamp from the GSIL definition in this final rule. DOE will continue to monitor the market and may reconsider this decision in the future if traffic signal lamps are used in general lighting applications.
CA IOUs acknowledged that silver bowl lamps are unique in that they have an aluminum cover at the top that reflects light back into the fixture. However, CA IOUs stated that these lamp types are becoming more popular and being used for general illumination, often in restaurants, because they can still project light into an area and provide overall illumination. CA IOUs and ASAP added that silver bowl LED lamps are also becoming more common and offered in different form factors. Therefore, CA IOUs recommended that the exemption for silver bowl lamps from GSILs be discontinued. (CA IOUs, No. 83 at pp. 107-108; ASAP, No. 94 at p.5) Utility Coalition also recommended that DOE not exempt silver bowl lamps from the GSL definition. Utility Coalition noted that they agreed with DOE's determination that silver bowl lamps provide overall illumination and argued that DOE should not exempt the incandescent versions of these lamps because a potential loophole may result. (Utility Coalition, No. 95 at p. 7)
As shown in Table III.1, DOE estimates the annual sales of silver bowl lamps to be approximately 1 million units and thus concludes that these lamps are low volume products. In addition, DOE has determined that silver bowl lamps use an opaque reflective coating to provide diffuse light concentrated in an upward direction which other lamps, such as omnidirectional or reflector lamps, are unable to provide without the use of additional components. DOE has adopted a definition in this final rule specifying the inclusion of an opaque reflective coating and requiring that these lamps be designed and marketed for their specialty application in order to discourage their use in general lighting applications. (See section III.B.7 for the adopted definition of silver bowl lamp.) For these reasons, DOE has maintained the exemption for silver bowl lamp from the GSIL definition in this final rule.
Utility Coalition also recommended that DOE not exempt left-hand thread lamps from the GSL definition. Utility Coalition noted that they agreed with DOE's determination that left-hand thread lamps provide overall illumination and argued that DOE should not exempt the incandescent versions of these lamps because a potential loophole may result. In addition, Utility Coalition noted that LED versions of left-hand thread lamps are now available with substantially higher efficacies than the incandescent versions. (Utility Coalition, No. 95 at p. 7)
As shown in Table III.1, DOE estimates the annual sales of left-hand thread lamps to be less than 1 million units and thus concludes that these lamps are low volume products. In addition, DOE has adopted a definition in this final rule requiring that these lamps be designed and marketed for their specialty application in order to discourage their use in general lighting applications. (See section III.B.10 for the adopted definition of left-hand thread lamp.) Given the very low sales and the adopted definition, DOE concluded that the continued exemption of left-hand thread lamps is unlikely to create a loophole. Thus, DOE has maintained the exemption for left-hand thread lamps from the GSIL definition in this final rule. DOE will continue to monitor the market and may reconsider this decision in the future if left-hand thread lamps are used in general lighting applications.
Westinghouse stated that the lumen output of heat lamps (or infrared lamps) is low but was not sure if it is below 310 lumens which would exclude them from the GSL definition. (Westinghouse, No. 83 at p. 43) DOE notes that
DOE also estimated the sales data of medium screw base incandescent lamps that are appliance lamps; black light lamps; colored lamps; marine signal service lamps; and sign service lamps. As indicated in Table III.1, the annual sales of black light, marine signal service, and sign service lamps were 1 million units or less. Appliance lamps and colored lamps were estimated to have annual sales of 2 million units or less. Having received no comments to the contrary, DOE has maintained the exemptions for these lamps due to low sales and the inability or unlikelihood of these lamps to serve in general lighting applications. Further, DOE adopted definitions for these exempted lamp types to prevent them from becoming loopholes. (See section III.B for a discussion of the adopted definitions.)
As discussed in section III.A.1.a, in this final rule, DOE is also maintaining the exemption of G shape lamps with a diameter of 5 inches or greater. As stated previously, DOE will continue to monitor the market and may reconsider this decision in the future if G shape lamps with a diameter of 5 inches or greater are used in general lighting applications.
Based on the preliminary determinations in the October 2016 NOPDDA, DOE proposed a new definition for GSIL. GSILs are included in the definition of GSL. (42 U.S.C. 6291(30)(BB)(i)(I)) Thus, any lamp that meets the definition of a GSIL would be a GSL. ASAP supported DOE's proposed revisions to the GSIL definition stating that it is clearer and reduces the chances of loophole products emerging that can undercut the energy savings from the 45 lm/W backstop standard. (ASAP, No. 94 at p. 3)
In this final rule, DOE is adopting a revised definition of GSIL, A general service incandescent lamp is a standard incandescent or halogen type lamp that is intended for general service applications; has a medium screw base; has a lumen range of not less than 310 lumens and not more than 2,600 lumens or, in the case of a modified spectrum lamp, not less than 232 lumens and not more than 1,950 lumens; and is capable of being operated at a voltage range at least partially within 110 and 130 volts; however this definition does not apply to the following incandescent lamps: An appliance lamp; a black light lamp; a bug lamp; a colored lamp; a G shape lamp with a diameter of 5 inches or more as defined in ANSI C79.1-2002; a n infrared lamp; a left-hand thread lamp; a marine lamp; a marine signal service lamp; a mine service lamp; a plant light lamp; an R20 short lamp; a sign service lamp; a silver bowl lamp; a showcase lamp; and a traffic signal lamp. See the amendments to § 430.2 for the revised definition in its entirety.
CFLs are also included in the definition of GSL; however, the term “compact fluorescent lamp” was not previously defined. DOE adopted a definition for CFL in the August 2016 CFL test procedure final rule. 81 FR 59386, 59403 (August 29, 2016). DOE incorporated language from the industry standards published by IES RP-16-10 and IES LM-66-14 to define CFL without inappropriately excluding or including lamps.
DOE did not receive any comments regarding this definition and therefore considers CFLs to be lamps as described in the definition adopted in the August 2016 CFL test procedure final rule.
General service LED and OLED lamps are included in the definition of GSL under 42 U.S.C. 6291(30)(BB). DOE proposed definitions for both terms in the October 2016 NOPDDA. 81 FR 71803. NEMA recommended and LEDVANCE supported their recommendation that the definition of general service LED lamp be modified to include lamps marketed for vibration service, rough service, and vibration resistance and exclude specialty lamps and specialty base lamps as defined by NEMA. (NEMA, No. 93 at p. 26; LEDVANCE, No. 90 at pp. 32-33)
As described in section III.A.1.a, DOE discontinued exemptions for vibration service and rough service lamps from the definition of GSIL and therefore these lamps are also included in the definition of GSL. 81 FR 71801. DOE has addressed other specialty lamps as they relate to the definition of GSL in section III.A.4. Therefore, DOE has not revised the definition of “general service LED lamp” in this final rule.
DOE is definitions for “general service LED lamp” and “general service OLED lamp” as detailed in the amendments to § 430.2.
As stated previously, the definition of GSL includes (subject to the exemptions to the extent DOE maintains them) any other lamps that DOE determines are used to satisfy lighting applications traditionally served by GSILs. (42 U.S.C. 6291(30)(BB)(i)(IV)) In addition to GSILs, CFLs, and general service LED and OLED lamps, DOE proposed in the October 2016 NOPDDA a determination that any other lamps that are intended to serve in general lighting applications and have specific features would meet the statutory criterion of lamps used to satisfy lighting applications traditionally served by GSILs. To implement this determination in the October 2016 NOPDDA, DOE proposed to define general service lamp as a lamp capable of serving in general lighting applications and that has the following basic characteristics: (1) An ANSI base (with the exclusion of light fixtures and LED downlight retrofit kits); (2) a lumen output of greater than or equal to 310 lumens and less than or equal to 4,000 lumens; (3) an ability to operate at any voltage; and (4) no designation or label for use in non-general applications. 81 FR 71807. “General lighting application” is currently defined at 10 CFR 430.2 as lighting that provides an interior or exterior area with overall illumination. The key aspects of the proposed definition of GSL and specific comments received regarding these features are discussed in the following sections.
Regarding DOE's authority to include other lamps as GSLs, DOE received several comments regarding the availability of equivalent LED substitutes. Westinghouse commented
After reviewing product availability, technical information, and comments from stakeholders, DOE believes there are three main categories of lamps: (1) Lamps with more efficient, equivalent replacements (
Regarding the third category of lamps, DOE believes that there are certain lamps that cannot be made with fluorescent or LED technology while reasonably maintaining the same form factor and light output, and thus more efficient, equivalent replacements are technically infeasible for these lamps. For example, certain bipin and double-ended halogen lamps have such small form factors that current information shows it is unlikely that these lamps can be made using a more efficient technology while maintaining a similar form factor and light output. DOE is aware of ongoing research regarding the design challenges when adapting LED technology to the compact form factors of the incandescent and halogen lamps they are intending to replace.
DOE believes this conclusion is significant because the unavailability of non-incandescent substitutes for a given lamp suggests that lamp is not being used for traditional GSIL applications. The applications traditionally served by GSILs involve general illumination, and DOE believes non-incandescent lamps such as CFLs and LED lamps can adequately serve that application. Indeed, that premise is fundamental to the policy set by EISA 2007 regarding energy use in lighting; the 45 lm/W default standard would likely preclude the use of incandescent technology for any lamp to which it applied. DOE recognizes that various lighting applications do not involve general illumination, and that many of those applications involve technical requirements that necessitate design features in lamps such as specific sizes, shapes, and lumen outputs. If the design characteristics of lamps for a given application are such that non-incandescent lamps cannot be made with the same characteristics, DOE believes it cannot, at present, conclude that those lamps are being used for general illumination. Consequently, DOE is not including such lamps as “other lamps” in its definition of GSL. In the discussion that follows, DOE refers to lamps that it, for this reason, is excluding from GSLs as “specialty products.” But DOE emphasizes that it uses that language only for convenience in explaining its decisions. It is not in fact determining that such lamps are “specialty products.” Rather, and consistent with the “other lamps” clause, DOE is simply declining to determine that such lamps are used for traditional GSIL applications.
DOE has reviewed product availability to determine which form factor and light output combinations may not be available in fluorescent or LED technology. For the second category of lamps, products that do not currently have more efficient replacements with the same form factor and light output but for which replacements can likely be made in the future, DOE believes that it is possible to manufacture equivalent replacements but that companies have chosen not to do so because the market demand has not yet been great enough. These products have been included in the definition of general service lamp, to the extent they satisfy other aspects of the definition. As discussed in the following sections, DOE has developed multiple criteria that together justify a determination that a lamp is used for traditional GSIL applications. For lamps that cannot be made with non-incandescent technology, those criteria may be insufficient and DOE has excluded such lamps from being GSLs. But for lamps that can be made with non-incandescent technology, DOE believes the criteria it has developed will be adequate for the “other lamps” determination, just as for lamps that are already available with non-incandescent technology.
As stated previously, EISA 2007 added the definition of GSL to EPCA and defined the term, in part, to include GSILs, CFLs, general service LED and OLED lamps, and any other lamp that DOE determines is used to satisfy lighting applications traditionally served by GSILs (“other lamps” authority). (42 U.S.C. 6291(30)(BB)(i)(IV)).
To implement this provision, DOE must determine what types of lighting applications have been traditionally served by GSILs; and then it must establish criteria for determining whether a given lamp is used in such applications. With respect to the first issue, the October 2016 NOPDDA noted that GSILs have traditionally provided overall illumination. DOE bases that conclusion on the definition of GSIL and its review of lamps in the market that fulfill that definition. A GSIL, as defined in section 6291(30)(D), is (subject to exemptions) “a standard incandescent or halogen type lamp” that “is intended for general service
GE stated that the phrase “used in general lighting applications” that DOE included in the proposed definition of GSL was too vague and DOE should instead include the phrase “used to satisfy lighting applications traditionally served by general service incandescent lamps.” GE explained that for a product to satisfy light applications traditionally served by GSILs it should have a medium screw base, produce between 310 and 2,600 lumens, and operate on a voltage between 110 and 130 V per the current definition of GSILs. (GE, No. 83 at p. 130; GE, No. 88 at pp. 2-4)
NEMA commented that the authority to include other lamps that are used to satisfy lighting applications traditionally served by GSILs is limited to consideration of new technologies given that the EISA 2007 amendment establishing the GSL definition was enacted when halogen technology was just beginning to be introduced and development of LED technology was underway. (NEMA, No. 93 at pp. 3-4)
DOE acknowledges that the phrase identified by GE is the same one used in the statutory definition of GSL. While including the phrase would ensure consistency with the statutory definition, it is clear from the comments on this rulemaking that the phrase is ambiguous and needs further clarification.
With respect to NEMA's comment, nothing in the language of the statute limits the consideration of “other lamps” to “new technologies.” EPCA directs DOE to consider how GSILs have traditionally been used (
In developing a definition for GSL that includes “other lamps,” DOE has also considered how to determine whether a lamp is used for traditional GSIL applications. EPCA does not specify to what extent a lamp must be used to satisfy those applications in order to be considered a GSL, and DOE does not interpret the definition to require that the use of other lamps be extensive. As in its consideration of whether to maintain an exemption under the GSL definition, DOE also considered the potential of lamp switching that may occur in response to any GSL standard when evaluating “other lamps.” Even if a lamp is currently used in only very limited instances to satisfy lighting applications traditionally served by GSILs, that use has the potential to increase in response to a standard for GSLs.
DOE does not have data on every application in which a lamp is used, so absent complete data on actual use, DOE considers the characteristics of a lamp relevant for assessing whether it is used to satisfy lighting applications traditionally served by GSILs. In looking at the application of a GSIL, DOE considered the lighting characteristics of a GSIL,
Utility Coalition and CA IOUs asserted that the scope of GSL is not limited to residential products. The definition of “general lighting application” means “lighting that provides an interior or exterior area with overall illumination,” with no mention of sector. Utility Coalition stated that the inclusion of all voltages and bases in the proposed GSL definition reinforces that this rulemaking is not specific to only residential products. Further Utility Coalition asserted that the existence of exemptions for clearly non-residential lamps, such as marine lamps and traffic signal lamps, indicated that the scope of GSLs is not only residential products. (Utility Coalition, No. 95 at p. 4; CA IOUs, No. 83 at p. 136)
With respect to whether “other lamps” must be for residential use, DOE notes that GSLs are regulated under Title III, Part B of EPCA, The Energy Conservation Program for Consumer Products Other Than Automobiles;
Nothing in the language of the statute limits the consideration of “other lamps” to “new technologies.” EPCA directs DOE to consider how GSILs have traditionally been used (
As described in the October 2016 NOPDDA, GSILs have traditionally provided overall illumination. Therefore, a lamp that would satisfy the same application as traditionally served by GSILs is one that would provide overall illumination. DOE included the phrase “is used in general lighting applications” in the definition of GSL because “general lighting application” means lighting that provides an interior or exterior area with overall illumination. As described in the October 2016 NOPDDA, DOE considers the term “overall illumination” to be similar in meaning to the term “general lighting” as defined in the industry standard ANSI/IES RP-16-10 (hereafter “RP-16”). RP-16 states that “general lighting” means lighting designed to provide a substantially uniform level of illuminance throughout an area, exclusive of any provision for special local requirements.
DOE acknowledges the point that some commenters made, that the “other lamps” subclause in the GSL definition refers to lamps that “are used” for traditional GSIL applications, not lamps that could be so used or are likely to be so used. DOE's approach is consistent with that language. A lamp that is capable of being used for general illumination could, in many cases, be used for traditional GSIL applications. But, as previously described, that capability is not sufficient, on its own, to qualify a lamp as an “other lamp” under DOE's definition. Rather, a lamp must have specific additional characteristics, described in later sections. DOE believes that this set of market characteristics, in light of market realities, is sufficient to identify lamps that
As noted, DOE does not interpret “are used” to impose a particular threshold of how prevalent a GSIL-type use must be before a lamp can qualify as an “other lamp.” In addition, the statute does not specify that the GSIL-type uses be the only uses of a lamp for it to qualify as an “other lamp.”
Finally, DOE does not believe that by referring to lamps that “are used” for GSIL-type applications, EPCA requires DOE to have direct evidence of such uses. As usual with factual determinations, this one can be made on the basis of expert judgment and circumstantial evidence. The criteria discussed in later sections are relevant in that respect; these are characteristics that make a lamp particularly suitable for consumers' use as a substitute for GSILs. DOE notes that lamps—like other products—tend to be designed and optimized for the applications in which buyers actually use them. Consistent with that observation, specialty lamps tend to have a range of design characteristics which make them especially suitable for their particular applications, and at the same time make it more difficult to use them in the same applications as GSILs. Thus, if a lamp that is capable of providing general illumination has design features that make it highly suitable for performing that task in the sort of application that GSILs have traditionally served, DOE infers that manufacturers of that lamp are, to some extent, serving buyers that use the lamps in that way. The marketing or labeling of a lamp also helps reveal the uses to which a lamp is actually put. If a lamp is marketed solely for specialty purposes, that fact makes it less likely that the lamp is used for traditional GSIL applications. DOE has reflected this consideration by excluding from the definition of GSL certain specialty lamps.
In the October 2016 NOPDDA, DOE proposed that a GSL must have an ANSI base, with the exclusion of light fixtures and LED downlight retrofit kits. DOE noted that it considers an ANSI base to be a lamp base standardized by the American National Standards Institute. To better clarify the term ANSI base, DOE proposed a definition in the October 2016 NOPDDA. 81 FR 71804. More specifically, an
Utility Coalition supported DOE's proposal to include all bases specified in ANSI C81.61-2016 or IEC 60061-1:2005 in the GSL definition and noted the wide availability of base types in LED lamps. (Utility Coalition, No. 95 at p. 4) ASAP also commented that the ANSI base type specification is appropriate. ASAP noted that bases commonly found in residential applications are driven by the applications or fixture types that are popular at that point in time and can be driven by changes in the market or manufacturing decisions to take advantage of existing standards. (ASAP, No. 83 at pp. 117-118)
However, GE commented that base type needs to be limited because lamps are included in the GSL scope that have never been nor cannot ever be used in a home, and instead are intended for use in specialty commercial or industrial applications. GE explained that most fixtures in homes have predominantly medium screw base sockets with some candelabra base sockets and very few intermediate base sockets. (GE, No. 83 at p. 130) NEMA stated that DOE should include only common base types as only they would be used to satisfy lighting applications traditionally served by GSILs. Maxlite agreed that the ANSI base specification is too broad and suggested limiting general service lamps to those with bases that are common in consumer and residential products. (NEMA, No. 93 at pp. 27-28; Maxlite, No. 83 at p. 123)
As noted in section III.A.4.b, EPCA directs DOE to include as GSLs lamps that are used to satisfy lighting
For this final rule, DOE reviewed available product offerings by ANSI base type. While DOE is maintaining the specification that GSLs must have an ANSI base, DOE has concluded that certain incandescent/halogen lamps without more efficient, equivalent replacements should not—for the reasons previously given—be included in the definition of GSL. As described in more detail in section III.A.4.f, DOE is excluding lamps with the following ANSI bases from the definition of GSL: Wedge bases; prefocus bases; reflector lamps with a diameter less than 2 inches that do not have E26/24, E26d, E26/50x39, E26/53x39, E29/28, E29/53x39, E39, E39d, EP39, or EX39 bases; and J, JC, JCD, JCS, JCV, JCX, JD, JS, and JT shape lamps that do not have Edison screw bases. DOE did not receive comments specific to its proposed definition of ANSI base. However, upon further deliberation, DOE has concluded that the term “ANSI base” is clear enough that it does not need a specific regulatory definition.
In the October 2016 NOPDDA, DOE proposed to prescribe a maximum lumen output when defining GSL. DOE noted that it believes that lamps with lumen outputs greater than 2,600 can be used in overall illumination and therefore would meet the definition of GSL. However, DOE reviewed available product information and proposed a maximum lumen output in the definition of GSL. At the time of the October 2016 NOPDDA, DOE noted that overall product offerings of general service lamps significantly decreased around 4,000 lumens. Using product offerings as a proxy for overall sales, DOE concluded that sales of lamps with lumen outputs greater than 4,000 lumens were also much lower than lamps with lumen outputs between 310 and 4,000 lumens. While sales are not necessarily an indication of use in general lighting applications, DOE tentatively concluded that the limited and unique product offerings above 4,000 lumens indicated that these lamps may be used mainly in specialty applications rather than for applications traditionally served by GSILs. Therefore, DOE proposed that general service lamps must have lumen outputs greater than or equal to 310 lumens and less than or equal to 4,000 lumens. 81 FR 71804.
NEMA and LEDVANCE argued that DOE cannot regulate high lumen lamps (2,601-3,300 lumen lamps) unless the sales threshold specified in 42 U.S.C. 6295(l)(4)(G) is met (
NEMA commented that DOE does not acknowledge that sales of high lumen incandescent lamps have been decreasing over the last several years and that DOE states that most product offerings between 2,601 and 3,300 lumens are CFLs and LED lamps without providing sales data to support this claim. NEMA stated that although this observation may be correct, DOE is proposing to eliminate high lumen incandescent lamps from the market by applying the 45 lm/W backstop standard without considering the statutory requirement for regulating this lamp type. NEMA stated that DOE cannot include all three lamp technologies in one category noting that DOE has not provided evidence that such a standard would be economically justified for high lumen CFL and LED lamps or would achieve significant energy savings. NEMA added that DOE did not identify high lumen incandescent lamps as posing a lamp switching risk and noted that, following DOE's proposed reasoning, these lamps provide no lamp switching risk. In addition, NEMA stated that DOE must adhere to the requirements outlined by Congress for regulating these lamps and cannot use its discretion alone. Further, NEMA concluded that these lamps are not used to satisfy lighting applications traditionally served by GSILs, noting that high lumen incandescent lamps are mostly used in commercial and outdoor applications where very bright light is required. (NEMA, No. 93 at p. 21)
As DOE explained for shatter-resistant incandescent and 3-way incandescent lamps in III.A.1.a, 42 U.S.C. 6295(l)(4)(G) requires DOE to complete a rulemaking for high lumen lamps when the sales threshold is met. However, as previously explained, the mandatory rulemaking under 42 U.S.C. 6295(l)(4) is not the only avenue for DOE to regulate high lumen lamps. Additionally, DOE is not making a determination as to the lumen limit in the definition of GSIL. As commenters noted, the definition of GSIL applies to lamps that have a lumen range of not less than 310 lumens and not more than 2,600 lumens (or, in the case of a modified spectrum lamp, not less than 232 lumens and not more than 1,950 lumens). The definition of GSIL remains limited to lamps that have a lumen range of not less than 310 lumens and not more than 2,600 lumens (or, in the case of a modified spectrum lamp, not less than 232 lumens and not more than 1,950 lumens). DOE is adding a lumen range of greater than or equal to 310 lumens (or 232 lumens for modified spectrum general service incandescent lamps) and less than or equal to 3,300 lumens to the definition of GSL for “other lamps.” As discussed previously in this document, consideration of including lamps in the definition of GSL under the “other lamps” authority is a separate consideration from whether to maintain or discontinue an exemption from the GSL (and GSIL) definition. DOE is establishing this lumen range as part of the definition of GSL as authorized under the “other lamps” provision in the statutory definition of GSL. (42 U.S.C. 6291(30)(BB)(i)(IV)).
The consideration of “other lamps” is not limited by a lumen range. Where Congress intended to limit the definition of GSL based on certain lamp characteristics, it did so (
DOE also received comments recommending both raising and lowering the upper lumen limit. NRDC commented that they support the upper lumen limit of 4,000 lumens but noted that they identified several lamps around 3,910 lumens, and therefore suggested increasing the lumen range to around 4,500 lumens to prevent a potential loophole. (NRDC, No. 83 at pp. 10; 138) While supporting an upper lumen bound, NEMA and GE stated that DOE should not set the maximum lumens for GSLs beyond 3,300 lumens per Congress' definition of high lumen incandescent lamps (42 U.S.C. 6295(l)(4)(G)). (NEMA, No. 93 at p. 23; GE, No. 88 at p. 3) NEMA stated that high lumen lamps above 3,300 lumens are too bright to be used in households, where GSILs are predominantly used. NEMA further stated that 200 W incandescent lamps and 40-45 W CFLs in the 2,650-3,600 lumen range are not found in homes because, in addition to being too bright, they are extremely expensive (
For this final rule, DOE reviewed available product offerings to determine whether to raise, lower, or maintain the 4,000 lumen upper limit proposed in the October 2016 NOPDDA. As described in section III.A.4.b, DOE did not limit its analysis to lamps used in only the residential sector. DOE is aware that implementing any lumen limits, regardless of the value, may encourage industry to develop products just outside of the prescribed range. However, DOE believes that lumen output is an important characteristic for determining whether a lamp is used in traditional GSIL applications, particularly since the definition of GSIL itself includes only lamps up to 2,600 lumens in output. While, as noted, that limit in the definition of GSIL does not circumscribe DOE's authority to include lamps as “other lamps,” it does illustrate what applications GSILs have traditionally served. Applications that require high-output lamps have not traditionally been served by lamps up to 2,600 lumens. DOE's current approach recognizes that fact, but also recognizes that lamps with higher outputs are actually used for some of the same applications as GSILs.
Upon reviewing current product offerings, DOE has concluded that it is appropriate to lower the upper lumen bound from 4,000 to 3,300 lumens. DOE determined that there are lamps within the range of 3,301 to 4,000 lumens not intended for use in general lighting applications. For example, lamps marketed for use in stage and studio applications fall within the range of 3,301 to 4,000 lumens. Further, as noted in the October 2016 NOPDDA, although the reported sales of these incandescent lamps are declining, the majority of product offerings between 2,601 and 3,300 lumens are CFLs or LED lamps and are thus not captured in the sales data. Based on product offerings, DOE found that establishing the upper lumen limit at 3,300 was appropriate for including lamps used in applications traditionally served by GSILs.
DOE also received several comments regarding the lower lumen bound in the proposed definition of GSL. NRDC, NEEP, and ASAP stated that DOE should reduce its proposed minimum lumen output for GSLs from 310 to 120 to include 25 W and 40 W equivalent decorative lamps. NRDC added that this would prevent manufacturers from tweaking the lumen output of their current incandescent products, such as globe shape lamps at 320 lumens, to exclude them from the GSL definition. (NRDC, No. 85 at pp. 5-6; NEEP, No. 92 at p. 3) NRDC further stated that lamps between 120 and 310 lumens should be included in the GSL definition because hundreds of millions of sockets contain these lamps; they have high hours of use in commercial settings; and they are available in LED replacements that are mostly dimmable and offered in a variety of shapes, base types, and optics. (NRDC, No. 85 at p. 6; NEEP, No. 92 at p. 3; ASAP, No. 94 at p. 3) RELS agreed with NRDC's proposal, stating that a more inclusive GSL definition would lead to more energy savings, lowering the environmental impact of these products. (RELS, No. 86 at p. 1)
NEEP noted that when many bulbs are used together (
CEC recommended a few changes to the lower lumen limit in the definition of GSL to maintain consistency with its own regulations. CEC stated that its general service LED lamp regulation applies to E12 base lamps with 150 lumens or greater and all other lamps of 200 lumens or greater. CEC stated that because 25 W equivalent lamps with lumens less than 310 are used for general illumination (
Similar to establishing an upper lumen bound, establishing a lower lumen bound can provide an incentive for manufacturers to create products just below the lumen limit. Stakeholders are concerned about this result and have provided several suggestions regarding where this lower lumen bound should be to prevent this problem. Stakeholders have suggested lowering the lower lumen bound from 310 lumens to 120, 150, or 200 lumens to include 25 W equivalent lamps. DOE acknowledges that some lamps with lumen outputs less than 310 lumens can be marketed as 25 W equivalents. However, there is inconsistency in how these lamps are marketed. There are no Federal guidelines that govern the “equivalency” claims of lamps. As such, there is great variety in equivalency claims. Even when equivalency guidelines exist, there is variety in what a 25 W equivalent may be. For example, the ENERGY STAR Lamps V2.0 Specification defines the typical light output of a 25 W omnidirectional lamp to be at least 250 lumens and the typical lumen output of an 25 W omnidirectional decorative lamp (which is also omnidirectional) to be at least 150 lumens. DOE has reviewed available product offerings and instead of trying to include every lamp that is marketed as a 25 W equivalent, DOE has determined the minimum lumen output
GE stated that high lumen lamps, which it considered to be the 150 W and 200 W incandescent lamps, also tend to have larger bulb sizes. GE stated that these lamps are made in A21 and A23 shapes because the filament must be placed farther from the glass due to the increased heat. Therefore, these lamps may not fit in existing fixtures where A19 size lamps are used and also may not meet the UL wattage limit on many fixtures in the home (NEMA estimates that about 95 percent of GSL fixtures will not accommodate 200 W incandescent lamps because it is prohibited by UL 1598). (GE, No. 83 at pp. 72-73) In contrast, NRDC disagreed that the slightly larger size of the 150 W and 200 W incandescent lamps would be too large to be used as a replacement for a standard incandescent lamp in household fixtures. (NRDC, No. 83 at pp. 73-74)
DOE reviewed the lamp dimensions of the A19, A21, and A23 bulb shapes. Per the typical naming convention, the number after the “A” indicates the diameter of the bulb in eighths of an inch. DOE agrees that the bulb shapes of higher lumen lamps are generally larger than those with lumen outputs between 310 and 2,600 lumens. DOE notes that this difference is a quarter to a half of an inch increase in lamp diameter. While there are potentially fixtures that cannot accommodate this increase in size, there is no requirement that all lamps that meet the definition of general service lamp have the same size as GSILs (as currently defined). General service lamps included through the “other lamps” category are those that are used in lighting applications traditionally served by GSILs. Larger diameters would not preclude use of a higher-output lamp in a different fixture. DOE does not believe that, in light of the complete set of characteristics it is using to define “other lamps,” a larger diameter would mean that a lamp is not used in those applications.
In the October 2016 NOPDDA, DOE did not propose a specific voltage range when defining GSL. 81 FR 71804. ASAP and Utility Coalition agreed with the operating voltage criterion. ASAP commented that they support not specifying a voltage range because adding a range creates the opportunity for manufacturers to specify that products operate outside of the range even though the products can also operate at common voltages, thus creating a loophole. (ASAP, No. 83 at p. 118; Utility Coalition, No. 95 at p. 4) However, several stakeholders commented that including lamps that operate at all voltages would have unintended consequences. Westinghouse and Maxlite noted that the voltage range is too broad and could have unintended consequences if products are inadvertently included. (Westinghouse, No. 83 at pp. 119-120; Maxlite, No. 83 at p. 123) GE asserted that by not limiting the operating voltage, DOE was including lamps intended for use in specialty commercial or industrial applications such as airplanes, trains, and automobiles. (GE, No. 83 at p. 130)
Maxlite suggested limiting the operating voltage range to voltages that are common in consumer and residential products. (Maxlite, No. 83 at p. 123) GE stated that 98 percent of GSILs are used in homes according to the 2010 LMC, and nearly all lighting systems in homes operate at 120 V, with a few at 12 V. (GE, No. 88 at p. 4) NEMA stated and Philips agreed that the GSL definition should specify a voltage range from 110 to 130 V or 11 to 13 V. (NEMA, No. 93 at pp. 27-28; Philips, No. 96 at p. 5) NEMA provided a list of specialty applications in which lamps of uncommon voltages are used. (NEMA, No. 93 at pp. 27-28) In order to narrow the scope while preventing loopholes, Westinghouse suggested writing the regulatory language to prevent manufacturers from rating a lamp for an exempted voltage if the lamp is intended to operate at 12 V or 120 V by stating that if the lamp “can operate at 120 V” or “can operate at 12 V,” it would meet the definition of GSL. (Westinghouse, No. 83 at pp. 119-120)
NRDC commented that an operating voltage cap at 120 V does not make sense because 130 V products are increasingly being sold and therefore should be covered too. (NRDC, No. 83 at p. 132) Maxlite added that they agreed with including 130 V products but requested that 277 V products and other voltages not be included. (Maxlite, No. 83 at pp. 132-133) CEC stated that while it agrees with DOE not proposing a specific voltage range in the definition for GSLs, voltage limitations may be useful when defining what is not covered within the GSL definition. (CEC, No. 91 at p. 4)
Northwest Energy Efficiency Alliance (NEEA) and Philips requested clarification on whether certain lamps, such as non-integrated CFLs and HID lamps, are included in the definition of GSL because these lamps operate on a ballast rather than “at any voltage” as specified in the proposed GSL definition. Philips noted these lamps will not operate if placed directly on a DC or AC sinusoidal waveform and therefore requested that DOE clarify the language in the proposed GSL definition. NEEA noted that these are popular products and that they should be included in the scope. (NEEA, No. 83 at pp. 134-135; Philips, No. 83 at p. 124)
As noted in section III.A.4.b, EPCA directs DOE to include as GSLs lamps which are used to satisfy lighting applications traditionally served by GSILs. DOE has determined that lamps that would satisfy the same applications as traditionally served by GSILs are ones that would provide overall illumination. DOE is not directed to limit its analysis to lamps that provide overall illumination in only the residential sector or, more specifically, only in homes. Therefore, DOE has not used this criterion in deciding whether certain lamps are general service lamps.
DOE reviewed available product offerings to determine whether lamps of all operating voltages are used in general lighting applications. DOE found that certain operating voltages could be an indicator that the lamp is used in specialty applications. For example, lamps with an input voltage of 6.6 V are typically used in airport or aviation applications. DOE has therefore revised the operating voltage criteria for this final rule. Instead of including lamps that operate at all input voltages, DOE is including integrated lamps that are capable of operating at or between input voltages of 12 V, 24 V, 100 to 130 V, 220 to 240 V, or 277 V. DOE determined that lamps capable of operating at these voltages generally provide overall illumination. For example, lamps operating at 12 V and 24 V are commonly MR16 lamps, and lamps operating at 277 V are commonly spiral CFLs. All non-integrated lamps of any voltage are included, assuming they meet the other specified criteria. DOE found that the operating voltage of non-integrated lamps did not correlate to use in specialty applications.
By definition, GSL does not apply to any lighting application or bulb shape that under 42 U.S.C. 6291(30)(D) is not included in the “general service incandescent lamp” definition. (42 U.S.C. 6291(30)(BB))(ii)(I)) DOE tentatively determined in the October 2016 NOPDDA that the language of the
In the October 2016 NOPDDA, DOE assessed each of the 22 lamp categories within the GSIL exemptions to determine whether the Secretary should discontinue or maintain these exemptions for purposes of the GSL definition. DOE tentatively concluded that 14 of the 22 GSIL exemptions for medium screw base incandescent lamps should be maintained, while eight of the GSIL exemptions should be discontinued and considered as GSLs. Consistent with that tentative determination, DOE then assessed the remaining 14 lamp categories in the GSIL exemptions to determine whether the application or lamp shape described is specific to an incandescent technology in order to determine the applicability of each exemption to GSLs other than GSILs. DOE tentatively determined that appliance lamps; black light lamps; bug lamps; colored lamps; infrared lamps; left-hand thread lamps; marine lamps; marine signal service lamps; mine service lamps; plant light lamps; sign service lamps; silver bowl lamps; showcase lamps; and traffic signal lamps are not specific to incandescent technology. Therefore, DOE proposed to extend the exemptions for all 14 lamp categories to all GSLs. 81 FR 71805.
Philips agreed with DOE's determination of exemption types that are not specific to incandescent technology and that the exemption should be technology neutral. However, Philips cautioned DOE that certain wattages and shapes may be specific only to incandescent technology due to size and heat management issues. (Philips, No. 96 at p. 3) NEEP also agreed that many exempt lamp categories are not specific to incandescent technology. In support of their point, NEEP cited the following as having high efficiency replacements: Appliance lamps; black light lamps; bug lamps; colored lamps; left-hand thread lamps; marine lamps; plant light lamps; sign service lamps; silver bowl lamps; showcase lamps; and traffic signal lamps. (NEEP, No. 92 at p. 3)
NEMA and LEDVANCE stated that the exemptions for incandescent, CFL, and LED versions of these 14 lamp categories should be maintained, noting that some do not have a CFL or LED replacement. (LEDVANCE, No. 90 at pp. 29-30; NEMA, No. 93 at p. 22) For any specialty lamp types with a CFL or LED replacement, NEMA explained that there is no evidence that lamp shifting is occurring to these lamps, and therefore saw no reason to discontinue exemptions for the CFL or LED versions. NEMA stated that an exemption from energy conservation standards should extend to all technologies for a particular lamp type if no energy conservation standards have been set for that lamp. However, NEMA did remind DOE of its comments in response to the March 2016 GSL ECS NOPR to consider energy conservation standards for certain specialty LED lamps excluded from the definition of general service lamp. (NEMA, No. 93 at p. 22) NEMA also referenced a table from its comments in response to the March 2016 GSL ECS NOPR explaining what sort of technologies are available for the lamp types that may be impacted by the general service lamp rulemaking. (NEMA, No. 66 at pp. 38-40)
As described section III.A.1, in this final rule, DOE concluded that 15 of the 22 GSIL exemptions for medium screw base incandescent lamps should be maintained. Consistent with that determination, DOE then assessed the 15 lamp categories to determine whether the application or lamp shape described is specific to an incandescent technology in order to determine the applicability of each exemption to GSLs other than GSILs. DOE determined that appliance lamps; black light lamps; bug lamps; colored lamps; G shape lamps with a diameter of 5 inches or more; infrared lamps; left-hand thread lamps; marine lamps; marine signal service lamps; mine service lamps; plant light lamps; sign service lamps; silver bowl lamps; showcase lamps; and traffic signal lamps are not specific to incandescent technology. Therefore, DOE is extending the exemptions for all 15 lamp categories to all GSLs.
In addition to the aforementioned exempted lamp types, DOE surveyed the market in the October 2016 NOPDDA for MR-shaped lamps with smaller diameters than the common MR16 lamps that are used in non-general lighting applications. DOE found and confirmed that these lamps are typically marketed for use in non-general lighting applications such as projectors, scientific illumination equipment, theater lighting, studio lighting, stage lighting, film lighting, medical equipment lighting, and emergency lighting. In addition, DOE found that these lamps are significantly more expensive and have shorter lifetimes than MR-shaped lamps designed for general lighting applications. Further, DOE noted it is unsure whether higher efficiency replacements are technologically feasible for these lamps due to their specific optical working distances and smaller form factors. Due to their use in specialty applications and lack of more efficacious equivalent replacements, DOE proposed in the October 2016 NOPDDA that MR-shaped lamps with diameters less than 2 inches that are designed and marketed for use in projectors, scientific illumination equipment, theater lighting, studio lighting, stage lighting, film lighting, medical equipment lighting, and emergency lighting not be included in the GSL definition. 81 FR 71806.
DOE received several comments regarding whether specialty MR lamps should be exempt from the definition of GSL. NRDC agreed with exempting specialty MR16 lamps but stated that regular MR16 lamps should not be exempted because there are LED versions available. (NRDC, No. 83 at pp. 150-151) NRDC and ASAP suggested defining specialty MR16 lamps by specifying a maximum lifetime or voltage requirement. (NRDC, No. 83 at pp. 150-151; NRDC, No. 85 at pp. 2-3; ASAP, No. 94 at p. 2) NEEP also agreed that specialty MR lamps should be exempted. However, NEEP expressed support for covering all MR lamps and requiring petitions to consider individual lamps as specialty MR lamps. NEEP reasoned that this requirement would avoid any potential loopholes for MR-shaped lamps that have a diameter just less than 2 inches and also for higher efficiency replacements. NEEP stressed that there are LED MR14 and MR11 lamps currently being used in general service applications and that unless technical restrictions prevent them from being used as replacements for small form factors, they should be included in the GSL definition. (NEEP, No. 92 at pp. 3-4)
GE commented that MR lamps originated from specialty equipment and have since become commonly used for accent lighting. GE noted that the MR lamps used in general service lighting applications typically operate at 12 V and have a lifetime from 2,000 to 5,000 hours. However, GE stated that MR lamps designed for specialty
NEMA commented that while MR16 lamps are used in both specialty and general lighting applications, if MR16 lamps are eliminated, millions of dollars in equipment designed to use these lamps, such as medical and ophthalmology equipment, will be stranded. NEMA added that because of the small form factor, an LED alternative cannot be made that fits older equipment. (NEMA, No. 83 at pp. 147-148)
NEMA again drew attention to its proposal submitted in response to the March 2016 GSL ECS NOPR to establish wattage caps of 15 W for LED versions and 50 W for incandescent versions of MR lamps. NEMA explained that the 45 lm/W limit would be problematic for LED MR-shaped lamps and the wattage caps would be technologically feasible, economically justified, and reduce testing and certification burden. (NEMA, No. 93 at pp. 25-26) LEDVANCE added that there are no lamps that can replace the functionality of MR lamps and therefore DOE cannot impose an efficacy standard and make them unavailable. (LEDVANCE, No. 90 at pp. 21-22)
After reviewing available product offerings, DOE agrees that certain MR lamps are specialty lamps. These lamps are labeled for use in applications such as projector lighting, film lighting, and audio/visual lighting. In addition, certain MR lamps are used in specialized equipment (such as scientific illumination and medical equipment) or emergency lighting installations which would be either inoperable or lose their UL safety rating if these lamps were to be removed from the market.
DOE received several comments regarding how to revise the definition of specialty MR lamp. CEC recommended that DOE align its specialty MR lamp definition with CEC's definition for small diameter directional lamps (SDDLs) which it had worked with NEMA to develop. CEC stated the definition of specialty MR lamps should be based on physical and electrical characteristics instead of applications. CEC recommended the definition require the MR bulb shape to be as defined in ANSI C79.1 with a diameter of 2.25 inches or less and meet one of the following criteria: Not be capable of operating at 12 V, 24 V, or 120 V, not have an ANSI compliant pin base or E26 base, have a lumen output of more than 850 lumens, have a wattage of more than 75 W, or have a lifetime of 300 hours or less. (CEC, No. 91 at pp. 7-8)
Utility Coalition also recommended that DOE refer to CEC's definition of SDDL to inform its definition of specialty MR lamps. Utility Coalition stated their research found specialty MR lamps to have extremely high wattages, high lumens, and short lifetimes (50-100 hours) and LED SDDLs are currently not available as adequate substitutes. Utility Coalition further noted that a 300-hour lifetime maximum would prevent them from being used in general service applications. (Utility Coalition, No. 95 at pp. 11-12)
GE, LEDVANCE, and NEMA disagreed with DOE's proposed requirement that specialty MR lamps have a diameter less than 2 inches noting that many MR16 lamps, with a diameter of exactly 2 inches, are specialty lamps. (GE, No. 88 at p. 2; LEDVANCE, No. 90 at pp. 21-22; NEMA, No. 93 at pp. 24-25) GE suggested defining specialty MR lamps to have a maximum diameter of 2.25 inches, to operate at voltages other than 12 or 120 volts, to have a lifetime less than 1,000 hours, or to have a wattage of more than 75 W. (GE, No. 88 at p. 3) NEMA and LEDVANCE recommended the same diameter requirements. NEMA also recommended the same lifetime and wattage criteria as GE but specified the lamps not operate at 11-13 V or 120-130 V. Further, NEMA specified that if any of these characteristics are not applicable, it could also be considered a specialty MR lamp if it is listed in Table 8 of ANSI Special Report 24f. LEDVANCE stated that Table 8 shows various lamp voltages, wattages, bases, lengths, working distances (which are application critical), and beam characteristics. LEDVANCE asserted that none of the lamps in Table 8 have characteristics that are identical to a 20 W, 30 W, or 50 W GU5.3 bipin base, less than 4 inch length MR16 lamp. Philips expressed support for NEMA's proposed definition. (NEMA, No. 93 at pp. 24-25; LEDVANCE, No. 90 at pp. 31-32; Philips, No. 96 at pp. 4-5)
Additionally, LEDVANCE and NEMA stated that the applications outlined in the proposed specialty MR lamp definition were limiting as they did not capture all of the specialty uses of these lamps, in particular aviation applications, and therefore should be removed. (NEMA, No. 93 at pp. 24-25; LEDVANCE, No. 90 at pp. 31-32) Philips explained that some halogen MR lamps are used in exit sign applications and any LED replacements for the lamps would need to meet several different lighting and electrical safety requirements from NFPA, UL, and local safety codes. (Philips, No. 96 at pp. 4-5)
After reviewing available MR lamps, DOE agrees that revisions to the definition of specialty MR lamp are appropriate. In addition to product offerings in catalogs, DOE reviewed the Lighting Facts database and ANSI Special Report 24f to determine which MR lamps were specialty products and should therefore be included in the definition of specialty MR lamp. DOE considered factors such as whether the lamp had a specific feature that prevented or made it unlikely for use in general lighting applications; whether the lamp was labeled for a specialty application; and whether the lamp must exist for reasons of safety. Regarding whether equivalent LED replacements exist (
DOE has decided to revise specifications for lamp diameter and a specialty application label in the definition of specialty MR lamp. To include specialty MR16 lamps, DOE has revised the diameter requirement to include MR lamps with diameters of 2.25 inches or less. DOE continues to include smaller MR-shaped lamps (such as MR11s and MR14s) in the definition of specialty MR lamp because DOE found numerous smaller MR-shaped lamps marketed for use in specialty
DOE has also decided to add a specification for lifetime in the definition of specialty MR lamp. DOE has reviewed available product information and agrees that this qualifier should be added to ensure only specialty MR lamps are included in the definition. DOE agrees with stakeholders that specialty MR lamps tend to have short lifetimes because lumen output is valued over their longevity. CEC suggested a lifetime requirement of 300 hours or less whereas industry suggested a lifetime requirement of 1,000 hours or less. DOE notes that 1,000 hours is the same lifetime as many lamps used in general service applications, such as GSILs. Furthermore, DOE reviewed available specialty lamps and found that the majority had a lifetime of 300 hours or less. DOE is therefore including a requirement that specialty MR lamps have a lifetime of 300 hours or less in the definition adopted in this final rule.
Although DOE also received comments regarding voltage and wattage (or lumen output), DOE is not including requirements for these quantities in the definition of specialty MR lamp. As described in section III.A.4.e, DOE has modified the input voltage requirements for all general service lamps. DOE has included in the definition of GSL non-integrated lamps that operate at any voltage and integrated lamps that are capable of operating at 12 V, 24 V, 100 to 130 V, 220 to 240 V, and 277 V. Lamps that cannot operate at these voltages are not included in the definition of general service lamp. DOE has found that it is not necessary to limit input voltage requirements for specialty MR lamps beyond the requirements already established for general service lamps. Regarding light output, DOE believes that there are certain lamps that cannot be made with fluorescent or LED technology while reasonably maintaining the same form factor and light output. These lamps are discussed in section III.A.4.a.
As recounted in the October 2016 NOPDDA, DOE determined in a final rule published on November 14, 2013 that standards for R20 short lamps would not result in significant energy savings because such lamps are designed for special applications or have special characteristics not available in reasonably substitutable lamp types. 78 FR 68331, 68340. Therefore, DOE proposed in the October 2016 NOPDDA to maintain the exemption for these lamps from GSIL and exempt R20 short lamps from the definition of GSL. 81 FR 71806. As described in section III.A.1.a, DOE is maintaining this exemption in this final rule.
As described in section III.A.4.a, DOE believes there are three main categories of lamps: (1) Lamps with more efficient, equivalent replacements (
Utility Coalition agreed with DOE's process to begin with a broad scope and exempt products that do not have general service applications or do not have an LED replacement. Utility Coalition stressed that DOE should only exempt products if commenters can specifically explain why a product cannot be manufactured with LED technology. (Utility Coalition, No. 95 at p. 4)
Several stakeholders provided specific examples of lamps that do not have more efficient, equivalent replacements. Westinghouse noted that for certain incandescent/halogen specialty lamps there is no design path to develop LED products with equivalent lumen output and similar form factor. Hence Westinghouse noted that because they are specialty and not available in more efficient technology, they should not be included in the GSL definition. Specifically, Westinghouse noted the following lamps: JC and JCD shaped lamps with G4, G8, G9, GU4, GU7.9, GU8, GY6.35, GY7.9, GY8, and GY8.6 base types; T shape lamps with diameters of 1 inch or less (T8 or smaller) that do not have medium screw bases; lamps with wedge bases; T shape lamps with diameters of 0.75 inch or less (T6 or smaller) with double-ended double contact, metal fin bases; and miniature reflector lamps with diameter less than 2 inches. (Westinghouse, No. 83 at pp. 126-129; Westinghouse, No. 89 at pp. 1-2) Maxlite agreed, commenting that lamps operating at 12 V with small bases such as G4, G9, wedge, and festoon, are typically halogen lamps with high lumens and when made in LED form, are significantly larger and no longer fit in the traditional luminaires for which they were designed. GE and NEMA added that halogen bipin lamps cannot be made using LED technology and should not be included as general service lamps. (Maxlite, No. 83 at pp. 133-134; NEMA, No. 83 at pp. 52-53; GE, No. 88 at p. 4)
GE stated that if specialty MR lamps are exempt from the GSL definition, specialty PAR lamps should be exempted as well. GE explained that only PAR20, 30, and 38 lamps with medium screw bases that operate at 120 V are used in general service applications. All other PAR lamps should be considered specialty PAR lamps. (GE, No. 88 at p. 3)
NEMA and GE expressed concern that including lamps of all voltages and base types in the GSL definition would include specialty lamps. (NEMA, No. 93 at pp. 27-28; GE, No. 88 at p. 5) NEMA stated that LED replacements do not exist for the following applications: Airport; airplane; airway; locomotive; automobiles; photographic; stage; studio; medical; and dental. GE added the following to NEMA's list of applications for which equivalent LED replacements do not exist: Projection; television service; headlight; street railway or other transportation service; microscope; map; and microfilm or other specialized equipment service. Hence the inclusion of these lamp types in the GSL definition may create an absence of products resulting in safety and security concerns. Philips also stated that it was important to maintain the incandescent/halogen versions because recent Caliper reports indicate issues with compatibility of LED reflector lamps with dimming/control systems. (Philips, No. 96 at p. 6) NEMA submitted ANSI Special Report 24f that provides details on some but not all specialty lamps. (NEMA, No. 93 at pp. 27-28; GE, No. 88 at p. 4)
In contrast, Utility Coalition stated that LED replacements are widely available in an array of screw bases like medium screw bases (E26/E27);
ASAP suggested using a similar approach as DOE's motors rulemaking and defining the specific base types and voltages that are problematic and excluding them from the definition of GSL. (ASAP, No. 83 at pp. 120-121)
In section III.A.4.a, DOE discusses the three categories of lamp identified: (1) Lamps with more efficient, equivalent replacements (
After identifying lamps without more efficient equivalent replacements, DOE considered the size of the ANSI base, the dimensions of the bulb shape, and the lumen output gap between existing incandescent products and existing LED replacements to evaluate whether equivalent replacements could be produced. DOE determined that the larger the ANSI base, the greater the bulb volume, and the smaller the lumen gap between existing incandescent and LED products, the more likely that an equivalent LED replacement could be produced. Larger ANSI bases and bulb shapes allow for more space to accommodate a heat sink and/or additional electronics needed to support LED technology. For example, a medium screw base LED filament lamp can accommodate the electronics of an LED driver in the ANSI base. However, lamps with very small bases, such as wedge bases, or lamps with very small shapes, such as T shape lamps with diameters of 1 inch or less, cannot accommodate the LED driver and/or the LEDs themselves in the same form factor and light output combinations as is possible with incandescent technology. Furthermore, certain lamp types have already shown progress in developing equivalent LED replacements. For example, incandescent/halogen candelabra base lamps with B10 shapes are available with lumen outputs up to 760 lumens. Equivalent LED replacements are currently available with lumen outputs only up to 500 lumens. A small lumen output gap between existing incandescent and LED products indicates that only modest improvements in technology, electronics, or design are necessary to increase product performance.
After reviewing these factors, DOE concludes that lamps were included in the definition of GSL proposed in the October 2016 NOPDDA that should not have been included because they do not and likely cannot have equivalent replacements using more efficient technology. DOE is excluding these lamps from the definition of general service lamp for the reasons given in section III.A.4.a. DOE has determined that it must use a combination of shape, base, length, and diameter to capture all of these specialty lamps. The excluded products include:
• T shape lamps that have a first number symbol less than or equal to 8 (diameter less than or equal to 1 inch) as defined in ANSI C79.1-2002, nominal overall length less than 12 inches, and that are not compact fluorescent lamps;
• S shape or G shape lamps that have a first number symbol less than or equal to 12.5 (diameter less than or equal to 1.5625 inches) as defined in ANSI C79.1-2002;
• Reflector lamps that have a first number symbol less than 16 (diameter less than 2 inches) as defined in ANSI C79.1-2002 and that do not have E26/24, E26d, E26/50x39, E26/53x39, E29/28, E29/53x39, E39, E39d, EP39, or EX39 bases;
• MR shape lamps that have a first number symbol equal to 16 (diameter equal to 2 inches) as defined in ANSI C79.1-2002, operate at 12 volts, and have a lumen output greater than or equal to 800;
• J, JC, JCD, JCS, JCV, JCX, JD, JS, and JT shape lamps that do not have Edison screw bases; and
• Lamps that have a wedge base or prefocus base.
In the March 2016 GSL ECS NOPR, DOE proposed that a GSL cannot be a lamp that is the subject of other ongoing rulemakings. 81 FR 14528, 14543. In the October 2016 NOPDDA, DOE proposed to discontinue this criteria regarding other rulemakings. DOE continued to exempt GSFLs from the definition of GSL. 81 FR 71806. Because the definition of GSFL and the supporting definition of fluorescent lamp are structured in a certain way, DOE added some exemptions to the proposed rule to exclude lamps from the definition of GSL that are specifically and currently excluded from the GSFL and fluorescent lamp definitions. For example, DOE exempted circline lamps, which were considered to be GSFLs in the January 2015 rulemaking but for which DOE did not evaluate standards, and DOE exempted fluorescent lamps with a CRI of 87 or greater because they are statutorily exempt from standards. However, DOE did not propose to exempt other lamps that were the subject of other ongoing rulemakings. For example, DOE did not specifically propose to exempt HID lamps that otherwise meet the GSL criteria. 81 FR 71806.
NEMA agreed with exempting GSFLs from the definition of general service lamp, noting that Congress intended to
After reviewing the proposed exemptions for fluorescent lamps, DOE agrees that some revisions are necessary to ensure terms related to fluorescent lamps are used consistently. In this final rule, DOE is adopting a definition of “other fluorescent lamps, which grouped these exemptions and made clear that the lamps included are circline lamps and certain double-ended lamps that use fluorescent technology. An “other fluorescent lamps” is a low pressure mercury electric-discharge sources in which a fluorescing coating transforms some of the ultraviolet energy generated by the mercury discharge into light and include circline lamps and include double-ended lamps with the following characteristics: Lengths from one to eight feet; designed for cold temperature applications; designed for use in reprographic equipment; designed to produce radiation in the ultra-violet region of the spectrum; impact-resistant; reflectorized or aperture; or a CRI of 87 or greater.
GE, NEMA and LEDVANCE pointed to what they saw as a contradiction in DOE attempting to include HID lamps in the GSL definition to be regulated when in a recent rulemaking DOE had determined that regulations on HID lamps were either not technologically feasible, economically justified, or would not result in significant energy savings. (GE, No. 88 at p. 4, NEMA, No. 93 at pp. 23-24, LEDVANCE, No. 90 at p. 22, Philips, No. 96 at p. 4) NEMA noted that in the HID determination DOE had stated that significant energy savings would not result from standards for directional HID lamps. (NEMA, No. 93 at pp. 23-24)
GE stated that HID fixtures are never found in the home and are rarely found outside it. (GE, No. 88 at p. 4) Philips stated that because HID lamps require a ballast, are extremely expensive, and have a warm-up time, they are not typically used by consumers and thus do not pose a risk for lamp switching. (Philips, No. 96 at p. 5) NEMA added that 2015 sales for HID lamps with 4,000 lumens or lower were 33 percent below 2012 sales and expected to fall. (NEMA, No. 93 at pp. 23-24) LEDVANCE pointed out that currently there are no viable replacements for HID lamps. (LEDVANCE, No. 90 at p. 22)
NEMA asserted that, had Congress intended for HID lamps to be included as GSLs, it would have done so expressly, but instead authorized DOE to regulate HID lamps as commercial equipment. (NEMA, No. 93 at pp. 23-24) Finally, NEMA and Philips stated there is no DOE test procedure for HID lamps. (Philips, No. 96 at p. 4; NEMA, No. 93 at pp. 23-24)
LEDVANCE stated that should DOE regulate HID lamps as GSLs, it needs to exclude the lamps exempted from analysis in DOE's final determination for HID lamps. 80 FR 76355, December 9, 2015. Specifically, these were for lamps less than 50 W, directional lamps, specialty lamps, and lamps that run exclusively on electronic ballasts, which LEDVANCE asserted would eliminate most HID lamps from the scope of this final rule. LEDVANCE added that while direct LED lamp replacements are available for high wattage HID lamps, there are no such lamp replacements for low wattage lamps. LEDVANCE explained that to replace low wattage HID lamps, consumers would have to replace the entire fixture and DOE has not done the necessary payback analysis for this scenario. (LEDVANCE, No. 90 at pp. 30-31)
DOE acknowledges the various comments that HID lamps are primarily used for specialty applications. Given the particular characteristics of HID lamps regarding startup, DOE believes that the criteria it has developed for the “other lamps” category may not be adequate to support an inference that an HID lamp, in particular, is actually used in traditional GSIL applications. Accordingly, DOE will not include HID lamps as GSLs in this rulemaking and will continue to study the issue. DOE notes that if it notices an influx of HID lamps for the general service lamp market, then DOE may revisit this decision.
DOE further notes that although DOE determined in the recent HID lamps rulemaking that standards for HID lamps are either not technologically feasible or not economically justified, that analysis was based on a different set of lamps than would be analyzed as part of a rulemaking for GSLs. For example, the HID lamp determination considered only mercury vapor, high pressure sodium, and metal halide technology. In addition, the determination did not analyze self-ballasted or directional HID lamps, among other types. Thus, the previous determination is not relevant and an analysis conducted in the context of a rulemaking for GSLs could well come to a different conclusion. However, per the preceding discussion, DOE has determined to exclude HID lamps from the definition of GSL.
DOE proposed a revised definition of GSL in the October 2016 NOPDDA. Westinghouse recommended DOE revise the definition of GSL to capture only those products intended by Congress to be regulated and exclude lamps which are specialty products or covered by existing regulations. (Westinghouse, No. 89 at p. 2)
NEMA recommended the following changes to the proposed GSL definition: Include lamps that operate only at voltages between 110 to 130 V or 11 to 13 V and have maximum lumens of 3,300; and exclude incandescent reflector lamps, specialty lamps, and specialty base lamps. NEMA also provided definitions for specialty lamp and specialty base lamps. NEMA defined specialty lamp as a lamp designed for and used in special applications and listed the current 22 exempted lamp types specified in the GSIL definition. NEMA defined a specialty base lamp as a lamp with an intermediate base (E17), candelabra base (E12), mini-candelabra base (E11), bayonet base, double ended base, screw terminal base, medium side prong base, mogul prong base, recessed single contact, mogul screw, mogul bi-post, G53, double contact prefocus, 2-pin GY6.35, 2-pin G8, and 2-pin G9 when used with any lamp; or 2-pin G4 when used with non-reflector lamp. (NEMA, No. 93 at p. 27) LEDVANCE supported NEMA's recommended changes for the GSL definition. (LEDVANCE, No. 90 at pp. 32-33) Philips agreed with NEMA's proposed voltage range for the GSL definition. (Philips, No. 96 at p. 6)
GE recommended DOE modify the GSL definition to include only lamps with medium screw bases and candelabra bases; that operate between 110 and 130 V or at 12 V, have maximum lumens at 3,300, and “satisfy lighting applications traditionally served by general service incandescent lamps;” and exclude HID lamps. Additionally, GE suggested the definition exclude lamps with the following applications: Airway, airport, aircraft, photo, projection, stage, studio or television service, headlight, locomotive, street railway, or other transportation service; medical or dental service, microscope, map, microfilm, or other specialized equipment service. (GE, No. 88 at pp. 3-4)
In the preceding sections, DOE has reviewed all aspects of the GSL
DOE notes that the definition adopted in this final rule excludes incandescent reflector lamps. That exclusion simply mirrors the exemption for IRLs from the statutory definition of GSL. DOE had proposed to discontinue the IRL exemption. But it is not reaching a decision on that issue in this final rule; DOE will address the status of IRLs in a separate final rule. Accordingly, as of this final rule the exemption for IRLs stands and DOE is replicating that exemption in its definition of GSL.
Thus, DOE is adopting a definition of “general service lamp” in § 430.2 to capture the criteria and the exemptions discussed in previous sections. A general service lamp is a lamp that has an ANSI base; is able to operate at a voltage of 12 volts or 24 volts, at or between 100 to 130 volts, at or between 220 to 240 volts, or of 277 volts for integrated lamps (as defined in this section), or is able to operate at any voltage for non-integrated lamps (as defined in this section); has an initial lumen output of greater than or equal to 310 lumens (or 232 lumens for modified spectrum general service incandescent lamps) and less than or equal to 3,300 lumens; is not a light fixture; is not an LED downlight retrofit kit; and is used in general lighting applications. General service lamps include, but are not limited to, general service incandescent lamps, compact fluorescent lamps, general service light-emitting diode lamps, and general service organic light-emitting diode lamps. General service lamps do not include:
In the October 2016 NOPDDA, DOE proposed several definitions to support its proposed definition of “general service lamp.” Specifically, DOE proposed definitions for “integrated lamp,” “non-integrated lamp,” “light fixture,” “pin base lamp,” “GU24 base,” “LED downlight retrofit kit,” and several terms to better define the lamp types described in section III.A.4 that are exempt from the definition of general service lamp.
LEDVANCE and Philips agreed with the proposed supporting definitions and emphasized that further specifications were not necessary since manufacturers have produced no products that would take advantage of any potential loopholes. (LEDVANCE, No. 90 at p. 34; Philips, No. 96 at p. 5) CEC stated DOE should base definitions of exempted lamp types on physical and electrical characteristics rather than application, whenever possible. (CEC, No. 91 at p. 5) DOE discusses specific comments regarding the proposed definitions in the following sections.
DOE proposed definitions for “black light lamp,” “colored lamp,” “plant light lamp,” and “bug lamp” in the October 2016 NOPDDA. 81 FR 71807. DOE received several comments regarding these definitions.
ASAP commented that while they supported DOE's approach of using the electromagnetic spectrum to define bug lamps, colored lamps, infrared lamps, and black light lamps, they would suggest defining exempted lamps by specifying a percentage of radiated power within a band of the spectrum rather than just a peak as stated in the proposed definitions. ASAP noted that fluorescent lamps, which can have multiple peaks in the spectrum, could become a loophole and therefore the definitions should be more specific. (ASAP, No. 83 at pp. 44, 99, 105)
The proposed definition of black light lamp would require radiant power peaks in UV-A portion of the electromagnetic spectrum. Typical incandescent lamps and fluorescent lamps do not have their highest radiant power peak in the UV-A portion of the electromagnetic spectrum. Hence, DOE finds that specifying this limited region of the lower end of the electromagnetic spectrum is sufficiently distinctive for identifying black light lamps. Therefore, in this final rule, DOE is adopting the definition of “black light lamp” as proposed in the October 2016 NOPDDA. A black light lamp is a lamp that is designed and marketed as a black light lamp and is an ultraviolet lamp with the highest radiant power peaks in the UV-A band (315 to 400 nm) of the electromagnetic spectrum.
The proposed definition for colored lamp would apply to lamps that satisfy one of two conditions—either a CRI less than 40 or a CCT lower than or greater than a designated value. NRDC, NEEP, and ASAP requested that DOE modify the definition of colored lamp to require that lamps meet both the CRI and the CCT requirement in order to be considered colored lamps. In addition, several stakeholders suggested modifying the lower CCT value. NRDC suggested changing the lower bound
Maxlite noted that it had supported the inclusion of 2,200 K and 2,500 K for filament lamps in ENERGY STAR Lamps Specification V2.0 as these are becoming popular colors for ultra-warm products. However, Maxlite cautioned DOE not to make categorizations of these CCTs part of the colored lamp definition. Maxlite explained that filament LED lamps with a CCT of 2,200 K or 2,400 K that are designed to mimic incandescent lamps were very popular when introduced. However, Maxlite stated that recent market feedback has shown a preference for a slightly higher CCT of 2,700 K. Westinghouse agreed that consumers may prefer a different color temperature because they have experienced consumers returning lamps with CCTs of 2,200 K and 2,400 K. (Maxlite, No. 83 at pp. 105-106; Westinghouse, No. 83 at pp. 101-102)
NEMA, LEDVANCE, and GE stated the proposed definition of colored lamp was one that has been used by industry for many years and has proven to be both clear and effective. NEMA, LEDVANCE, and GE noted that changing the definition could have the unintended consequence of preventing colored lamps from being produced. In particular, NEMA and LEDVANCE explained that if the definition included CCT and CRI requirements instead of one or the other, then a number of colored lamps would no longer be included in the definition. NEMA and LEDVANCE stated that meeting just one criteria was sufficient to be considered a colored lamp. (GE, No. 83 at p. 104; NEMA, No. 93 at pp. 28-29; LEDVANCE, No. 90 at p. 34)
CCT and CRI are both metrics that characterize the color of light emitted by a light source. CCT is measured by examining how close the light source's chromaticity is to the reference blackbody locus. CRI is calculated from the differences in the chromaticities of eight standard color samples when illuminated by a light source compared to a reference illuminant of the same CCT. Hence, each measurement provides an independent method of determining if the light emitted by a light source is colored. Regarding the proposed requirement of CCT less than 2,500 K, DOE notes that ENERGY STAR Lamps Specification V2.0 includes CCTs of 2,200 K for only filament lamps. As noted by stakeholders, lamps with a CCT of 2,200 K are relatively new products and it is still uncertain how they will be used. Therefore, DOE is maintaining the lower bound threshold of 2,500 K for colored lamps. DOE will continue monitor the market to understand the impact of new products at low CCTs and may revise the definition of colored lamp in the future.
ASAP also noted that in the “colored lamp” definition, as well as specifying that the lamp be designed and marketed as a colored lamp, DOE stated the lamp not be designed and marketed for general service applications. ASAP commented DOE had not added the latter prohibitive phrase in any other definition of an exempted lamp type and suggested DOE either remove it or specify it in all definitions. (ASAP, No. 94 at p. 7)
DOE agrees that the term “designed and marketed” should be consistently used in definitions of exempted lamp types. Therefore, in this final rule, DOE removes the phrase “not designed and marketed for general lighting applications” because the definition of colored lamp already includes the phrase “designed and marketed as a colored lamp.” DOE is adopting a slightly modified definition of colored lamp in the final rule. A colored lamp is a colored fluorescent lamp, a colored incandescent lamp, or a lamp designed and marketed as a colored lamp with either of the following characteristics (if multiple modes of operation are possible [such as variable CCT], either of the below characteristics must be maintained throughout all modes of operation): a CRI less than 40, as determined according to the method set forth in CIE Publication 13.3; or a CCT less than 2,500 K or greater than 7,000 K.
The proposed definition of plant light lamp would require radiant power peaks in the red and blue region of the electromagnetic spectrum. NRDC commented that plant light lamps could have radiant power peaks in the green portion of the spectrum in addition to the blue or red portions thus making them suitable for general lighting applications. NRDC recommended adding a maximum allowable CRI to ensure general service lamps are not characterized as plant light lamps. (NRDC, No. 83 at pp. 96-97; NRDC, No. 85 at p. 10) ASAP agreed that the radiant power peak requirements specified for plant light lamps could easily be met by fluorescent lamps and possibly by incandescent lamps. ASAP also noted the availability and growing market of efficient LED lamps that emit light beneficial for plants and recommended that plant light lamps be included in the definition of GSILs. (ASAP, No. 94 at pp. 3-7)
A high CRI is not required for the lamp to effectively function and emit the highest radiant power peaks in blue and red wavelengths. Hence, a CRI requirement is not appropriate for defining a plant light lamp. While DOE finds that requirements for radiant power peak may not be exclusively applicable to plant light lamps, the additional requirement that the lamp be designed and marketed for plant growing applications is sufficient to discourage consumers from using plant light lamps in general light applications. For discussion regarding the inclusion of this lamp type in the GSIL definition, see section III.A.1.b. In this final rule DOE is adopting the definition of “plant light lamp” as proposed in the October 2016 NOPDDA. A plant light lamp is a lamp that is designed to promote plant growth by emitting its highest radiant power peaks in the regions of the electromagnetic spectrum that promote photosynthesis: Blue (440 nm to 490 nm) and/or red (620 to 740 nm), and is designed and marketed for plant growing applications.
NRDC commented that the definition of bug lamp, which requires the lamp to have a visible yellow coating, should also specify the amount of coating to prevent possible loopholes. However, GE commented that the requirement that bug lamps produce the majority of radiant power above 550 nm paired with the requirement of a visible yellow coating would prevent general service lamps from meeting the definition of bug lamp. They stated that the definition as proposed is sufficient and well understood by industry. (NRDC, No. 83 at p. 153; GE, No. 83 at p. 154) ASAP stated that fluorescent lamps exhibit peak radiant power above 550 nm and therefore could easily meet the
DOE concludes that requiring the yellow coating to be visible on the lamp is sufficient and quantifying it is unnecessary. DOE understands that the requirements for radiant power peak may not be exclusively applicable to bug lamps. However, DOE finds that the combination of requirements for radiant power peak and visible yellow coating should discourage this lamp type from being used in general service applications. For discussion regarding the inclusion of this lamp type in the GSIL definition, see section III.A.1.b. In this final rule, DOE is adopting the definition of “bug lamp” proposed in the October 2016 NOPDDA . A bug lamp is a lamp that is designed and marketed as a bug lamp, has radiant power peaks above 550 nm on the electromagnetic spectrum, and has a visible yellow coating.
In the October 2016 NOPDDA, DOE proposed a definition for “infrared lamp” to support the definition of “general service lamp.” 81 FR 71809. NRDC, Utility Coalition, ASAP, and NEEP stated that the proposed definition of infrared lamp, which states that the highest radiant power peaks are in the infrared region of the electromagnetic spectrum, describes any incandescent lamp. They noted that the definition's requirement that the primary purpose is to provide heat is the only difference from a standard incandescent lamp. NRDC, Utility Coalition, ASAP, and NEEP suggested several possible modifications to the definition. First, they recommended specifying a limit on the percentage of radiant power in the visible spectrum. Specifically, NEEP suggested stating that the lamp must generate more than 95 percent of energy towards heat rather than lighting and ASAP suggested that the share of radiant power in visible range be limited to a maximum of 1 percent. NEEP and ASAP suggested applying a wattage minimum to ensure that only infrared lamps were included, while NRDC recommended a wattage minimum of 125 W coupled with a minimum lamp diameter of 5 inches. Utility Coalition recommended an approach of using maximum lumen output whereas NEEP suggested using a lumens per watt limit. (NRDC, No. 83 at pp. 12-13, 94-95; NRDC, No. 85 at pp. 6-7; NRDC, No. 85 at p. 7; NEEP, No. 92 at pp. 1-3; Utility Coalition, No. 95 at p. 10; ASAP, No. 94 at p. 6)
Westinghouse commented that the proposed definition of infrared lamp is sufficient and that these lamps are not at risk for use in general service applications because of their low lumen output. Westinghouse added that a lumen range could be added if necessary. (Westinghouse, No. 83 at pp. 41-42) LEDVANCE and NEMA supported the definition. They explained that using “and” in the definition, to require an infrared lamp to have radiant power peaks in the infrared region and have a primary purpose of providing heat, means that these lamps would be distinct from any GSIL and prevent any lamp switching. (NEMA, No. 93 at p. 29; LEDVANCE, No. 90 at pp. 34-35)
DOE understands that the requirement of a radiant power peak is not exclusively applicable to infrared lamps. In this final rule, DOE reviewed the definition of “infrared lamp” and determined that most infrared lamps are at least 125 W. This high wattage aligns with the use of this lamp type to provide heat. Hence, DOE is including a wattage minimum in the definition of “infrared lamp.” In this final rule, DOE is adopting a slightly modified definition for “infrared lamp.” An infrared lamp is a lamp that is designed and marketed as an infrared lamp; has its highest radiant power peaks in the infrared region of the electromagnetic spectrum (770 nm to 1 mm); has a rated wattage of 125 watts or greater; and which has a primary purpose of providing heat.
DOE received comments on its use of the statutory definition of “appliance lamp,” which is defined at 42 U.S.C. 6291(30)(T).
NRDC and NEEP stated that appliance lamps resemble a conventional incandescent light bulb to a consumer, except they have smaller bulb dimensions, and therefore can serve as a replacement for 40 W incandescent lamps. NEEP explained that these lamps would particularly be attractive as a replacement due to their low price. NRDC recommended that appliance lamps should be able to operate in high temperature environments throughout the product's rated lifetime. This requirement would make the lamp more robust and expensive and therefore, an unsuitable replacement for general light applications. NEEP suggested adding the criteria of high temperature operation or a lumen maximum. (NRDC, No. 85 at p. 8; NEEP, No. 92 at pp.1-3)
Most appliance lamps are intended for use in a variety of appliances and therefore are designed to operate in low and high temperature environments. Therefore, a criterion for high temperature operation would not be appropriate for defining these lamp types. DOE finds that the specifications in the definition for designating and marketing the lamp for use in appliances is sufficiently clear, thus discouraging consumers from using appliance lamps in general lighting applications. DOE will continue to monitor the market and may revise this definition if needed in the future.
In the October 2016 NOPDDA, DOE proposed a definition of “marine lamp.” 81 FR 71808. NRDC and NEEP commented that additional detail was needed for the definition of marine lamps to avoid potential loopholes. NRDC noted that these lamps likely operate on 12 or 24 V and recommended that marine lamps be defined as not able to operate at more than 25 V. NEEP suggested adding at least one qualifier to this definition relating to either operating voltage, outdoor temperature operation, or waterproof capability. (NRDC, No. 83 at pp. 95-96; NRDC, No. 85 at p. 9; NEEP, No. 92 at pp. 1-3)
DOE reviewed the performance characteristics of marine lamps and determined that most operate at voltages 12 V to 13.5 V. DOE finds that these operating voltages likely align with the use of these lamps in marine applications. Hence in this final rule DOE is adopting the definition of “marine lamps” with a voltage specification. A marine lamp means a lamp that is designed and marketed for use on boats and can operate at or between 12 volts and 13.5 volts.
ASAP commented that the proposed definition for showcase lamp is insufficient to prevent loopholes and that widely available incandescent showcase lamps could fit into many light fixtures. Additionally, ASAP noted that DOE is proposing to include many T shape lamps in the definition of GSILs and recommended that showcase lamps also be included. (ASAP, No. 94 at pp. 3-7)
DOE finds that the shape and wattage specifications as well as the requirement that these lamps be designed and marketed as a showcase lamp is sufficient to discourage consumers from
NRDC stated that given their medium screw base and residential voltage as well as likeness to incandescent lamps, traffic signal lamps would appeal to consumers. Further, the unique characteristics of a strengthened filament and longer life liken these lamps to vibration and rough service lamps. NRDC recommended that DOE remove the exemption for traffic signal lamps to avoid potential lamp switching scenarios. NRDC also commented that LED lamps already meet the needs of traffic signal lamps. (NRDC, No. 85 at p. 8)
NEMA and LEDVANCE agreed with the proposed definition of traffic signal lamp. LEDVANCE explained that these replacement traffic signal lamps have a low lumen output, longer life, A21 shapes; and are more robustly constructed and expensive compared to a GSIL. LEDVANCE stated that due to these factors consumers would not use these lamps as replacements. LEDVANCE added that these lamps cannot be found in typical distribution channels such as retail stores. NEMA and LEDVANCE also stated that this type of lamp has seen dramatic decreases in sales because of the EPCA mandate to use LED technology in new traffic signal modules. (NEMA, No. 93 at p. 30; LEDVANCE, No. 90 at p. 35)
In its review of the definition for traffic signal lamps, DOE found that most traffic signal lamps have a lifetime of 8,000 hours, which is longer than typical incandescent lamps. This distinctive characteristic aligns with the use of these lamp types in traffic signals, in which long lifetimes are likely a desirable feature. Hence, DOE is amending its proposed definition of “traffic signal lamps” to include a lifetime specification. Atraffic signal lamp means a lamp that is designed and marketed for traffic signal applications and has a lifetime of 8,000 hours or greater.
NEMA and LEDVANCE agreed with DOE's proposed definition of silver bowl lamp. Both stated that this is a specialty lamp used for pendant and hanging light fixtures and that the lamp has an opaque silver coating causing the light to reflect towards the ceiling to create a specific lighting atmosphere. NEMA and LEDVANCE asserted that these lamps are not suitable for general service lighting applications. (NEMA, No. 93 at pp. 29-30; LEDVANCE, No. 90 at p. 35)
ASAP disagreed and recommended that the definition for “silver bowl lamp” be revised to include a minimum requirement for the percentage of total bulb surface that has a reflective coating. ASAP also suggested that the coating be required to be opaque. Finally, ASAP noted that more efficient alternatives to the incandescent silver bowl lamps are available and that silver bowl lamps should also be included in the definition of GSILs. (ASAP, No. 94 at p. 4)
Manufacturer catalogs and product specifications do not provide the amount of coating used in silver bowl lamps and therefore, it is difficult to determine a consistent value applicable across all products. DOE agrees that an opaque coating is necessary for the primary purpose of the lamp to reflect light towards the lamp base. DOE has therefore included the term “opaque” in the definition. For discussion regarding the exclusion of this lamp type in the GSIL definition, see section III.A.1.b. In this final rule, DOE amends the proposed definition to specify an opaque coating and is adopting a definition of “silver bowl lamp.” A silver bowl lamp is a lamp that has an opaque reflective coating applied directly to part of the bulb surface that reflects light toward the lamp base and that is designed and marketed as a silver bowl lamp.
In the October 2016 NOPDDA, DOE proposed to exempt certain MR-shaped lamps that have smaller diameters than MR16 lamps and are marketed for use in specialty applications. In doing so, DOE found it necessary to establish a definition for “specialty MR lamp” to describe the lamps used in these specialty applications. As described in section III.A.4.f, DOE has revised the definition of specialty MR lamp for this final rule. A specialty MR lamp
NEMA recommended and LEDVANCE supported a definition for “MR lamp,” describing it as “a curved focusing reflectorized bulb which may have a multifaceted inner surface that is generally dichroic coated and referred to as a multifaceted reflector lamp with a GU10, GU11, GU5.3, GUX5.3, GU8, GU4, or E26 base” and providing information regarding common light sources and diameters used in the lamp type. (NEMA, No. 93 at p. 27; LEDVANCE, No. 90 at pp. 32-33) DOE does not find that a general definition for MR-shaped lamps is necessary to clarify the scope of this rulemaking. Additionally, the details regarding the bulb shape provided in NEMA's proposed definition are very similar to those in the ANSI standard that DOE references in its definition of “specialty MR lamp.”
In the October 2016 NOPDDA, DOE proposed a definition for “designed and marketed” to provide additional detail regarding the use of the term in several of the supporting definitions. 81 FR 71809. NEEP, Utility Coalition, and ASAP recommended the addition of the words “prominently displayed” in the definition to provide clarity in product labels regarding the application of the product. NEEP commented that this requirement would not overly impact the manufacturer's packaging process. Further, Utility Coalition and ASAP explained that this requirement would reduce confusion among consumers about how the lamp should be used. (NEEP, No. 92 at pp. 1-3; Utility Coalition, No. 95 at p. 11; ASAP, No. 94 at p. 7)
DOE agrees that the specification of “prominently displayed” would help ensure that the application for which the product is intended is clearly communicated to consumers. Hence in this final rule, DOE amends the proposed definition of “designed and marketed” to specify that the application designation be prominently displayed. Designed and marketed is exclusively designed to fulfill the indicated application and, when distributed in commerce, designated and marketed solely for that application, with the designation prominently displayed on the packaging and all publicly available documents (
In the October 2016 NOPDDA, DOE also proposed definitions for “GU24 base,” “integrated lamp,” “LED downlight retrofit kit,” “left-hand thread lamp,” “light fixture,” “marine signal service lamp,” “mine service lamp,” “non-integrated lamp,” “non-reflector lamp,” “pin base lamp,” “reflector lamp,” and “sign service lamp.” 81 FR 71807, 71809. DOE believes the definitions for “GU24 base” and “non-reflector lamp” are no longer necessary. DOE did not receive any comments on the other definitions and is adopting a definition for integrated lamp, LED downlight retrofit kit, left hand thread lamp, light fixture, marine signal service lamp, mine service lamp, non-integrated lamp, pin-base lamp, sign-service lamp in § 430.2in this final rule.
Although DOE received no comments on the definition of reflector lamp, DOE believes the phrase “is used to provide directional light” describes the function of a reflector lamp better than “is used to direct light.” DOE has therefore revised the definition of reflector lamp in the final rule. A reflector lamp is a lamp that has an R, PAR, BPAR, BR, ER, MR, or similar bulb shape (as defined in ANSI C78.20-2003 and ANSI C79.1-2002) and is used to provide directional light.
In the March 2016 GSL ECS NOPR, DOE proposed standards for GSLs. Although the October 2016 NOPDDA did not specifically address the proposed standards, DOE received a number of general comments regarding the proposed standards. CEC and RELS urged DOE to consider a minimum efficiency standard that achieves feasible and prospective energy savings for products in the GSL scope once the definition of GSL is finalized. (CEC, No. 81 at p. 1; CEC, No. 83 at pp. 32-33; RELS, No. 86 at p. 1) CEC stated that significant energy savings would result in shifting from an incandescent lamp to an LED lamp or shifting from an LED lamp to a more efficient LED lamp for SDDLs and medium screw base LED reflector lamps. CEC also provided an estimate of current availability of LED replacements at 80 lm/W or higher for SDDLs and medium screw base directional lamps. (CEC, No. 91 at pp. 7-8)
NEEP commented that given the range of LED products available on the market that are high quality and high efficiency, NEEP believes that the federal minimum standard for 2020 and corresponding scope are very achievable. (NEEP, No. 83 at pp. 13-14)
This final rule adopts a definition for GSL, as well as related definitions. DOE is not addressing proposed standards in this final rule. DOE acknowledges the comments regarding the proposed standards for GSLs, and will address them at such time as standards may be finalized.
If DOE fails to complete a rulemaking in accordance with 42 U.S.C. 6295(i)(6)(A)(i)-(iv) or a final rule from the first rulemaking cycle does not produce savings greater than or equal to the savings from a minimum efficacy standard of 45 lm/W, the statute provides a “backstop” under which DOE must prohibit sales of GSLs that do not meet a minimum 45 lm/W standard beginning on January 1, 2020. (42 U.S.C. 6295(i)(6)(A)(v)) DOE received a number of comments regarding the backstop standard.
CEC commented on the potential for DOE to exercise enforcement discretion if the backstop standard was applicable. (CEC, No. 91 at p. 10) CEC stated that if DOE were to exercise enforcement discretion, that the backstop standard would still be applicable in the context of California building codes (which incorporate Federal appliance standards), and in the context of California's appliance efficiency standards (which require product certification for federally covered products). (CEC, No. 91 at p. 10)
As of the issuance date of this document the backstop standard would not be applicable. The backstop standard is not applicable unless DOE fails to complete the rulemaking as prescribed by EPCA by January 1, 2017, or the final rule does not produce savings that are greater than or equal to the savings from a minimum efficacy standard of 45 lm/W. (42 U.S.C. 6295(i)(6)(A)(iv))
Federal energy conservation requirements generally supersede state laws or regulations concerning energy conservation testing, labeling, and standards. (42 U.S.C. 6297(a)-(c)) Generally, preemption applies both before an energy conservation standard becomes effective, and after an energy conservation standard becomes effective. (42 U.S.C. 6297(b) and (c)) For energy conservation standards applicable to GSLs, EISA 2007 established additional preemption provisions specific to California and Nevada. Namely, beginning January 1, 2018, no provision of law can preclude these states from adopting: (1) Standards established in a final DOE rule adopted in accordance with 42 U.S.C. 6295(i)(6)(A)(i)-(iv); (2) the minimum efficacy standard of the backstop standard (45 lm/W) if no final rule was adopted in accordance with 42 U.S.C. 6295(i)(6)(A)(i)-(iv); or (3) for the State of California, any California regulations related to the covered products adopted pursuant to state statute in effect as of the date of enactment of EISA 2007 (
CEC stated that California has already established a 45 lm/W standard with an effective date of January 1, 2018. (CEC, No. 91 at p. 10) CEC stated that the technology neutral approach to the scope of GSLs would minimize lamp switching that would otherwise limit the energy savings and consumer benefits achieved by the 45 lm/W requirement effective January 1, 2018 in California and in January 1, 2020 in the rest of the nation. (CEC, No. 91 at p. 1) Philips asked if CFL and LED reflector lamps would be GSLs under the definitions proposed in the October 2016 NOPDDA, whether they would be subject to the backstop standard, and if so, whether the backstop standard would preempt the California Title 20 regulation. (Philips, No. 96 at p. 6)
Except for the narrow exception to the preemption provision provided in 42 U.S.C. 6295(i)(6)(A)(vi), the general EPCA preemption provisions apply to GSLs. Federal test procedures for GSLs supersede state test procedures that require testing in any manner other than the Federal test procedure. (42 U.S.C. 6297(a)(1)(A)) Prior to the effective date of standards for GSLs, no state regulation regarding energy efficiency or
NEMA noted that in response to the March 2016 ECS NOPR, it had commented that in 2020 manufacturers would have to supply the entire nation with general service LED lamps as incandescent lamps would not be available. NEMA had explained in its comment that this would mean a 300 percent increase in the steady state demand and require tripling capacity for only that year. NEMA stated that the proposed definitions in the October 2016 NOPDDA increased the scope of GSLs to a wider range of specialty products than what was proposed in the March 2016 GSL ECS NOPR. Hence the projected spike in demand in 2020 would now be even higher. Therefore, NEMA encouraged DOE to either not impose regulations or postpone them for a few years on niche products. (NEMA, No. 83 at pp. 157-158)
NRDC noted that stakeholders have known that standards set by DOE and/or the 45 lm/W backstop standard would be implemented in 2020. NRDC stated that sales from a recent quarter showing LED market share was at 25 percent indicated that industry has done an amazing job preparing for this standard. Further NRDC noted that supply chains worldwide would be impacted as Europe and China are also phasing out incandescent lamps. Hence, NRDC asserted that industry would be adequately prepared for to meet demand in 2020. (NRDC, No. 83 at pp. 164-165)
GE, NEMA and LEDVANCE urged DOE to reconsider its interpretation of the Appropriations Rider and EISA 2007 and pointed out that expanding the scope of GSLs will further increase the amount of stranded inventory and consequently the time it will take to sell the lamps, adding that a minimum of 2-3 years will be required to sell stranded inventory and exit the businesses. GE, NEMA and LEDVANCE stated that typically DOE allows existing inventory of noncompliant products to be sold after a standard goes into effect while the backstop standard prohibits sale of noncompliant products at a certain date. (GE, No. 88 at pp. 5-6; NEMA, No. 93 at p. 31; LEDVANCE, No. 90 at p. 36) Philips and LEDVANCE added that enforcement of a prohibition of sale date would also impact the electrical distribution market. Philips recommended DOE consider a prohibition on manufacturing and not sales. LEDVANCE stated DOE should allow manufacturers and retailers to sell inventory they have on-hand before the date of prohibition. (Philips, No. 96 at p. 6; LEDVANCE, No. 90 at pp. 16-17) To avoid imposing severe financial burdens on industry, NEMA stated that DOE should withdraw its proposed expansion of GSL scope and evaluate discontinuing exemptions in the second GSL rulemaking Congress authorized to begin in 2020. (NEMA, No. 93 at p. 31)
CEC agreed that a prohibition on sale would pose difficulties for the industry. CEC noted that use of date-of-manufacture for the compliance date would be more easily enforced and would ensure that retailers are not unfairly penalized for incorrectly determining the exact amount of stock that can be sold prior to the compliance date, but CEC also commented that it understood the backstop standard to establish a date-of-sale compliance date. (CEC, No. 91 at pp. 9-10)
NEMA also encouraged DOE to consider establishing an energy conservation standard that caps energy use (wattage) as it is significantly less burdensome compared to a lumens per watt requirement. NEMA explained a wattage limit is particularly applicable to rough service, vibration service, and shatter-resistant lamps, appliance lamps, intermediate base lamps, candelabra base lamps, T shape lamps and other lamps that have 40 W restrictions as well as high lumen lamps. NEMA stated because there is no hard evidence that lamp switching from general service LED lamps to specialty versions is even possible and will result in loss of significant energy savings, there is no reason for DOE to impose testing burden on manufacturers by regulating specialty LED lamps. (NEMA, No. 93 at p. 11) In addition to test burden, Philips and NEMA noted the significantly increased burden on manufacturers if DOE required certification reports to be submitted for all products to certify to the 45 lm/W standard. (Philips, No. 83 at p. 163; Philips, No. 96 at p. 6; NEMA, No. 93 at p. 11)
NEMA noted that they, as well as domestic lighting manufacturers, are advocates for domestic manufacturing and employment. Thus, in addition to energy savings and energy efficiency, NEMA argued that DOE must consider the fact that the proposed rule will destroy domestic jobs. (NEMA, No. 83 at p. 16)
However, NRDC and ASAP commented that many LED lamps are designed and produced by domestic companies, and therefore recommended comparing the number of jobs in the U.S. associated with making LED lamps compared to less efficient products. (NRDC, No. 83 at p. 46; ASAP, No. 94 at p. 7) NRDC and Utility Coalition added that, to their knowledge, incandescent/halogen lamps by leading manufacturers such as GE and Philips Lighting are not made in the U.S. They cited domestic producers of SSLs and their employee numbers and asserted that domestic jobs related to designing, testing, and marketing LED lamps and their components would outnumber domestic jobs related to production of incandescent lamps. (Utility Coalition, No. 95 at pp. 5-6; NRDC, No. 85 at pp. 10-11)
DOE acknowledges that manufacturers may face a difficult transition if required to comply with a 45 lm/W standard. Manufacturers have voiced concern regarding the loss of domestic manufacturing jobs, the stranding of inventory, the ability to meet the demand for all general service lamps with lamps using LED technology, and the burden associated with testing and certifying compliance for all general service lamps in DOE's Compliance Certification Management System (CCMS). Manufacturers have requested an end to or delay in imposing any new standards for general service lamps and a two to three year delay in enforcing the backstop standard.
DOE is committed to working with manufacturers to ensure a successful transition if the backstop standard goes into effect.
In the October 2016 NOPDDA, DOE proposed editorial modifications to regulatory text to align with the recently adopted test procedure for integrated LED lamps. Specifically, DOE proposed changes to 10 CFR 429.56 regarding the certification and reporting requirements of integrated LED lamps. In the July 2016 LED test procedure (TP) final rule, DOE adopted the requirement that testing of integrated LED lamps be conducted by test laboratories accredited by an Accreditation Body that is a signatory member to the International Laboratory Accreditation Cooperation (ILAC) Mutual Recognition Arrangement (MRA). 81 FR 43404, 43419 (July 1, 2016). To align with this requirement, DOE proposed in the October 2016 NOPDDA to modify the certification report language in 429.56(b)(2) to specify that the testing laboratory's ILAC accreditation body's identification number or other approved identification assigned by the ILAC accreditation body must be included in the certification report. In addition, DOE proposed that manufacturers must also report CRI in the certification report for integrated LED lamps. 81 FR 71809.
LEDVANCE requested clarification on DOE's citation of an ILAC accreditor identification number while NEMA pointed out that there are no identification numbers for ILAC accreditors. NEMA, LEDVANCE, and Philips also asked DOE to reconsider including CRI in the certification reporting requirements to minimize the regulatory and testing burden especially because CRI is not a part of the energy conservation standard for general service incandescent lamps or general service LED lamps. (LEDVANCE, No. 90 at p. 35; NEMA, No. 93 at p. 30; Philips, No. 96 at p. 5)
This final rule document finalizes the definition for GSL and related definitions. DOE is not making changes to the certification and reporting requirements in this final rule. DOE recognizes the comments received regarding the reporting of a testing laboratory's ILAC accreditation number and the reporting of the CRI for integrated lamps, and will address these comments to the extent the proposed revisions are considered at a later date.
For the changes described in the various definitions in this final rule, DOE is adopting a January 1, 2020 effective date.
This final rule neither implements nor seeks to enforce any standard. Rather, this final rule merely defines what constitutes a GSIL and what constitutes a GSL. Lamps that are GSLs will become subject to either a standard developed by DOE or to a 45 lm/W backstop standard, but this rule does not determine what standard will be applicable to lamps that are being newly included as GSLs. Accordingly, this action does not constitute a significant regulatory action under Executive Orders 12866 and 13563.
NEMA commented that DOE failed to meet the requirements of Executive Order 12866 in that DOE did not consider regulatory alternatives to the regulation adopted in this document including the alternative of not regulating and that DOE must choose the regulatory approach that maximizes net benefits unless a statute requires another regulatory approach. (NEMA, No. 93 at p. 10)
As explained throughout the preamble, DOE has undertaken revisions to the GSIL and GSL definitions as authorized by EPCA. (42 U.S.C. 6295(i)(6)(A)(i)(II)) In amending the definitions, DOE considered the potential that lamps exempted from the definition of GSL would create loopholes should a GSL standard or standards be adopted. However, this rule does not establish standards.
The Regulatory Flexibility Act (5 U.S.C. 601
DOE reviewed the definitions for GSL and related terms adopted in this final rule under the provisions of the Regulatory Flexibility Act and the procedures and policies published on February 19, 2003. DOE certifies that this final rule does not have a significant economic impact on a substantial number of small entities. The factual basis for this certification is set forth in the following paragraphs.
For manufacturers of GSLs, the SBA has set a size threshold, which defines those entities classified as “small businesses” for the purposes of the statute. DOE used the SBA's small business size standards to determine whether any small entities would be subject to the requirements of the rule. (See 13 CFR part 121.) The size standards are listed by NAICS code and industry description and are available at
To estimate the number of companies that could be small businesses that manufacture GSLs covered by this rulemaking, DOE conducted a market survey using publicly available information. DOE's research involved information provided by trade associations (
DOE notes that this final rule merely defines what constitutes a GSIL and what constitutes a GSL. Manufacturers of general service lamps are required to use DOE's test procedures to make representations and certify compliance with standards, if required. The test procedure rulemakings for CFLs, integrated LED lamps, and other general service lamps
Manufacturers of GSLs must certify to DOE that their products comply with any applicable energy conservation standards. In certifying compliance, manufacturers must test their products according to DOE test procedures for GSLs, including any amendments adopted for those test procedures. DOE has established regulations for the certification and recordkeeping requirements for all covered consumer products and commercial equipment. 76 FR 12422 (March 7, 2011). The collection-of-information requirement for the certification and recordkeeping is subject to review and approval by OMB under the Paperwork Reduction Act (PRA). This requirement has been approved by OMB under OMB control number 1910-1400. DOE requested OMB approval of an extension of this information collection for three years, specifically including the collection of information adopted in the present rulemaking, and estimated that the annual number of burden hours under this extension is 30 hours per company. In response to DOE's request, OMB approved DOE's information collection requirements covered under OMB control number 1910-1400 through November 30, 2017. 80 FR 5099 (January 30, 2015).
Notwithstanding any other provision of the law, no person is required to respond to, nor shall any person be subject to a penalty for failure to comply with, a collection of information subject to the requirements of the PRA, unless that collection of information displays a currently valid OMB control number.
Pursuant to the National Environmental Policy Act (NEPA) of 1969, DOE has determined that the rule fits within the category of actions included in Categorical Exclusion (CX) B5.1 and otherwise meets the requirements for application of a CX. (See 10 CFR part 1021, App. B, B5.1(b); 1021.410(b) and App. B, B(1)-(5).) The rule fits within this category of actions because it is a rulemaking that changes the definition of a covered class of products for which there are existing energy conservation standards, and for which none of the exceptions identified in CX B5.1(b) apply. Therefore, DOE has made a CX determination for this rulemaking, and DOE does not need to prepare an Environmental Assessment or Environmental Impact Statement for this rule. DOE's CX determination for this rule is available at
Executive Order 13132, “Federalism,” 64 FR 43255 (August 10, 1999), imposes certain requirements on federal agencies formulating and implementing policies or regulations that preempt state law or that have Federalism implications. The Executive Order requires agencies to examine the constitutional and statutory authority supporting any action that would limit the policymaking discretion of the states and to carefully assess the necessity for such actions. The Executive Order also requires agencies to have an accountable process to ensure meaningful and timely input by state and local officials in the development of regulatory policies that have Federalism implications. On March 14, 2000, DOE published a statement of policy describing the intergovernmental consultation process it will follow in the development of such regulations. 65 FR 13735. DOE has examined this rule and has determined that it 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. EPCA governs and prescribes federal preemption of state regulations as to energy conservation for the products that are the subject of this final rule. States can petition DOE for exemption from such preemption to the extent, and based on criteria, set forth in EPCA. (42 U.S.C. 6297) Therefore, no further action is required by Executive Order 13132.
With respect to the review of existing regulations and the promulgation of new regulations, section 3(a) of Executive Order 12988, “Civil Justice Reform,” imposes on federal agencies the general duty to adhere to the following requirements: (1) Eliminate drafting errors and ambiguity; (2) write regulations to minimize litigation; (3) provide a clear legal standard for affected conduct rather than a general standard; and (4) promote simplification and burden reduction. 61 FR 4729 (Feb. 7, 1996). Regarding the review required by section 3(a), section 3(b) of Executive Order 12988 specifically requires that Executive agencies make every reasonable effort to ensure that the regulation: (1) Clearly specifies the preemptive effect, if any; (2) clearly specifies any effect on existing federal law or regulation; (3) provides a clear legal standard for affected conduct while promoting simplification and burden reduction; (4) specifies the retroactive effect, if any; (5) adequately defines key terms; and (6) addresses other important issues affecting clarity and general draftsmanship under any guidelines issued by the Attorney General. Section 3(c) of Executive Order 12988 requires Executive agencies to review regulations in light of applicable standards in section 3(a) and section 3(b) to determine whether they are met or it is unreasonable to meet one or more of them. DOE has completed the required review and determined that, to the extent permitted by law, this final rule meets the relevant standards of Executive Order 12988.
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) requires each federal agency to assess the effects of federal regulatory actions on state, local, and tribal governments and the private sector. Public Law 104-4, sec. 201 (codified at 2 U.S.C. 1531). For a
DOE examined this final rule according to UMRA and its statement of policy and determined that the rule contains neither an intergovernmental mandate, nor a mandate that may result in the expenditure of $100 million or more in any year, so these requirements do not apply.
Section 654 of the Treasury and General Government Appropriations Act, 1999 (Pub. L. 105-277) requires federal agencies to issue a Family Policymaking Assessment for any rule that may affect family well-being. This rule would not have any impact on the autonomy or integrity of the family as an institution. Accordingly, DOE has concluded that it is not necessary to prepare a Family Policymaking Assessment.
Pursuant to Executive Order 12630, “Governmental Actions and Interference with Constitutionally Protected Property Rights,” 53 FR 8859 (March 15, 1988), DOE has determined that this rule would not result in any takings that might require compensation under the Fifth Amendment to the U.S. Constitution.
Section 515 of the Treasury and General Government Appropriations Act, 2001 (44 U.S.C. 3516 note) provides for federal agencies to review most disseminations of information to the public under information quality guidelines established by each agency pursuant to general guidelines issued by OMB. OMB's guidelines were published at 67 FR 8452 (Feb. 22, 2002), and DOE's guidelines were published at 67 FR 62446 (Oct. 7, 2002). DOE has reviewed this final rule under the OMB and DOE guidelines and has concluded that it is consistent with applicable policies in those guidelines.
Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use,” 66 FR 28355 (May 22, 2001), requires federal agencies to prepare and submit to OIRA at OMB, a Statement of Energy Effects for any significant energy action. A “significant energy action” is defined as any action by an agency that promulgates or is expected to lead to promulgation of a final rule, and that: (1) Is a significant regulatory action under Executive Order 12866, or any successor order; and (2) is likely to have a significant adverse effect on the supply, distribution, or use of energy, or (3) is designated by the Administrator of OIRA as a significant energy action. For any significant energy action, the agency must give a detailed statement of any adverse effects on energy supply, distribution, or use should the proposal be implemented, and of reasonable alternatives to the action and their expected benefits on energy supply, distribution, and use.
This regulatory action to adopt definitions for GSL and related terms is not a significant regulatory action under Executive Order 12866. Moreover, it would not have a significant adverse effect on the supply, distribution, or use of energy, nor has it been designated as a significant energy action by the Administrator of OIRA. Therefore, it is not a significant energy action, and, accordingly, DOE has not prepared a Statement of Energy Effects.
Under section 301 of the Department of Energy Organization Act (Pub. L. 95-91; 42 U.S.C. 7101), DOE must comply with section 32 of the Federal Energy Administration Act of 1974, as amended by the Federal Energy Administration Authorization Act of 1977. (15 U.S.C. 788; FEAA) Section 32 essentially provides in relevant part that, where a rule authorizes or requires use of commercial standards, the NOPR must inform the public of the use and background of such standards. In addition, section 32(c) requires DOE to consult with the Attorney General and the Chairman of the Federal Trade Commission (FTC) concerning the impact of the commercial or industry standards on competition.
The modifications to the definition of general service lamp and the associated supporting definitions adopted in this final rule references the following commercial standards that are already incorporated by reference in 10 CFR part 430:
As required by 5 U.S.C. 801, DOE will report to Congress on the promulgation of this rule prior to its effective date. The report will state that it has been determined that the rule is not a “major rule” as defined by 5 U.S.C. 804(2).
The Secretary of Energy has approved publication of this final rule.
Administrative practice and procedure, Confidential business information, Energy conservation, Household appliances, Imports, Incorporation by reference, Intergovernmental relations, Small businesses.
For the reasons set forth in the preamble, DOE amends part 430 of chapter II, subchapter D, of title 10 of the Code of Federal Regulations, as set forth below:
42 U.S.C. 6291-6309; 28 U.S.C. 2461 note.
The additions and revisions read as follows:
(1) A CRI less than 40, as determined according to the method set forth in CIE Publication 13.3 (incorporated by reference; see § 430.3); or
(2) A CCT less than 2,500 K or greater than 7,000 K.
(1) An appliance lamp;
(2) A black light lamp;
(3) A bug lamp;
(4) A colored lamp;
(5) A G shape lamp with a diameter of 5 inches or more as defined in ANSI C79.1-2002 (incorporated by reference; see § 430.3);
(6) An infrared lamp;
(7) A left-hand thread lamp;
(8) A marine lamp;
(9) A marine signal service lamp;
(10) A mine service lamp;
(11) A plant light lamp;
(12) An R20 short lamp;
(13) A sign service lamp;
(14) A silver bowl lamp;
(15) A showcase lamp; and
(16) A traffic signal lamp.
(1) Appliance lamps;
(2) Black light lamps;
(3) Bug lamps;
(4) Colored lamps;
(5) G shape lamps with a diameter of 5 inches or more as defined in ANSI C79.1-2002 (incorporated by reference; see § 430.3);
(6) General service fluorescent lamps;
(7) High intensity discharge lamps;
(8) Infrared lamps;
(9) J, JC, JCD, JCS, JCV, JCX, JD, JS, and JT shape lamps that do not have Edison screw bases;
(10) Lamps that have a wedge base or prefocus base;
(11) Left-hand thread lamps;
(12) Marine lamps;
(13) Marine signal service lamps;
(14) Mine service lamps;
(15) MR shape lamps that have a first number symbol equal to 16 (diameter equal to 2 inches) as defined in ANSI C79.1-2002 (incorporated by reference; see § 430.3), operate at 12 volts, and have a lumen output greater than or equal to 800;
(16) Other fluorescent lamps;
(17) Plant light lamps;
(18) R20 short lamps;
(19) Reflector lamps (as defined in this section) that have a first number symbol less than 16 (diameter less than 2 inches) as defined in ANSI C79.1-2002 (incorporated by reference; see § 430.3) and that do not have E26/E24, E26d, E26/50x39, E26/53x39, E29/28, E29/53x39, E39, E39d, EP39, or EX39 bases;
(20) S shape or G shape lamps that have a first number symbol less than or equal to 12.5 (diameter less than or equal to 1.5625 inches) as defined in ANSI C79.1-2002 (incorporated by reference; see § 430.3);
(21) Sign service lamps;
(22) Silver bowl lamps;
(23) Showcase lamps;
(24) Specialty MR lamps;
(25) T shape lamps that have a first number symbol less than or equal to 8
(26) Traffic signal lamps;
(27) Incandescent reflector lamps.
Office of Energy Efficiency and Renewable Energy, Department of Energy.
Final rule.
On March 17, 2016, the U.S. Department of Energy (DOE) published a notice of proposed rulemaking (NOPR) proposing standards for general service lamps (GSLs) pursuant to the Energy Policy and Conservation Act of 1975 (EPCA), as amended. In this final rule DOE responds to comments received on the October 2016 NOPDDA regarding IRLs and amends the definition of GSL.
The effective date of this rule is January 1, 2020.
The docket, which includes
A link to the docket Web page can be found at:
Ms. Lucy deButts, U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, Building Technologies Office, EE-2J, 1000 Independence Avenue SW., Washington, DC 20585-0121. Telephone: (202) 287-1604. Email:
Title III, Part B of the Energy Policy and Conservation Act of 1975 (EPCA or the Act), Public Law 94-163 (42 U.S.C. 6291-6309, as codified) established the Energy Conservation Program for Consumer Products Other Than Automobiles, a program covering most major household appliances (collectively referred to as “covered products”).
In particular, amendments to EPCA in the Energy Independence and Security Act of 2007 (EISA 2007) directed DOE to engage in rulemakings regarding GSLs. (42 U.S.C. 6295(i)(6)(A)-(B)) EPCA, as amended by EISA 2007, directs DOE to initiate a rulemaking no later than January 1, 2014, to determine whether standards in effect for GSLs should be amended and determine whether exemptions for certain incandescent lamps should be maintained or discontinued. (42 U.S.C. 6295(i)(6)(A)(i)) The scope of the rulemaking is not limited to incandescent lamp technologies. (42 U.S.C. 6295(i)(6)(A)(ii)) Further, for this first cycle of rulemaking, the EISA 2007 amendments provide that DOE must consider a minimum standard of 45 lumens per watt (lm/W). (42 U.S.C. 6295(i)(6)(A)(ii)) If DOE fails to complete a rulemaking in accordance with 42 U.S.C. 6295(i)(6)(A)(i)-(iv) or a final rule from the first rulemaking cycle does not produce savings greater than or equal to the savings from a minimum efficacy standard of 45 lm/W, the statute provides a “backstop” under which DOE must prohibit sales of GSLs that do not meet a minimum 45 lm/W standard beginning on January 1, 2020. (42 U.S.C. 6295(i)(6)(A)(v))
In March 2016, DOE published a notice of proposed rulemaking (NOPR) that proposed a revised definition of GSL and energy conservation standards for certain GSLs (hereafter the “March 2016 GSL ECS NOPR”). 81 FR 14528 (March 17, 2016). In conjunction with the March 2016 GSL ECS NOPR, DOE also published on its Web site the complete technical support document (TSD) for the proposed rule, which described the analyses DOE conducted and included technical documentation for each analysis. The TSD also included the life cycle cost (LCC) spreadsheet, the national impact analysis spreadsheet, and the manufacturer impact analysis (MIA) spreadsheet.
DOE held a public meeting on April 20, 2016, to hear oral comments on and solicit information relevant to the proposed rule. At this meeting, DOE heard concerns from stakeholders regarding the expansion of scope in the proposed GSL definition and DOE's approach to analyzing the 22 GSIL exemptions. In addition, DOE received written comments that reiterated these concerns, and also provided additional data for DOE's consideration. Specifically, the National Electrical Manufacturers Association (NEMA) provided new data and information on the 22 exempted lamp types to inform DOE's evaluation of whether the exemptions should be maintained or discontinued as required by 42 U.S.C. 6295(i)(6)(A)(i)(II).
After the publication of the March 2016 GSL ECS NOPR, DOE analyzed the data submitted by NEMA and collected additional data where available. DOE published a notice of proposed definition and data availability (hereafter the “October 2016 NOPDDA”) to: (1) Propose a revised definition of GSL that included, among other lamp types, IRLs; (2) announce the availability of the NEMA data and supplemental data collected by DOE; (3) request public comment on proposed definitions and compiled data; and (4) request any additional data that stakeholders may have in support of this evaluation. 81 FR 71794 (October 18, 2016). DOE also held a public meeting on October 21, 2016 to hear oral comments and solicit information relevant to the October 2016 NOPDDA.
In a separate final rule being published in the same issue of the
The following sections of this final rule respond to comments received on the October 2016 NOPDDA and during the NOPDDA public meeting regarding IRLs in more detail.
DOE is required under the EISA 2007 amendments to EPCA to undertake the present rulemaking. Under EPCA, DOE shall initiate a rulemaking to determine whether standards in effect for GSLs should be amended to establish more stringent standards; and determine whether exemptions for certain incandescent lamps should be maintained or discontinued. (42 U.S.C. 6295(i)(6)(A)(i)) In addition to that mandate, DOE has the authority to
An additional statute relevant to this rulemaking is section 312 of the Consolidated and Further Continuing Appropriations Act, 2016 (Pub. L. 114-113, 129 Stat. 2419; hereafter referred to as the “Appropriations Rider”) that prohibits expenditure of funds appropriated by that law to implement or enforce: (1) 10 CFR 430.32(x), which includes maximum wattage and minimum rated lifetime requirements for GSILs; and (2) standards set forth in section 325(i)(1)(B) of EPCA (42 U.S.C. 6295(i)(1)(B)), which sets minimum lamp efficiency ratings for incandescent reflector lamps (IRLs).
This final rule constitutes a decision on whether to maintain or discontinue the exemption for IRLs, and include IRLs as GSLs if discontinued. This final rule does not determine whether DOE should impose or amend standards for any category of lamps, such as GSILs or GSLs.
As discussed in more detail, DOE is grounding the decision of whether to maintain or discontinue the IRL exemption on an assessment of whether IRLs would provide a convenient unregulated alternative to lamps that will be subject to energy conservation standards. In DOE's view, EPCA exempted certain categories of lamps from the definition of GSL because, on the one hand, some lamps in those categories have specialty applications; and on the other hand, it was not clear, when these lamp provisions were enacted, whether those lamps were part of the broader lamp market to which Congress wished to apply energy conservation standards. For certain lamps exempted from regulation as a GSL, EPCA established standards. With regard to IRLs, EPCA imposed efficiency standards ranging from 10.5 to 15 lm/W. (42 U.S.C. 6295(i)(1)(B)). The purpose, then, of the decision that Congress entrusted to DOE, to maintain or to discontinue a given exemption, was that DOE should assess the role of lamps of that type in the broader lighting market, bearing in mind the evident statutory purpose of achieving energy conservation by imposing efficiency standards for general lighting.
While the statute does not expressly state a criterion by which DOE should decide which exemptions to maintain—it simply identifies one important evidentiary input, sales data—DOE understands its instruction to be that DOE should maintain an exemption if doing so would be consistent with that statutory purpose, and discontinue the exemption if it would not. To carry out that instruction, DOE has assessed whether lamps within the IRL exemption are readily substitutable for lamps that are already categorized as general service lamps. Sales data, as the statute directs, are an important type of evidence informing that assessment.
The discontinuation of the IRL exemption will render the lamps within that exemption GSLs, to the extent they would otherwise qualify as GSLs, As the October 2016 NOPDDA observed, DOE will then either impose standards on these lamps pursuant to its authority to develop GSL standards or apply the backstop standard prohibiting the sale of lamps not meeting a 45 lm/W efficacy standard.
Commenters on the March 2016 GSL ECS NOPR and October 2016 NOPDDA contended that DOE lacked authority to discontinue exemptions in the way it proposed and objected to the procedures DOE had undertaken. DOE discussed those comments in the GSL definition final rule that is being published in the same issue of the
Besides the 22 lamp types listed in section 6291(30)(D)(ii), which the GSL definition final rule addressed, DOE is also interpreting “the exemptions” in section 6291(i)(6)(A)(i)(II) to include the exemption in section 6291(30)(BB)(ii) for incandescent reflector lamps. Clause (i)(II) refers to “the exemptions for certain incandescent lamps”; and the (BB)(ii) carve-out for “incandescent reflector lamps” readily fits that description so long as it can properly be viewed as an “exemption.” In the GSL definition final rule that is being published in the same issue of the
DOE recognizes that, as a commenter pointed out, IRLs are already subject to standards under EPCA. The GSL definition final rule that is being published in the same issue of the
For IRLs, the existing standards are much less stringent than the 45 lm/W backstop standard, and presumably less stringent than any standard that DOE might develop to achieve energy savings comparable to those from the 45 lm/W backstop standard. For example, when EISA 2007 was adopted, the standard for incandescent reflector lamps ranged from 10.5 to 15 lm/W. It seems unlikely that Congress would have considered that standard an adequate alternative to GSL standards. Therefore, DOE considers it consistent with the scheme of subsection (i)(6) that DOE should assess whether to subject to GSL regulation the lamps within the IRL exemption.
Commenters also argued that DOE cannot discontinue the exemption for IRLs because, the commenters observed, the statute exempts these lamps from being GSLs twice. First, “reflector lamps” are one of the 22 types of lamp exempted by section 6291(30)(BB)(ii)(I); and second section 6291(30)(BB)(ii)(II) specifically exempts incandescent reflector lamps. By exempting them twice, the commenters suggest, Congress made quite clear that incandescent
The interpretation that these commenters advance would significantly impair the standards regime established by EISA 2007. That statute's amendments to EPCA imposed standards for general service fluorescent lamps and incandescent reflector lamps, the two categories of lamp that subclause (30)(BB)(ii)(II) exempts from being GSLs. For general service fluorescent lamps, when EISA was enacted the standards ranged from 64 to 80 lm/W, substantially above the backstop that the EISA amendments specify as the default for GSLs. For incandescent reflector lamps, the standards when EISA 2007 was enacted ranged from 10.5 to 15.0 lumens per watt, well below the backstop. Today, incandescent reflector lamps are widely used for general illumination just as GSILs are. If EPCA mandated that IRLs continue being exempt from GSLs, then they would present a convenient alternative product, subject to much less stringent standards than GSLs. The GSL standards (potentially the backstop or standards developed by DOE) would save far less energy if consumers and manufacturers can switch many lighting applications to less-efficient IRLs. That outcome would be especially odd in light of the authority that Congress provided DOE to assess whether to maintain or discontinue exemptions—a decision that, as DOE has explained, DOE believes was meant to focus on which exempted lamps would be substitutes for regulated GSLs. DOE's interpretation, under which paragraph (i)(6) authorizes it to make the same sort of determination with respect to IRLs, is a more consistent and coherent interpretation of the EISA amendments.
Of course, if the statute unambiguously foreclosed that interpretation or indicated that DOE must not discontinue the IRL exemption, that command would trump the policy considerations just discussed. But with respect to IRLs, the statute does permit DOE's interpretation that the IRL exemption is one that DOE can discontinue in a subsection (i)(6)(A)(i)(II) rulemaking. As explained in the paragraphs that follow, through a careful exploration of sections 6291 and 6295, DOE believes the “reflector lamp” exemption in section 6291(30)(D)(ii) is not necessarily as broad as the IRL exemption. DOE believes “reflector lamp” was meant to encompass a different range of lamps, with a scope left to DOE to interpret, while IRL is a defined term with a broad scope. Thus, the “reflector lamp” and IRL exemptions are somewhat different in nature, and EPCA calls on DOE to decide whether to maintain or discontinue each. DOE addressed the “reflector lamp” exemption, as applied to lamps that are not IRLs, in the GSL definition final rule that is being published in the same issue of the
Paragraph (30)(C) defines “incandescent lamp” to “includ[e] only the following”: “[a]ny lamp . . . that is not a reflector lamp” and meets certain criteria, such as a rated wattage between 30 and 199 watts; “[a]ny lamp (commonly referred to as a reflector lamp) which is not colored or designed for rough or vibration services applications, that contains an inner reflective coating on the outer bulb to direct the light,” and meets additional technical criteria like bulb shape; and “[a]ny general service incandescent lamp” rated above 199 watts. DOE notes that paragraph (30)(C) did not define “reflector lamp” to mean a lamp described in the terms just quoted; rather, paragraph (30)(C) noted that such lamps commonly are called reflector lamps. By contrast, paragraph (30)(F) does define the term IRL to mean “a lamp described in subparagraph (C)(ii).” Finally, paragraph (30)(D) defines GSIL, and that definition states that GSILs do not include any of 22 lamp types, one of which is “reflector lamps.”
From this set of definitions, DOE infers that “reflector lamp” does not necessarily mean the same thing as “incandescent reflector lamp.” Had Congress wanted to define “reflector lamp,” it could easily have done so. That it did not suggests that Congress left the term, as used in the list of 22 lamp types, for DOE to elaborate. Furthermore, if “reflector lamp” was meant to be necessarily coextensive with subparagraph (C)(ii), the definition of GSIL contains a curious circular redundancy. The statute defines “incandescent lamp” to include the lamps described in subparagraph (C)(ii); it defines “general service incandescent lamp” to be an incandescent lamp or halogen lamp with certain additional attributes; and then it says general service incandescent lamps do not include “reflector lamp[s].” If that usage of “reflector lamp” necessarily has the same scope as subparagraph (C)(ii), the statute included them in GSILs only to exclude them.
The context further suggests that “reflector lamp,” as used in the list of 22 exempted lamp types, was meant to exempt a scope different from, and in some respects narrower than, paragraph (C)(ii). Each of the other exemptions describes a narrow category of lamp, such as “mine service lamp,” “traffic signal lamp,” or “vibration service lamp,” that has specialty applications and that Congress could have thought might have few or no general service applications. The statute does not reflect a final judgment on that point; instead it defers the decision for DOE to make in a section 6295(i)(6)(A)(i)(II) rulemaking. Still, the general character of the 22 exemptions is that they are lamp types about which such a judgment—whether the exempted lamps have substantial general service applications—would be necessary in deciding whether to impose general lamp standards. By contrast, subparagraph (C)(ii), which defines IRLs, encompasses a wide range of lamps which certainly had general service applications; and EPCA reflected that reality by imposing efficiency standards (ranging from 10.5 to 15 lm/W) on IRLs since 1995. Public Law 102-486, section 123(f), 106 Stat. 2824.
It bears mention also that EPCA first added “reflector lamps” among the 22 exempted lamp types as a result of EISA amendments in 2007. EISA 2007 section 321 also established the first statutory standards for GSILs. Public Law 110-140, section 321(a)(3), 121 Stat. 1577. While those standards were expressed in terms of a maximum wattage for a given range of lumen output, the minimum efficiency needed to satisfy those standards would be from 17 to 36 lm/W in the wattage range that includes IRLs.
In light of these observations, DOE understands the definition of “general service lamp” as follows (as concerns reflector lamps and IRLs): Until DOE discontinued the relevant exemptions, no “reflector lamps,” as the term is used in section 6291(30)(D)(ii), were GSILs or
In principle, then, DOE has had two tasks regarding exemptions relevant for reflector lamps. With respect to “reflector lamps,” it was to assess whether that one of the relatively narrow 22 listed lamp types—the scope of which the statute does not make clear—has uses in general illumination, and whether sales data and other evidence indicate that such lamps are ready substitutes for lamps that are already included as GSLs. DOE has finalized this analysis in a separate final rule, the GSL definition final rule. By contrast, as noted previously, the category of IRLs includes lamps that, as of 2007, it was already evident were being used in general lighting applications. However, DOE must still analyze whether, in light of sales data and other evidence, IRLs are an important enough substitute for lamps already included as GSLs to warrant discontinuing their exemption. This analysis is the subject of this final rule and discussed in more detail in the section that follows.
The term general service lamp (GSL) includes general service incandescent lamps (GSILs), compact fluorescent lamps (CFLs), general service light-emitting diode (LED) and organic light-emitting diode (OLED) lamps, and any other lamps that DOE determines are used to satisfy lighting applications traditionally served by GSILs; however, GSLs do not include any lighting application or bulb shape that under 42 U.S.C. 6291(30)(D)(ii) is not included in the “general service incandescent lamp” definition, or any general service fluorescent lamp or incandescent reflector lamp. (42 U.S.C. 6291(30)(BB)) The October 2016 NOPDDA revisited the proposed definition of GSL from the March 2016 GSL ECS NOPR, including the exemptions contained in the GSIL and GSL definitions, and proposed a revised definition of “general service lamp” in § 430.2 to capture various criteria and delineate the lamp types considered to be GSLs. 81 FR 71806-71807. More specifically, DOE proposed a definition for GSL in the October 2016 NOPDDA. A general service lamp, as proposed, would be a lamp that has an ANSI base, operates at any voltage, has an initial lumen output of greater than or equal to 310 lumens (or 232 lumens for modified spectrum general service incandescent lamps) and less than or equal to 4,000 lumens, is not a light fixture, is not an LED downlight retrofit kit, and is used in general lighting applications. General service lamps include, but are not limited to, general service incandescent lamps, compact fluorescent lamps, general service light-emitting diode lamps, and general service organic light-emitting diode lamps, but do not include general service fluorescent lamps; linear fluorescent lamps of lengths from one to eight feet; circline fluorescent lamps; fluorescent lamps specifically designed for cold temperature applications; impact-resistant fluorescent lamps; reflectorized or aperture fluorescent lamps; fluorescent lamps designed for use in reprographic equipment; fluorescent lamps primarily designed to produce radiation in the ultra-violet region of the spectrum; fluorescent lamps with a color rendering index of 87 or greater; R20 short lamps; specialty MR lamps; appliance lamps; black light lamps; bug lamps; colored lamps; infrared lamps; left-hand thread lamps, marine lamps, marine signal service lamps; mine service lamps; plant light lamps; sign service lamps; silver bowl lamps, showcase lamps, and traffic signal lamps.
In support of its analysis of whether to maintain or discontinue an exemption, in the October 2016 NOPDDA DOE presented estimated sales data. NEMA stated that sales for most of the exempted lamps are declining and that it was the intent of Congress to require that DOE find sales increasing as a prerequisite to discontinue an exemption. (NEMA, No. 83 at p. 34; NEMA No. 93 at p. 12) NEMA pointed to the petition process established under section 321 of EISA 2007 as indicative of that intent. (NEMA, No. 93 at pp. 12-13) NEMA and LEDVANCE noted that Congress required a demonstration of increased sales as a prerequisite for DOE to grant a petition submitted by the public to reconsider an exemption, and that DOE must be guided by the same consideration when determining whether an exemption should be maintained under 42 U.S.C. 6295(i)(6)(A)(i)(II). (NEMA, No. 83 at pp. 33-34; LEDVANCE, No. 90 at pp. 25-27) NEMA and LEDVANCE cited the requirement under 42 U.S.C. 6295(i)(6)(A)(i)(II) for DOE to consider, in part, “exempted lamp sales” collected by DOE as supporting the requirement for increased lamp sales in order to discontinue an exemption. (NEMA, No. 93 at 5; LEDVANCE, No. 90 at p. 26) NEMA and LEDVANCE added that a determination of lamp switching must be driven by data showing increased sales. (NEMA No. 93 at p. 13; LEDVANCE, No. 90 at pp. 25-27) NEMA and LEDVANCE concluded that the October 2016 NOPDDA did not provide data indicating that lamp switching was occurring, and rather data from the Energy Information Administration
As DOE has explained in the GSL definition final rule that is being published in the same issue of the
DOE also considered the potential of lamp switching that may occur in response to any GSL standard. If an exempted lamp has the same utility to lamp users as a lamp subject to a standard as a GSL, DOE considered the potential increase in the use of the exempted lamp in response to a standard. As noted by commenters, prior to the effective date of any new standard the sales trends of exempted lamps do not necessarily capture the potential for lamp switching. As such, current lamp sale trends are only part of the consideration. DOE is permitted to account for future changes in consumer behavior so as to avoid the creation of loopholes.
DOE received several comments regarding whether a lamp could serve as a replacement for a GSL and therefore present a risk of lamp switching. California Investor Owned Utilities (CA IOUs) stated that evaluations of the exemptions should be based on whether the exempted lamp type could serve as a replacement for a general service lamp. (CA IOUs, No. 83 at p. 107) Westinghouse stated that there are low-cost products on the market that consumers do not use as replacements for GSLs because they are not the appropriate shape or design. Avalos noted that a couple of exempted lamp types could be considered GSILs but are not due to their lamp structure. (Westinghouse, No. 83 at p. 30; Avalos, No. 80 at p. 1)
GE and LEDVANCE stated that DOE should consider the traditional omni-directional incandescent lamp when considering the potential for lamp switching. (GE, No. 83 at pp. 37-38; LEDVANCE No. 83 at p. 59) GE stated that the definition of GSIL (a type of GSL) describes a lamp with a medium screw base, that produces between 310 and 2,600 lumens, and can operate on a voltage between 110 and 130 V, and that in order for a lamp to be considered as having the potential for “lamp switching” the lamp must maintain these same attributes. (GE, No. 88 at pp. 2-3) Westinghouse stated that consideration of lamp switching should be limited to whether a consumer could use an exempted lamp to replace a lamp that the consumer is currently using, and that consideration of how the use of fixtures may change in response to standards (
Other commenters stated that consideration of lamp switching should include the ability of an exempted lamp to provide similar function as a traditional GSIL, regardless of the fixture traditionally used with GSILs. ASAP stated that the presence of directional lamps in residences in the U.S. has grown significantly over time due to changes in new construction. (ASAP, No. 83 at pp. 38-39) ASAP stated that lighting in homes that traditionally was provided by A shape lamps in floor and table fixtures is being provided in newer construction through reflector lamps in recessed can lighting. (ASAP, No. 83 at pp. 58-59)
As noted previously, DOE understands the purpose of the decision that EPCA calls for on maintaining or discontinuing exemptions to be to ensure that consumers and manufacturers do not switch to readily available substitutes once standards for GSLs come into force. In making this assessment, the potential for an exempted lamp to be placed in a fixture that traditionally used a GSIL, and the potential change in the fixtures used to provide lighting in an application that was traditionally served by a GSIL are important considerations that DOE appropriately takes into account. As noted by commenters, the function traditionally provided by GSILs can, in some instances, be provided by more than one type of fixture. In order to minimize the potential for loopholes, DOE has considered the potential for a consumer to change the type of lamp used in an existing fixture, and the potential change in the type of fixture used to provide the same function as traditionally provided by a fixture using a GSIL.
CA IOUs stated that evaluations of the exemptions should also be based on whether the exempted lamp type can be made as an LED lamp. (That consideration would be relevant because it is almost certain that incandescent lamps will not be able to satisfy the 45 lm/W backstop standard if it comes into force.) (CA IOUs, No. 83 at p. 107) DOE is aware that LED replacements may exist for some of the exempt lamp categories. DOE did consider the existence or absence of LED replacements for IRLs, though not as the only reason to discontinue or maintain an exemption.
NEMA provided updated sales information for this final rule. NEMA provided sales data from four members, which represents a significant portion of the market, for each of the exemptions that DOE proposed to discontinue. NEMA stated that although not all members are included, it conferred with other members that did not provide data to confirm the general trend of decreasing sales and shipments of specialty incandescent lamps since standards went into effect for GSILs between 2010 and 2012. (NEMA, No. 93 at pp. 9-10) DOE has updated Table III.1 to reflect this new data.
Table III.1 summarizes the IRL exemption discontinued in this final rule.
DOE believes that discontinuing the exemption for IRLs could lead to significant energy savings. As shown in Table III.1, IRLs have annual sales that are several times the sales of the largest-volume lamp category among those exemptions that DOE has already discontinued. See the GSL definition final rule for more information that is being published in the same issue of the
In the October 2016 NOPDDA, DOE assessed data available for IRLs and preliminarily concluded that these lamps have high annual sales. Specifically, DOE estimated that the sales of IRLs are approximately 270 million units per year. DOE believed IRLs are capable of providing overall illumination and could be used as a replacement for GSILs. Therefore, DOE found there was also high potential for lamp switching and subsequently creating a loophole. For these reasons, DOE proposed to discontinue the exemption for IRLs in the October 2016 NOPDDA.
As noted at the outset of this document, this final rule amending the definition of GSL does not establish standards for GSLs. Inclusion of IRLs in the definition of GSL does not amend the standards currently applicable to IRLs. EPCA directs DOE to consider whether to amend the standards for GSLs, and whether the definition of GSL should be amended. (42 U.S.C. 6295(i)(6)(A)(i)(II)) In order to evaluate any potential standards or amendments to standards for GSL, DOE must first determine the scope of the GSL definition. As explained previously, DOE has considered lamp sales and the potential for lamp switching in an effort to ensure all lamps that can be used in general lighting applications are included.
Of course, DOE makes this decision cognizant of the fact that IRLs are already subject to minimum efficiency standards. However, DOE does not believe section 6295(i)(6) reveals an intention that, because of those standards, DOE should maintain the IRL exemption from being regulated as GSLs. The IRL standards in the statute dating from 1992—which were the extant standards when EISA added subsection (i)(6)—are substantially less stringent than the standards that EISA section 321 specified for GSILs and even further less stringent than the GSL backstop. Given that some IRLs have long been used for general illumination, as discussed previously, it would be odd for Congress to have left open, unalterably, such a large loophole to its own standards. Rather, DOE believes that in enacting EISA 2007, Congress chose not to update the statutory standards for IRLs because instead it was directing DOE to decide whether to regulate those lamps as GSLs. Thus, the fact that IRLs are already subject to IRL-specific standards does not preclude DOE's decision in this final rule. It simply means that, consistent with EPCA, DOE is to perform a particular assessment for IRLs bearing in mind the existing standards. DOE has carried out that assessment.
DOE received several comments in support of its decision to expand the scope of the GSL definition to include IRLs. ASAP commented that they strongly supported covering IRLs in the scope of this rulemaking noting that hundreds of millions of IRLs are sold each year. ASAP stated that IRLs of all technology types are a growing presence in homes. ASAP noted that there are more efficient alternatives widely available at affordable prices, and including IRLs as GSLs is a step towards technological neutrality which will benefit the environment, industry and consumers. ASAP added that the fact IRLs are regulated under their own standards does not preclude them from inclusion as GSLs. (ASAP, No. 83 at pp. 38-39; ASAP, No. 94 at pp. 1-2) NRDC and Utility Coalition supported DOE's proposal to include IRLs as GSLs. NRDC stated this was indicative of a shift to a technology-based approach which has been discussed at DOE for many years. NRDC and Utility Coalition added that including IRLs as GSLs will deliver significant energy and consumer savings when considering DOE's estimate of 270 million IRLs sold per year. (NRDC, No. 83 at p. 11; NRDC, No. 85 at p. 2; Utility Coalition, No. 95 at pp. 1-2) Soraa also supported DOE's proposal to include IRLs as GSLs noting that reflector lamps are used or can be used to provide overall illumination. (Soraa, No. 87 at p. 2)
CEC supported DOE's proposal to discontinue the exemption for reflector lamps due in part to their high lamp sales and potential for lamp switching. CEC agreed with DOE's estimate of the annual sales of IRLs of approximately 270 million units, noting that California's existing stock of medium screw base incandescent and halogen reflector lamps is estimated to be more than 60 million units with annual shipments in 2016 estimated at nearly 35 million units. CEC added that although LED reflector lamps are gaining market share from IRLs, CEC's recent general service LED lamps rulemaking determined that incandescent technology would represent the vast majority of medium screw base directional lamp shipments in 2029 if the IRL exemption were maintained. (CEC, No. 91 at pp. 4-5)
In contrast, GE recommended that reflector lamps (in GE's comment, primarily IRLs) continue to be regulated separately and that it is not appropriate to evaluate reflector type lamps as GSLs because these products cannot successfully be used to satisfy lighting applications traditionally served by GSILs. (GE, No. 88 at p. 2) GE added that each reflector lamp has unique optical properties that must be considered when applying a minimum efficacy requirement and noted that these products cannot meet the same efficiency limits designed for general service A shape lamps. (GE, No. 88 at p. 2) Westinghouse stated that while there is energy savings potential in regulating IRLs, it should be done in an IRL standards rulemaking rather than in a GSL standards rulemaking. (Westinghouse, No. 83 at pp. 21-22) Westinghouse stated it is not suggesting that LED versions for R20, BR30, and R40 shapes used in the residential sector for general purposes are not suitable replacements. However, Westinghouse asserted that to ensure that efficiencies are achievable for this shape and due consideration is given to economic feasibility, IRLs should be considered in their own rulemaking. (Westinghouse, No. 83 at pp. 47-48; Westinghouse, No. 83 at pp. 55-56)
In support of their assertion that reflector lamps should be regulated separately, several commenters disagreed with DOE's determination that reflector lamps posed a risk of lamp switching. GE stated that while a large number of IRLs are still in use, sales have declined significantly over the past 5 years, in large part, due to a shift to LED reflector lamps. Further GE stated that reflector lamps would not fit in most fixtures in which GSILs are used. Even if a reflector lamp could fit in such a fixture it could not deliver the omnidirectional light output provided by the GSIL. Therefore, GE asserted reflector lamps would not be suitable replacements for the standard GSILs and needed to be evaluated in their own rulemaking. (GE, No. 83 at pp. 37-38) LEDVANCE agreed and stated that the consumer will not obtain effective light by putting a reflector lamp such as a PAR30 in a fixture that does not have some type of directional functionality. (LEDVANCE, No. 83 at pp. 59-61)
CA IOUs stated that while it may not be always be optimal, reflector lamps can be used in general service applications. (CA IOUs, No. 83 at p. 66) NRDC stated that reflector lamps can be used in applications other than down lights. NRDC pointed out that reflector lamps come in various shapes and there was nothing to prevent a manufacturer from altering the reflector lamp design so more light goes in different directions. (NRDC, No. 83 at p. 45) CA IOUs further noted that as the cheaper product, the use of IRLs in general service applications may increase due to new market pressures in 2020. (CA IOUs, No. 83 at p. 66) CEC agreed that medium screw base reflector lamps represent a lamp switching risk adding that lamp shape does not determine whether a lamp can provide general service lighting and general service lamps are not limited to omnidirectional lighting. (CEC, No. 91 at pp. 4-5) Utility Coalition also stated that LED lamps are suitable replacements for GSLs in many applications because they have the same base types and therefore represent a significant risk of undercutting the energy savings of the 45 lm/W standard if they are not included. (Utility Coalition, No. 95 at pp. 1-2)
Additionally, Utility Coalition commented that there are LED versions
As discussed previously in this document, DOE did not limit its consideration of lamp switching to the ability to replace a lamp in a fixture currently used by a consumer that had been using a traditional incandescent lamp. As indicated by comments from ASAP previously in this document, the presence of reflector lamps in residences in the U.S. has grown significantly over time due to changes in new construction. (ASAP, No. 83 at pp. 38-39) Lighting in homes that traditionally was provided by A shape lamps in floor and table fixtures is being provided in newer construction through reflector lamps in recessed lighting. (ASAP, No. 83 at pp. 58-59)
The basic design characteristic of an “incandescent reflector lamp,” as EPCA defines the term, is that it directs the light. But it is possible to direct the omnidirectional light from an incandescent filament into a somewhat more limited set of angles and still have a lamp that provides general illumination. The reflector lamps now being widely used in recessed can lighting are an important example. In such an application (with the lamp mounted in the ceiling), the reflector redirects light that was initially emitted upward. But the resulting light distribution spreads broadly over the area downward from the lamp, so that a consumer can readily use the lamp to provide general illumination for a room. In light of these observations, DOE concludes that “omnidirectional illumination” is not a prerequisite for the traditional functions of incandescent lamps, as GE suggested. Rather, DOE may consider a lamp a ready substitute for GSLs—for purposes of assessing an exemption—if the lamp can provide the same sort of general illumination that GSLs provide.
As presented in Table III.1, DOE estimates that the sales of incandescent reflector lamps are approximately 270 million units per year. 81 FR 71794, 71800. DOE notes that incandescent reflector lamps have higher annual sales than any of the 22 exempt lamp types, thus indicating that these lamps are likely used in general lighting applications. In addition, because IRLs are capable of providing overall illumination and could be used as replacements for GSILs, there is also high potential for lamp switching. For these reasons, DOE is discontinuing the exemption from the GSL definition for IRLs.
LEDVANCE noted that in January 2015, DOE said it found new standards for IRLs not economically justified. 80 FR 4042, 4043 (Jan. 26, 2015). (LEDVANCE, No. 90 at pp. 6-7) NEMA asserted that inclusion of IRLs in the definition of GSL given DOE's previous determination that standards for IRLs would not be economically justified or technically feasible can only be understood as an attempt by DOE to eliminate the product from the market, an outcome prohibited under EPCA. (NEMA, No. 93 at p. 14)
DOE acknowledges that a recent rulemaking was completed for IRLs. DOE completed a final rule in January 2015 that concluded that amended energy conservation standards for IRLs (other than ER30, BR30, BR40, and ER40 lamps of 50 W or less; BR30, BR40, and ER40 lamps of 65 W; and R20 lamps of 45 W or less) would not be economically justified. 80 FR 4042 (January 26, 2015). DOE notes that there are established test procedures for IRLs. See, Appendix R to 49 CFR 430 subpart B. While the recent IRL rulemaking considered energy conservation standards for a limited segment of IRLs, this rule defines what is and is not a general service lamp. As such, DOE is addressing a fundamentally different question. The purpose of this rulemaking is not to establish energy conservation standards, but to determine whether certain lamps because of functional and design characteristics should be included in the definition of general service lamp.
DOE has determined that lamps of different shapes, even those that are not omnidirectional, can provide overall illumination. Therefore, even though reflector lamps are designed to direct the light they provide, DOE has concluded that they should be included as general service lamps. DOE's previous conclusion regarding energy conservation standards for a subset of IRLs (less than half of the IRL market) has no bearing on their ability to be a general service lamp, assuming they meet the other criteria in the adopted definition.
Further, DOE notes that the conclusion reached in the previous rulemaking was based on an analysis of incandescent technology. The January 2015 IRL rulemaking concluded that an amended standard based on more efficient incandescent technology would not be economically justified. An analysis conducted under the general service lamps authority could well come to a different conclusion because more efficient replacements could use incandescent, fluorescent, or LED technology. Thus, the cost-benefit analysis would be different and the cost-benefit analysis from the January 2015 rulemaking is not applicable here.
DOE notes that incandescent reflector lamps have high annual sales, indicating that they are likely used in general lighting applications. Further, as noted by several commenters, IRLs that are currently exempt from standards have ballooned in sales and have gone from representing a minority of the market to a majority of the market. Thus, industry has shown that consumers of IRLs find various distributions of light acceptable in their applications because the ER- and BR-shaped lamps that increased in sales have broader distributions of light than the PAR-shaped lamps they replaced.
DOE also received comments regarding the impacts on manufacturers of including IRLs in the definition of GSL. NEMA noted that in response to the March 2016 ECS NOPR, it had commented that in 2020 manufacturers would have to supply the entire nation with general service LED lamps as incandescent lamps would not be available. NEMA had explained in its comment that this would mean a 300
DOE acknowledges that manufacturers may face a difficult transition if required to comply with a 45 lm/W standard, particularly for IRLs. Regarding concerns that the application of the backstop standard would eliminate domestic manufacturing of IRLs, DOE determined that manufacturers are already planning to close or move out of the country several domestic production facilities related to the manufacturing of IRLs due to reduced demand. In press releases regarding these closures, manufacturers noted that the market is moving away from traditional technologies, such as IRLs and other incandescent lamps, and transitioning to LED technology.
DOE is committed to working with manufacturers to ensure a successful transition if the backstop standard goes into effect.
DOE is amending the definition of “general service lamp” in § 430.2 to include IRLs. Ageneral service lamp is a lamp that has an ANSI base; is able to operate at a voltage of 12 volts or 24 volts, at or between 100 to 130 volts, at or between 220 to 240 volts, or of 277 volts for integrated lamps (as defined in this section), or is able to operate at any voltage for non-integrated lamps (as defined in this section); has an initial lumen output of greater than or equal to 310 lumens (or 232 lumens for modified spectrum general service incandescent lamps) and less than or equal to 3,300 lumens; is not a light fixture; is not an LED downlight retrofit kit; and is used in general lighting applications. General service lamps include, but are not limited to, general service incandescent lamps, compact fluorescent lamps, general service light-emitting diode lamps, and general service organic light-emitting diode lamps. General service lamps do not include:
• Appliance lamps;
• Black light lamps;
• Bug lamps;
• Colored lamps;
• G shape lamps with a diameter of 5 inches or more as defined in ANSI C79.1-2002;
• General service fluorescent lamps;
• High intensity discharge lamps;
• Infrared lamps;
• J, JC, JCD, JCS, JCV, JCX, JD, JS, and JT shape lamps that do not have Edison screw bases;
• Lamps that have a wedge base or prefocus base;
• Left-hand thread lamps;
• Marine lamps;
• Marine signal service lamps;
• Mine service lamps;
• MR shape lamps that have a first number symbol equal to 16 (diameter equal to 2 inches) as defined in ANSI C79.1-2002, operate at 12 volts, and have a lumen output greater than or equal to 800;
• Other fluorescent lamps;
• Plant light lamps;
• R20 short lamps;
• Reflector lamps (as defined in this section) that have a first number symbol less than 16 (diameter less than 2 inches) as defined in ANSI C79.1-2002 and that do not have E26/E24, E26d, E26/50x39, E26/53x39, E29/28, E29/53x39, E39, E39d, EP39, or EX39 bases;
• S shape or G shape lamps that have a first number symbol less than or equal to 12.5 (diameter less than or equal to 1.5625 inches) as defined in ANSI C79.1-2002;
• Sign service lamps;
• Silver bowl lamps;
• Showcase lamps;
• Specialty MR lamps;
• T shape lamps that have a first number symbol less than or equal to 8 (diameter less than or equal to 1 inch) as defined in ANSI C79.1-2002, nominal overall length less than 12 inches, and that are not compact fluorescent lamps (as defined in this section);
• Traffic signal lamps.
For the changes described in this final rule, DOE is adopting a January 1, 2020 effective date.
This final rule neither implements nor seeks to enforce any standard. Rather, this final rule merely defines what constitutes a GSL. Lamps that are GSLs will become subject to either a standard developed by DOE or to a 45 lm/W backstop standard, but this rule does not determine what standard will be applicable to lamps that are being newly included as GSLs. Accordingly, this action does not constitute a significant regulatory action under Executive Orders 12866 and 13563.
The Regulatory Flexibility Act (5 U.S.C. 601
DOE reviewed the definition of GSL amended in this final rule under the provisions of the Regulatory Flexibility
For manufacturers of IRLs, the SBA has set a size threshold, which defines those entities classified as “small businesses” for the purposes of the statute. DOE used the SBA's small business size standards to determine whether any small entities would be subject to the requirements of the rule. (See 13 CFR part 121.) The size standards are listed by NAICS code and industry description and are available at
To estimate the number of companies that could be small businesses that manufacture IRLs covered by this rulemaking, DOE conducted a market survey using publicly available information. DOE's research involved information provided by trade associations (
DOE notes that this final rule merely includes IRLs in the regulatory definition of GSLs. Manufacturers of GSLs, including IRLs, are required to use DOE's test procedures to make representations and certify compliance with standards, if required. The effective date allows reasonable time for manufacturers to transition, while reducing the number of redesigns needed, should manufacturers need to comply with a 45 lm/W statutory standard beginning on January 1, 2020. For these reasons, DOE concludes and certifies that the new amended definition of GSL, which includes IRLs, does not have a significant economic impact on a substantial number of small entities, and the preparation of an FRFA is not warranted.
Manufacturers of GSLs must certify to DOE that their products comply with any applicable energy conservation standards. In certifying compliance, manufacturers must test their products according to DOE test procedures for GSLs, including any amendments adopted for those test procedures. DOE has established regulations for the certification and recordkeeping requirements for all covered consumer products and commercial equipment. 76 FR 12422 (March 7, 2011). The collection-of-information requirement for the certification and recordkeeping is subject to review and approval by OMB under the Paperwork Reduction Act (PRA). This requirement has been approved by OMB under OMB control number 1910-1400. DOE requested OMB approval of an extension of this information collection for three years, specifically including the collection of information adopted in the present rulemaking, and estimated that the annual number of burden hours under this extension is 30 hours per company. In response to DOE's request, OMB approved DOE's information collection requirements covered under OMB control number 1910-1400 through November 30, 2017. 80 FR 5099 (January 30, 2015).
Notwithstanding any other provision of the law, no person is required to respond to, nor shall any person be subject to a penalty for failure to comply with, a collection of information subject to the requirements of the PRA, unless that collection of information displays a currently valid OMB control number.
Pursuant to the National Environmental Policy Act (NEPA) of 1969, DOE has determined that the rule fits within the category of actions included in Categorical Exclusion (CX) B5.1 and otherwise meets the requirements for application of a CX. (See 10 CFR part 1021, App. B, B5.1(b); 1021.410(b) and App. B, B(1)-(5).) The rule fits within this category of actions because it is a rulemaking that changes the definition of a covered class of products for which there are existing energy conservation standards, and for which none of the exceptions identified in CX B5.1(b) apply. Therefore, DOE has made a CX determination for this rulemaking, and DOE does not need to prepare an Environmental Assessment or Environmental Impact Statement for this rule. DOE's CX determination for this rule is available at
Executive Order 13132, “Federalism,” 64 FR 43255 (August 10, 1999), imposes certain requirements on federal agencies formulating and implementing policies or regulations that preempt state law or that have Federalism implications. The Executive Order requires agencies to examine the constitutional and statutory authority supporting any action that would limit the policymaking discretion of the states and to carefully assess the necessity for such actions. The Executive Order also requires agencies to have an accountable process to ensure meaningful and timely input by state and local officials in the development of regulatory policies that have Federalism implications. On March 14, 2000, DOE published a statement of policy describing the intergovernmental consultation process it will follow in the development of such regulations. 65 FR 13735. DOE has examined this rule and has determined that it 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. EPCA governs and prescribes federal preemption of state regulations as to energy conservation for the products that are the subject of this final rule. States can petition DOE for exemption from such preemption to the extent, and based on criteria, set forth in EPCA. (42 U.S.C. 6297) Therefore, no further action is required by Executive Order 13132.
With respect to the review of existing regulations and the promulgation of new regulations, section 3(a) of Executive Order 12988, “Civil Justice Reform,” imposes on federal agencies the general duty to adhere to the following requirements: (1) Eliminate drafting errors and ambiguity; (2) write regulations to minimize litigation; (3)
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) requires each federal agency to assess the effects of federal regulatory actions on state, local, and tribal governments and the private sector. Public Law 104-4, sec. 201 (codified at 2 U.S.C. 1531). For a regulatory action likely to result in 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 (adjusted annually for inflation), section 202 of UMRA requires a federal agency to publish a written statement that estimates the resulting costs, benefits, and other effects on the national economy. (2 U.S.C. 1532(a), (b)) The UMRA also requires a federal agency to develop an effective process to permit timely input by elected officers of state, local, and tribal governments on a proposed “significant intergovernmental mandate,” and requires an agency plan for giving notice and opportunity for timely input to potentially affected small governments before establishing any requirements that might significantly or uniquely affect them. On March 18, 1997, DOE published a statement of policy on its process for intergovernmental consultation under UMRA. 62 FR 12820. DOE's policy statement is also available at
DOE examined this final rule according to UMRA and its statement of policy and determined that the rule contains neither an intergovernmental mandate, nor a mandate that may result in the expenditure of $100 million or more in any year, so these requirements do not apply.
Section 654 of the Treasury and General Government Appropriations Act, 1999 (Pub. L. 105-277) requires federal agencies to issue a Family Policymaking Assessment for any rule that may affect family well-being. This rule would not have any impact on the autonomy or integrity of the family as an institution. Accordingly, DOE has concluded that it is not necessary to prepare a Family Policymaking Assessment.
Pursuant to Executive Order 12630, “Governmental Actions and Interference with Constitutionally Protected Property Rights,” 53 FR 8859 (March 15, 1988), DOE has determined that this rule would not result in any takings that might require compensation under the Fifth Amendment to the U.S. Constitution.
Section 515 of the Treasury and General Government Appropriations Act, 2001 (44 U.S.C. 3516 note) provides for federal agencies to review most disseminations of information to the public under information quality guidelines established by each agency pursuant to general guidelines issued by OMB. OMB's guidelines were published at 67 FR 8452 (Feb. 22, 2002), and DOE's guidelines were published at 67 FR 62446 (Oct. 7, 2002). DOE has reviewed this final rule under the OMB and DOE guidelines and has concluded that it is consistent with applicable policies in those guidelines.
Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use,” 66 FR 28355 (May 22, 2001), requires federal agencies to prepare and submit to OIRA at OMB, a Statement of Energy Effects for any significant energy action. A “significant energy action” is defined as any action by an agency that promulgates or is expected to lead to promulgation of a final rule, and that: (1) Is a significant regulatory action under Executive Order 12866, or any successor order; and (2) is likely to have a significant adverse effect on the supply, distribution, or use of energy, or (3) is designated by the Administrator of OIRA as a significant energy action. For any significant energy action, the agency must give a detailed statement of any adverse effects on energy supply, distribution, or use should the proposal be implemented, and of reasonable alternatives to the action and their expected benefits on energy supply, distribution, and use.
This regulatory action to amend a definition for GSL is not a significant regulatory action under Executive Order 12866. Moreover, it would not have a significant adverse effect on the supply, distribution, or use of energy, nor has it been designated as a significant energy action by the Administrator of OIRA. Therefore, it is not a significant energy action, and, accordingly, DOE has not prepared a Statement of Energy Effects.
Under section 301 of the Department of Energy Organization Act (Pub. L. 95-91; 42 U.S.C. 7101), DOE must comply with section 32 of the Federal Energy Administration Act of 1974, as amended by the Federal Energy Administration Authorization Act of 1977. (15 U.S.C. 788; FEAA) Section 32 essentially provides in relevant part that, where a rule authorizes or requires use of commercial standards, the NOPR must inform the public of the use and background of such standards. In addition, section 32(c) requires DOE to consult with the Attorney General and the Chairman of the Federal Trade Commission (FTC) concerning the impact of the commercial or industry standards on competition. DOE has not incorporated by reference any industry standards in this rulemaking that were not already incorporated and therefore there is no impact on competition.
As required by 5 U.S.C. 801, DOE will report to Congress on the promulgation of this rule prior to its effective date. The report will state that it has been determined that the rule is not a “major rule” as defined by 5 U.S.C. 804(2).
The Secretary of Energy has approved publication of this final rule.
Administrative practice and procedure, Confidential business information, Energy conservation, Household appliances, Imports, Incorporation by reference, Intergovernmental relations, Small businesses.
For the reasons set forth in the preamble, the final rule for part 430 of chapter II, subchapter D, of title 10 of the Code of Federal Regulations effective beginning January 1, 2020, is amended as set forth below:
42 U.S.C. 6291-6309; 28 U.S.C. 2461 note.
Employee Benefits Security Administration, U.S. Department of Labor.
Notification of Proposed Class exemption.
This document contains a notice of pendency before the Department of Labor of a proposed class exemption from certain prohibited transaction restrictions of the Employee Retirement Income Security Act of 1974, as amended (ERISA), and the Internal Revenue Code of 1986, as amended (the Code). The provisions at issue generally prohibit fiduciaries with respect to employee benefit plans and individual retirement accounts (IRAs) from engaging in self-dealing and receiving compensation from third parties in connection with transactions involving the plans and IRAs. The exemption proposed in this document, if granted, would allow certain insurance intermediaries, and the insurance agents and insurance companies they contract with, to receive compensation in connection with fixed annuity transactions that may otherwise give rise to prohibited transactions as a result of the provision of investment advice to plan participants and beneficiaries, IRA owners and certain plan fiduciaries (including small plan sponsors). The proposed exemption includes protective conditions to safeguard the interests of the plans, participants and beneficiaries and IRA owners and is similar to the Department's Best Interest Contract Exemption (PTE 2016-01) granted on April 8, 2016, at 81 FR 21002, as corrected at 81 FR 44773 (July 11, 2016).
All written comments and requests for a hearing concerning the proposed class exemption should be sent to the Office of Exemption Determinations by any of the following methods, identified by ZRIN 1210-ZA26:
Federal eRulemaking Portal:
Brian Shiker or Erin Hesse, telephone (202) 693-8540, Office of Exemption Determinations, Employee Benefits Security Administration, U.S. Department of Labor (this is not a toll-free number).
The Department is proposing this class exemption on its own motion pursuant to ERISA section 408(a) and Code section 4975(c)(2), and in accordance with procedures set forth in 29 CFR part 2570, subpart B (76 FR 66637, 66644, October 27, 2011). Effective December 31, 1978, section 102 of Reorganization Plan No. 4 of 1978, 5 U.S.C. App. 1 (1996), transferred the authority of the Secretary of the Treasury to issue exemptions of the type proposed by the Secretary of Labor.
The Department is proposing this exemption in connection with its regulation under ERISA section 3(21)(A)(ii) and Code section 4975(e)(3)(B) (Regulation), published in the
In conjunction with the Regulation, the Department granted Prohibited Transaction Exemption (PTE) 2016-01 (the Best Interest Contract Exemption), also on April 8, 2016, and corrected on July 11, 2016. The Best Interest Contract Exemption is designed to promote the provision of investment advice that is in the best interest of retail investors such as plan participants and beneficiaries, IRA owners, and certain plan fiduciaries, including small plan sponsors (Retirement Investors). ERISA and the Code generally prohibit fiduciaries from receiving payments from third parties and from acting on conflicts of interest, including using their authority to affect or increase their
To facilitate continued provision of advice to Retirement Investors under conditions designed to safeguard the interests of these investors, the Best Interest Contract Exemption allows certain investment advice fiduciaries (Financial Institutions and Advisers) to receive various forms of compensation that, in the absence of an exemption, would not be permitted under ERISA and the Code. “Financial Institutions,” defined in the exemption to include banks, investment advisers registered under the Investment Advisers Act of 1940 or state law, broker-dealers, and insurance companies, and individual “Advisers” must adhere to basic standards of impartial conduct (Impartial Conduct Standards), namely, giving prudent advice that is in the customer's best interest, avoiding misleading statements, and receiving no more than reasonable compensation. Additionally, Financial Institutions must exercise supervisory authority over Advisers by adopting anti-conflict policies and procedures and insulating the Advisers from incentives to violate the exemption's Impartial Conduct Standards.
The class exemption proposed in this document would provide relief that is similar to the Best Interest Contract Exemption for certain insurance intermediaries that commit to act as Financial Institutions. Insurance intermediaries typically recruit, train and support independent insurance agents and market and distribute insurance products such as traditional fixed rate annuities and fixed indexed annuities. The intermediaries include organizations commonly referred to as independent marketing organizations (IMOs), field marketing organizations (FMOs) and brokerage general agencies (BGAs). The exemption would apply to recommendations of “Fixed Annuity Contracts,” which are generally defined as fixed rate annuities and fixed indexed annuities. If the conditions of the exemption are satisfied, insurance intermediaries that satisfy the definition of “Financial Institution,” as well as the insurance agents and insurance companies that they contract with, would be permitted to receive compensation and other consideration as a result of the provision of investment advice to Retirement Investors in connection with transactions involving these annuities.
ERISA section 408(a) specifically authorizes the Secretary of Labor to grant administrative exemptions from ERISA's prohibited transaction provisions.
The proposed exemption would be available for insurance intermediaries satisfying the definition of “Financial Institution,” and insurance agents (Advisers) and insurance companies with whom they contract, as well as their affiliates and related entities (as defined in the proposal), when they make investment recommendations regarding Fixed Annuity Contracts to retail “Retirement Investors.” Retirement Investors are plan participants and beneficiaries, IRA
The proposed exemption is designed to cover commissions and other forms of compensation received in connection with the recommendation of Fixed Annuity Contracts. Rather than prohibit such compensation structures, the exemption would permit individual Advisers
In order to protect the interests of plan participants and beneficiaries, IRA owners, and plan fiduciaries, the exemption would require the Financial Institution to acknowledge fiduciary status for itself and its Advisers. The Financial Institutions and Advisers would have to adhere to basic standards of impartial conduct. In particular, under the proposal's standards-based approach, the Adviser and Financial Institution must give prudent advice that is in the customer's best interest, avoid misleading statements, and receive no more than reasonable compensation. Additionally, Financial Institutions generally must adopt policies and procedures reasonably designed to mitigate any harmful impact of conflicts of interest, and disclose basic information about their conflicts of interest, the recommended Fixed Annuity Contract and the cost of their advice. The exemption is calibrated to align the Adviser's interests with those of the plan or IRA customer, while leaving the Adviser and Financial Institution the flexibility and discretion necessary to determine how best to satisfy the exemption's standards in light of the unique attributes of their business.
As explained more fully in the preamble to the Regulation, ERISA is a comprehensive statute designed to protect the interests of plan participants and beneficiaries, the integrity of employee benefit plans, and the security of retirement, health, and other critical benefits. The broad public interest in ERISA-covered plans is reflected in its imposition of fiduciary responsibilities on parties engaging in important plan activities, as well as in the tax-favored status of plan assets and investments. One of the chief ways in which ERISA protects employee benefit plans is by requiring that plan fiduciaries comply with fundamental obligations rooted in the law of trusts. In particular, plan fiduciaries must manage plan assets prudently and with undivided loyalty to the plans and their participants and beneficiaries.
The Code also has rules regarding fiduciary conduct with respect to tax-favored accounts that are not generally covered by ERISA, such as IRAs. In particular, fiduciaries of these arrangements, including IRAs, are subject to the prohibited transaction rules and, when they violate the rules, to the imposition of an excise tax enforced by the Internal Revenue Service. Unlike participants in plans covered by Title I of ERISA, IRA owners do not have a statutory right to bring suit against fiduciaries for violations of the prohibited transaction rules.
Under this statutory framework, the determination of who is a “fiduciary” is of central importance. Many of ERISA's and the Code's protections, duties, and liabilities hinge on fiduciary status. In relevant part, ERISA section 3(21)(A) and Code section 4975(e)(3) provide that a person is a fiduciary with respect to a plan or IRA to the extent he or she (i) exercises any discretionary authority or discretionary control with respect to management of such plan or IRA, or exercises any authority or control with respect to management or disposition of its assets; (ii) renders investment advice for a fee or other compensation, direct or indirect, with respect to any moneys or other property of such plan or IRA, or has any authority or responsibility to do so; or, (iii) has any discretionary authority or discretionary responsibility in the administration of such plan or IRA.
The statutory definition deliberately casts a wide net in assigning fiduciary responsibility with respect to plan and IRA assets. Thus, “any authority or control” over plan or IRA assets is sufficient to confer fiduciary status, and any persons who render “investment advice for a fee or other compensation, direct or indirect” are fiduciaries, regardless of whether they have direct control over the plan's or IRA's assets and regardless of their status as an investment adviser or broker under the federal securities laws. The statutory definition and associated responsibilities were enacted to ensure that plans, plan participants and beneficiaries, and IRA owners can depend on persons who provide investment advice for a fee to provide recommendations that are untainted by conflicts of interest. In the absence of fiduciary status, the providers of investment advice are neither subject to ERISA's fundamental fiduciary standards, nor accountable under ERISA or the Code for imprudent, disloyal, or biased advice.
As amended, the Regulation provides that a person renders investment advice with respect to assets of a plan or IRA if, among other things, the person provides, directly to a plan, a plan fiduciary, plan participant or beneficiary, IRA or IRA owner, the following types of advice, for a fee or other compensation, whether direct or indirect:
(i) A recommendation as to the advisability of acquiring, holding, disposing of, or exchanging, securities or other investment property, or a recommendation as to how securities or other investment property should be invested after the securities or other investment property are rolled over, transferred or distributed from the plan or IRA; and
(ii) A recommendation as to the management of securities or other investment property, including, among other things, recommendations on investment policies or strategies, portfolio composition, selection of other persons to provide investment advice or investment management services, types of investment account arrangements (brokerage versus advisory), or recommendations with respect to rollovers, transfers or distributions from a plan or IRA, including whether, in what amount, in what form, and to what destination such a rollover, transfer or distribution should be made.
In addition, in order to be treated as a fiduciary, such person, either directly or indirectly (
The Regulation also provides that as a threshold matter in order to be fiduciary advice, the communication must be a “recommendation,” which is defined as “a communication that, based on its content, context, and
The Regulation also specifies certain circumstances where the Department has determined that a person will not be treated as an investment advice fiduciary even though the person's activities technically may satisfy the definition of investment advice. For example, the Regulation contains a provision excluding recommendations to independent fiduciaries with financial expertise that are acting on behalf of plans or IRAs in arm's length transactions, if certain conditions are met. The independent fiduciary must be a bank, insurance carrier qualified to do business in more than one state, investment adviser registered under the Investment Advisers Act of 1940 or by a state, broker-dealer registered under the Securities Exchange Act of 1934 (Exchange Act), or any other independent fiduciary that holds, or has under management or control, assets of at least $50 million, and:
(i) The person making the recommendation must know or reasonably believe that the independent fiduciary of the plan or IRA is capable of evaluating investment risks independently, both in general and with regard to particular transactions and investment strategies (the person may rely on written representations from the plan or independent fiduciary to satisfy this condition);
(ii) the person must fairly inform the independent fiduciary that the person is not undertaking to provide impartial investment advice, or to give advice in a fiduciary capacity, in connection with the transaction and must fairly inform the independent fiduciary of the existence and nature of the person's financial interests in the transaction;
(iii) the person must know or reasonably believe that the independent fiduciary of the plan or IRA is a fiduciary under ERISA or the Code, or both, with respect to the transaction and is responsible for exercising independent judgment in evaluating the transaction (the person may rely on written representations from the plan or independent fiduciary to satisfy this condition); and
(iv) the person cannot receive a fee or other compensation directly from the plan, plan fiduciary, plan participant or beneficiary, IRA, or IRA owner for the provision of investment advice (as opposed to other services) in connection with the transaction.
Similarly, the Regulation provides that the provision of any advice to an employee benefit plan (as described in ERISA section 3(3)) by a person who is a swap dealer, security-based swap dealer, major swap participant, major security-based swap participant, or a swap clearing firm in connection with a swap or security-based swap, as defined in section 1a of the Commodity Exchange Act (7 U.S.C. 1a) and section 3(a) of the Exchange Act (15 U.S.C. 78c(a)) is not investment advice if certain conditions are met. Finally, the Regulation describes certain communications by employees of a plan sponsor, plan, or plan fiduciary that would not cause the employee to be an investment advice fiduciary if certain conditions are met.
The Department anticipates that the Regulation will cover many investment professionals who did not previously consider themselves to be fiduciaries under ERISA or the Code. Under the Regulation, these entities will be subject to the prohibited transaction restrictions in ERISA and the Code that apply specifically to fiduciaries. ERISA section 406(b)(1) and Code section 4975(c)(1)(E) prohibit a fiduciary from dealing with the income or assets of a plan or IRA in his own interest or his own account. ERISA section 406(b)(2), which does not apply to IRAs, provides that a fiduciary shall not “in his individual or in any other capacity act in any transaction involving the plan on behalf of a party (or represent a party) whose interests are adverse to the interests of the plan or the interests of its participants or beneficiaries.” ERISA section 406(b)(3) and Code section 4975(c)(1)(F) prohibit a fiduciary from receiving any consideration for his own personal account from any party dealing with the plan or IRA in connection with a transaction involving assets of the plan or IRA.
Parallel regulations issued by the Departments of Labor and the Treasury explain that these provisions impose on fiduciaries of plans and IRAs a duty not to act on conflicts of interest that may affect the fiduciary's best judgment on behalf of the plan or IRA.
Investment professionals often receive compensation for services to Retirement Investors in the retail market through a variety of arrangements that violate the prohibited transaction rules applicable to plan fiduciaries. These include commissions paid by the plan, participant or beneficiary, or IRA, or commissions and other payments from third parties that provide investment products. A fiduciary's receipt of such payments would generally violate the prohibited transaction provisions of ERISA section 406(b) and Code section 4975(c)(1)(E) and (F) because the amount of the fiduciary's compensation is affected by the use of its authority in providing investment advice, unless such payments meet the requirements of an exemption.
As the prohibited transaction provisions demonstrate, ERISA and the Code strongly disfavor conflicts of interest. In appropriate cases, however, the statutes provide exemptions from their broad prohibitions on conflicts of interest. For example, ERISA section 408(b)(14) and Code section 4975(d)(17) specifically exempt transactions involving the provision of fiduciary investment advice to a participant or beneficiary of an individual account plan or IRA owner if the advice, resulting transaction, and the Adviser's fees meet stringent conditions carefully designed to guard against conflicts of interest.
In addition, the Secretary of Labor has discretionary authority to grant administrative exemptions under ERISA and the Code on an individual or class basis, but only if the Secretary first finds that the exemptions are (1)
Pursuant to its exemptive authority, the Department has previously granted several conditional administrative class exemptions that are available to fiduciary advisers in defined circumstances. As a general proposition, these exemptions focused on specific advice arrangements and provided relief for narrow categories of compensation. However, the new Best Interest Contract Exemption (PTE 2016-01) is specifically designed to address the conflicts of interest associated with the wide variety of payments advisers receive in connection with retail transactions involving plans and IRAs. Similarly, the Department has granted a new exemption for principal transactions, Exemption for Principal Transactions in Certain Assets between Investment Advice Fiduciaries and Employee Benefit Plans and IRAs (Principal Transactions Exemption) (PTE 2016-02),
At the same time that the Department granted the new exemptions, it also amended existing exemptions to, among other things, ensure uniform application of the Impartial Conduct Standards, which are fundamental obligations of fair dealing and fiduciary conduct, and include obligations to act in the customer's best interest, avoid misleading statements, and receive no more than reasonable compensation.
The amendments also revoked in whole or in part certain existing exemptions, which provided little or no protections to IRA and non-ERISA plan participants, in favor of a more uniform application of the Best Interest Contract Exemption in the market for retail investments. Most notably for purposes of this proposal, PTE 84-24,
With limited exceptions, it is the Department's intent that investment advice fiduciaries in the retail investment market rely on statutory exemptions, the Best Interest Contract Exemption or this proposed exemption, if granted, to the extent that they receive conflicted forms of compensation that would otherwise be prohibited. The new and amended exemptions reflect the Department's view that Retirement Investors should be protected by a more consistent application of fundamental fiduciary standards across a wide range of investment products and advice relationships, and that retail investors, in particular, should be protected by the stringent protections set forth in the Best Interest Contract Exemption or this proposed exemption, if granted. When fiduciaries have conflicts of interest, they will uniformly be expected to adhere to fiduciary norms and to make recommendations that are in their customer's best interest.
In broadest outline, the Best Interest Contract Exemption permits Advisers and the Financial Institutions (as defined in the exemption) that employ or otherwise retain them to receive many common forms of compensation that ERISA and the Code would otherwise prohibit, provided that they give advice that is in their customers' best interest and the Financial Institution implements basic protections against the dangers posed by conflicts of interest. More specifically, under the Best Interest Contract Exemption, Financial Institutions generally must:
• Acknowledge fiduciary status with respect to investment advice to the Retirement Investor;
• Adhere to Impartial Conduct Standards requiring them to:
○ Give advice that is in the Retirement Investor's best interest (
○ Charge no more than reasonable compensation; and
○ Make no misleading statements about investment transactions, compensation, and conflicts of interest;
• Implement policies and procedures reasonably and prudently designed to prevent violations of the Impartial Conduct Standards;
• Refrain from giving or using incentives for Advisers to act contrary to the customer's best interest; and
• Fairly disclose the fees, compensation, and material conflicts of interest, associated with their recommendations.
Advisers relying on the exemption must adhere to the Impartial Conduct Standards when making investment recommendations. In order for relief to be available under the exemption, there must be a “Financial Institution” that meets the definition set forth in the exemption and that satisfies the applicable conditions.
Section VIII(e) of the Best Interest Contract Exemption states that a “Financial Institution” can be a registered investment adviser (RIA), a bank or similar financial institution, a broker-dealer or an insurance company. The Department noted in the preamble to the exemption that these entities were identified by Congress as advice providers in the statutory exemption for investment advice under ERISA section 408(g) and Code section 4975(f)(8) and
Thus, although the definition of Financial Institution in the Best Interest Contract Exemption was limited to certain specified entities, the exemption provided a mechanism under which the definition can be expanded if an individual exemption is granted to another type of entity, under the same conditions. In that event, the individual exemption would provide relief to the applicants identified in the exemption, but the definition of Financial Institution in the Best Interest Contract Exemption would be expanded so that other entities that satisfy the definition in the individual exemption can rely on the Best Interest Contract Exemption. In the preamble to the Best Interest Contract Exemption, the Department stated that “[i]f parties wish to expand the definition of Financial Institution to include marketing intermediaries or other entities, they can submit an application to the Department for an individual exemption, with information regarding their role in the distribution of financial products, the regulatory oversight of such entities, and their ability to effectively supervise individual Advisers' compliance with the terms of this exemption.”
Pursuant to section VIII(e)(5) of the Best Interest Contract Exemption, the Department received 22 applications for individual exemptions from insurance intermediaries that contract with independent insurance agents to sell fixed annuities (applicants). The applicants describe themselves as “independent marketing organizations,” “insurance marketing organizations” and “field marketing organizations.”
Collectively, the Department refers to the applicants and similar entities as either “insurance intermediaries” or “IMOs.” The applicants sought individual exemptions under the same conditions as the Best Interest Contract Exemption, but with a new definition of “Financial Institution” incorporating insurance intermediaries.
Because of the large number of applications, the Department determined to propose, on its own motion, a class exemption for such intermediaries based on the facts and representations in the individual applications received by the Department. The applicants employ a wide variety of business models and approaches, however, and the proposal, while designed to provide class relief for insurance intermediaries, may not be available to all the applicants depending on their individual circumstances. As discussed below, there are a variety of compliance options available to the insurance industry under the Best Interest Contract Exemption. This proposed exemption would supplement these options by permitting the IMO or other intermediary to act as a covered “Financial Institution” with supervisory responsibilities under specified conditions, many of which parallel the conditions of the Best Interest Contract Exemption. To the extent insurance intermediaries wish to pursue additional exemptive relief, the Department will consider such additional requests.
Primarily, it is important to note that insurance intermediaries are not required to act as Financial Institutions under this exemption, if granted, in order to participate in the marketplace. They may provide valuable compliance assistance and other services to insurance companies or other insurance intermediaries that act as Financial Institutions under the Best Interest Contract Exemption or this exemption, if granted, and receive compensation for their services. In this regard, both the Best Interest Contract Exemption and this proposal, if granted, would specifically provide relief for compensation paid to “affiliates” and “related entities” of an Adviser and Financial Institution, which would typically include IMOs.
Alternatively, even without this new exemption, an insurer could take direct responsibility for supervising agents, regardless of whether it chooses to market its products through a captive sales force, independent agents, or other channels, much as insurers currently have responsibility to oversee the activities of their agents—including independent agents—under state-law suitability rules. As FAQ 22 noted, the insurer's responsibility under the Best Interest Contract Exemption is to oversee the recommendation and sale of its products, not recommendations and transactions involving other insurers. See
The following entities submitted applications for individual exemptions permitting them to act as Financial Institutions under the Best Interest Contract Exemption: Gradient Insurance Brokerage, Inc., C2P Advisory Group, LLC dba Clarity to Prosperity, Legacy Marketing Group, LLC, InForce Solutions, LLC, Futurity First Insurance Agency, Financial Independence Group, Brokers International Ltd, Insurance Advocates, Advisors Excel, AmeriLife Group, LLC, InsurMark, Annexus, Ideal Producers Group, ECA Marketing, Saybrus Partners, Inc., Alpine Brokerage Services, The Annuity Source, Inc., M&O Financial, Inc., Kestler Financial Group, Inc., First Income Advisors, Crump Life Insurance Services, Inc., and The IMPACT Partnership, LLC. The applicants provided background information on the distribution of fixed annuities, described their business models and discussed their anticipated approaches to compliance with the proposed exemption.
As described by various applicants, fixed annuities—and in particular, fixed indexed annuities—are commonly distributed by independent insurance agents. Independent insurance agents distribute the products of not one insurance company, but rather multiple insurance companies.
Typically, insurance intermediaries recruit, train and support independent insurance agents and market and distribute insurance products. Since the independent agents are not associated with any one particular insurance company, the intermediary steps in to develop sales processes, provide marketing material, and formulate supervisory procedures and methods for the independent agents to use. The insurance companies and the agents have come to rely on these insurance intermediaries to serve a wide variety of functions relating to the distribution of fixed annuities through the independent insurance agent channel. Insurance intermediaries commonly provide services that include: Agent recruitment and screening, licensing and contracting services, creation of product illustrations, case management, IT services, marketing services, new business processing, training and supervising agents and ensuring compliance with existing standards under state insurance law.
Further, insurance intermediaries can serve an important compliance function. Insurance intermediaries may serve to facilitate statutory and regulatory compliance as well as help to resolve compliance issues that may arise between state regulators, the insurance company and an agent. In performing this role, insurance intermediaries can perform compliance reviews, create policies and procedures and vet the practices of agents. Many insurance intermediaries contractually require that an agent comply with specific standards that are set by the insurance intermediary, as well as the federal and state laws and regulations that govern insurance.
Some insurance intermediaries currently work with the insurance companies to ensure that annuities sold by agents are “suitable” for their clients. This suitability standard generally requires agents and insurance companies to review detailed information about the client to determine if the fixed annuity purchase complies with the suitability standards under state insurance law (
The distribution services provided by the insurance intermediary generate multiple forms of compensation for the insurance intermediary. Most prominently, the sale of an annuity usually triggers the payment of a commission to the insurance intermediary. The commission can be based on many factors, including, but not limited to, the specific annuity product sold, the state in which it is sold, the premium amount and the age of the annuity owner. An insurance intermediary can also receive compensation for additional services, including, but not limited to, product development, marketing, administrative and compliance services and field support services. The specific compensation terms are generally spelled out in the contracts between the insurance intermediary and the insurance company and the insurance intermediary and the agent.
The compensation payments received by insurance intermediaries may trigger prohibited transaction concerns under both ERISA and the Code. After the applicability date of the Regulation, insurance agents who recommend fixed annuity products will generally be fiduciaries with respect to a Retirement Investor's account. The receipt of a commission or other compensation by a fiduciary, or an entity in which the fiduciary has an interest that would affect its judgment as a fiduciary, as a result of the provision of investment advice is a prohibited transaction for which an exemption is needed.
Under this fixed annuity distribution and compensation model, an insurance company could serve as a “Financial Institution” for purposes of the Best Interest Contract Exemption. However, the applicants express concern that insurance companies may not necessarily agree to satisfy the role of the Financial Institution under the Best Interest Contract Exemption with respect to independent insurance
The applicants represent that the independent insurance agent model benefits consumers because independent agents can offer a wider variety of products to satisfy consumers' goals. Thus, the applicants take the position that permitting insurance intermediaries to serve as Financial Institutions will facilitate independent insurance agents' continued sale of fixed annuities in the Retirement Investor marketplace under a single set of policies and procedures. The exemption proposed herein would apply to commissions and other compensation received by an insurance agent, insurance intermediary, insurance companies and any other affiliates and related entities, as a result of a plan's or IRA's purchase of Fixed Annuity Contracts.
Many of the applicants stated that they had direct contractual relationships with the majority of the insurance companies for which they distribute fixed annuities. Frequently, these direct contractual relationships with the insurance companies assigned responsibility for the oversight of agents and sub-IMOs to the intermediaries. Some applicants indicated they are at the highest level of an insurance company's distribution hierarchy, or at the “top-tier” or “top-level.”
As top-level IMOs, most applicants represented that they oversee independent, insurance-only agents or sub-IMOs (which in turn oversee independent insurance-only agents), or both. This oversight is accomplished through the top-level IMO's use of its compliance structure and other business and administrative tools. The applicants use their compliance structure to directly oversee agents or to assist sub-IMOs in the distribution of fixed annuities and the oversight of their agents. One applicant, however, stated that it is a sub-IMO. As a sub-IMO, the applicant represents that it has contractual relationships with the insurance companies for which it distributes fixed annuities, but that it also has a contractual relationship with a top-level IMO. The top-level IMO provides the sub-IMO with distribution and other support services. Further, the top-level IMO assists the sub-IMO in accessing a wide variety of insurance products. The sub-IMO represents that contracting with a top-level IMO to provide this access and these services allows it to focus on the training and support of its agents.
Further, other applicants, in addition to describing themselves as top-level IMOs, also represented that they are affiliated with large insurance companies. One of these applicants wholly owns numerous sub-IMOs. Despite the differences in the ownership structure, the applicants represent that they, like the other top-level IMOs, assist in the distribution of fixed annuities, both their affiliates' and those sold by other insurance companies, and provide valuable business and administrative assistance to sub-IMOs and agents.
Finally, some applicants indicated that their services extend to assisting insurance companies in the design of insurance products.
The applicants represented to the Department that they have broad experience that will contribute to their ability to satisfy the conditions of the exemption. Some applicants pointed to their experience in providing oversight of independent agents for insurance law compliance. A number of the applicants indicated that they planned to rely on affiliated registered investment advisers and/or broker-dealer entities in developing systems to comply with the exemption.
The applicants generally indicated that they would maintain internal compliance departments and adopt supervisory structures to ensure compliance with the exemption. Several applicants pointed to technology that they would use to ensure compliance. Some applicants indicated that insurance agents would be required to use the intermediary's technology to ensure that clients receive the disclosures and a contract, where required. Agents would also be required to use the intermediary's Web site services and maintain records centrally.
Some of the applicants additionally described how their sales practices would ensure best interest recommendations. A number of the applicants plan to require centralized approval of agent recommendations; in some cases, the recommendations would be reviewed by salaried employees of the intermediary with additional credentials, such as Certified Financial Planners. One applicant indicated that internal review would include a comparison of the proposed product to other similar fixed indexed annuity products available in the marketplace in order to ensure it is appropriate for the purchaser, and that the analysis would include utilizing third party benchmarking services and industry comparisons. Another applicant indicated that it would ensure that an RIA representative would work with insurance-only agents where a recommendation would involve the liquidation of securities, to ensure that both state and federal securities laws are properly followed.
Some applicants additionally stated that their contracts with insurance agents would include certain specific requirements, including: Adherence to the intermediary's policies and procedures with respect to advertising, market conduct and point of sale processes, transparency and documentation; provision of advice in accordance with practices developed by the intermediary; and agreement that the agents will not accept any compensation, direct or indirect, from an insurance company, except as specifically approved by the intermediary. A number of the applicants indicated that they would perform background checks and rigorous selection processes before working with agents and would require ongoing training regarding compliance with the exemption.
A few of the applicants addressed product selection. These applicants indicated that agents making recommendations pursuant to the exemption would be limited to certain products and insurance companies. The applicants indicated there would be ongoing due diligence with respect to insurance companies and product offerings under the exemption.
After consideration of the applicants' representations and the information provided in the applications, the Department has decided to propose a class exemption for insurance intermediaries. The proposal is described below.
Section I of the proposed exemption would provide relief for the receipt of compensation by insurance intermediary Financial Institutions and their “Advisers,” “Affiliates,” and “Related Entities,” as a result of the Adviser's or Financial Institution's provision of investment advice within the meaning of ERISA section 3(21)(A)(ii) or Code section 4975(e)(3)(B) to a “Retirement Investor” regarding the purchase of a Fixed Annuity Contract. The proposed exemption would broadly provide relief from the restrictions of ERISA section 406(b) and the sanctions imposed by
The definitions and conditions of the proposal vary in certain respects from those in the Best Interest Contract Exemption, as discussed below. The differences are intended to ensure that transactions involving fixed annuity contracts that are sold by independent insurance agents through insurance intermediaries occur only when they are in the best interest of Retirement Investors. Fixed indexed annuities, with their blend of limited financial market exposures and minimum guaranteed values, can play an important and beneficial role in retirement preparation, as the Department noted in its Regulatory Impact Analysis for the Regulation.
These additional protections correspond to concerns, noted previously by the Department and expressed by other regulators, including the Securities and Exchange Commission (SEC) staff, the Financial Industry Regulatory Authority (FINRA), and the North American Securities Administrators Association, regarding fixed indexed annuities and the way they are marketed. Although indexed annuities are often sold as simple “no risk” products, they are neither simple nor risk free. Without proper care, Retirement Investors can all too easily be misled about the terms, guarantees, and risks associated with these products.
As FINRA noted in its Investor Alert, “Equity-Indexed Annuities: A Complex Choice”:
Sales of equity-indexed annuities (EIAs) . . . have grown considerably in recent years. Although one insurance company at one time included the word `simple' in the name of its product, EIAs are anything but easy to understand. One of the most confusing features of an EIA is the method used to calculate the gain in the index to which the annuity is linked. To make matters worse, there is not one, but several different indexing methods. Because of the variety and complexity of the methods used to credit interest, investors will find it difficult to compare one EIA to another.
FINRA also explained that equity-indexed annuities “give you more risk (but more potential return) than a fixed annuity but less risk (and less potential return) than a variable annuity.”
Similarly, in its 2011 “Investor Bulletin: Indexed Annuities,” the SEC staff stated: “You can lose money buying an indexed annuity. If you need to cancel your annuity early, you may have to pay a significant surrender charge and tax penalties. A surrender charge may result in a loss of principal, so that an investor may receive less than his original purchase payments. Thus, even with a specified minimum value from the insurance company, it can take several years for an investment in an indexed annuity to `break even.' ”
The North American Securities Administrators Association, the association of state securities regulators, issued the following statement on equity indexed annuities:
Equity indexed annuities are extremely complex investment products that have often been used as instruments of fraud and abuse. For years, they have taken an especially heavy toll on our nation's most vulnerable investors, our senior citizens for whom they are clearly unsuitable.
In the Department's view, the complexity and conflicted payment structures associated with fixed indexed annuities heighten the dangers posed by conflicts of interest when Advisers recommend these products to Retirement Investors. These are complex products requiring careful consideration of their terms and risks. Assessing the prudence of a particular indexed annuity requires an understanding of surrender terms and charges; interest rate caps; the particular market index or indexes to which the annuity is linked; the scope of any downside risk; associated administrative and other charges; the insurer's authority to revise terms and charges over the life of the investment; and the specific methodology used to compute the index-linked interest rate and any optional benefits that may be offered, such as living benefits and death benefits. In operation, the index-linked interest rate can be affected by participation rates; spread, margin or asset fees; interest rate caps; the particular method for determining the change in the relevant index over the annuity's period (annual, high water mark, or point-to-point); and the method for calculating interest earned during the annuity's term (
Accordingly, the Department has taken care to address these concerns, while preserving the beneficial and important role these products can play for retirement investors.
As stated above, the proposed exemption is limited to transactions involving Fixed Annuity Contracts. To ensure that the exemption would not be used more broadly than intended, the proposal includes a definition of Fixed Annuity Contract, which is “an annuity contract that satisfies applicable state standard nonforfeiture laws at the time of issue and the benefits of which do not vary, in whole or in part, on the basis of the investment experience of a separate account or accounts maintained by the insurer. This includes both fixed rate annuity contracts and fixed indexed annuity contracts.” The definition is intended to include fixed immediate annuities but exclude variable annuity contracts, which the Department understands are typically sold through securities distribution channels.
If this proposed exemption is granted, therefore, relief will be available for sales of fixed rate annuities sold by insurance intermediaries and independent insurance agents under several different exemptions. Relief for all annuity sales is available under the Best Interest Contract Exemption if, as discussed above, an insurance company acts as the Financial Institution under the terms of that exemption. Alternatively, relief for fixed rate annuity contracts is available under PTE 84-24. By also proposing relief for such transactions in this exemption, the Department is not indicating that these other exemptions are unavailable. The intent is to provide flexibility to parties depending on their individual circumstances.
The Department requests comment on the proposed definition of Fixed Annuity Contract. Does the definition adequately describe fixed annuities and carve out variable annuities? Are there other attributes of fixed annuity contracts that should be identified in the definition? Finally, should the definition address group annuity contracts, which may not be required to satisfy state nonforfeiture laws? Is relief necessary in this distribution channel for group annuity contracts? If so, should the definition provide that rather than satisfying the state nonforfeiture laws, the group annuity contract must “guarantee return of principal net of reasonable compensation, and provide a guaranteed declared minimum interest rate in accordance with the rates specified in the standard nonforfeiture laws in the state that are applicable to individual annuities”?
The proposed definition of Adviser in Section VIII(a) generally mirrors the definition in the Best Interest Contract Exemption, although a reference to banking law was not included in this proposed definition as the Department did not believe it was relevant. The definition states:
“Adviser” means an individual who:
(1) Is a fiduciary of the Plan or IRA by reason of the provision of investment advice described in ERISA section 3(21)(A)(ii) or Code section 4975(e)(3)(B), or both, and the applicable regulations, with respect to the assets of the Plan or IRA involved in the recommended transaction;
(2) Is an employee, independent contractor, or agent of a Financial Institution; and
(3) Satisfies the federal and state regulatory and licensing requirements of insurance laws with respect to the covered transaction, as applicable.
The Department requests comment on whether this definition accurately describes the relationship between independent insurance agents and insurance intermediaries who will serve as Financial Institutions under the exemption, and, if not, how the definition should be revised.
The proposal includes a new definition of Financial Institution that would apply with respect to insurance intermediaries.
The proposed definition of Financial Institution is based on the applicants' representations and suggestions and the Department's additional analysis of how best to safeguard Retirement Investors' interests in this distribution channel. The components of the definition are intended to describe insurance intermediaries that are likely to be able to comply with the exemption and provide meaningful oversight of Advisers working in the fixed annuity marketplace. The proposal seeks to identify insurance intermediaries with the financial stability and operational capacity to implement the anti-conflict policies and procedures required by the exemption. Additionally, insurance intermediaries described in the definition are sufficiently large and established to stand behind their contractual and other commitments to Retirement Investors, and to police conflicts of interest associated with a
As an initial matter, the proposal defines a Financial Institution as an insurance intermediary that has a direct written contract regarding the distribution of Fixed Annuity Contracts with both the insurance company issuing the annuity contract and the Adviser or another intermediary (sub-intermediary) that has a direct written contract with the Adviser. Additional exemption conditions describe the terms of the required contract, see proposed Section II(d)(6) and (7). By requiring a contractual relationship between the insurance company and the intermediary, the proposal would ensure that the insurance intermediary and the insurance company have a direct relationship that will enable the insurance intermediary to satisfy its obligations under the exemption. By also requiring a contractual relationship between the intermediary and the Adviser or sub-intermediary, the proposal would further ensure that the intermediary will have the right to implement its oversight obligations as a Financial Institution pursuant to the requirements of the exemption, if granted. The Department requests comment on whether this condition should be adjusted to allow for multiple levels of intermediaries.
In addition to the baseline contractual relationship requirement, the proposal sets forth a series of conditions that would apply to the insurance intermediary. Subsection (1) of the proposed definition would require the insurance intermediary to satisfy the applicable licensing requirements of the insurance laws of each state in which it conducts business. Accordingly, the intermediary would be required to operate in accordance with the states' requirements in this respect.
Next, the proposal seeks to confirm that the insurance intermediary has sound business practices that have been reviewed by an independent entity. Subsection (2) of the proposed definition would require that the intermediary have financial statements that are audited annually by an independent certified public accountant. This condition would utilize the definition of Independent in Section VIII(f) of the proposed exemption.
This condition was suggested in several individual applications. Some applicants believed that periodic financial audits would provide reasonable assurance of the entity's financial health. The Department agrees. The Department anticipates that requiring an annual audit of the financial statements, coupled with the Financial Institution's web disclosures, will provide an opportunity for the Department and other interested persons to be alerted to any financial weaknesses or other items of concern with respect to the stability or solvency of the Financial Institution, or its ability to stand behind its commitments to Retirement Investors.
As an alternative to an audit of financial statements, one applicant suggested that the audit should relate to the intermediary's internal controls and procedures. The applicant noted that banks and trust companies are currently required to obtain these reports under SSAE 16 (formerly SAS 70), and that the applicant could work with its auditors to prepare a similar report, but suggested that such an approach would require additional transition relief as the accounting industry would have to agree on the appropriate data points for an internal controls audit for an insurance intermediary and the resulting topics of the SSAE 16-like report.
The Department requests comment on the utility of the proposed audited financial statements requirement as a protection of Retirement Investors, and the suggested alternative audit of internal controls and procedures. The Department also requests information on the cost of these alternatives to insurance intermediaries intending to rely on the exemption.
Subsection (3) of the proposed definition would require the Financial Institution to maintain fiduciary liability insurance, or unencumbered cash, bonds, bank certificates of deposit, U.S. Treasury Obligations, or a combination of all of these, available to satisfy potential liability under ERISA or the Code as a result of the firm's failure to meet the terms of this exemption, or any contract entered into pursuant to Section II(a). The aggregate amount of these items must equal at least 1% of the average annual amount of premium sales of Fixed Annuity Contracts by the Financial Institution to Retirement Investors over the prior three fiscal years of the Financial Institution. To the extent this condition is satisfied by insurance, the proposal states that the insurance must apply solely to actions brought by the Department of Labor, the Department of Treasury, the Pension Benefit Guaranty Corporation, Retirement Investors or plan fiduciaries (or their representatives) relating to Fixed Annuity Contract transactions, including but not limited to, actions for failure to comply with the exemption or any contract entered into pursuant to Section II(a), and it may not contain an exclusion for Fixed Annuity Contracts sold pursuant to the exemption. Any such insurance also may not have a deductible that exceeds 5% of the policy limits and may not exclude coverage based on a self-insured retention or otherwise specify an amount that the Financial Institution must pay before a claim is covered by the fiduciary liability policy. To the extent this condition is satisfied by retaining assets, the assets must be unencumbered and not subject to security interests or other creditors.
This provision of the proposal seeks to ensure that the Financial Institution can stand behind its commitments to retirement investors and satisfy potential liabilities under the exemption. The Financial Institution's ability to back its commitments ensures that it can be held accountable when it violates its obligations and, thereby, promotes compliance. A number of the applicants specifically suggested that they would obtain insurance to cover potential liability under the exemption, although the approaches and suggested amounts varied. Additionally, as some applicants indicated uncertainty as to the current availability of insurance for liability under the exemption, the proposal would provide flexibility to the intermediaries to determine whether to acquire insurance or set aside assets to satisfy potential liability.
The Department has concluded that the condition should be included in this proposal based on the suggestion of applicants, as well as its understanding that insurance intermediaries often are not legally required to maintain, and do not maintain, significant amounts of capital. Particularly because these entities do not necessarily have the sort of history of regulatory oversight and supervisory experience that characterize Financial Institutions identified in the
The Department requests comment on the approach taken in proposed subsection (3) of the definition. First, do commenters agree that the exemption should specify that insurance/assets should be based on a percentage of prior sales of Fixed Annuity Contracts? Is a three-year average an appropriate method for determining the amount of premium sales? Should a different and or minimum/maximum amount be specified, or should there be no specific level at all? For example, should the exemption instead require that a “reasonable” amount of insurance be obtained or assets set aside? As an additional protection for Retirement Investors, should individual Advisers be required to carry insurance themselves?
Moreover, should the final exemption retain the proposal's approach of allowing Financial Institutions flexibility to either obtain fiduciary liability insurance or set aside assets to satisfy potential liabilities? If the Department adopts this approach, should it specify how assets should be held (
Finally, subsection (4) of the proposed definition would require the insurance intermediary to have had annual Fixed Annuity Contract sales averaging at least $1.5 billion in premiums over each of the three prior fiscal years to qualify as a Financial Institution. This proposed threshold is intended to identify insurance intermediaries that have the financial stability and operational capacity to implement the anti-conflict policies and procedures required by the exemption. The proposed condition aims to ensure that the insurance intermediary is in a position to meaningfully mitigate compensation conflicts across products and insurers, which is a critical safeguard of the exemption, as proposed. Although this proposed threshold would limit entities that could operate as the supervisory Financial Institution to larger intermediaries, it would not prevent smaller intermediaries from working with larger intermediaries, similarly to how some of them currently operate.
The proposed $1.5 billion threshold is based on a variety of factors. The intermediaries that approached the Department for individual exemptions and expressed their willingness and ability to function in a supervisory capacity to mitigate conflicts generally indicated sales of this amount or more in their applications, although not all applicants provided this information. Additionally, the Department believes that the $1.5 billion dollar threshold will cover those intermediaries that are most likely to make beneficial use of the exemption because economies of scale are likely to yield advantages in efficiently carrying out compliance responsibilities under this proposed exemption, especially if they step into the role that insurance companies would otherwise serve under the Best Interest Contract Exemption. The Department is also concerned that the conditions of the exemption will not serve their purpose in protecting Retirement Investors from conflicts of interest if the insurance intermediary does not have the requisite experience and resources to be able to effectively mitigate the potential adverse impact of these incentives.
To this point, the Department questions whether intermediaries with lower levels of annual sales will be able to effectively mitigate conflicts in an environment that is so heavily dependent on commission compensation, particularly without the history of regulatory oversight and supervisory experience that characterize other Financial Institutions, such as banks, insurance companies, and broker-dealers. One of the chief reasons for extending Financial Institution status to insurance intermediaries is their ability to mitigate the conflicts of interest posed by the variable compensation that independent agents may receive from different insurance companies paying different compensation. Sufficiently large intermediaries that sell many products from a wide variety of insurance companies are in a position to control the compensation that the agent stands to receive from the various insurers and products and, thereby, minimize or eliminate the independent agents' conflicts of interest in choosing between insurance companies and products. In addition, the anti-conflict purpose of the exemption's conditions would not be served with respect to an entity that is so small that the difference between the firm's conflicts and the individual advisers' conflicts is essentially non-existent.
The proposed requirement that the premium threshold be met using the preceding three-year average is intended, again, to identify intermediaries with an established history of significant sales. However, it is not intended as a barrier to new entities becoming Financial Institutions or for smaller intermediaries to operate under this exemption, albeit not as a Financial Institution. The Department notes that while a large intermediary would be responsible for acting as the Financial Institution under the exemption, smaller intermediaries will typically be eligible to obtain prohibited transaction relief under the proposed exemption's provisions that extend to “affiliates” and “related entities.” In this regard, the Department understands that the marketplace of intermediaries that distributes fixed annuities is hierarchical. Smaller intermediaries commonly work with larger intermediaries, and receive materials and support from the larger intermediaries in exchange for a fee or a portion of the sales commission. Therefore, smaller intermediaries could obtain relief from ERISA's prohibited transaction rules as long as there is an intermediary in their distribution hierarchy that acts as the Financial Institution and provides the requisite anti-conflict and supervisory role under the exemption, including execution of the best interest contract.
Importantly, in determining whether an intermediary meets the $1.5 billion threshold, each intermediary that receives a commission for an annuity transaction could count the total premium amount involved towards the required premium threshold. This will facilitate the ability of smaller intermediaries to satisfy the premium
The Department notes that applicants suggested various other methods of defining which intermediaries should qualify as Financial Institutions. The most prevalent suggestion was to limit the exemption to “top tier” intermediaries with a significant number of direct relationships with insurance carriers. The “top tier” intermediary was generally described as the entity at the top of an insurance carrier's distribution hierarchy. Some applicants stated that the exemption should focus on the “top tier” intermediaries because such entities have a closer tie with the insurance company.
The Department's proposal is not limited to intermediaries with “top tier” status. As an initial matter, the Department understands that many insurance intermediaries have direct contracts with insurance carriers regardless of the intermediary's size and it may not be clear whether a particular contractual relationship is properly characterized as a “top tier” relationship. Additionally, even assuming that “top tier” could be defined objectively, the Department is not certain that status at the top of an insurance company's distribution hierarchy is necessary to indicate that an intermediary is an established entity capable of providing effective oversight of Advisers and mitigating compensation incentives. Accordingly, the Department has tentatively concluded that the premium threshold is a better indicator that an intermediary can serve these functions based on its involvement in a significant amount of sales over its three prior fiscal years.
The Department requests comment on a variety of aspects of the proposed premium threshold condition and possible alternatives. First, the Department seeks comment on alternative approaches to identifying intermediaries that are likely to be able to comply with the exemption and provide meaningful oversight of Advisers working in the fixed annuity marketplace. More specifically, the Department asks whether focusing on premium levels is an effective measure of compliance and conflict mitigation capability. The Department also seeks comment on the requirement that the premium condition be met by averaging premiums over the preceding three fiscal years. In particular, the Department asks the following questions:
Sections II through V of the proposal contain the conditions proposed for relief under the exemption. The conditions are the same as the Best Interest Contract Exemption in many respects, but some of the conditions have been revised, augmented or deleted, as discussed in this section. The Department requests comments on these revisions.
Section II sets forth the requirements that establish the Retirement Investor's enforceable right to adherence to the Impartial Conduct Standards and related conditions. For advice to certain Retirement Investors—specifically, advice regarding IRA investments, and plans that are not covered by Title I of ERISA (non-ERISA plans), such as plans covering only partners or sole proprietors—Section II(a) requires the Financial Institution and Retirement Investor to enter into a written contract that includes the provisions described in Section II(b)-(d) of the exemption and that also does not include any of the ineligible provisions described in
The contract with Retirement Investors regarding IRAs and non-ERISA plans must include the Financial Institution's acknowledgment of its fiduciary status and that of its Advisers, as required by Section II(b) and the Financial Institution's agreement that it and its Advisers will adhere to the Impartial Conduct Standards as required by Section II(c). The Impartial Conduct Standards require Advisers and Financial Institutions to provide advice that is in the Retirement Investor's best interest (
In this regard, the Department cautions Financial Institutions and Advisers to avoid inaccurate or misleading statements regarding the risk characteristics of fixed indexed annuity contracts, particularly statements that inaccurately suggest these products have only upside potential and no risk of loss of principal.
Under Section II(d), the Financial Institution must warrant that it has adopted, and in fact must comply with, anti-conflict policies and procedures reasonably and prudently designed to ensure that Advisers adhere to the Impartial Conduct Standards. The policies and procedures requirements generally include all the elements in the Best Interest Contract Exemption, including the requirement that the Financial Institution designate a person or persons responsible for addressing material conflicts of interest and monitoring Advisers' adherence to the Impartial Conduct Standards.
Proposed Section II(d)(3) specifically addresses incentives to Advisers, and provides that the Financial Institution's policies and procedures must prohibit the use of quotas, appraisals, or performance or personnel actions, bonuses, contests, special awards, differential compensation, or other actions or incentives if they are intended or would reasonably be expected to cause Advisers to make recommendations that are not in the best interest of the Retirement Investor. The condition applies regardless of the source of the incentive. Independent insurance agents distribute the products of multiple insurance companies and accordingly, may be subject to more than one company's incentives. In some cases, the agents may also work for more than one intermediary. Under the terms of the exemption, however, the intermediary would be expected to ensure that these arrangements did not incentivize the agents to make recommendations that run counter to the best interest standard.
The insurance intermediaries indicated they are well positioned to mitigate the impact of the competing financial incentives offered by multiple insurance companies. Consistent with the intermediaries' representations, one of the key protections of this exemption is the requirement that the insurance intermediary Financial Institution manage the conflicts of interest that independent agents and other Advisers face in recommending the products of multiple insurance companies. Proposed Section II(d)(3) would tolerate differential compensation—regardless of source—only to the extent that it is not intended or reasonably expected to cause Advisers to make recommendations that are not in the best interest of the Retirement Investor. Financial Institutions can allow Advisers to receive differential compensation if it is justified by neutral factors tied to the differences in the services delivered to Retirement Investors.
The Department views this as a critical safeguard of this proposed exemption. The proposed condition is intended to ensure that an Adviser's relationship with multiple insurance companies and even multiple insurance intermediaries does not generate compensation or incentive structures that undermine the Adviser's provision of advice that is in Retirement Investors' best interest.
Proposed Section II(d)(3) retains the principles based approach of the Best Interest Contract Exemption, and does not purport to detail any single approach for compliance with the condition. A number of applicants indicated that they expect their
A new proposed Section II(d)(4) would require Financial Institutions to approve in advance all written marketing materials used by Advisers after determining that such materials provide a balanced description of the risks and features of the annuity contracts to be recommended. The condition ensures that Advisers are not using marketing materials that do not fully and fairly disclose the risks and characteristics of an annuity.
New proposed Section II(d)(5) would impose additional requirements on the person or persons designated as responsible for addressing material conflicts of interest and monitoring Advisers' adherence to the Impartial Conduct Standards. The new section would require the person to approve, in writing, recommended annuity applications involving Retirement Investors prior to transmitting the applications to the insurance company. While a specific approval requirement is not in the Best Interest Contract Exemption, a number of applicants suggested they would have internal compliance departments review recommendations prior to the transmittal of an annuity contract to an insurance company. The condition would reinforce the duty of the Financial Institution to monitor and supervise the Advisers operating within the Financial Institution's distribution chain. This may be particularly important when there are sub-intermediaries, who may be more involved in day-to-day activities, between the Adviser and the Financial Institution.
The proposal also would establish certain specific requirements for the relationship between the insurance intermediary and the Adviser. Section II(d)(6) would specify certain aspects of the written contract between the Financial Institution and the Adviser or sub-intermediary. First, the Financial Institution must require in its written contract with the Adviser or sub-intermediary that Advisers may use written marketing materials only if they are approved by the Financial Institution. As discussed above, Section II(d)(4) of this proposal would require Financial Institutions to approve in advance all written marketing materials used by Advisers after determining that such materials provide a balanced description of the risks and features of the annuity contracts to be recommended.
Second, Advisers must be required to provide the transaction disclosure required by Section III(a) of the exemption and orally review the annuity-specific information required in Section III(a)(1) with the Retirement Investor, as discussed below. These marketing and disclosure conditions address the Department's objective that Advisers and Financial Institutions relying on the exemption should describe recommended annuity contracts fully and fairly, and that the Retirement Investor must be made aware of aspects of the annuity contract that could impact the amounts ultimately paid to the Retirement Investor.
New proposed Section II(d)(7) sets forth requirements that would govern the compensation of the Adviser and sub-intermediary. The applicants described two broad approaches to paying compensation, and Section II(d)(7) permits both. Under the first approach, all compensation to be paid to the Adviser or sub-intermediary with respect to the purchase of an annuity contract pursuant to the exemption must be paid to the Adviser or sub- intermediary exclusively by the insurance intermediary. Under this approach, the intermediary would contract with insurance companies to receive the entire commission itself, and then, in turn, would pay an Adviser and/or any sub-intermediary a portion of the commission.
Under the second approach, Advisers or sub-intermediaries could receive commissions from insurance companies for the sale of annuities to Retirement Investors provided that the commission structure was approved in advance by the insurance intermediary and all forms of compensation other than commissions, whether cash or non-monetary, are paid to the Adviser or sub-intermediary exclusively by the insurance intermediary. In this approach, insurance companies can continue the practice of paying commissions directly to agents, with an override payment going to the intermediary.
Under the proposal, the insurance intermediary may elect either compensation approach or some combination of the two. The proposal offers this flexibility because different applicants had different preferences for accomplishing the same general result, that the insurance intermediaries take responsibility for Adviser compensation and other incentives. Some applicants preferred to take in all compensation from insurance companies in order to facilitate compliance with the exemption and avoid the potential for errors. Other applicants preferred the second approach, expressing the view that it would not require the establishment of new internal accounting procedures and the engagement of additional personnel.
A new proposed Section II(d)(8) would also require that Financial Institutions provide, and require Advisers to attend, annual training on compliance with the exemption, conducted by a person who has appropriate technical training and proficiency with ERISA and the Code. The training must, at a minimum, cover the policies and procedures, the Impartial Conduct Standards, material conflicts of interest, ERISA and Code compliance (including applicable fiduciary duties and the prohibited
Section II(e) requires the Financial Institution to disclose information about its services and applicable fees and compensation. Section II(e) is generally unchanged from the Best Interest Contract Exemption, although some of the provisions were revised in minor ways to reflect the fact that this proposed exemption is limited to Fixed Annuity Contracts.
Like the Best Interest Contract Exemption, Section II(e)(7) of this proposal would require the Financial Institution to disclose whether or not the Adviser and Financial Institution will monitor the Retirement Investor's annuity contract and alert the Retirement Investor to any recommended change to the contract, and, if monitoring, the frequency with which the monitoring will occur and the reasons for which the Retirement Investor will be alerted. Financial Institutions and their Advisers should not disclaim responsibility for monitoring if they will receive ongoing compensation justified in whole or in part based on the provision of such monitoring services.
Section II(f) generally provides that the exemption is unavailable if the contract includes exculpatory provisions or provisions waiving the rights and remedies of the plan, IRA or Retirement Investor, including their right to participate in a class action in court. The contract may, however, provide for binding arbitration of individual claims, and may waive contractual rights to punitive damages or rescission to the extent permitted by governing law. Pursuant to Section II(g) of the exemption, advice to Retirement Investors regarding ERISA plans does not have to be subject to a written contract, but Advisers and Financial Institutions must comply with the substantive standards established in Section II(b)-(e) to avoid liability for a non-exempt prohibited transaction. These conditions are unchanged from the Best Interest Contract Exemption.
Section II(h) of the Best Interest Contract Exemption established streamlined conditions for “level fee fiduciaries” defined in section VIII(h) of that exemption. Under that definition, a Financial Institution and Adviser can be level fee fiduciaries if the only fee received by them and their affiliates is a “level fee” that is disclosed in advance to the Retirement Investor. A “level fee” is defined as a fee or compensation that is provided as a fixed percentage of the value of the assets or a set fee that does not vary with the particular investment recommended, rather than a commission or other transaction-based fee.
This proposal, however, does not include provisions for “level fee fiduciaries.” Although some of the applicants acknowledged they would level commissions across product categories, the mere leveling of commissions would not cause these Advisers and Financial Institutions to be “level fee fiduciaries” as defined in the Best Interest Contract Exemption because each purchase of a fixed annuity by a Retirement Investor would initiate the payment of a commission based on that particular transaction. The Department seeks comment on this aspect of the proposal. Are there business models in existence for the recommendation and sale of Fixed Annuity Contracts that would satisfy the level fee provisions of the Best Interest Contract Exemption, as described above?
Section III proposes certain disclosure requirements, in addition to the disclosures in Section II(e) of the exemption. Section III(a)'s provisions on “transaction disclosure” generally require the disclosure of material conflicts of interest and basic information relating to those conflicts and the advisory relationship. In this respect, the proposal mirrors the Best Interest Contract Exemption.
In addition, the transaction disclosure in this proposal has an annuity-specific disclosure requirement that would apply to recommendations of all Fixed Annuity Contracts. A new proposed Section III(a)(1) would require the Financial Institution to provide a transaction disclosure in accordance with the most recent Annuity Disclosure Model Regulation published by the National Association of Insurance Commissioners (NAIC) or its successor.
Under the proposal, both the Adviser and the Retirement Investor must sign the disclosure after the Adviser orally reviews the information. The aim of this disclosure is to ensure that Retirement Investors are informed of the risks and features of annuity products prior to entering into the annuity contract. This disclosure would be required prior to the transmittal of the annuity application to the insurance company and would be required to be made in connection with any recommendations to make additional deposits into the contract. The Department understands that in some cases, insurance companies currently provide an advance disclosure document, commonly referred to as a “statement of understanding.” This condition of the exemption would be satisfied if the required information is provided in a “statement of understanding” in accordance with the applicable time frames specified in the condition. So long as the disclosure is delivered in a document that is distinct from the annuity contract, whether through a “statement of understanding” or otherwise the disclosure will satisfy the condition.
The Department requests comment on the proposed disclosure condition. Does the Annuity Disclosure Model Regulation require the information commenters believe is appropriate and necessary in transactions involving
Section III(b) requires web-based disclosure that is intended to provide information about the Financial Institutions' arrangements with product manufacturers and other parties for Third Party Payments in connection with specific investments or classes of investments that are recommended to Retirement Investors, a description of the Financial Institution's business model and its compensation and incentive arrangements with Advisers and a copy of the Financial Institution's most recent audited financial statements as required pursuant to Section VIII(d)(2). Other than the disclosure of the audited financial statements, this provision is generally otherwise unchanged from the Best Interest Contract Exemption, except that certain provisions are revised in minor ways to account for the fact that the exemption will provide relief only for Fixed Annuity Contracts.
The Department requests comment on the proposed requirement to maintain a copy of the Financial Institution's most recent audited financial statements on the Web site.
Section IV of the proposal relates to Financial Institutions that limit Advisers' investment recommendations, in whole or in part, based on whether the investments are Proprietary Products (as defined in Section VIII(j)) or to investments that generate Third Party Payments (as defined in Section VIII(n)). For purposes of this proposal, Section IV would apply to all Financial Institutions relying on the exemption because insurance intermediaries sell only investments that generate Third Party Payments (from the insurance company). Among other things, Section IV requires Financial Institutions to document the limitations they place on their Advisers' investment recommendations, the material conflicts of interest associated with proprietary or third party arrangements, and the services that will be provided both to Retirement Investors as well as third parties in exchange for payments. Such Financial Institutions must then reasonably conclude that the limitations will not cause the Financial Institution or its Advisers to receive compensation in excess of reasonable compensation, and, after consideration of their policies and procedures, reasonably determine that the limitations and associated conflicts of interest will not cause the Financial Institution or its Advisers to recommend imprudent investments. Financial Institutions must document the bases for their conclusions in these respects and retain the documentation pursuant to the recordkeeping requirements of the exemption, for examination upon request by the Department and other parties set forth in that section.
Section V of the proposed exemption would establish record retention and disclosure conditions that a Financial Institution must satisfy for the exemption to be available for compensation received in connection with recommended transactions. This provision is unchanged from the Best Interest Contract Exemption.
Sections VI and VII propose supplemental exemptions. Section VI would apply to certain prohibited transactions commonly associated with annuity purchases but which are not covered by Section I. Section I permits Advisers and Financial Institutions to receive compensation that would otherwise be prohibited by the self-dealing and conflicts of interest provisions of ERISA section 406(a)(1)(D) and 406(b), and Code section 4975(c)(1)(D)-(F). However, Section I does not extend to any other prohibited transaction sections of ERISA and the Code. ERISA section 406(a) and Code section 4975(c)(1)(A)-(D) contain additional prohibitions on certain specific transactions between plans and IRAs and “parties in interest” and “disqualified persons,” including service providers. These additional prohibited transactions include: (i) The purchase of a Fixed Annuity Contract by a plan/IRA from a party in interest/disqualified person, and (ii) the transfer of plan/IRA assets to a party in interest/disqualified person. These prohibited transactions are subject to excise tax and personal liability for the fiduciary.
Section VII proposes an exemption for pre-existing transactions involving Fixed Annuity Contracts. The exemption permits continued receipt of compensation based on transactions involving Fixed Annuity Contacts that occurred prior to the Applicability Date, as defined in Section VII(a), as well as the receipt of compensation for recommendations to continue to adhere to a systematic purchase program established before the Applicability Date. In this case, the Department anticipates that a systematic purchase program would involve a program in which a Retirement Investor would make regular, pre-scheduled contributions to an annuity contract; however, the Department requests comment on whether such relief is necessary or appropriate. The exemption also explicitly covers compensation received as a result of a recommendation to hold an annuity contract that was purchased prior to the Applicability Date but would not cover recommendations to exchange an annuity for another annuity. In addition, a few references to securities that are found in the Best Interest Contract Exemption were deleted from this exemption because it would not provide relief for securities transactions.
This preamble discussion focused on conditions in this proposal that differ from the Best Interest Contract Exemption. The preamble to the Best Interest Contract Exemption includes a lengthy and in-depth discussion of the remaining conditions, which is incorporated into this preamble by reference. Because of the significant length of that discussion, the Department did not repeat it in this document, but rather directs parties to the Best Interest Contract Exemption preamble for a more complete description of the scope, definitional terms, and conditions of the exemption.
Section IX of the proposal provides for a transition period, from April 10, 2017, to August 15, 2018, under which fewer conditions would apply. During the transition period, the Financial Institution and its Advisers would be required to satisfy the conditions of Section IX(d) of the proposal. Prior to receiving compensation in reliance on the exemption, Financial Institutions would be required under Section IX(d)
During the transition period, the Adviser and Financial Institution must comply with the Impartial Conduct Standards. Additionally, the Financial Institution would be required to comply with applicable disclosure obligations under state insurance law with respect to the sale of the Fixed Annuity Contract, and certain additional disclosures would be required, including an acknowledgment of the Adviser's and Financial Institution's fiduciary status; a description of their material conflicts of interest; and a disclosure of whether they offer proprietary products or products that generate third party payments and the extent to which they limit investment recommendations on those bases. The Financial Institution would have to approve all written marketing materials used by Advisers, as described in Section II(d)(4). The Financial Institution would have to designate a person responsible for addressing material conflicts of interest and monitoring Advisers' adherence to the Impartial Conduct Standards, and such person would be required to approve, in writing, recommended annuity applications involving Retirement Investors prior to transmitting them to the insurance company. Finally, the Financial Institution would have to comply with the recordkeeping requirements of Section V(b) and (c).
It is proposed that, starting on August 16, 2018, parties intending to rely on the exemption must comply with all of the applicable conditions in Sections II-V.
This proposed exemption would not provide relief from a transaction prohibited by ERISA section 406(a)(1)(C), or from the taxes imposed by Code section 4975(a) and (b) by reason of Code section 4975(c)(1)(C), regarding the furnishing of goods, services or facilities between a plan and a party in interest. The provision of investment advice to a plan under a contract with a plan fiduciary is a service to the plan and compliance with this exemption will not relieve an Adviser or Financial Institution of the need to comply with ERISA section 408(b)(2), Code section 4975(d)(2), and applicable regulations thereunder.
Executive Orders 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing and streamlining rules, and of promoting flexibility. It also requires federal agencies to develop a plan under which the agencies will periodically review their existing significant regulations to make the agencies' regulatory programs more effective or less burdensome in achieving their regulatory objectives.
Under Executive Order 12866, “significant” regulatory actions are subject to the requirements of the Executive Order and review by the OMB. Section 3(f) of Executive Order 12866, defines a “significant regulatory action” as an action that is likely to result in a rule (1) having an annual effect on the economy of $100 million or more, or adversely and materially affecting a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local or tribal governments or communities (also referred to as “economically significant” regulatory actions); (2) creating serious inconsistency or otherwise interfering with an action taken or planned by another agency; (3) materially altering the budgetary impacts of entitlement grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) raising novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in the Executive Order.
Pursuant to the terms of Executive Order 12866, OMB has tentatively determined that this proposed action is economically significant within the meaning of section 3(f)(1) of the Executive Order. Accordingly, OMB has reviewed the proposed prohibited transaction class exemption and the Department provides the following assessment of its impact.
As discussed earlier in this preamble, the prohibited transaction rules of ERISA and the Code prohibit employee benefit plan and individual retirement account (IRA) fiduciaries from receiving indirect or variable compensation as a result of their investment advice to the plans and IRAs. The exemption proposed in this document would allow certain insurance intermediaries, and the insurance agents and insurance companies with whom they contract, to receive compensation in connection with certain fixed annuity transactions that may otherwise give rise to prohibited transactions as a result of the provision of investment advice to plan participants and beneficiaries, IRA owners and certain plan fiduciaries. The proposed class exemption includes protective conditions, similar to those contained in the Department's Best Interest Contract Exemption (PTE 2016-01) granted on April 8, 2016,
The Best Interest Contract Exemption is available only to certain Financial Institutions that are subject to well-established regulatory conditions and oversight, namely banks, investment advisers registered under the Investment Advisers Act of 1940 or state law, broker-dealers, and insurance companies. However, the exemption provides a mechanism that would make it more broadly available to other entities that are described in the definition of Financial Institution in an individual prohibited transaction exemption providing relief under the same conditions as in the Best Interest Contract Exemption. Thus, if an individual exemption is granted, other entities that satisfy the applicable
In response to this provision, the Department received 22 individual exemption applications from insurance intermediaries that work with independent insurance agents to sell fixed annuity products (“applicants”). The applicants describe themselves as “independent marketing organizations,” “insurance marketing organizations” and “field marketing organizations” among other names. Collectively, the Department refers to the applicants and similar entities as “IMOs” in this analysis. The applicants sought individual exemptions under the same conditions as the Best Interest Contract Exemption, but with a new definition of “Financial Institution” incorporating insurance intermediaries.
Because of the large number and similar characteristics of the applicants, the Department decided that instead of utilizing the individual exemption process described in the Best Interest Contract Exemption, it would propose, on its own motion, a class exemption for IMOs based on the facts and representations provided in the individual exemption applications received by the Department. As discussed more fully below, the Department believes this is the most efficient way to provide relief to IMOs from the prohibited transaction rules of ERISA and the Code so long as they meet the protective conditions of the exemption that would safeguard the interests of affected plans, participants and beneficiaries, and IRA owners. Accordingly, the Department today is proposing a class exemption that would allow IMOs and associated independent insurance agents to continue to recommend fixed annuities in the Retirement Investor marketplace and receive commissions and other variable compensation.
As discussed in detail in in section 3.2 of the Regulatory Impact Analysis for the Regulation,
Insurers generally guarantee FIA contract holders at least a zero return. However, the actual return on a FIA is not determined until the end of the crediting period and is based on the performance of the index or other external reference.
Similar to variable annuities, the returns of fixed-indexed annuities can vary widely, which results in a risk to investors. Furthermore, insurers generally reserve rights to change participation rates, interest caps, and fees, which can limit the investor's exposure to the upside of the market and effectively transfer investment risks from insurers to investors.
In 2015, FIA sales totaled a record high $54.5 billion, which represents a 13% increase from sales of $48.2 billion in 2014.
Table 1 shows the shares of FIA sales by distribution channel for 2008-2015. In 2015, approximately 63% of FIAs, $34.1 billion, were sold through the independent agent distribution channel.
As discussed earlier in this preamble, the main function of IMOs is to market, distribute and wholesale various insurance products.
There is no centralized database containing information identifying all existing IMOs in the U.S., because IMOs are licensed as insurance agents or agencies in each state where they operate. Therefore, it is difficult to reliably estimate how many IMOs currently exist in the U.S. Some evidence indicates that the number of IMOs could be in the hundreds,
As discussed earlier in this preamble, the Department has studied the characteristics of IMOs that applied for the individual exemptions. The applications indicate that most IMOs applicants have been in business for 25 to 40 years and operate in all 50 states. For example, one IMO applicant has over 600 offices across 50 states.
Most applicant IMOs partner with between 20 and 75 insurers. One IMO indicated that it conducts business with nine out of the top 10 insurers offering FIAs.
Sub-IMOs have contractual relationships with the insurers for whom they distribute fixed annuities, and they also have contractual relationships with top-level IMOs. Top-level IMOs generally provide their related sub-IMOs with distribution and other support services. Top-level IMOs often assist these sub-IMOs in accessing a wide variety of insurance products. Sub-IMOs contract with top-level IMOs to obtain this access, and these services allow some sub-IMOs to focus on the training and support of their agents.
Some applicants, in addition to describing themselves as top-level IMOs, also represented that they are affiliated with large insurers. One of these applicants, in turn, wholly owns numerous sub-IMOs. Despite the differences in the ownership structure, these applicants represent that they, like the other top-level IMOs, assist in the distribution of fixed annuities, both for their affiliates and for other insurers, and provide valuable business and administrative assistance to sub-IMOs and agents.
The number of smaller IMOs or sub-IMOs that larger IMOs conduct business with varies widely, but most applicant IMOs that disclosed this information in their applications state that they conduct business with between 7 and 35 sub-IMOs. Two IMO applicants indicate that they work with over 100 other IMOs.
Several IMO applicants are affiliated with BDs and/or registered investment advisers (RIAs). Moreover, some of the IMOs that currently are not affiliated with BDs or RIAs reported that they are developing a BD,
The applicants represented to the Department that they have experience in a variety of areas that will contribute to their ability to satisfy the conditions of the Best Interest Contract Exemption. Some applicants pointed to direct experience providing oversight of independent agents for insurance law compliance, while some indicated that they planned to rely on affiliated RIAs and/or BD entities in developing systems to comply with the exemption. The cost of developing a new compliance platform often represents a large share of total compliance costs. Thus, if an IMO does not have to develop a new system, it would save costs significantly for itself and the insurance industry as a whole would save significant costs if other IMOs were similarly positioned. In addition, IMOs with affiliated BDs and/or RIAs can draw from the supervisory experience of BDs and RIAs regarding properly training, monitoring, and not inappropriately incentivizing agents and even share personnel with them. They also can use disclosure forms similar to their affiliated BDs and/or RIAs.
The applicants generally indicated they would maintain internal compliance departments and adopt supervisory structures to ensure compliance with the exemption. Several applicants pointed to technology that would be used in ensuring compliance. Some applicants indicated that insurance agents would be required to use their technology to ensure clients receive disclosures and a contract, where required. Agents would also be required to use the IMO's Web site services and maintain records centrally.
Some applicants additionally described how their sales practices would ensure best interest recommendations. A number of the applicants specifically proposed to require centralized approval of agent recommendations; in some cases, the recommendations would be reviewed by salaried employees of the IMO with additional credentials, such as Certified Financial Planners. One applicant indicated that internal review would include a comparison of the proposed product to other similar fixed indexed annuity products available in the marketplace to ensure it is appropriate for the purchaser, and that the analysis would include utilizing third-party benchmarking services and industry comparisons. Another applicant indicated that it would ensure that a RIA representative would work with insurance-only agents when a recommendation would involve the liquidation of securities to ensure that both state and federal securities laws are properly followed.
Some applicants additionally stated that their contracts with insurance agents would include certain specific requirements, including: Adherence to the IMO's policies and procedures with respect to advertising, market conduct and point of sale processes, transparency and documentation; provision of advice in accordance with practices developed by the IMO; and agreement that the agents will not accept any direct or indirect compensation from an insurance company, except as specifically approved by the IMO. A number of the applicants indicated that they would perform background checks and rigorous selection processes before working with agents and would require agents to receive ongoing training regarding compliance with the exemption.
A few of the applicants addressed product selection. These applicants indicated that agents making recommendations pursuant to the exemption would be limited to certain products and insurance companies. The applicants indicated there would be ongoing due diligence with respect to insurance companies and product offerings under the exemption.
Based on information contained in the submitted applications, some qualified and willing IMOs might be able to perform compliance responsibilities more cost effectively than some insurance companies. Many IMO applicants indicate that they have affiliated BDs or RIAs, and these IMOs have several advantages in managing compliance costs: They can utilize compliance platforms already developed and implemented for BDs and/or RIAs with some necessary adjustments. This would allow large IMOs to save some large start-up fixed costs to develop a new system.
The applications also indicate that some IMOs already have many of the capacities and much of the infrastructure in place that would be necessary to carry out compliance responsibilities required by the exemption, and thus might incur only relatively small, incremental costs to comply with the exemption conditions.
The Department cautions that although its careful review of individual exemption applications reveals that many applicant IMOs share the common characteristics discussed above, the Department is uncertain regarding the extent to which these characteristics can be generalized to the overall IMO market. The Department welcomes comments regarding whether these common characteristics can be extrapolated to the broader IMO market
As discussed earlier in this preamble, IMOs are not included within the Financial Institution definition under the Best Interest Contract Exemption. Instead, the exemption provides a mechanism under which the definition can be expanded if an individual exemption is granted to another type of entity. In that event, the individual exemption would provide relief to the applicants identified in the exemption, but the definition of Financial Institution in the Best Interest Contract Exemption would be expanded so that other entities that satisfy the definition in the individual exemption could rely on the Best Interest Contract Exemption. The Department received 22 applications for individual exemptions from IMOs that work with independent insurance agents to sell fixed annuity products. Because of the large number of applications, the Department determined to propose, on its own motion, a class exemption for such intermediaries based on the facts and representations in the individual applications received by the Department.
The following discussion assesses the impact of this class exemption relative to the baseline associated with the aforementioned provision of the Best Interest Contract Exemption. Under this baseline scenario, the Department would have granted individual exemptions to one of more of the applicants. The specific contours of this baseline are necessarily hypothetical, because at this time the Department has neither granted nor proposed any such individual exemptions. For purposes of this assessment, the Department assumes that any such individual exemptions would have included all of the same conditions included in this class exemption, and made available the same exemptive relief to the same market participants. This assumption is reasonable insofar as at this time the Department has not reached a tentative finding with respect to any particular applicant that an exemption with fewer or different conditions would be beneficial to IRA investors and protective of their rights as is required before the Department grants an exemption.
Given this assumption that the scope and conditions of this class exemption are substantively the same as those associated with the appropriate baseline, it follows that the impact of this class exemption relative to the baseline is likely to be limited to the procedural differences between the class and individual exemption procedures. With the exception of these procedural differences, under both the proposed class exemption and the baseline scenario, the same market participants would chiefly pursue the same courses of action and achieve the same results. However, notwithstanding the substantive equivalence of the proposed class exemption and the baseline, it is possible that some market participants would perceive substantive differences, and make different decisions with different results. The Department invites comments these or any other potential substantive impact of this proposed class exemption relative to the baseline scenario.
This proposed class exemption would extend to IMOs that satisfy its conditions relief that is similar to that for Financial Institutions under the Best Interest Contract Exemption. The Department anticipates that, like the Best Interest Contract Exemption, this proposed exemption will deliver benefits that justify its costs.
In issuing the Regulation and Best Interest Contract Exemption, the Department noted that compliance might be more burdensome for some industry segments than for others, that some insurers and some independent insurance agents might be among those needing to make more significant changes, and that this could impose some costs on affected Retirement Investors.
This proposed class exemption offers affected insurers, agents, and IMOs an alternative path to compliance that in some cases is likely to prove more economically efficient than existing paths. The applications that prompted this proposal support the premise that many IMOs have, or can affordably develop, the capacity to perform the functions required of Financial Institutions. In particular, some IMOs' positions as intermediaries between multiple insurers and multiple independent agents may be advantageous for purposes of mitigating agents' conflicts and ensuring that their recommendations are loyal to their customers' interests.
Under the proposed class exemption, market forces will favor migration of these functions to the entities that can perform them most efficiently. To the extent that IMOs take advantage of relief under this proposed exemption to shoulder these responsibilities, insurers may be relieved of what would have been greater costs to perform the same functions. This would improve the efficiency of the market in which insurers, independent agents, and IMOs operate. Meanwhile, the conditions of this exemption aim to ensure that, like Financial Institutions under the Best Interest Contract Exemption, covered IMOs can be relied on to perform their role effectively. If IMOs and related independent agents sell their services and FIAs in efficiently competitive intermediate and consumer markets, then such efficiency would accrue mostly to Retirement Investors.
The Department believes that the proposed class exemption will be more beneficial than would the individual exemption approach that is contemplated under the relevant provision of the Best Interest Contract Exemption. The Department believes that as a practical matter, the same rules could be established via either approach. That is, an individual exemption issued pursuant to the relevant provision of the Best Interest Contract Exemption could be crafted to make the intended relief available to any IMO that satisfied the same conditions as those included in this proposed class exemption. The Department believes, however, that the proposed class exemption offers the less costly route to the desired result. The cost advantage arises not from any difference in ongoing compliance costs, which generally would be the same. Rather the Department anticipates that the availability of the class exemption will obviate the need for some or all current and potential future applicants to pursue to completion an application for an individual exemption,
If the conditions of the exemption are satisfied, IMOs acting as Financial Institutions, and the independent agents and insurers they contract with, would be permitted to receive indirect and variable compensation in connection with recommendations of Fixed Annuity Contracts that would otherwise be prohibited as a result of the Regulation extending fiduciary status to many investment professionals who formerly were not treated as fiduciaries.
The Department expects that IMOs will determine whether to seek relief under this exemption's conditions based on their long-term strategic goals and will do so only if makes economic sense. IMOs that choose not to use the exemption, or that are unable to satisfy the conditions, may still play a role in the fixed annuity distribution channel by providing valuable compliance assistance and other services to insurance companies or other insurance intermediaries who act as Financial Institutions under the Best Interest Contract Exemption, or this exemption if granted, and receive compensation for their services.
The proposed class exemption would require IMOs to structure compensation received for transactions involving Fixed Annuity Contracts in a way that mitigates conflicts of interests and does not improperly incentivize independent agents to sell one product over another.
The Department considered the alternative of issuing the proposed class exemption without imposing additional conditions to those contained in the Best Interest Contract Exemption, but chose to propose these additional conditions to ensure that transactions involving recommendations for Retirement Investors to purchase FIAs that are sold by independent agents through IMOs occur only when they are in their clients' best interest. These protections respond to the Department's concern that IMOs are not subject to well-established regulatory conditions and oversight like those that apply to Financial Institutions eligible to act as Financial Institutions under the Best Interest Contract Exemption and concerns expressed by the SEC, FINRA, and North American Securities Administrators Administration regarding how FIAs have been designed and marketed. The conditions would provide additional protection to consumers to ensure that Retirement Investors are adequately protected from the deleterious effects of conflicts of interest. However, these additional conditions will impose some compliance burden on IMOs relying on the exemption. Due to data limitations, the Department only was able to quantify the incremental costs associated with additional annuity disclosure. The Department discusses the impact of these additional conditions below.
To the extent this condition is satisfied by insurance, the proposal states that the insurance must apply solely to actions brought by the Department of Labor, the Department of Treasury, the Pension Benefit Guaranty Corporation, Retirement Investors or plan fiduciaries (or their representatives) relating to Fixed Annuity Contract transactions, including but not limited to actions for failure to comply with the exemption or any contract entered into pursuant to the exemption, and it may not contain an exclusion for Fixed Annuity Contracts sold pursuant to the exemption. Any such insurance also may not have a deductible that exceeds 5% of the policy limits nor exclude coverage based on a self-insured retention or otherwise specify an amount that the Financial Institution must pay before a claim is covered by the fiduciary liability policy. To the extent this condition is satisfied by retaining assets, the assets must be unencumbered and not subject to security interests or other creditors.
This condition provides IMOs with the flexibility to either obtain fiduciary liability insurance or set aside sufficient assets to satisfy potential liabilities. The Department expects that IMOs will choose the option that makes the best sense for them economically. If insurance markets are efficient and loss ratios are not very high, it is likely that insurance will be more attractive, unless an IMO faces particularly high fiduciary risks. In addition, an IMO with a more profitable best use for cash is more likely to find insurance more attractive than a cash set-aside. A number of the applicants specifically suggested that they would obtain insurance to cover
An upper bound on the costs of this provision an estimate is obtained by looking at the costs of using the set-aside reserve option. As discussed above, in 2015, approximately $34.1 billion in total sales FIAs were sold through the independent agent distribution channel. If all sales in the independent agent distribution channel were through an IMO utilizing the exemption then one percent, or $341 million, would have to be set aside as a reserve. The opportunity costs of this reserve using a return of 7 percent (3 percent) would be $23.9 million ($10.2 million) for one year. There are at least three reasons why this estimate is too high: not all sales through the independent agent channel would be made using this exemption, the estimate of the total sales includes not just FIAs sold to IRAs, but all FIA sales, and to the extent the insurance option is cheaper IMOs will use that less expensive option and costs will be lower.
This condition requiring IMOs to set aside cash or maintain insurance is likely to yield benefits for consumers. Set asides or insurance premiums that are paid out to compensate consumers for losses arising from fiduciary breaches will represent one, direct such benefit. In addition, the condition may deter fiduciary breaches. Some applicants indicated that they may pass on expenses attributable to this condition to advisers, particularly to advisers whose records or observed conduct indicate high fiduciary risk, or may step up efforts to screen advisers and end relationships with those deemed most risky. These steps by IMOs in turn could reinforce advisers' motivation to maintain high fiduciary standards.
The Department considered an alternative of requiring a fixed minimum amount of fiduciary liability insurance to be purchased and requiring individual Advisers to carry the insurance themselves. The Department, however, chose the alternative of basing the insurance coverage or reserve requirement on premiums, because it views this method as the most efficient way to ensure that Financial Institutions have sufficient financial resources to satisfy any potential liabilities. The Department solicited comments on this approach and potential alternatives to the Department's chosen alternative earlier in this preamble.
The Department understands that insurance companies submit their financial statements on a quarterly basis to the NAIC, which collects these data on behalf of state insurance commissioners.
As an alternative to an audit of financial statements, one applicant suggested that the audit should relate to the intermediary's internal controls and procedures. The applicant noted that banks and trust companies are currently required to obtain these reports under SSAE 16 (formerly SAS 70), and that the applicant could work with its auditors to prepare a similar report, but suggested that such an approach would require additional transition relief as the accounting industry would have to agree on the appropriate data points for an internal controls audit for an insurance intermediary and the resulting topics of the SSAE 16-like report. The Department did not propose this alternative, because there are no clear standards for such a compliance-based audit, and the Department believes it is most critical for financial statements to be audited to ensure that the financial viability of the IMO and its ability to meet its commitment to Retirement Investors can be determined and assessed.
Proposed Section II(d)(3) does not specify the precise manner by which a Financial Institution must comply with the condition. The Department considered the alternative of requiring Financial Institutions to make their relationships with their Advisers exclusive with respect to the sale of Fixed Annuity Contracts to Retirement Investors. However, in order to provide maximum flexibility the Department chose not to require exclusivity in the proposal. Accordingly, a Financial Institution may take the alternative approach of contractually requiring an Adviser to provide information to the Financial Institution regarding all of the compensation and incentives provided by all of the other insurance companies and intermediaries through which the Adviser sells Fixed Annuity Contracts in which case the Financial Institution ultimately would be responsible for implementing the policies and
The objective of this disclosure is to ensure that Retirement Investors are informed of the risks and features of annuity products prior to entering into the annuity contract. While the information required to be disclosed could be available in the annuity contract or other document, the Department chose this alternative because it believes that the consumer will be better able to make an informed choice regarding whether to invest in the product if the features of the annuity contract are specifically highlighted in advance of the purchase in a separate, stand-alone written document. This disclosure would be required prior to the transmittal of the annuity application to the insurance company and would have to be made in connection with any recommendations to make additional deposits into the contract. The Department understands that in some cases, insurance companies currently provide an advance disclosure document, often referred to as a “statement of understanding.” This condition of the exemption would be satisfied if the required information is provided in a statement of understanding or similar document in accordance with the applicable time frames specified in the condition. The Department provides an estimate regarding the costs associated with the annuity-specific disclosure in the “Paperwork Reduction Act” section below.
The Department chose the alternative of imposing this condition, to ensure that IMOs using the exemption are well-established entities possessing the financial stability and operational capacity to implement the anti-conflict policies and procedures required by the exemption. This proposed condition aims to ensure that the IMO is in the position to mitigate compensation incentives across products, which is a critical safeguard of the proposed exemption.
The proposed $1.5 billion threshold was based on the representations in the applications. Not all applicants provided this information, but the applicants that did generally indicated sales of this amount or more. In addition, almost all IMOs that applied for individual exemptions are identified in media reports as large IMOs or super-IMOs. Some IMO applicants reported $4 billion to $5 billion in FIA sales alone in 2015.
The Department believes that this dollar threshold covers IMOs most likely to make beneficial use of the exemption, because economies of scale are likely to yield advantages in efficiently carrying out compliance responsibilities. The largest share of compliance costs often is up-front fixed costs incurred to construct a compliance infrastructure. As the IMO gets larger, the burden of fixed costs can be spread out more widely.
Because the sales threshold is based on a three-year average, some year-to-year volatility in sales would not cause IMOs to lose their eligibility for the exemption. Smoothing sales over three years provides IMOs with the degree of certainty and continuity that are necessary for IMOs to justify up-front expenditures to update compliance systems. However, if an exempted IMO falls slightly below this threshold, it may look for a way to boost sales volume, such as by acquiring another IMO or recruiting highly productive independent agents. Thus, in certain situations, this condition may accelerate mergers and acquisitions among IMOs. One applicant has reported that it already acquired three IMOs.
These additional conditions could impose additional burdens on IMOs seeking exemptive relief that are not incurred by Financial Institutions seeking relief under the Best Interest Contract Exemption. However, with the exception of the annuity-specific disclosure, the Department does not have sufficient data to quantify the incremental costs associated with these conditions. Instead, the Department solicits public comments regarding costs related to the additional conditions set forth in the proposed class exemption.
While the Department received 22 individual exemption applications from IMOs, it is uncertain regarding how many applicants and/or other IMOs would use the proposed class exemption, if it is granted. The Department also is uncertain about the extent to which covered IMOs' compliance burdens, including burdens attributable to the additional conditions not required of Financial Institutions under the Best Interest Contract Exemption, would be less than the reduction in burden that otherwise would be shouldered by insurers acting as Financial Institutions. The Department invites comments regarding the uncertainties discussed above.
As part of its continuing effort to reduce paperwork and respondent burden, the Department conducts a preclearance consultation program to provide the general public and Federal agencies with an opportunity to comment on proposed and continuing collections of information in accordance
Currently, the Department is soliciting comments concerning the proposed information collection request (ICR) included in the Proposed Best Interest Contract Exemption for Insurance Intermediaries (PTE). A copy of the ICR may be obtained by contacting the PRA addressee shown below or at
The Department has submitted a copy of the proposed PTE to the Office of Management and Budget (OMB) in accordance with 44 U.S.C. 3507(d) for review of its information collections. The Department and OMB are particularly interested in comments that:
• Evaluate whether the collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
• Evaluate the accuracy of the agency's estimate of the burden of the collection of information, including the validity of the methodology and assumptions used;
• Enhance the quality, utility, and clarity of the information to be collected; and
• Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology,
Comments should be sent to the Office of Information and Regulatory Affairs, Office of Management and Budget, Room 10235, New Executive Office Building, Washington, DC 20503; Attention: Desk Officer for the Employee Benefits Security Administration. OMB requests that comments be received within 30 days of publication of the proposed PTE to ensure their consideration.
As discussed in detail below, the proposed class exemption will require Financial Institutions to enter into a contractual arrangement with Retirement Investors regarding investments in IRAs and plans not subject to Title I of ERISA (non-ERISA plans), adopt written policies and procedures and make disclosures to Retirement Investors (including with respect to ERISA plans), the Department, and on a publicly accessible Web site, in order to receive relief from ERISA's and the Code's prohibited transaction rules for the receipt of compensation as a result of a Financial Institution's and its Adviser's advice (
The Department has made the following assumptions in order to establish a reasonable estimate of the paperwork burden associated with these ICRs:
• 51.8 percent of disclosures to ERISA plans and plan participants
• Financial Institutions will use existing in-house resources to distribute required disclosures.
• Tasks associated with the ICRs performed by in-house personnel will be performed by clerical personnel at an hourly wage rate of $54.74 and financial managers at an hourly wage rate of $167.39.
• Financial Institutions will hire outside service providers to assist with nearly all other compliance costs;
• Outsourced legal assistance will be billed at an hourly rate of $335.00.
• Approximately 19 large insurance intermediary Financial Institutions will use this exemption.
The Department believes that nearly all Financial Institutions will contract with outside service providers to implement the various compliance requirements of this exemption. As discussed previously, the conditions in this proposed PTE are similar to the conditions in the Department's Best Interest Contract Exemption (PTE 2016-01) but with some additional requirements. The Department believes it accurately estimated the aggregate burden imposed on the insurance industry in the Best Interest Contract Exemption, and it acknowledges that most of the entity-level burden attributed to insurance companies in the Best Interest Contract Exemption will instead be incurred by IMOs covered by this proposed PTE. For the conditions that are substantially similar between this PTE and PTE 2016-01, the Department estimates that IMOs will incur compliance costs identical to similarly sized insurance companies. Accordingly, for the conditions in this PTE that are substantially similar to those in PTE 2016-01, the per-firm costs are as follows:
Sections III and V require Financial Institutions and Advisers to make certain disclosures. These disclosures include: (1) A pre-transaction disclosure, stating the best interest standard of care, describing any Material Conflicts of Interest with respect to the transaction, disclosing the recommendation of proprietary products and products that generate third party payments (where applicable), and informing the Retirement Investor of disclosures available on the Financial Institution's Web site and informing the Retirement Investor that the investor may receive specific disclosure of the costs, fees, and other compensation associated with the transaction; (2) a disclosure, on request, describing in detail the costs, fees, and other compensation associated with the transaction; (3) a web-based disclosure; and (4) a one-time disclosure to the Department.
Under Section IV, Financial Institutions will have to prepare a written documentation regarding the limitations they place on recommendations.
Section IX requires Financial Institutions to make a transition disclosure, acknowledging their fiduciary status and that of their Advisers with respect to the advice, stating the Best Interest standard of care, and describing the Financial Institution's Material Conflicts of Interest and any limitations on product offerings, prior to or at the same time as the execution of any transactions during the transition period from the Applicability Date to August 15, 2018. The transition disclosure can cover multiple transactions, or all transactions occurring in the transition period.
Financial Institutions will also be required to maintain records necessary to prove that the conditions of the exemption have been met.
The Department is able to disaggregate an estimate of many of the legal costs from the costs above; however, it is unable to disaggregate any of the other costs.
In response to a recommendation made during the Department's August 2015 public hearing on the proposed Regulation, and in an attempt to create estimates with a clearer empirical evidentiary basis, the Department itself drafted examples of certain portions of the required disclosures, including a sample contract, the one-time disclosure to the Department, and the transition disclosure. The Department believes that the time spent updating existing contracts and disclosures in future years would be no longer than the time necessary to create the original disclosure. The Department did not attempt to draft the complete set of required disclosures because it expects that the amount of time necessary to draft such disclosures will vary greatly among firms. For example the Department did not attempt to draft sample policies and procedures, disclosures describing in detail the costs, fees, and other compensation associated with the transaction, documentation of the limitations regarding proprietary products or investments that generate third party payments, or a sample web disclosure. The Department expects the amount of time necessary to complete these disclosures will vary significantly based on a variety of factors including the nature of a firm's compensation structure, and the extent to which a firm's policies and procedures require review and signatures by different individuals.
Considered in conjunction with the estimates provided in the proposal for PTE 2016-01, the Department estimates that outsourced legal assistance to draft standard contracts, contract disclosures, pre-transaction disclosures, the one-time disclosure to the Department, and the transition disclosures will cost an average of $3,857 per firm for a total of $73,000 during the first year. In subsequent years, it will cost an average of $3,076 per firm for a total of $58,000 annually to update the contracts, contract disclosures, and pre-transaction disclosures.
The legal costs of these disclosures were disaggregated from the total compliance costs because these disclosures are expected to be relatively uniform. Although the tested disclosures generally took less time than many of the commenters on the proposal for PTE 2016-01 said they would, the Department acknowledges that the disclosures that were not tested are those that are expected to be the most time consuming. Importantly, as explained in greater detail in section 5.3 of the regulatory impact analysis for the Regulation, the Department is primarily relying on cost data provided by the Securities Industry and Financial Markets Association (SIFMA) and the Financial Services Institute (FSI) to calculate the total cost of the legal disclosures, rather than its own internal drafting of disclosures. Accordingly, in the event that any of the Department's estimates understate the time necessary to create and update the disclosures, it does not impact the total burden estimates. The total burden estimates were derived from SIFMA and FSI's all-inclusive costs. Therefore, in the event that legal costs are understated, other
In addition to legal costs for creating the contracts and disclosures, the start-up cost estimates include the costs of implementing and updating the IT infrastructure, creating the Web disclosures, gathering and maintaining the records necessary to produce the various disclosures and to prove that the conditions of the exemption have been met, developing policies and procedures, documenting limitations regarding proprietary products or investments that generate third party payments, addressing material conflicts of interest, monitoring Advisers' adherence to the Impartial Conduct Standards, and any other steps necessary to ensure compliance with the conditions of the exemption not described elsewhere. In addition to legal costs for updating the contracts and disclosures, the ongoing cost estimates include the costs of updating the IT infrastructure, updating the Web disclosures, reviewing processes for gathering and maintaining the records necessary to produce the various disclosures and to prove that the conditions of the exemption have been met, reviewing the policies and procedures, producing the detailed transaction disclosures on request, documenting limitations regarding proprietary products or investments that generate third party payments, monitoring investments as agreed upon with the Retirement Investor, addressing material conflicts of interest, monitoring Advisers' adherence to the Impartial Conduct Standards, and any other steps necessary to ensure compliance with the conditions of the exemption not described elsewhere. These costs total $126.1 million during the first year and $31.4 million in subsequent years. These costs do not include the costs of distributing disclosures and contracts, nor do they include the costs of the additional requirements imposed on insurance intermediary Financial Institutions in this proposed PTE, all of which are discussed below.
The Department estimates that 15,000 Retirement Investors through ERISA plans and 212,000 Retirement Investors through IRAs and non-ERISA plans will receive a three-page transition disclosure during the first year.
Additionally, 15,000 Retirement Investors with respect to ERISA plans will receive a fifteen-page contract disclosure, and 212,000 Retirement Investors with respect to IRAs and non-ERISA plans will receive a fifteen-page contract during the first year. In subsequent years, 4,300 Retirement Investors with respect to ERISA plans
The transition disclosure will be distributed electronically to 51.8 percent of ERISA plan investors and 44.1 percent of IRAs and non-ERISA plan investors during the first year. Paper disclosures will be mailed to the remaining 48.2 percent of ERISA plan investors and 55.9 percent of IRAs and non-ERISA plan investors. The contract disclosure will be distributed electronically to 51.8 percent of ERISA plan investors during the first year or during any subsequent year in which the plan begins a new advisory relationship. Paper contract disclosures will be mailed to the remaining 48.2 percent of ERISA plan investors. The contract will be distributed electronically to 44.1 percent of IRAs and non-ERISA plan investors during the first year or during any subsequent year in which the investor enters into a new advisory relationship. Paper contracts will be mailed to the remaining 55.9 percent of IRAs and non-ERISA plan investors. The Department estimates that electronic distribution will result in de minimis cost, while paper distribution will cost approximately $232,000 during the first year and $31,000 during subsequent years. Paper distribution will also require two minutes of clerical time to print and mail the disclosure or contract, resulting in 8,400 hours at an equivalent cost of $459,000 during the first year and 900 hours at an equivalent cost of $47,000 during subsequent years.
The Department assumes that Retirement Investors interested in engaging in the purchase or sale of fixed indexed annuities will engage in one transaction per year that requires a pre-transaction disclosure. Therefore, the Department estimates that plans and IRAs will receive 227,000 three-page pre-transaction disclosures during the second year and all subsequent years. The pre-transaction disclosures will be distributed electronically for 51.8 percent of the ERISA plan investors and 44.1 percent of the IRA holders and non-ERISA plan participants. The remaining 126,000 disclosures will be mailed. The Department estimates that electronic distribution will result in de minimis cost, while paper distribution will cost approximately $78,000. Paper distribution will also require two minutes of clerical time to print and mail the statement, resulting in 4,200 hours at an equivalent cost of $230,000 annually.
The Department estimates that Financial Institutions will receive ten requests per year for more detailed information on the fees, costs, and compensation associated with the transaction during the second year and all subsequent years. The Department solicits comments on the number of requests for more detailed information that Financial Institutions can expect to receive. The detailed disclosures will be distributed electronically for 51.8 percent of the ERISA plan investors and 44.1 percent of the IRA holders and non-ERISA plan participants. The Department believes that requests for additional information will be proportionally likely with each Retirement Investor type. Therefore, approximately 105 detailed disclosures will be distributed on paper. The Department estimates that electronic distribution will result in de minimis cost, while paper distribution will cost approximately $76. Paper distribution will also require two minutes of clerical time to print and mail the statement, resulting in 4 hours at an equivalent cost of $192 annually.
Finally, the Department estimates that all 19 Financial Institutions will submit the required one-page disclosure to the Department electronically at de minimis cost during the first year.
In order to receive compensation covered under this proposed exemption, Section II(d)(5) requires a person designated pursuant to Section II(d)(2) as responsible for addressing Material Conflicts of Interest and monitoring Advisers' adherence to Impartial Conduct Standards to approve, in writing, recommended annuity applications involving Retirement Investors prior to transmitting the
As discussed previously in this analysis, the Department estimates that Advisers working on behalf of Financial Institutions will make 227,000 recommendations to Retirement Investors annually. The Department estimates that, on average, it will take a financial manager fifteen minutes to review and approve recommendations. This results in 57,000 hours annually at an equivalent cost of $9.5 million.
The Department assumes that each of the 19 Financial Institutions will hire outside service providers to create a template for the pre-transaction annuity disclosure. The Department estimates that it will take legal service providers 1.5 hours to create the template during the first year and 1.5 hours to update the template during subsequent years. Once the template has been created, the disclosure itself will be populated by the IT systems (the costs of IT updates were discussed previously). The total cost burden for the outsourced legal assistance to create and update the template for the pre-transaction annuity disclosure is estimated to be $10,000 annually.
The Department estimates that plans and IRAs will receive 227,000 one page pre-transaction annuity disclosures annually. The pre-transaction disclosures will be distributed electronically for 51.8 percent of the ERISA plan investors and 44.1 percent of the IRA holders and non-ERISA plan participants. The remaining 126,000 disclosures will be mailed. The Department estimates that electronic distribution will result in de minimis cost, while paper distribution will cost approximately $65,000. Paper distribution will also require two minutes of clerical time to print and mail the statement, resulting in 4,200 hours at an equivalent cost of $230,000 annually.
The Department assumes that maintaining financial statements that are audited annually by an Independent certified public accountant is a best practice for businesses in this industry and that Financial Institutions generally engage in this practice. Therefore, no additional burden is assessed for this requirement. The Department solicits comment on how widespread the practice of obtaining annual audits is. In the event that it is not a usual and customary business practice, the Department solicits comments regarding the costs associated with this requirement.
Overall, the Department estimates that in order to meet the conditions of this class exemption, Financial Institutions and Advisers will distribute approximately 681,000 disclosures and contracts during the first year and 501,000 disclosures and contracts annually during subsequent years. Distributing these disclosures and contracts, reviewing recommendations, and maintaining records that the conditions of the exemption have been fulfilled will result in a total of 69,000 hours of burden during the first year and 66,000 hours of burden annually during subsequent years. The equivalent cost of this burden is $10.2 million during the first year and $10.0 million annually in subsequent years. This exemption will result in an outsourced labor, materials, and postage cost burden of $126.4 million during the first year and $31.6 million annually during subsequent years.
These paperwork burden estimates are summarized as follows:
The Regulatory Flexibility Act (5 U.S.C. 601
As discussed above, only IMOs that have transacted sales averaging at least $1.5 billion in premiums per fiscal year over it prior three fiscal years are eligible to use the proposed exemption. The Small Business Administration (SBA) defines a small business in the Financial Investments and Related Activities Sector as a business with up to $38.5 million in annual receipts. Although the Department believes that revenues of IMOs are closely related to sales volume, the Department is uncertain regarding the exact relationship between sales and revenue for these entities.
Based on the limited information disclosed by the individual exemptions applicants, the Department believes that receipts of IMOs that are eligible to use proposed class exemption are likely to exceed the SBA revenue threshold and, therefore, such entities are unlikely to be considered small entities for purposes of the RFA.
Accordingly, based on the foregoing, pursuant to section 605(b) of the RFA, the Assistant Secretary of the Employee Benefits Security Administration hereby proposes to certify that the proposed rule will not have a significant economic impact on a substantial number of small entities.
The proposed exemption is subject to the Congressional Review Act provisions of the Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 801
Executive Order 13132 outlines fundamental principles of federalism. It also requires adherence to specific criteria by federal agencies in formulating and implementing policies that have “substantial direct effects” on the states, the relationship between the national government and states, or on the distribution of power and responsibilities among the various levels of government. Federal agencies promulgating regulations that have these federalism implications must consult with state and local officials, and describe the extent of their consultation and the nature of the concerns of state and local officials in the preamble to the final regulation. The Department does not believe this proposed class exemption has federalism implications because it has no substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.
The attention of interested persons is directed to the following:
(1) The fact that a transaction is the subject of an exemption under ERISA section 408(a) and Code section 4975(c)(2) does not relieve a fiduciary, or other party in interest or disqualified person with respect to a plan, from certain other provisions of ERISA and the Code, including any prohibited transaction provisions to which the exemption does not apply and the general fiduciary responsibility provisions of ERISA section 404 which require, among other things, that a fiduciary act prudently and discharge his or her duties respecting the plan solely in the interests of the participants and beneficiaries of the plan. Additionally, the fact that a transaction is the subject of an exemption does not affect the requirement of Code section 401(a) that the plan must operate for the exclusive benefit of the employees of the employer maintaining the plan and their beneficiaries;
(2) Before the exemption may be granted under ERISA section 408(a) and Code section 4975(c)(2), the Department must find that the exemption is administratively feasible, in the interests of plans and their participants and beneficiaries and IRA owners, and protective of the rights of participants and beneficiaries of the plan and IRA owners;
(3) If granted, the proposed exemption is applicable to a particular transaction only if the transaction satisfies the conditions specified in the exemption; and
(4) The proposed exemption, if granted, is supplemental to, and not in derogation of, any other provisions of ERISA and the Code, including statutory or administrative exemptions and transitional rules. Furthermore, the fact that a transaction is subject to an administrative or statutory exemption is not dispositive of whether the transaction is in fact a prohibited transaction.
(a) In general. ERISA and the Internal Revenue Code prohibit fiduciary advisers to employee benefit plans (Plans) and individual retirement accounts (IRAs) from receiving compensation that varies based on their investment advice. Similarly, fiduciary advisers are prohibited from receiving compensation from third parties in connection with their advice. This exemption permits certain persons who provide investment advice to Retirement Investors, and associated Financial Institutions, Affiliates and other Related Entities, to receive such otherwise prohibited compensation as described below.
(b) Covered transactions. This exemption permits Advisers, Financial Institutions, and their Affiliates and Related Entities, to receive compensation as a result of their provision of investment advice within the meaning of ERISA section 3(21)(A)(ii) or Code section 4975(e)(3)(B) to a Retirement Investor regarding the purchase of a Fixed Annuity Contract, as defined in Section VIII(d).
As defined in Section VIII(m) of the exemption, a Retirement Investor is: (1) A participant or beneficiary of a Plan with authority to direct the investment of assets in his or her Plan account or to take a distribution; (2) the beneficial owner of an IRA acting on behalf of the IRA; or (3) a Retail Fiduciary with respect to a Plan or IRA.
As detailed below, Financial Institutions and Advisers seeking to rely on the exemption must adhere to Impartial Conduct Standards in rendering advice regarding Fixed Annuity Contracts. In addition, Financial Institutions must adopt policies and procedures designed to ensure that their individual Advisers adhere to the Impartial Conduct Standards; disclose important information relating to fees, compensation, and Material Conflicts of Interest; and retain records demonstrating compliance with the exemption. The exemption provides relief from the restrictions of ERISA section 406(a)(1)(D) and 406(b) and the sanctions imposed by Code section 4975(a) and (b), by reason of Code section 4975(c)(1)(D), (E) and (F). The Adviser and Financial Institution must comply with the applicable conditions of Sections II-V to rely on this exemption. This document also contains separate exemptions in Section VI (Exemption for Purchases of Fixed Annuity Contracts) and Section VII (Exemption for Pre-Existing Transactions).
(c) Exclusions. This exemption does not apply if:
(1) The Plan is covered by Title I of ERISA, and (i) the Adviser, Financial Institution or any Affiliate is the
(2) The compensation is received as a result of investment advice to a Retirement Investor generated solely by an interactive Web site in which computer software-based models or applications provide investment advice based on personal information each investor supplies through the Web site without any personal interaction or advice from an individual Adviser (
(3) The Adviser has or exercises any discretionary authority or discretionary control with respect to the recommended transaction.
The conditions set forth in this section include certain Impartial Conduct Standards, such as a Best Interest Standard, that Advisers and Financial Institutions must satisfy to rely on the exemption. In addition, Section II(d) and (e) require Financial Institutions to adopt anti-conflict policies and procedures that are reasonably designed to ensure that Advisers adhere to the Impartial Conduct Standards, and requires disclosure of important information about the Financial Institutions' services, applicable fees and compensation. With respect to IRAs and Plans not covered by Title I of ERISA, the Financial Institutions must agree that they and their Advisers will adhere to the exemption's standards in a written contract that is enforceable by the Retirement Investors. To minimize compliance burdens, the exemption provides that the contract terms may be incorporated into annuity contracts or applications, and permits reliance on a negative consent process with respect to existing contract holders. Advisers and Financial Institutions need not execute the contract before they make a recommendation to the Retirement Investor. However, the contract must cover any advice given prior to the contract date in order for the exemption to apply to such advice. There is no contract requirement for recommendations to Retirement Investors about investments in Plans covered by Title I of ERISA, but the Impartial Conduct Standards and other requirements of Section II(b)-(e), including a written acknowledgment of fiduciary status, must be satisfied in order for relief to be available under the exemption, as set forth in Section II(g). Section II imposes the following conditions on Financial Institutions and Advisers:
(a) Contracts with Respect to Investments in IRAs and Other Plans Not Covered by Title I of ERISA. If the investment advice concerns an IRA or a Plan that is not covered by Title I of ERISA, the advice is subject to an enforceable written contract on the part of the Financial Institution, which may be a master contract covering multiple recommendations, that is entered into in accordance with this Section II(a) and incorporates the terms set forth in Section II(b)-(d). The Financial Institution additionally must provide the disclosures required by Section II(e). The contract must cover advice rendered prior to the execution of the contract in order for the exemption to apply to such advice and related compensation.
(1) Contract Execution and Assent.
(i) New Contracts. Prior to or at the same time as the execution of the recommended transaction, the Financial Institution enters into a written contract with the Retirement Investor acting on behalf of the Plan, participant or beneficiary account, or IRA, incorporating the terms required by Section II(b)-(d). The terms of the contract may appear in a standalone document or they may be incorporated into an annuity contract or application, or similar document, or amendment thereto. The contract must be enforceable against the Financial Institution. The Retirement Investor's assent to the contract may be evidenced by handwritten or electronic signatures.
(ii) Amendment of Existing Contracts by Negative Consent. As an alternative to executing a contract in the manner set forth in the preceding paragraph, the Financial Institution may amend Existing Contracts to include the terms required in Section II(b)-(d) by delivering the proposed amendment and the disclosure required by Section II(e) to the Retirement Investor prior to August 15, 2018, and considering the failure to terminate the amended contract within 30 days as assent. If the Retirement Investor does terminate the contract within that 30-day period, this exemption will provide relief for 14 days after the date on which the termination is received by the Financial Institution. An Existing Contract is an annuity contract that was executed before August 15, 2018, and remains in effect. If the Financial Institution elects to use the negative consent procedure, it may deliver the proposed amendment by mail or electronically, but it may not impose any new contractual obligations, restrictions, or liabilities on the Retirement Investor by negative consent.
(2) Notice. The Financial Institution maintains an electronic copy of the Retirement Investor's contract on its Web site that is accessible by the Retirement Investor.
(b) Fiduciary. The Financial Institution affirmatively states in writing that it and the Adviser(s) act as fiduciaries under ERISA or the Code, or both, with respect to any investment advice provided by the Financial Institution or the Adviser subject to the contract or, in the case of an ERISA plan, with respect to any investment recommendations regarding the Plan or participant or beneficiary account.
(c) Impartial Conduct Standards. The Financial Institution affirmatively states that it and its Advisers will adhere to the following standards and, they in fact, comply with the standards:
(1) When providing investment advice to the Retirement Investor, the Financial Institution and the Adviser(s) provide investment advice that is, at the time of the recommendation, in the Best Interest of the Retirement Investor. As further defined in Section VIII(c), such advice reflects the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims, based on the investment objectives, risk tolerance, financial circumstances, and needs of the Retirement Investor, without regard to the financial or other interests of the Adviser, Financial Institution or any Affiliate, Related Entity, or other party;
(2) The recommended transaction will not cause the Financial Institution, Adviser or their Affiliates or Related Entities to receive, directly or indirectly, compensation for their services that is in excess of reasonable compensation within the meaning of ERISA section 408(b)(2) and Code section 4975(d)(2).
(3) Statements by the Financial Institution and its Advisers to the Retirement Investor about the recommended transaction, fees and compensation, Material Conflicts of Interest, and any other matters relevant to a Retirement Investor's investment decisions, will not be materially misleading at the time they are made.
(d) Warranties. The Financial Institution affirmatively warrants, and in fact complies with, the following:
(1) The Financial Institution has adopted and will comply with written policies and procedures reasonably and prudently designed to ensure that its Advisers adhere to the Impartial
(2) In formulating its policies and procedures, the Financial Institution has specifically identified and documented its Material Conflicts of Interest; adopted measures reasonably and prudently designed to prevent Material Conflicts of Interest from causing violations of the Impartial Conduct Standards set forth in Section II(c); and designated a person or persons, identified by name, title or function, responsible for addressing Material Conflicts of Interest and monitoring their Advisers' adherence to the Impartial Conduct Standards;
(3) The Financial Institution's policies and procedures prohibit the use of quotas, appraisals, performance or personnel actions, bonuses, contests, special awards, differential compensation or other actions or incentives that are intended or would reasonably be expected to cause Advisers to make recommendations that are not in the Best Interest of the Retirement Investor. Notwithstanding the foregoing, this Section II(d)(3) does not prevent the provision of differential compensation (whether in type or amount, and including, but not limited to, commissions) based on investment decisions by Plans, participant or beneficiary accounts, or IRAs, to the extent that the Financial Institution's policies and procedures and incentive practices, when viewed as a whole, are reasonably and prudently designed to avoid a misalignment of the interests of Advisers with the interests of the Retirement Investors they serve as fiduciaries (such compensation practices can include differential compensation based on neutral factors tied to the differences in the services delivered to the Retirement Investor with respect to the different types of investments, as opposed to the differences in the amounts of Third Party Payments the Financial Institution receives in connection with particular investment recommendations);
(4) The Financial Institution has approved in advance all written marketing materials used by Advisers after determining that such materials provide a balanced description of the risks and features of the Fixed Annuity Contracts to be recommended;
(5) A person designated pursuant to Section II(d)(2) as responsible for addressing Material Conflicts of Interest and monitoring Advisers' adherence to the Impartial Conduct Standards approves, in writing, recommended annuity applications involving Retirement Investors prior to transmitting the applications to the insurance company;
(6) The Financial Institution requires in its written contract with Advisers or sub-intermediaries that Advisers must (i) use written marketing materials only if they are approved in advance by the Financial Institution as described in Section II(d)(4), and (ii) provide the disclosure required by Section III(a) and orally review the information in Section III(a)(1) with the Retirement Investor;
(7) The Financial Institution either: (i) Requires in its written contract with the insurance company and each Adviser or sub-intermediary that all compensation to be paid to the Adviser or sub-intermediary with respect to the purchase of a Fixed Annuity Contract by a Retirement Investor pursuant to this exemption must be paid to the Adviser or sub-intermediary exclusively by the Financial Institution; or (ii) requires in its written contract with the insurance company and each Adviser or sub-intermediary that with respect to the purchase of a Fixed Annuity Contract by a Retirement Investor pursuant to this exemption, (A) the Adviser or sub-intermediary may only sell annuities to Retirement Investors for which the commission structure has been approved in advance by the IMO and (B) all other forms of compensation, whether cash or non-monetary, must be paid to the Adviser or sub-intermediary exclusively by the Financial Institution; and
(8) The Financial Institution will provide, and require its Advisers to attend, annual training on compliance with the exemption that is conducted by a person who has appropriate technical training and proficiency with ERISA and the Code. The training must, at a minimum, cover the policies and procedures, the Impartial Conduct Standards, Material Conflicts of Interest, ERISA and Code compliance (including applicable fiduciary duties and the prohibited transaction provisions), ethical conduct, and the consequences of failure to comply with the conditions of this exemption (including any loss of exemptive relief provided herein).
(e) Disclosures. In the Best Interest Contract or in a separate single written disclosure provided to the Retirement Investor with the contract, or, with respect to ERISA plans, in another single written disclosure provided to the Plan prior to or at the same time as the execution of the recommended transaction, the Financial Institution clearly and prominently:
(1) States the Best Interest standard of care owed by the Adviser and Financial Institution to the Retirement Investor; informs the Retirement Investor of the services provided by the Financial Institution and the Adviser; and describes how the Retirement Investor will pay for services, directly or through Third Party Payments. If, for example, the Retirement Investor will pay through commissions or other forms of transaction-based payments, the contract or writing must clearly disclose that fact;
(2) Describes Material Conflicts of Interest; discloses any fees or charges the Financial Institution, its Affiliates, or the Adviser imposes upon the Retirement Investor or the Retirement Investor's annuity; and states the types of compensation that the Financial Institution, its Affiliates, and the Adviser expect to receive from third parties in connection with Fixed Annuity Contracts recommended to Retirement Investors;
(3) Informs the Retirement Investor that the Retirement Investor has the right to obtain copies of the Financial Institution's written description of its policies and procedures adopted in accordance with Section II(d), as well as the specific disclosure of costs, fees, and compensation, including Third Party Payments, regarding recommended transactions, as set forth in Section III(a), below, described in dollar amounts, percentages, formulas, or other means reasonably designed to present materially accurate disclosure of their scope, magnitude, and nature in sufficient detail to permit the Retirement Investor to make an informed judgment about the costs of the transaction and about the significance and severity of the Material Conflicts of Interest, and describes how the Retirement Investor can get the information, free of charge; provided that if the Retirement Investor's request is made prior to the transaction, the information must be provided prior to the transaction, and if the request is made after the transaction, the information must be provided within 30 business days after the request;
(4) Includes a link to the Financial Institution's Web site as required by Section III(b), and informs the Retirement Investor that: (i) Model contract disclosures updated as necessary on a quarterly basis are maintained on the Web site, and (ii) the Financial Institution's written description of its policies and procedures adopted in accordance with Section II(d) are available free of charge on the Web site;
(5) Discloses to the Retirement Investor whether the Financial Institution offers Proprietary Products or receives Third Party Payments with respect to any recommended Fixed
(6) Provides contact information (telephone and email) for a representative of the Financial Institution that the Retirement Investor can use to contact the Financial Institution with any concerns about the advice or service they have received; and
(7) Describes whether or not the Adviser and Financial Institution will monitor the Retirement Investor's annuity contract and alert the Retirement Investor to any recommended change to the annuity contract, and, if so monitoring, the frequency with which the monitoring will occur and the reasons for which the Retirement Investor will be alerted.
(8) The Financial Institution will not fail to satisfy this Section II(e), or violate a contractual provision based thereon, solely because it, acting in good faith and with reasonable diligence, makes an error or omission in disclosing the required information, provided the Financial Institution discloses the correct information as soon as practicable, but not later than 30 days after the date on which it discovers or reasonably should have discovered the error or omission. To the extent compliance with this Section II(e) requires Advisers and Financial Institutions to obtain information from entities that are not closely affiliated with them, they may rely in good faith on information and assurances from the other entities, as long as they do not know that the materials are incomplete or inaccurate. This good faith reliance applies unless the entity providing the information to the Adviser and Financial Institution is (1) a person directly or indirectly through one or more intermediaries, controlling, controlled by, or under common control with the Adviser or Financial Institution; or (2) any officer, director, employee, agent, registered representative, relative (as defined in ERISA section 3(15)), member of family (as defined in Code section 4975(e)(6)) of, or partner in, the Adviser or Financial Institution.
(f) Ineligible Contractual Provisions. Relief is not available under the exemption if a Financial Institution's contract contains the following:
(1) Exculpatory provisions disclaiming or otherwise limiting liability of the Adviser or Financial Institution for a violation of the contract's terms;
(2) Except as provided in paragraph (f)(4) of this Section, a provision under which the Plan, IRA or Retirement Investor waives or qualifies its right to bring or participate in a class action or other representative action in court in a dispute with the Adviser or Financial Institution, or in an individual or class claim agrees to an amount representing liquidated damages for breach of the contract; provided that, the parties may knowingly agree to waive the Retirement Investor's right to obtain punitive damages or rescission of recommended transactions to the extent such a waiver is permissible under applicable state or federal law; or
(3) Agreements to arbitrate or mediate individual claims in venues that are distant or that otherwise unreasonably limit the ability of the Retirement Investors to assert the claims safeguarded by this exemption.
(4) In the event that the provision on pre-dispute arbitration agreements for class or representative claims in paragraph (f)(2) of this Section is ruled invalid by a court of competent jurisdiction, this provision shall not be a condition of this exemption with respect to contracts subject to the court's jurisdiction unless and until the court's decision is reversed, but all other terms of the exemption shall remain in effect.
(g) ERISA plans. Section II(a) does not apply to recommendations to Retirement Investors regarding investments in Plans that are covered by Title I of ERISA. For such investment advice, relief under the exemption is conditioned upon the Adviser and Financial Institution complying with certain provisions of Section II, as follows:
(1) Prior to or at the same time as the execution of the recommended transaction, the Financial Institution provides the Retirement Investor with a written statement of the Financial Institution's and its Advisers' fiduciary status, in accordance with Section II(b).
(2) The Financial Institution and the Adviser comply with the Impartial Conduct Standards of Section II(c).
(3) The Financial Institution adopts policies and procedures incorporating the requirements and prohibitions set forth in Section II(d), and the Financial Institution and Adviser comply with those requirements and prohibitions.
(4) The Financial Institution provides the disclosures required by Section II(e).
(5) The Financial Institution and Adviser do not in any contract, instrument, or communication: Purport to disclaim any responsibility or liability for any responsibility, obligation, or duty under Title I of ERISA to the extent the disclaimer would be prohibited by ERISA section 410; purport to waive or qualify the right of the Retirement Investor to bring or participate in a class action or other representative action in court in a dispute with the Adviser or Financial Institution, or require arbitration or mediation of individual claims in locations that are distant or that otherwise unreasonably limit the ability of the Retirement Investors to assert the claims safeguarded by this exemption.
The Financial Institution must satisfy the following conditions with respect to an investment recommendation, to be covered by this exemption:
(a) Transaction Disclosure. The Financial Institution provides the Retirement Investor, prior to the transmittal of a recommended application for a Fixed Annuity Contract to the insurance company, the following disclosure, clearly and prominently, in a single written document, that:
(1) Provides a disclosure regarding the Fixed Annuity Contract that is in accordance with the most recent Annuity Disclosure Model Regulation published by the National Association of Insurance Commissioners, or its successor, as of the time of the transaction;
(2) States the Best Interest standard of care owed by the Adviser and Financial Institution to the Retirement Investor; and describes any Material Conflicts of Interest;
(3) Informs the Retirement Investor that the Retirement Investor has the right to obtain copies of the Financial Institution's written description of its policies and procedures adopted in accordance with Section II(d), as well as specific disclosure of costs, fees and other compensation including Third Party Payments regarding recommended transactions. The costs, fees, and other compensation may be described in dollar amounts, percentages, formulas, or other means reasonably designed to present materially accurate disclosure of their scope, magnitude, and nature in
(4) Includes a link to the Financial Institution's Web site as required by Section III(b) and informs the Retirement Investor that: (i) Model contract disclosures or other model notices, updated as necessary on a quarterly basis, are maintained on the Web site, and (ii) the Financial Institution's written description of its policies and procedures as required under Section III(b)(1)(iv) are available free of charge on the Web site.
(5) Following disclosure of the information in Section III(a)(1), the Adviser must orally review the information with the Retirement Investor, and both the Adviser and Retirement Investor must sign the transaction disclosure and indicate that the oral review has occurred.
(6) The disclosures in subsections (2)-(4) do not have to be repeated for subsequent recommendations by the Adviser and Financial Institution to invest in the same Fixed Annuity Contract within one year of the provision of the contract disclosure in Section II(e) or a previous disclosure pursuant to this Section III(a), unless there are material changes in the subject of the disclosure.
(b) Web Disclosure. For relief to be available under the exemption for any investment recommendation, the conditions of Section III(b) must be satisfied.
(1) The Financial Institution maintains a Web site, freely accessible to the public and updated no less than quarterly, which contains:
(i) A discussion of the Financial Institution's business model and the Material Conflicts of Interest associated with that business model;
(ii) A schedule of typical contract fees and service charges, if applicable;
(iii) A model contract or other model notice of the contractual terms (if applicable) and required disclosures described in Section II(b)-(e), which are reviewed for accuracy no less frequently than quarterly and updated within 30 days if necessary;
(iv) A written description of the Financial Institution's policies and procedures that accurately describes or summarizes key components of the policies and procedures relating to conflict-mitigation and incentive practices in a manner that permits Retirement Investors to make an informed judgment about the stringency of the Financial Institution's protections against conflicts of interest;
(v) To the extent applicable, a list of all product manufacturers and other parties with whom the Financial Institution maintains arrangements that provide Third Party Payments to either the Adviser or the Financial Institution with respect to Fixed Annuity Contracts recommended to Retirement Investors; a description of the arrangements, including a statement on whether and how these arrangements impact Adviser compensation, and a statement on any benefits the Financial Institution provides to the product manufacturers or other parties in exchange for the Third Party Payments;
(vi) Disclosure of the Financial Institution's compensation and incentive arrangements with Advisers including, if applicable, any incentives (including both cash and non-monetary compensation or awards) to Advisers for recommending particular product manufacturers or Fixed Annuity Contracts to Retirement Investors, or for Advisers to move to the Financial Institution from another firm or to stay at the Financial Institution, and a full and fair description of any payout or compensation grids, but not including information that is specific to any individual Adviser's compensation or compensation arrangement; and
(vii) A copy of the Financial Institution's most recent audited financial statements required in accordance with Section VIII(e)(2).
(viii) The Web site may describe the above arrangements with product manufacturers, Advisers, and others by reference to dollar amounts, percentages, formulas, or other means reasonably calculated to present a materially accurate description of the arrangements. Similarly, the Web site may group disclosures based on reasonably-defined categories of Fixed Annuity Contracts, product manufacturers, Advisers, and arrangements, and it may disclose reasonable ranges of values, rather than specific values, as appropriate. But, however constructed, the Web site must fairly disclose the scope, magnitude, and nature of the compensation arrangements and Material Conflicts of Interest in sufficient detail to permit visitors to the Web site to make an informed judgment about the significance of the compensation practices and Material Conflicts of Interest with respect to transactions recommended by the Financial Institution and its Advisers.
(2) To the extent the information required by this Section is provided in other disclosures which are made public, the Financial Institution may satisfy this Section III(b) by posting such disclosures to its Web site with an explanation that the information can be found in the disclosures and a link to where it can be found.
(3) The Financial Institution is not required to disclose information pursuant to this Section III(b) if such disclosure is otherwise prohibited by law.
(4) In addition to providing the written description of the Financial Institution's policies and procedures on its Web site, as required under Section III(b)(1)(iv), Financial Institutions must provide their complete policies and procedures adopted pursuant to Section II(d) to the Department upon request.
(5) In the event that a Financial Institution determines to group disclosures as described in subsection (1)(vii), it must retain the data and documentation supporting the group disclosure during the time that it is applicable to the disclosure on the Web site, and for six years after that, and make the data and documentation available to the Department within 90 days of the Department's request.
(c)(1) The Financial Institution will not fail to satisfy the conditions in this Section III solely because it, acting in good faith and with reasonable diligence, makes an error or omission in disclosing the required information, or if the Web site is temporarily inaccessible, provided that, (i) in the case of an error or omission on the Web site, the Financial Institution discloses the correct information as soon as practicable, but not later than seven (7) days after the date on which it discovers or reasonably should have discovered the error or omission, and (ii) in the case of an error or omission with respect to the transaction disclosure, the Financial Institution discloses the correct information as soon as practicable, but not later than 30 days after the date on which it discovers or reasonably should have discovered the error or omission.
(2) To the extent compliance with the Section III disclosures requires Advisers and Financial Institutions to obtain information from entities that are not closely affiliated with them, they may rely in good faith on information and assurances from the other entities, as long as they do not know that the materials are incomplete or inaccurate. This good faith reliance applies unless the entity providing the information to
(3) The good faith provisions of this Section apply to the requirement that the Financial Institution retain the data and documentation supporting the group disclosure during the time that it is applicable to the disclosure on the Web site and provide it to the Department upon request, as set forth in subsection (b)(1)(vii) and (b)(5) above. In addition, if such records are lost or destroyed, due to circumstances beyond the control of the Financial Institution, then no prohibited transaction will be considered to have occurred solely on the basis of the unavailability of those records; and no party, other than the Financial Institution responsible for complying with subsection (b)(1)(vii) and (b)(5) will be subject to the civil penalty that may be assessed under ERISA section 502(i) or the taxes imposed by Code section 4975(a) and (b), if applicable, if the records are not maintained or provided to the Department within the required timeframes.
(a) General. A Financial Institution that at the time of the transaction restricts Advisers' investment recommendations, in whole or part, to Proprietary Products or to Fixed Annuity Contracts that generate Third Party Payments, may rely on this exemption provided all the applicable conditions of the exemption are satisfied.
(b) Satisfaction of the Best Interest standard. The Financial Institution satisfies the Best Interest standard of Section VIII(c) as follows:
(1) Prior to or at the same time as the execution of the recommended transaction, the Retirement Investor is clearly and prominently informed in writing that the Financial Institution offers Proprietary Products or receives Third Party Payments with respect to the purchase, sale, exchange, or holding of Fixed Annuity Contracts; and the Retirement Investor is informed in writing of the limitations placed on the universe of Fixed Annuity Contracts that the Adviser may recommend to the Retirement Investor. The notice is insufficient if it merely states that the Financial Institution or Adviser “may” limit investment recommendations based on whether the annuities are Proprietary Products or generate Third Party Payments, without specific disclosure of the extent to which recommendations are, in fact, limited on that basis;
(2) Prior to or at the same time as the execution of the recommended transaction, the Retirement Investor is fully and fairly informed in writing of any Material Conflicts of Interest that the Financial Institution or Adviser have with respect to the recommended transaction, and the Adviser and Financial Institution comply with the disclosure requirements set forth in Section III above (providing for web and transaction-based disclosure of costs, fees, compensation, and Material Conflicts of Interest);
(3) The Financial Institution documents in writing its limitations on the universe of recommended Fixed Annuity Contracts; documents in writing the Material Conflicts of Interest associated with any contract, agreement, or arrangement providing for its receipt of Third Party Payments or associated with the sale or promotion of Proprietary Products; documents in writing any services it will provide to Retirement Investors in exchange for Third Party Payments, as well as any services or consideration it will furnish to any other party, including the payor, in exchange for the Third Party Payments; reasonably concludes that the limitations on the universe of recommended Fixed Annuity Contracts and Material Conflicts of Interest will not cause the Financial Institution or its Advisers to receive compensation in excess of reasonable compensation for Retirement Investors as set forth in Section II(c)(2); reasonably determines, after consideration of the policies and procedures established pursuant to Section II(d), that these limitations and Material Conflicts of Interest will not cause the Financial Institution or its Advisers to make imprudent investment recommendations; and documents in writing the bases for its conclusions;
(4) The Financial Institution adopts, monitors, implements, and adheres to policies and procedures and incentive practices that meet the terms of Section II(d); and, in accordance with Section II(d)(3), neither the Financial Institution nor (to the best of its knowledge) any Affiliate or Related Entity uses or relies upon quotas, appraisals, performance or personnel actions, bonuses, contests, special awards, differential compensation or other actions or incentives that are intended or would reasonably be expected to cause the Adviser to make imprudent investment recommendations, to subordinate the interests of the Retirement Investor to the Adviser's own interests, or to make recommendations based on the Adviser's considerations of factors or interests other than the investment objectives, risk tolerance, financial circumstances, and needs of the Retirement Investor;
(5) At the time of the recommendation, the amount of compensation and other consideration reasonably anticipated to be paid, directly or indirectly, to the Adviser, Financial Institution, or their Affiliates or Related Entities for their services in connection with the recommended transaction is not in excess of reasonable compensation within the meaning of ERISA section 408(b)(2) and Code section 4975(d)(2); and
(6) The Adviser's recommendation reflects the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims, based on the investment objectives, risk tolerance, financial circumstances, and needs of the Retirement Investor; and the Adviser's recommendation is not based on the financial or other interests of the Adviser or on the Adviser's consideration of any factors or interests other than the investment objectives, risk tolerance, financial circumstances, and needs of the Retirement Investor.
This Section establishes record retention and disclosure conditions that a Financial Institution must satisfy for the exemption to be available for compensation received in connection with recommended transactions.
(a) EBSA Disclosure. Before receiving compensation in reliance on the exemption in Section I, the Financial Institution notifies the Department of its intention to rely on this exemption. The notice will remain in effect until revoked in writing by the Financial Institution. The notice need not identify any Plan or IRA. The notice must be provided by email to
(b) Recordkeeping. The Financial Institution maintains for a period of six (6) years, in a manner that is reasonably accessible for examination, the records necessary to enable the persons described in paragraph (c) of this Section to determine whether the conditions of this exemption have been
(1) If such records are lost or destroyed, due to circumstances beyond the control of the Financial Institution, then no prohibited transaction will be considered to have occurred solely on the basis of the unavailability of those records; and
(2) No party, other than the Financial Institution responsible for complying with this paragraph (c), will be subject to the civil penalty that may be assessed under ERISA section 502(i) or the taxes imposed by Code section 4975(a) and (b), if applicable, if the records are not maintained or are not available for examination as required by paragraph (c), below.
(c)(1) Except as provided in paragraph (c)(2) of this Section or precluded by 12 U.S.C. 484, and notwithstanding any provisions of ERISA section 504(a)(2) and (b), the records referred to in paragraph (b) of this Section are reasonably available at their customary location for examination during normal business hours by:
(i) Any authorized employee or representative of the Department or the Internal Revenue Service;
(ii) Any fiduciary of a Plan that engaged in an investment transaction pursuant to this exemption, or any authorized employee or representative of such fiduciary;
(iii) Any contributing employer and any employee organization whose members are covered by a Plan described in paragraph (c)(1)(ii), or any authorized employee or representative of these entities; or
(iv) Any participant or beneficiary of a Plan described in paragraph (c)(1)(ii), IRA owner, or the authorized representative of such participant, beneficiary or owner; and
(2) None of the persons described in paragraph (c)(1)(ii)-(iv) of this Section are authorized to examine records regarding a recommended transaction involving another Retirement Investor, privileged trade secrets or privileged commercial or financial information of the Financial Institution, or information identifying other individuals.
(3) Should the Financial Institution refuse to disclose information on the basis that the information is exempt from disclosure, the Financial Institution must, by the close of the thirtieth (30th) day following the request, provide a written notice advising the requestor of the reasons for the refusal and that the Department may request such information.
(4) Failure to maintain the required records necessary to determine whether the conditions of this exemption have been met will result in the loss of the exemption only for the transaction or transactions for which records are missing or have not been maintained. It does not affect the relief for other transactions.
(a) In general. In addition to prohibiting fiduciaries from receiving compensation from third parties and compensation that varies based on their investment advice, ERISA and the Internal Revenue Code prohibit the purchase by a Plan, participant or beneficiary account, or IRA of a Fixed Annuity Contract from an insurance company that is a service provider to the Plan or IRA. This exemption permits a Plan, participant or beneficiary account, or IRA to engage in a purchase with a Financial Institution that is a service provider or other party in interest or disqualified person to the Plan or IRA. This exemption is provided because Fixed Annuity Contract transactions often involve prohibited purchases involving entities that have a pre-existing party in interest relationship to the Plan or IRA.
(b) Covered transactions. The restrictions of ERISA section 406(a)(1)(A) and (D), and the sanctions imposed by Code section 4975(a) and (b), by reason of Code section 4975(c)(1)(A) and (D), shall not apply to the purchase of a Fixed Annuity Contract by a Plan, participant or beneficiary account, or IRA, from a Financial Institution that is a party in interest or disqualified person.
(c) The following conditions are applicable to this exemption:
(1) The transaction is effected by the Financial Institution in the ordinary course of its business;
(2) The compensation, direct or indirect, for any services rendered by the Financial Institution and its Affiliates and Related Entities is not in excess of reasonable compensation within the meaning of ERISA section 408(b)(2) and Code section 4975(d)(2); and
(3) The terms of the transaction are at least as favorable to the Plan, participant or beneficiary account, or IRA as the terms generally available in an arm's length transaction with an unrelated party.
(d)
(1) The Plan is covered by Title I of ERISA and (i) the Adviser, Financial Institution or any Affiliate is the employer of employees covered by the Plan, or (ii) the Adviser and Financial Institution is a named fiduciary or plan administrator (as defined in ERISA section 3(16)(A)) with respect to the Plan, or an affiliate thereof, that was selected to provide advice to the plan by a fiduciary who is not Independent.
(2) The compensation is received as a result of investment advice to a Retirement Investor generated solely by an interactive Web site in which computer software-based models or applications provide investment advice based on personal information each investor supplies through the Web site without any personal interaction or advice from an individual Adviser (
(3) The Adviser has or exercises any discretionary authority or discretionary control with respect to the recommended transaction.
(a) In general. ERISA and the Internal Revenue Code prohibit Advisers, Financial Institutions and their Affiliates and Related Entities from receiving compensation that varies based on their investment advice. Similarly, fiduciary advisers are prohibited from receiving compensation from third parties in connection with their advice. Some Advisers and Financial Institutions did not consider themselves fiduciaries within the meaning of 29 CFR 2510-3.21 before the applicability date of the amendment to 29 CFR 2510-3.21 (the Applicability Date). Other Advisers and Financial Institutions entered into transactions involving Plans, participant or beneficiary accounts, or IRAs before the Applicability Date, in accordance with the terms of a prohibited transaction exemption that has since been amended. This exemption permits Advisers, Financial Institutions, and their Affiliates and Related Entities, to receive compensation in connection with a Plan's, participant or beneficiary account's or IRA's purchase, exchange, or holding of a Fixed Annuity Contract that was acquired prior to the Applicability Date, as described and limited below.
(b) Covered transaction. Subject to the applicable conditions described below, the restrictions of ERISA section 406(a)(1)(A), 406(a)(1)(D) and 406(b) and the sanctions imposed by Code section 4975(a) and (b), by reason of Code section 4975(c)(1)(A), (D), (E) and (F), shall not apply to the receipt of compensation by an Adviser, Financial Institution, and any Affiliate and Related Entity, as a result of investment advice (including advice to hold) provided to a Plan, participant or beneficiary or IRA owner in connection
(1) The compensation is received pursuant to an agreement, arrangement or understanding that was entered into prior to the Applicability Date and that has not expired or come up for renewal post-Applicability Date;
(2) The purchase, exchange, holding or sale of the investment property was not otherwise a non-exempt prohibited transaction pursuant to ERISA section 406 and Code section 4975 on the date it occurred;
(3) The compensation is not received in connection with the Plan's, participant or beneficiary account's or IRA's investment of additional amounts in the previously acquired investment vehicle;
(4) The amount of the compensation paid, directly or indirectly, to the Adviser, Financial Institution, or their Affiliates or Related Entities in connection with the transaction is not in excess of reasonable compensation within the meaning of ERISA section 408(b)(2) and Code section 4975(d)(2); and
(5) Any investment recommendations made after the Applicability Date by the Financial Institution or Adviser with respect to the investment property reflect the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims, based on the investment objectives, risk tolerance, financial circumstances, and needs of the Retirement Investor, and are made without regard to the financial or other interests of the Adviser, Financial Institution or any Affiliate, Related Entity, or other party.
For purposes of this exemption:
(a) “Adviser” means an individual who:
(1) Is a fiduciary of the Plan or IRA by reason of the provision of investment advice described in ERISA section 3(21)(A)(ii) or Code section 4975(e)(3)(B), or both, and the applicable regulations, with respect to the assets of the Plan or IRA involved in the recommended transaction;
(2) Is an employee, independent contractor, or agent of a Financial Institution; and
(3) Satisfies the federal and state regulatory and licensing requirements of insurance laws with respect to the covered transaction, as applicable
(b) “Affiliate” of an Adviser or Financial Institution means—
(1) Any person directly or indirectly through one or more intermediaries, controlling, controlled by, or under common control with the Adviser or Financial Institution. For this purpose, “control” means the power to exercise a controlling influence over the management or policies of a person other than an individual;
(2) Any officer, director, partner, employee, or relative (as defined in ERISA section 3(15)), of the Adviser or Financial Institution; and
(3) Any corporation or partnership of which the Adviser or Financial Institution is an officer, director, or partner.
(c) Investment advice is in the “Best Interest” of the Retirement Investor when the Adviser and Financial Institution providing the advice act with the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims, based on the investment objectives, risk tolerance, financial circumstances, and needs of the Retirement Investor, without regard to the financial or other interests of the Adviser, Financial Institution or any Affiliate, Related Entity, or other party.
(d) “Fixed Annuity Contract” means an annuity contract that satisfies applicable state standard nonforfeiture laws at the time of issue and the benefits of which do not vary, in whole or in part, on the basis of the investment experience of a separate account or accounts maintained by the insurer. Fixed Annuity Contracts includes fixed rate annuity contracts and fixed indexed annuity contracts.
(e) “Financial Institution” means an insurance intermediary that has a direct written contract regarding the distribution of Fixed Annuity Contracts with both (i) the insurance company issuing the Fixed Annuity Contract and (ii) the Adviser or another intermediary (sub-intermediary) that has a direct written contract with the Adviser, and that also:
(1) Satisfies the applicable licensing requirements of the insurance laws of each state in which it conducts business;
(2) Has financial statements that are audited annually by an Independent certified public accountant;
(3) Maintains, to satisfy potential liability under ERISA or the Code as a result of this exemption, or any contract entered into pursuant to Section II(a), in an aggregate amount which must be at least 1% of the average annual amount of premium sales of Fixed Annuity Contracts sold by the Financial Institution to Retirement Investors pursuant to this exemption over its prior three fiscal years:
(A) Fiduciary liability insurance that:
(i) Applies solely to actions brought by the Department of Labor, the Department of Treasury, the Pension Benefit Guaranty Corporation, Retirement Investors or plan fiduciaries (or their representatives) relating to Fixed Annuity Contract transactions, including but not limited to actions for failure to comply with the exemption or any contract entered into pursuant to Section II(a);
(ii) does not contain an exclusion of Fixed Annuity Contracts;
(iii) has a deductible that does not exceed 5% of the policy limits; and
(iv) does not exclude claims coverage based on a self-insured retention or otherwise specify an amount that the Financial Institution must pay before a claim is covered by the fiduciary liability policy;
(B) cash, bonds, bank certificates of deposit, U.S. Treasury Obligations that are unencumbered and not subject to security interests or other creditors, or
(C) a combination of (A) and (B); and
(4) Has transacted sales of Fixed Annuity Contracts averaging at least $1.5 billion in premiums per fiscal year over its prior three fiscal years;
(f) “Independent” means a person that:
(1) Is not the Adviser, the Financial Institution or any Affiliate relying on the exemption;
(2) Does not have a relationship to or an interest in the Adviser, the Financial Institution or Affiliate that might affect the exercise of the person's best judgment in connection with transactions described in this exemption; and
(3) Does not receive or is not projected to receive within the current federal income tax year, compensation or other consideration for his or her own account from the Adviser, Financial Institution or Affiliate in excess of 2% of the person's annual revenues based upon its prior income tax year.
(g) “Individual Retirement Account” or “IRA” means any account or annuity described in Code section 4975(e)(1)(B) through (F), including, for example, an
(h) A “Material Conflict of Interest” exists when an Adviser or Financial Institution has a financial interest that a reasonable person would conclude could affect the exercise of its best judgment as a fiduciary in rendering advice to a Retirement Investor.
(i) “Plan” means any employee benefit plan described in section 3(3) of ERISA and any plan described in section 4975(e)(1)(A) of the Code.
(j) “Proprietary Product” means a product that is managed, issued or sponsored by the Financial Institution or any of its Affiliates.
(k) “Related Entity” means any entity other than an Affiliate in which the Adviser or Financial Institution has an interest which may affect the exercise of its best judgment as a fiduciary.
(l) A “Retail Fiduciary” means a fiduciary of a Plan or IRA that is not described in section (c)(1)(i) of the Regulation (29 CFR 2510.3-21(c)(1)(i)).
(m) “Retirement Investor” means—
(1) A participant or beneficiary of a Plan subject to Title I of ERISA or described in section 4975(e)(1)(A) of the Code, with authority to direct the investment of assets in his or her Plan account or to take a distribution,
(2) The beneficial owner of an IRA acting on behalf of the IRA, or
(3) A Retail Fiduciary with respect to a Plan subject to Title I of ERISA or described in section 4975(e)(1)(A) of the Code or IRA.
(n) “Third-Party Payments” include sales charges and insurance commissions when not paid directly by the Plan, participant or beneficiary account, or IRA; gross dealer concessions; revenue sharing payments; distribution, solicitation or referral fees; volume-based fees; fees for seminars and educational programs; and any other compensation, consideration or financial benefit provided to the Financial Institution or an Affiliate or Related Entity by a third party as a result of a transaction involving a Plan, participant or beneficiary account, or IRA.
(a) In general. ERISA and the Internal Revenue Code prohibit fiduciary advisers to Plans and IRAs from receiving compensation that varies based on their investment advice. Similarly, fiduciary advisers are prohibited from receiving compensation from third parties in connection with their advice. This transition period provides relief from the restrictions of ERISA section 406(a)(1)(D), and 406(b) and the sanctions imposed by Code section 4975(a) and (b) by reason of Code section 4975(c)(1) (D), (E), and (F) for the period from April 10, 2017, to August 15, 2018 (the Transition Period) for Advisers, Financial Institutions, and their Affiliates and Related Entities, to receive such otherwise prohibited compensation subject to the conditions described in Section IX(d).
(b) Covered transactions. This provision permits Advisers, Financial Institutions, and their Affiliates and Related Entities to receive compensation as a result of their provision of investment advice within the meaning of ERISA section 3(21)(A)(ii) or Code section 4975(e)(3)(B) to a Retirement Investor regarding Fixed Annuity Contracts during the Transition Period.
(c) Exclusions. This provision does not apply if:
(1) The Plan is covered by Title I of ERISA, and (i) the Adviser, Financial Institution or any Affiliate is the employer of employees covered by the Plan, or (ii) the Adviser or Financial Institution is a named fiduciary or plan administrator (as defined in ERISA section 3(16)(A)) with respect to the Plan, or an Affiliate thereof, that was selected to provide advice to the Plan by a fiduciary who is not Independent;
(2) The compensation is received as a result of investment advice to a Retirement Investor generated solely by an interactive Web site in which computer software-based models or applications provide investment advice based on personal information each investor supplies through the Web site without any personal interaction or advice from an individual Adviser (
(3) The Adviser has or exercises any discretionary authority or discretionary control with respect to the recommended transaction.
(d) Conditions. The provision is subject to the following conditions:
(1) Before receiving compensation in reliance on the exemption in this Section IX, the Financial Institution notifies the Department of its intention to rely on this exemption and makes the following representation to the Department: “[Name of Financial Institution] is presently taking steps to put in place the systems necessary to comply with Section I of the Best Interest Contract Exemption for Insurance Intermediaries, and fully intends to comply with all applicable conditions for such relief after the expiration of the transition period.” The notice will remain in effect until revoked in writing by the Financial Institution. The notice need not identify any Plan or IRA. The notice must be provided by email to
(2) The Financial Institution and Adviser adhere to the following standards:
(i) When providing investment advice to the Retirement Investor, the Financial Institution and the Adviser(s) provide investment advice that is, at the time of the recommendation, in the Best Interest of the Retirement Investor. As further defined in Section VIII(c), such advice reflects the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims, based on the investment objectives, risk tolerance, financial circumstances, and needs of the Retirement Investor, without regard to the financial or other interests of the Adviser, Financial Institution or any Affiliate, Related Entity, or other party;
(ii) The recommended transaction does not cause the Financial Institution, Adviser or their Affiliates or Related Entities to receive, directly or indirectly, compensation for their services that is in excess of reasonable compensation within the meaning of ERISA section 408(b)(2) and Code section 4975(d)(2).
(iii) Statements by the Financial Institution and its Advisers to the Retirement Investor about the recommended transaction, fees and compensation, Material Conflicts of Interest, and any other matters relevant to a Retirement Investor's investment decisions, are not materially misleading at the time they are made.
(3) Disclosures. The Financial Institution complies with applicable disclosure obligations under state insurance law with respect to the sale of the Fixed Annuity Contract, and provides to the Retirement Investor, prior to the transmittal of the annuity application to the insurance company, a single written disclosure that clearly and prominently:
(i) Affirmatively states that the Financial Institution and the Adviser(s) act as fiduciaries under ERISA or the Code, or both, with respect to the recommendation;
(ii) Sets forth the standards in paragraph (d)(1) of this Section and affirmatively states that it and the Adviser(s) adhered to such standards in recommending the transaction;
(iii) Describes the Financial Institution's Material Conflicts of Interest; and
(iv) Discloses to the Retirement Investor whether the Financial Institution offers Proprietary Products or
(v) The disclosure may be provided in person, electronically or by mail. It does not have to be repeated for any subsequent recommendations during the Transition Period.
(vi) The Financial Institution will not fail to satisfy this Section IX(d)(3) solely because it, acting in good faith and with reasonable diligence, makes an error or omission in disclosing the required information, provided the Financial Institution discloses the correct information as soon as practicable, but not later than 30 days after the date on which it discovers or reasonably should have discovered the error or omission. To the extent compliance with this Section IX(d)(3) requires Financial Institutions to obtain information from entities that are not closely affiliated with them, they may rely in good faith on information and assurances from the other entities, as long as they do not know, or unless they should have known, that the materials are incomplete or inaccurate. This good faith reliance applies unless the entity providing the information to the Adviser and Financial Institution is (1) a person directly or indirectly through one or more intermediaries, controlling, controlled by, or under common control with the Adviser or Financial Institution; or (2) any officer, director, employee, agent, registered representative, relative (as defined in ERISA section 3(15)), member of family (as defined in Code section 4975(e)(6)) of, or partner in, the Adviser or Financial Institution.
(4) The Financial Institution approves in advance all written marketing materials used by Advisers after determining that such materials provide a balanced description of the risks and features of the annuity contracts to be recommended;
(5) The Financial Institution designates a person or persons, identified by name and title or function, responsible for addressing Material Conflicts of Interest and monitoring Advisers' adherence to the Impartial Conduct Standards and the person approves, in writing, recommended applications for Fixed Annuity Contracts involving Retirement Investors prior to transmitting them to the insurance company; and
(6) The Financial Institution complies with the recordkeeping requirements of Section V(b) and (c).
Office of the Secretary, Department of Education.
Final regulations.
The Secretary amends the regulations of the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards in order to require, subject to certain categorical exceptions and case-by-case exceptions, that Department grantees awarded competitive grant funds openly license to the public copyrightable grant deliverables created with Department grant funds.
These regulations are effective March 20, 2017.
Sharon Leu, U.S. Department of Education, 400 Maryland Avenue SW., Room 6W224, Washington, DC 20202. Telephone: (202) 453-5646 or by email:
If you use a telecommunications device for the deaf (TDD) or text telephone (TTY), call the Federal Relay Service (FRS), toll free, at 1-800-877-8339.
On November 3, 2015, the Secretary published a notice of proposed rulemaking (NPRM) in the
Under the Department's current regulations, title to intellectual property, including copyright, acquired under Department grant funds vests in the grantee. At the same time, for any work subject to copyright that was developed or for which ownership was acquired under a grant award, the Department reserves a royalty-free, non-exclusive, and irrevocable right to reproduce, publish, or otherwise use for Federal purposes, and to authorize others to do so (referred to as a “Federal purpose license”). This license allows the government the ability to authorize others to use work funded by Department grants.
Grantees under the Department's competitive grant programs create a number of copyrightable works using Department competitive grant funds that have significant benefit for students, parents, teachers, school districts, States, institutions of higher education, and the public overall. These copyrightable works are wide ranging in nature and include instructional materials, personalized learning delivery systems, assessment systems, language tools, and teacher professional development training modules, just to name a few. The Department's grantees creating these works include State educational agencies (SEAs), local educational agencies (LEAs), institutions of higher education (IHEs), and non-profit organizations and while the works are created under a specific grant program and therefore may target a specific school or group of students, the resources are such that other education stakeholders would significantly benefit from being able to access them, reuse them, and in some cases, modify them to address their needs and goals.
It is the Department's experience, however, that copyrightable works created under competitive grants made by the Department generally have not been disseminated widely to the public. This is the case despite the existence of the Federal purpose license and efforts by the Department and grantees to proactively make them available. Although the Department provides individualized technical assistance and actively works with all grantees on dissemination planning, we have found that many education stakeholders and other members of the public are generally not aware of the educational resources created as a result of the Department's competitive grant programs. We believe this is because the education resources often are created and disseminated locally or disseminated to limited audiences by grantees in presentations at research conferences, through professional associations, or by commercial mechanisms that are not easily accessed by the general public or to a wider group of stakeholders. Even when the resources are known to exist, stakeholders and the public are not sure how to access them, what usage rights or permissions are necessary to use them, or how to obtain those rights or permissions. Accordingly, while the Department's Federal purpose license does allow for the public to obtain a copy of these works from the Department, this has rarely occurred.
We believe that the open licensing regulation we are adopting here will address these key problems. Through an open license, grantees under the Department's competitive grant programs will explicitly give permission to the public to access, reproduce, publicly perform, publicly display, and distribute the copyrightable work; prepare derivative works, as defined in the Copyright Act, 17 U.S.C. 101, and reproduce, publicly perform, publicly display and distribute those derivative works; and otherwise use the copyrightable work, created in whole or in part with competitive grant funds provided by the Department, provided that in all such instances attribution is given to the copyright holder. Copyrightable grant deliverables, or deliverables, are final versions of a work developed to carry out the purpose of the grant, as specified in the grant announcement (
The approach the Department is taking with this rule is limited in scope. It will apply only to grantees receiving Department competitive grant funds, which constitutes approximately 10 percent of the Department's total discretionary funding. Within that category of grants, we anticipate approximately 60 percent would potentially be subject to the rule. The rule will not apply to grants that provide funding for general operating expenses; grants that provide supports to individuals (
The rule also provides for the Department to consider individual grantee requests for exception to the open licensing requirement. We note in the rule some examples of situations that may be appropriate for an exception to the open licensing requirement, such as where the Secretary has determined that the grantee or subgrantee's dissemination plan would likely achieve meaningful dissemination equivalent to or greater than the dissemination likely to be achieved through the open licensing requirement. Similarly, we provide the example of a situation in which the open licensing requirement would impede the grantee's ability to form the required partnerships necessary to carry out the purpose of the grant. The list of examples in the rule is not exhaustive and is intended to indicate the types of situations in which an exception may be appropriate depending on the specific circumstances.
In designing competitions that would not fall within any of the categorical exceptions specified in the rule, the Department will also consider whether to make an exception for a grant program for a particular year's competition. In that regard, the Department will consider whether the open licensing requirement conflicts with the statutory purpose of the program and whether harm caused to the program by implementing the open licensing requirement would outweigh its benefit. In granting exceptions, we may consider factors such as the following: (1) Possible negative effect on the statutory purpose of the program if an open licensing requirement is applied; (2) Possible barriers to the intended benefits of broad dissemination if an open licensing requirement is applied, for example, if the broadest possible dissemination can be achieved only through exclusive private entity partnerships; (3) The public need for, or benefit from, the opportunity to access or use the copyrightable grant deliverable given the context of the particular program; and (4) Other economic considerations, such as an undue financial hardship on the grantees to implement the rule. The Secretary's designee(s) will make final decisions about whether a program-level exception is granted. In each Notice Inviting Applications for a competitive grant program, the Department will clearly communicate whether or not the program is subject to the open licensing requirement or has received an exception.
The Department recognizes that implementation of these regulations represents a change from current practice and therefore plans to take a phased approach to implementing the rule for new competitive grants announced in FY 2017 and will fully implement it for all applicable competitive grant programs across the Department in FY 2018. This approach will provide us additional opportunities to take steps such as preparing administrative procedures regarding the consideration of requests for exceptions and providing relevant staff training. In FY 2017, each new competitive grant competition announcement will clearly indicate whether this rule will apply so that eligible applicants can make informed decisions regarding their participation in the competition.
In response to our invitation in the NPRM, 146 parties submitted comments. We group major issues according to subject and by comments submitted in response to the five additional questions we posed. Generally, we do not address technical and other minor changes or suggested changes the Secretary is not legally authorized to make under applicable statutory authority. In some cases, comments addressed issues beyond the scope of the proposed regulations. Although we appreciate commenters' concerns for broader issues affecting open access, because those comments are beyond the scope of this regulatory action, we do not discuss them here.
Each year, the Department funds a wide variety of competitive grant programs that support a diverse array of grant-funded copyrightable works. Conducting an empirical analysis of the exact costs and benefits of this final rule would require data not historically collected in the course of the administration of Department grants. Consistent with Section 1 of EO 13563, in our analysis of the rule, the Department considered qualitative values, including, transparency, equity, and distributive impacts, and recognized that some benefits and costs are difficult to quantify.
The Department has developed the guidelines required under the IQA, which are available at:
We note that the IQA guidelines do provide a procedure for the public to register complaints to the Department for applicable information covered by the IQA. According to these procedures, any member of the public may provide a detailed explanation of the specific data being sought or the specific elements of the guidelines that it believes we have not followed. If the commenter had provided this information we could have attempted to either provide this data in the final rule or explain why the data is unavailable to us. If the commenter wishes to submit another request under our IQA guidelines, in compliance with the procedures those guidelines set out, we would be happy to review such a request.
Commenters citing these conflicts note specifically that computer software source code can be both patentable and copyrightable and that under the Bayh-Dole Act, inventors, rather than the Federal government, are entitled to the title of the patents. These commenters suggested that further clarification of rights is necessary in order to avoid both confusion and litigation. One commenter noted that the proposed requirement to apply an open license to computer software source code is overly broad and could potentially cover all patentable inventions, trade secrets, or other intangible rights.
Other commenters who supported the proposed regulation stated that the
We also note that the Department regularly engages our colleagues at other Federal agencies to explore the use of openly licensed resources in advancing the goals of our programs. In June 2016, the Department, in collaboration with NSF and the Institute for Museum and Library Services (IMLS), convened an Open Educational Resources (OER) Research Meeting, attended by representatives from #GoOpen States and Districts, leading principal investigators of projects funded by NSF, IMLS, and the Department's Institute of Education Sciences (IES) programs, as well as with other knowledgeable education stakeholders and researchers. The convening was designed around articulating key OER research issues, identifying OER research infrastructure needs, and exploring potential partnerships to pursue research and development projects. A separate, more detailed discussion regarding the suggestion to use Creative Commons licenses is below.
We note that the proposed rule excluded current 2 CFR 200.315(b) from the Department's regulations. We proposed this exception to avoid any inconsistency between the proposed open licensing rule and the provision in 2 CFR 200.315(b) recognizing a copyright to material developed with grant funds. In light of the comment we received, however, we recognize that there is not an inconsistency and therefore, there is no need to exclude 2 CFR 200.315(b) from our regulations. As the commenter pointed out, a grantee must hold a copyright to any material to which it provides a copyright license. Indeed, central to the functionality of this final rule is the existence of provisions that give title for intangible property created with Federal support to the creators that is provided in 2 CFR 200.315(a) and (b).
In reviewing this issue, we realized that the proposed rule was not clear on whether the open licensing requirement would apply to subgrantees. We believe that it would and have revised the rule to make clear that it applies to the subgrantees of competitive grantees that are subject to this rule.
We note that we have expanded the exception in § 3474.20(d)(1)(v) to include all peer-reviewed scholarly publications that arise from any scientific research funded, either fully or partially, from grants awarded by the Department. This change is discussed further elsewhere in this preamble. Although the final rule no longer references the IES public access policy specifically, we are using the term “peer reviewed scholarly publications” because it is used by IES grantees, who represent a majority of those covered by this exception and is widely used in the field.
For copyrightable works that are not funded by the Department, we have similarly left the terms under which any derivative works may be licensed to the discretion of the owner of the derivative work (
Finally, as discussed earlier in this section, we have defined the term “derivative work” to have the same meaning as contained in the Copyright Act.
First, commenters noted that without a commonly understood licensing framework, lack of clarity over terms of use would impede the Department's goals of widespread sharing and dissemination. For example, individual grantees could each create their own open licenses by following the conditions provided in the proposed rule. While their intent would be to
Second, commenters stated that the Department should adopt a Creative Commons licensing framework because it would align with frameworks already in place at other organizations. This alignment would enable entities to collaborate and share resources across these projects with fewer barriers. For example, commenters pointed to open licensing and access policies by other funders including the Bill and Melinda Gates Foundation, the William and Flora Hewlett Foundation, the Ford Foundation, the World Health Organization, and the World Bank, that require use of Creative Commons licenses. Commenters also pointed to other governments (the United Kingdom, Australia, and Poland) that have identified Creative Commons licenses as they begin to implement similar policies. Many commenters pointed to grant programs at the Department of State, including USAID, and the Department of Labor's Trade Adjustment Assistance Community College and Career Training (TAACCCT) grant program as examples of programs at other Federal agencies that have already implemented open licensing requirements using Creative Commons licenses. Commenters noted that Creative Commons licenses have been embraced by open courseware projects that have produced diverse educational materials and innovative textbook offerings currently used at hundreds of major colleges and universities and K-12 schools throughout the country.
Third, commenters stated that individually created licenses may satisfy the conditions provided in the proposed rule, but may not have the same force or effect of law. Commenters asserted that Creative Commons licenses are legally robust, internationally recognized licenses that are enforceable and easily adopted worldwide as they were written to conform to the international treaties governing copyright.
Finally, commenters noted the practicality of a Creative Commons license. These commenters stated that while Creative Commons licenses have a three-layered design (legal, human readable, machine-readable), the process of selecting and affixing the license and license deed is simple. In addition, commenters pointed to the wide availability of tools and resources developed to support the implementation of the Creative Commons licensing framework in various contexts. By adopting the same licensing framework, the Department could also utilize these existing tools and resources in its own implementation and training activities.
However, we have revised § 3474.20(b)(2) to provide greater specificity concerning the requirements for the open licenses that a grantee may use under this rule that ensure that licenses selected are readily identified, either visually or electronically, and to minimize confusion about licensing terms and usage rights. These include the requirement that grantees use a symbol or device that readily communicates to users the permissions granted concerning the use of the copyrightable work, machine-readable code for digital resources, readily accessed legal terms, and the statement of attribution and disclaimer specified in 34 CFR 75.620(b).
With respect to ESSA, we note a few provisions that may be helpful in establishing the broader context of the Department's work to increase dissemination of educational materials through the use of open educational resources and educational technology. In particular, we note that while Title IV of ESSA authorizes block grants for services that previously were provided under competitive grants under ESEA, openly licensed resources are now incorporated more broadly into all digital education interventions funded by ESSA formula programs. For example, ESSA incorporates open
Other commenters suggested that the Department eliminate the exception for peer-reviewed research publications under the proposed rule. These commenters noted that, although the IES; public access policy makes peer-reviewed scholarly publications available for the public to access, these same publications would still be subject to copyright restrictions. These commenters expressed concern that exempting peer-reviewed research unintentionally overlooks materials that would be of value to the public and to the scientific community and encouraged the Department to apply the rule uniformly for all grant-funded materials, including these publications. The commenters recognized that IES' current public access policy is consistent with the requirements laid out in the 2013 Office of Science and Technology Policy (OSTP) Memorandum for Heads of Executive Departments and Agencies
Other commenters that did not support the proposed rule applauded the Department for exempting peer-reviewed research publications covered by the IES' public access plan. These commenters noted that the 2013 OSTP Memorandum provides an example of a policy that appropriately balances policy benefits of open access while accommodating journal publisher subscription business models.
The exception in proposed § 3474.20(c) would have applied only to IES grantees because peer reviewed scholarly publications produced under those grants are subject to the IES' public access policy, which ensures that those publications are made available to the public through posting on the Education Resources Information Center (ERIC). In the final rule, we have broadened this exception to cover any peer-reviewed scholarly publications funded by any Department grant, not just an IES grant. We do not believe this significantly changes the practical application of this exception; rather, we believe it makes the application of our rule more consistent. We note that the majority of research and development activities at the Department are the result of IES research grants. For IES grants that result in peer reviewed scholarly publications, the requirements of the IES public access plan will still apply. Currently, the Department is exploring the development of a rule, which would be subject to Administrative Procedures Act notice and comment requirements, which would extend the IES public access requirements for peer-reviewed scholarly publications to all Department grantees. Additionally, we have removed the reference to the IES public access plan from the exception in the corresponding final § 3474.20(d)(1)(v) because that plan is not applicable to Department grants funded outside of IES. The IES public access policy is a document that, under 20 U.S.C. 9581, could be revised without rulemaking. In light of the fact the document could continue to evolve, we do not think it is appropriate to rely on it for the scope of the exception.
One commenter also correctly noted that the work of writing publications may not always be funded by research and development grants. Regardless of whether the work of writing the article is grant-funded, if the research on which the publication is based is supported in whole or in part by grant funds, then the exception in final § 3474.20(d)(1)(v) applies.
Conversely, some grant programs may fund the authorship of articles for publication that do not arise from any scientific research funded by the Department. In these cases, the grantee would be required to apply open licenses to the new works of authorship as described in final § 3474.20(a).
In response to the comments to eliminate the exception in proposed § 3474.20(c)(3), we think that at this time, it is necessary to provide for an exception for peer-reviewed scholarly publications. The research community benefits from allowing the results of scientific research, including research funded by the Department, to be published in scientific journals and subjected to the rigors of peer-review that is a prerequisite to such publication. We note that we are not maintaining the exception in order to accommodate journal publisher subscription business models. Rather, we recognize that there are limited number of open access research journals. Requiring these grantees to
Similarly, this rule does not require that grantees provide access to computer programs protected under copyright or other laws. We understand that in many cases, the modifications may only be viable within the context of existing commercial software or platforms. However, we believe that these modifications, accompanied by any supporting documentation, may benefit other users of the same commercial software or platforms to the extent that these modifications can be separately identified and extracted from the underlying proprietary work and that open licensing would be permissible under the terms of any restrictions applicable to that underlying work. In light of these comments, we have revised the text of the rule to make this distinction more salient.
Finally, we agree that the references to “pre-existing content” and “existing intellectual property” required appropriate revisions in order to provide greater clarity to the public.
We agree with the commenters that our intentions and the rule's scope
The Department is committed to working with grantees to develop licensing and dissemination strategies that are particular to their grant program, offer appropriate privacy protection, do not create duplicative work for the grantee, and are consistent with the goals of the grant program and this final rule. Department staff will be trained to address these items throughout the implementation period of the rule. We note that it is impossible for us to make specific determinations in advance about which resources would be of use to various stakeholders in the field and believe our goals are best accomplished when the public is given access to the broadest array of materials created to make their own determination regarding their usefulness. The Department will provide further guidance to grantees concerning grant deliverables during implementation of grant programs.
First, the commenter indicated that under existing programmatic requirements, content and resources created by the Ready to Learn grant program are already distributed as broadly as possible. In implementing these distribution and outreach requirements, the commenter noted that grant-funded television content is distributed over-the-air to almost every household in America and grant-funded transmedia content such as mobile applications and other digital resources are already available at no cost to teachers, parents, and children.
Second, the commenter indicated that the quality and sustainability of materials created with Ready to Learn grant funds would be undermined. The commenter noted that Ready to Learn grant funding serves as seed funding for many of the public television series and transmedia content and asserted that without non-exclusive distribution rights it would be impossible to secure additional funding through public-private partnerships. In addition, the commenter noted that it would be impossible to secure partnerships with experienced producers of top quality educational series. Similarly, the commenter noted that Ready to Learn grantees, together with experienced producers, have been able to create resources that are qualitatively different than content created by other grantees and that the open license requirement would preclude production of any further content.
Finally, the commenter stated that the impact of the open license would extend beyond loss of revenue to encompass loss of educational content that would not be produced in response to this regulation. In addition, the commenter noted that resources produced by Ready to Learn funding can be used broadly by educators in accordance with the fair use provisions of copyright law and that testing and research have shown that there is no indication of a further need for educators to create derivative works. The commenter also stated that contrary to the Department's expectation that the proposed regulations would not have a significant economic impact on a substantial number of small entities, the proposed regulation would have a significant impact on a substantial number of small entities as it would reduce the programming available for small entity licensee stations to air, and would degrade community and foundation financial support for stations by constraining stations' ability to engage with and serve their local communities.
We have added an exception in § 3474.20(d)(1)(vi) for grantees or subgrantees under the Ready to Learn Program because of two factors unique to the design and statutory mandate of the Ready to Learn program. First, one stated goal of the proposed regulation is the broad distribution of materials funded by the Department. The commenter provided evidence that the particular qualities of the Ready to Learn distribution model and transmedia strategy, and the specific programmatic and statutory requirements to broadly distribute these materials have achieved market dissemination at least equivalent to the dissemination likely to be achieved through compliance with this final rule. Second, a stated goal of the proposed regulation is to spur innovation through creative reuse of grant-funded materials. As the commenter notes, many of the resources created under the Ready to Learn program are based on pre-existing intellectual property and the intellectual property owned by the grantee in the final grant deliverable, in isolation, would provide minimal opportunity for meaningful adaptation, modification, or other re-use.
We disagree with the commenter's recommendation that the Department adopt a categorical exception for all grants that provide funding for public television entities. Although it is apparent from the comment that the recommended exception was specifically with reference to the Ready to Learn television grant program, we note that public television entities may also be the recipient or sub-recipient of other Department grants subject to this regulation. For example, public television entities have received funding as partners in the Special Education Educational Technology, Media, and Materials for Individuals with Disabilities Program (formerly Technology and Media Services for Individuals with Disabilities). The recommended exception, as written, would apply too broadly to any grant in which a public television entity was a recipient or sub-recipient, without sufficient evidence that all public television entities would be adversely affected by this rule in a similar manner.
The reasons the commenter gave for a categorical exception are seemingly unique to grantees under the Ready to Learn grant program.
The #GoOpen movement is a specific movement where districts and states voluntarily participate in a community of practice focused on the use of openly licensed, digital resources. For these #GoOpen districts and States, openly licensed resources provide opportunities for cost savings and dissemination and innovation beyond the mere digitization and print reproduction of resources across the socioeconomic spectrum. The #GoOpen movement supports districts and States, in curating curricular materials that teachers can use or reuse or adopt based on the unique needs of their students or to suit their individual approaches to instruction. These teachers are afforded tools and professional learning resources from their district or State and from other districts and States so that they can capitalize on the opportunities provided by openly licensed and other digital resources. This is consistent with other policies, such as those reflected in the ESEA the authorization of appropriations for, among other professional development activities, training on the use of digital and openly sourced materials. Beyond individual classroom teachers, the #GoOpen initiative encourages administrators, technology directors, parents, and students themselves to work collaboratively in order to ensure the best opportunities for success. Through the #GoOpen movement, the Department actively supports partnerships between States, districts, and educators; promoting promising models of leadership; and aligning public and private efforts.
The #GoOpen movement is one specific initiative of the Department, where the Department coordinates the community of practice for States, school districts, and educators that voluntarily use openly licensed educational materials. We believe that a consideration to move towards openly licensed textbooks must include an objective evaluation of relevance and quality, as well as cost. Those resource decisions are made at the State and local level. Our efforts through the #GoOpen movement encourage State and district leaders to give equal consideration to openly licensed resources in making the best possible decision for educators and students.
This rule does not impose requirements for teachers or any other stakeholders to use openly licensed resources or encourage them to eschew publisher textbooks.
These commenters note that the technology transfer infrastructure established as a result of the Bayh-Dole Act and other patent provisions has incentivized commercial entities to develop grant-funded works into successful products and services with greater reach. One commenter provided data from articles analyzing the impact of the Bayh-Dole Act which state that federally funded research has resulted in nearly 10,000 patented products and enabled the launch of 4,200 new companies with a net product sales of $22 billion in 2013 alone. The commenter concluded from this data that the profits from these sales have incentivized partnerships with Department grantees that result in broad and relevant dissemination of products. Other commenters similarly note that public-private partnerships are critical to enabling sustainability of grant-funded products. In cases where grantees that have created computer software source code, that code itself often requires additional investment in product development, marketing, distribution, and support services for updates and upgrades. In cases where grant-funded research has resulted in creating interventions, these partnerships can allow continuous refinement and improvement of the intervention.
Those commenters that warned the Department about the unintended effects of an open license on the incentive to innovate asserted that profit incentives are the engine of innovation. The commenters stated that, this rule would remove these incentives, which would stifle new ideas and result in fewer innovations. Similarly, some commenters stated that commercialization was the only means by which intellectual property becomes widely distributed and that open licenses would irrevocably harm product dissemination for grant funded materials.
Other commenters expressed concerns that the loss of profit incentives would cause stakeholders to pursue alternate, non-Federal funding, rather than Department grant funding.
Alternatives to commercialization also exist that can promote innovation in the field of education, act as an efficient means of broad dissemination of educational research or resources, and help sustain innovations after grant
We again note that any derivative works created based upon grant deliverables using non-Department grant funds are not covered by this rule. Grantees may leverage works created under an open license to establish or maintain a relationship with a private entity for the purpose of commercialization.
The Department appreciates the commenters' concerns that our stakeholders may eschew Department grants in favor of other funding without these requirements. Our competitive grant programs are intended to support equal access to high-quality education for all students. By allowing others to freely use, with minimal restrictions, the educational resources created with our funding, we are providing opportunities for the global community of stakeholders to pursue solutions to their challenges. As previously mentioned, commercial incentives are not the only drivers of innovation in the field of education; similarly, we do not believe economic motive to be the sole consideration for stakeholders to participate in our grant programs. We observe that after implementing their similar policy, the Department of Labor continued to require applicants to form public-private partnerships in numerous notices inviting applicants for competitive grants. Despite the requirement that grantees make copyrightable intellectual property available under a Creative Commons Attribution (CC BY) license, the many programs covered since the enactment of their regulation have received a large pool of applicants. We recognize, however, that there may be some situations where a grantee may have difficulty forming a partnership with a private entity to create a grant deliverable. We believe that such situations are best addressed on a case-by-case basis and are revising the final regulation to include this situation as an example of where the Secretary may consider it appropriate to grant an exception to the open licensing requirement.
Third, many commenters noted that research institutions exercise good stewardship over grant resources and already employ a number of strategies to broadly disseminate their findings. Many commenters also provided examples of existing initiatives that result in broad dissemination of research-based interventions. Some of these examples included use of strong partnerships with a commercial partner to allow for continued refinements to the products, reinvestment into future research, and technical support for implementation, even after the end of the grant period. These commenters also note that many research institutions do not have the expertise or capacity to effectively scale interventions, and even if openly licensed resources were available, wide dissemination would not occur without these partnerships. Additionally, some commenters stated that the existing IES goal structure was the most effective model of ensuring research-based interventions are scaled and disseminated widely, and recommended that IES maintain this goal structure.
We agree with commenters that rigorous efficacy testing is necessary to ensure high quality resources, including interventions, products, and assessments, benefit students. We note that in addition to the early prototype models or interventions themselves, any final versions of program support materials necessary to the use of the prototype model or intervention, including professional development and training materials, research findings, and documentation of the context and efficacy of the resources created with grant funds would also be made available through an open license. Additionally, any materials created as part of IES research grants would also include rigorous peer-reviewed scholarly publications that would be available through ERIC. The availability of these supporting materials will allow the public to readily discern which resources could be appropriately used and which resources have not yet reached maturity. In some cases, these materials will prescribe the appropriate context and correct implementation methodology of the resource. We believe that practitioners should not be denied access to materials because of the possibility that they will misunderstand or misuse them. By openly licensing the supporting materials, data, and other program support materials, grantees can ensure that practitioners have the tools necessary to understand, learn from, and replicate deliverables, and to consult with researchers as appropriate.
In response to the commenters' concerns, we make three observations. First, even before product maturity, prototypes and early stage research, including supporting documentation, can greatly benefit other researchers, allowing them to also test and refine the resource, potentially creating prototypes for different applications. We believe
Second, we share in the concerns related to the misapplication of scientific research and misuse of educational tools. Nevertheless, we note that these issues may occur regardless of whether the research or tools are under copyright or available through an open license. We also note that members of the public, policymakers, educational practitioners, and other stakeholders, often incorrectly attribute their assertions to researchers, resulting in loss of reputation to the researcher. We do not believe that the root cause of these unfortunate circumstances is the availability of resources through an open license. In fact, a machine-readable license format on digital resources may actually facilitate the discovery of the original research and underlying frameworks for implementation. We also note that separate from the IES Policy Regarding Public Access to Research, many research institutions have already established faculty open access policies that enable public access to research and data.
Third, we acknowledge that in many cases, research entities lack expertise and capacity to scale the adoption of new resources and that in many cases, private entities play an important role in the iterative improvement of resources, often contributing funding in the process. For the purposes of this rule, the Department believes that the primary barrier to broad dissemination is not the lack of capacity; rather it is the lack of access to resources. Even if one research entity does not have the capacity to scale a resource, an open license enables other entities, some with greater expertise and resources, to disseminate them. We note that this regulation does not cover derivative works, funded privately through these partnerships.
Finally, we note that this regulation does not alter the structure or statutory requirements for any existing grant program, including the goal structure of IES-funded grant programs. As discussed elsewhere in this regulation, peer-reviewed scholarly publications that arise from scientific research funded, either fully or partially, from grants awarded by the Department are excepted from this regulation. This plan provides access both to research findings and the scientific data, encouraging researchers, practitioners, and the general public to test and improve findings and resources and otherwise enhance value for all stakeholders.
In the NPRM we posed five questions that requested comments on whether the proposed regulations should include certain additional implementation requirements. The responses provided to the five questions are summarized below.
Conversely, some commenters stated that applying open licenses and distributing materials prior to completion will give opportunity for more feedback and review and give the grantee additional time to make adjustments or refinements prior to the end of the grant period leading to a better final product. In addition, by making their work known, duplicative efforts can be avoided.
Other commenters stated that the decision of whether the license is applied prior to the end of the grant period should be made based on the goals and circumstances of the grant program.
Other commenters disagreed with requiring distribution by grantees. These commenters suggested that the responsibility of distribution resides with the Department, such as through the use of the ERIC, an online library of education research and information, sponsored by IES. Similarly, others suggested partnership with existing repositories or the creation of another
We also recognize that a grantee may develop a robust dissemination plan that could demonstrate meaningful dissemination that is equivalent to or greater than the dissemination likely to be achieved by compliance with the open licensing requirements. Accordingly, we are revising the regulation to provide this situation as an example of a scenario in which the Secretary would consider granting an exception to the open licensing requirement.
Aside from online platforms, commenters suggested the launch of a large advertising campaign of Department-funded works including the use of media such as emails, newsletters, and speeches where the Department highlights openly licensed materials and resources. Finally, a few commenters stated the need for the Department to communicate with grantees directly to discuss what exactly open licensing entails and how dissemination practices can be funded.
One commenter suggested that grantees should continue to work with technology transfer offices at their institutions.
A few commenters had direct experience implementing open licensing policies of other Federal agencies, including the Departments of Labor and the National Science Foundation. Based on their experience these commenters recommended that the Department direct grantees to use licenses that are interoperable that allow a broad range of reuse, including specifically, Creative Commons licenses. One commenter had experience leading open repository
One commenter stated that they did not know of any other Federal funding agencies that would make this regulation a grant requirement, as it would require forfeiture of intellectual property.
In reviewing these comments, we noted that our proposed rule did not account for situations in which a grant deliverable is jointly funded by both the Department and another Federal agency where the other Federal agency does not require the open licensing of its grant deliverables for that program. In these instances, we recognize that complying with the Department's open licensing requirement may cause confusion regarding a grantee's ability to comply with the requirements of that other Federal agency regarding the grant deliverable, so we are revising the regulation to provide that the rule would not apply to these types of grant deliverables.
Under Executive Order 12866, the Secretary must determine whether this regulatory action is “significant” and, therefore, subject to the requirements of the Executive order and subject to review by the Office of Management and Budget (OMB). Section 3(f) of Executive Order 12866 defines a “significant regulatory action” as an action likely to result in a rule that may—
(1) Have an annual effect on the economy of $100 million or more, or adversely affect a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities in a material way (also referred to as an “economically significant” rule);
(2) Create serious inconsistency or otherwise interfere with an action taken or planned by another agency;
(3) Materially alter the budgetary impacts of entitlement grants, user fees, or loan programs or the rights and obligations of recipients thereof; or
(4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles stated in the Executive order.
This final regulatory action will have an annual effect on the economy of more than $100 million because of the benefits that will be realized as a result of the dissemination of openly licensed resources required under this rule. Although the costs associated with this rule are relatively low, we believe the benefits from the resources that will be readily available to the public through broad dissemination will reach more than $100 million. We explain these costs and benefits in more detail in the
(1) Propose or adopt regulations only upon a reasoned determination that their benefits justify their costs (recognizing that some benefits and costs are difficult to quantify);
(2) Tailor its regulations to impose the least burden on society, consistent with obtaining regulatory objectives and taking into account—among other things and to the extent practicable—the costs of cumulative regulations;
(3) In choosing among alternative regulatory approaches, select those approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity);
(4) To the extent feasible, specify performance objectives, rather than the behavior or manner of compliance a regulated entity must adopt; and
(5) Identify and assess available alternatives to direct regulation, including economic incentives—such as user fees or marketable permits—to encourage the desired behavior, or provide information that enables the public to make choices.
Executive Order 13563 also requires an agency “to use the best available techniques to quantify anticipated present and future benefits and costs as accurately as possible.” The Office of Information and Regulatory Affairs of OMB has emphasized that these techniques may include “identifying changing future compliance costs that might result from technological innovation or anticipated behavioral changes.”
We are issuing these final regulations only on a reasoned determination that their benefits would justify their costs. In choosing among alternative regulatory approaches, we selected those approaches that maximize net benefits. Based on the analysis that follows, the Department believes that these final regulations are consistent with the principles in Executive Order 13563.
We also have determined that this regulatory action would not unduly interfere with State, local, and tribal governments in the exercise of their governmental functions.
Grantees under the Department's competitive grant programs create a number of copyrightable grant deliverables using Department grant funds that may have significant benefit for students, parents, teachers, school districts, States, institutions of higher education, and the public overall. These copyrightable works are wide ranging in nature and include instructional materials, personalized learning delivery systems, assessment systems,
As we note earlier, wide dissemination of these types of copyrightable works has not occurred under the Department's current regulations. We found very few instances in the last decade where program offices received a request to make grant-funded resources available under the Federal purpose license. However, we do have evidence of the impacts of open licensing in those competitive grant programs where open licensing was required or where the grantee voluntarily openly licensed its copyrightable works.
For example, the Department's First in the World (FITW) program has an existing open licensing requirement and thus provides a basis for estimating the potential benefit of these final regulations. In FY 2015, the Department awarded approximately $60 million in FITW funds to 18 institutions of higher education, research organizations, and education agencies. This total included 16 FITW development grants intended to seed and evaluate early stage innovations, where new intellectual property would be created, and two validation grants to test at a broad scale existing interventions supported by significant evidence.
We estimate that the 16 development grantees will produce at least 1,400 new resources that would be openly licensed, approximately 90 resources per grantee. This estimate is based on work that the FY 2015 grantees project they will do over a four-year period and we generally anticipate that most resources would be available for dissemination and licensing in the last two years of the grant period. We also note that the total number of resources to be created across the 16 grantees varies widely as a result of the different activities and innovative approaches proposed in their projects. For example, CSU-Los Angeles is proposing to redesign every first year science course, resulting in the largest estimate of resources created, while Delaware State is proposing to develop an analytics framework and tool for matching student interests to programs, which we believe would result in the creation of fewer resources. These two projects would impact approximately the same number of students, but one approach involves the creation of a large number of resources while another invests resources towards creation of a platform tool and a smaller number of resources associated with that tool.
Moreover, we believe that our estimates for the FITW grantees are likely to be higher than what we would expect for most other Department competitive grant programs, including those at the higher education level and those focused on elementary and secondary education. For example, in the higher education space, the Federal TRIO programs, which accounted for nearly half of all competitive awards to IHEs in FY 2015, have a more narrowly focused statutory purpose to provide basic services (
On the other hand, the Department also funds a number of activities that, under the final regulations, would be likely to produce significantly higher numbers of copyrightable resources than FITW grantees. For example, our National Language Resource Centers (LRC) program funds IHEs to research and develop resources for Less Commonly Taught Languages (LCTL),
Based on the experience with UT-Austin, we believe that if an open license requirement were in place at the time these awards were made to the 15 other grantees, we could assume that 15 times more language learning materials would be made available, or an additional 7,500 pieces of openly licensed content across the different language areas. Moreover, the enhanced availability of these materials potentially would have increased the impact of each of the individual centers by encouraging and supporting vibrant communities of practice focused on language instruction and learning at institutions that do not have the resources themselves. For example, this would have enabled discovery and use of resources created by the University of Indiana National African Resource Center, whose lack of broad dissemination leaves the public without information about what resources are available, where to access any materials, or how to seek permission to use any resources found. Since this is the only African language program in this cohort, the result is also the loss of resources for this entire language family.
In FY 2016, the Department made new and continuation awards under roughly 110 unique discretionary competitive and non-competitive grant programs that totaled $44.155 billion (excluding Pell). Of this total we estimate that 66 programs would be subject to the open licensing requirements of the final regulations. In addition to the Ready to Learn program, of the 43 programs (roughly $39.932 billion in FY 2016) that we estimate would be exempt from open licensing, approximately 30 are non-competitive programs that allocate funds on the basis of a formula, and approximately 13 support competitive grants in which program funds are only used to support activities that clearly fit within one or more or the categorical exemptions in this rule (
Within the group of 66 competitive grant programs (which received $4.223 billion in FY 2016) subject to the rule, not all grantees will produce intellectual property. For example, in the IDEA Personnel Development to Improve Services and Results for Children with Disabilities Program, many cohorts of grantees do not produce intellectual property at all and, therefore, this rule would not apply to those specific grantee cohorts. We note that the required activities in grant competitions often change over time, so the impact of
In addition, in some cases, only a portion of activities and funding would result in the creation of resources that would be required to be openly licensed under the final regulations. For example, in the case of IES's Education Research, Development, and Dissemination program, grants are awarded competitively to support research programs that both create interventions and resources and peer-reviewed publications that arise from scientific research (receiving an exception). The Department also has developed an agency-level exceptions process where any program could ultimately be granted either partial or complete exception to the requirements of the final regulations. For all of these reasons, we estimate that the potential impact of these final regulations will be limited to a relatively small but important subset of the programs and projects funded by the Department in any given year. The final regulations will ensure that those programs and projects that do produce copyrightable educational materials and resources, including materials and resources proven effective through rigorous evaluation, make such resources freely and widely available to the public for the potential benefit of students, teachers, and schools across the nation.
The final regulations will not impose significant costs on entities that receive assistance through the Department's competitive grant programs. We note that annual variation in the total volume of new and continuing discretionary grant awards, as well as in the purposes and priorities associated with such grants, limits the precision of our estimates, but we estimate that the upper bound total cost of these regulations, over ten years, will be approximately $22.6 million in labor fees, at an annualized rate of $3.2 million per year, with no additional costs to support technology infrastructure. This estimate assumes a discount rate of three to seven percent.
While the benefits of the final regulations depend on the broad, accessible dissemination of copyrightable educational materials and resources, we estimate that such dissemination will result in no additional technology infrastructure costs to grantees subject to the open licensing requirements, for two reasons. First, the near-universal adoption of digital tools and devices means that grantees will be creating and refining grant deliverables in digital formats that facilitate dissemination at no additional technology cost. Second, grantees may readily access and use a number of free methods to distribute digital openly licensed materials, including publicly available Web sites, content, or metadata repositories at no cost. Thus, we expect that grantees generally will be able to meet the dissemination requirements of the final regulations without incurring additional technology infrastructure costs.
Even though there will generally be no additional costs associated with technology infrastructure, we estimate that over a period of 10 years there may be a likely high-end labor cost of $22.6 million. This cost represents an upper bound estimate of the labor necessary to disseminate copyrightable products expected to be generated by all new ED grantees over a period of 10 years. To develop this upper bound estimate, we started by analyzing the volume of ED grantees that could potentially be impacted by the rule. In 2016, the most recent year preceding this final rule, the Department made approximately 5,470 new competitive grant awards. We know not all of these grantees will generate copyrightable products requiring dissemination under this final rule, so for purposes of this upper bound estimate we estimate that the Department will continue to make 5,470 new competitive grants each year, and that 30 percent of these awards will produce copyrightable content and consequently will be affected by the final rule. Further, we assume that for each year the rule is in effect after year one, every cohort of continuation awards will also be affected by the final rule. So, based on past data, we estimate that in the first year the final rule takes effect 1,641 grants will generate copyrightable products (30 percent of 5,470 total new grant awards made), and that by year four a total of 6,564 new and continuation awards would be impacted by the rule. Likewise, from years 4 through 10 this number plateaus and remains stable at 6,564.
Next, consistent with the estimates in the
Assuming a total of 1,641 new competitive grantees would generate copyrightable product during the first year the rule is in effect, with each new grantee producing 5 total deliverables in the first year, the overall volume of resources requiring dissemination would be 8,205 (1,641 grantees producing an average of 5 copyrightable products each). In the second year, with new grantees expected to produce 15 total deliverables on average, the overall volume of copyrightable products would be 49,230 (3,282 grantees producing an average of 15 copyrightable products). In year three the overall volume would increase to 98,460 (4,923 grantees producing and average of 20 copyrightable products), and by year 4 this number would be 328,200 (6,564 grantees producing an average of 50 copyrightable products).
Finally, we estimate the likely time and salary that would be required for individual grantees to complete these requirements. As an example of the specific steps that might be necessary for an individual grantee to complete dissemination requirements envisioned in the final rule, the grantee would:
1. Use the Creative Commons License tool to select and apply the symbol to the work and generate the machine readable code and affix to the work (
2. Upload the resource and metadata, including the name, description,
We estimate the time for completion of Steps 1 and 2 to be approximately 30 minutes total per resource. We also recognize that the actual time for completion may be substantially shorter in the case of automated or bulk resource uploads. Assuming a pay rate of $15/hour for data entry,
Taking into account these assumptions, we estimate that a reasonable upper bound estimate of the maximum likely labor costs for all expected grantees to implement this final rule over a period of 10 years to be $22.6 million, at an average total annual cost of $2.26 million.
Under current regulations, title to intellectual property acquired under Department grant funds, including copyright, vests in the grantee. With respect to copyrighted works, under 2 CFR 200.315(b), the Department also reserves a royalty-free, non-exclusive, and irrevocable right to reproduce, publish, or otherwise use for Federal purposes, and to authorize others to do so. No further action is necessary to designate these rights. Grantees may establish terms and conditions that permit use of their works to any member of the public, for each instance of use or for each created work. That the Department does not frequently exercise its Federal purpose license may create the false impression that any grantee can use the copyrighted works it creates with Federal grant funds for revenue generating purposes without any concern that third parties will have free access to those materials for Federal purposes.
This final rule requires that grantees openly license copyrightable grant deliverables created with Department funds to enable the public to use the work without restriction, so long as the public provides attribution to the copyright holder. While the type of license will differ depending on the type of work created, applying an open license to a grant product typically involves the addition of a brief license identification statement or insertion of a license symbol or device. This could occur following the development of the product, at the same time that the disclaimer currently required under 34 CFR 75.620 is applied.
In this context, the regulations could reduce commercial incentives for an eligible entity to apply to participate in a competitive grant program. For example, we believe that under some competitive grant programs, grant recipients may produce materials that will be subsequently sold or licensed to third parties, such as publishing companies or others in the field. Although an open license does not preclude the grantee or any individual from developing commercial products and derivatives from the grant funded material, it could diminish certain competitive advantages that these grantees currently possess as the copyright holder. In addition, publishers and other third parties may incur loss of revenue since their commercial product will potentially compete with freely available versions of a similar product or may hesitate to enter into licensing agreements with grantees.
In response to these concerns, we note that derivative works built upon the Department funded copyrightable works using non-Department funds are considered new works to the extent of the modifications and are not covered by this regulation. As long as the grantee or subgrantee does not elect an open license with a noncommercial use requirement, using non-Department funds, any other entity can improve upon the grant-funded copyrightable works resulting in a derivative work that can be commercialized for financial gain or as part of a sustainability plan. For purposes of clarity, noncommercial licenses would not limit the ability of grantees to commercialize their own derivative works. It is the underlying Department grant-funded copyrightable works that will be freely available to the public. This allows multiple entities to enter into a commercial market for derivative works, potentially resulting in multiple derivative products. In the event that a grantee or subgrantee selects an open license with a noncommercial use requirement, members of the public would likely need to contact the grantee or subgrantee directly in order to obtain broader usage rights.
Nothing in this regulation prevents the grantee itself from entering this marketplace, or from entering into private, commercial relationships with select commercial entities to distribute derivative works based upon the openly licensed works. In this case, the grantee's expertise as the original creator could allow it to retain market leverage, if its commercial product demonstrated market value that outcompeted other commercial derivatives. We believe that the grantee may be best positioned to create derivative works with the most economic value since it best understands both the present utility and future potential of the product and can anticipate the enhancements that would need to be taken to address unmet market needs.
Third, based on the Department's past grant making experiences, relatively few grantees have developed and marketed copyrighted works paid for with Department funds. In those cases, the open license requirement would not preclude their ability to continuously iterate and improve their product through copyrighted commercial derivatives.
We further note that in the competitions in which we required that grant-funded copyrightable works be openly licensed, it was not our experience that the requirement deterred grantees from applying or attracting partners. The two rounds of FITW grant competitions attracted over 500 applications in FY 2014 for 24 awards and over 300 applicants in FY 2015 for 18 awards. We have not heard from grantees that attracting partners has been or would be problematic. In addition, one of the considerations for granting a program level exception will be whether the open licensing requirement would impede the grantee's ability to form the required partnerships necessary to carry out the purpose of the grant. Thus, we believe we can address this concern through our exceptions process.
We believe that the benefits of the open licensing requirement in the education field will significantly outweigh the costs our grantees might incur. The education sector has had considerable recent experience with successful implementation of open licenses as a mechanism that enables dissemination, broad access, and use. Open licenses have enabled the Department's own grantees, including the New York State Department of Education (NYSED) to have broad reaching impacts and enabled collaboration that has resulted in significant cost savings for SEAs, LEAs,
The open license has also enabled other organizations to create derivative works that enhance the original curriculum. For example, UnboundED, a non-profit educational organization, has adapted the original materials created by the grant, developed supplemental digital content, English language learner support, and is offering curated sets of these materials to the public at no cost. In addition to the content, UnboundED has developed new teacher professional development materials and offers paid teacher training on using these and other open resources. Thus, the open license has enabled a single investment to result in broad, national dissemination and stimulated a derivative marketplace of services and supplemental content. Since the EngageNY content is freely available, other teachers, SEAs, and LEAs do not have to duplicate investments in curricula in these same content areas, resulting in a more efficient use of resources.
In addition, between 2012 and 2015, the Office of Career Technical and Adult Education (OCTAE) invested national activities funds in accelerating the teaching and learning of STEM competencies through high-quality OERs and high-quality adult education instruction of STEM by funding adult educators who located, used, evaluated, and shared science and math OER that are appropriate for adult education classes. The project also developed online professional development courses for teachers on how to use OER for math and science instruction in their adult education classrooms that are freely available in multiple repositories.
Under the National Language Resource Centers (LRC) grant program, the Department awarded funds to IHEs for research and development of resources for Less Commonly Taught Languages (LCTL). Though there was no specific requirement for the grantees to openly license their resources, one grantee did choose to do so. As previously discussed, the University of Texas at Austin created the Center for Open Educational Resources and Language Learning (COERLL), which creates fully openly licensed language and pedagogical materials for 16 languages, in addition to an open platform for discovery, remixing, and repurposing of these language resources, and open research. There are hundreds of different and diverse open materials, including curricula, lessons, worksheets, assessments, textbooks, videos, podcasts, research studies, open apps for student learning, and interactive platform, materials openly licensed on their Web site available under an open license and publically available on their Web site. These resources include language learning materials such as OER for K'ichee' Maya, an indigenous language spoken in Guatemala; software that allows a group of users to annotate the same text together; a series of native speaker surveys; a teacher professional development digital badge system; research on the perception and use of foreign language OER; and a Web site supporting a community of practice on Open Education in language learning.
Finally, the Department's FITW grant program has required grantees to openly license intellectual property.
Elsewhere in the Federal government, as noted previously, the Department of Labor was the earliest user of open copyright licenses. The Department of Labor first piloted the open license requirement in FY 2011, through the $2 billion TAACCCT grant program, which required all new resources created with TAACCCT funding to be made available under CC BY license.
Privately funded openly licensed projects also have a long history of creating educational resources with significant benefit to the public. For example, organizations such as Rice University's OpenStax and California State University's Multimedia Educational Resource for Learning and Online Teaching (MERLOT)
In sum, we believe that these regulations will help to ensure the broader and more effective dissemination of Department grant-funded works to the public. Department stakeholders, such as LEAs, SEAs, IHEs, students, and others beyond direct grant recipients would be able to freely use and access the technology and high-quality materials. The framework established by these regulations will also result in greater transparency and efficiencies in how these stakeholders and other members of the public can access these valuable educational resources.
As required by OMB Circular A-4 (available at
In determining whether to pursue regulatory action, we first considered other options that might accomplish our goals of enhancing dissemination and transparency. First, we considered whether we should establish an open licensing requirement as a supplemental priority, creating an authority for the Department to require open licensing in any appropriate grant program for fiscal year 2017 and future years. Although supplemental priorities provide opportunities for program offices to select or exempt certain grant programs from this requirement as appropriate, it would only lead to change program-by-program. We believe that it will be far more efficient to establish the requirement as a general rule for our competitive grant programs, while also building in the program-level and grantee exceptions process when an exception is appropriate.
We also considered whether we could instead license all copyrightable material to the public using our Federal purpose license. This approach would allow for access to and dissemination of grant-funded resources. However, as previously discussed, the Federal purpose license requires significantly increased administrative capacity at the Department. From an administrative perspective, use of the Federal purpose license places the burden on the
The Department recognizes that the variety of our programs require grantees to adopt a wide range of strategies for implementation. As previously discussed, we believe this final rule advances our goals of broad dissemination by requiring an open license that does not restrict the distribution of derivative works, such as through commercial channels, or create additional restrictions on future licensing of derivative works not created with Department grant funds. We recognize that in some instances, placing limitations on the license (
We also recognize that there will be cases where implementation of the requirements of this regulation would be inconsistent with statutory requirements of the grant programs or the Department's general goals. In cases such as those, the Secretary retains the ability to make exceptions to the open licensing requirement for those programs on a case-by-case basis under 2 CFR 3474.5(a)
Section 3474.20(c) contains an information collection requirement. Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3507(d)), the Department has submitted a copy of this section as part of a change request to OMB for its review under OMB Control Number(s) 1894-0006, and 1894-0009 to reflect this new requirement. There will be no increase or decrease in burden. This change request has been approved by OMB.
A Federal agency may not conduct or sponsor a collection of information unless OMB approves the collection under the PRA and the corresponding information collection instrument displays a currently valid OMB control number. Notwithstanding any other provision of law, no person is required to comply with, or is subject to penalty for failure to comply with, a collection of information if the collection instrument does not display a currently valid OMB control number.
This document provides early notification of our specific plans and actions for these programs.
In the NPRM we requested comments on whether the proposed regulations would require transmission of information that any other agency or authority of the United States gathers or makes available. We received no comments.
You may also access documents of the Department published in the
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For the reasons discussed in the preamble, the Secretary amends part 3474 of title 2 of the Code of Federal Regulations as follows:
20 U.S.C. 1221e-3 and 3474 unless otherwise noted.
For competitive grants awarded in competitions announced after February 21, 2017:
(a) A grantee or subgrantee must openly license to the public the rights set out in paragraph (b)(1) of this section in any grant deliverable that is created wholly or in part with Department competitive grant funds, and that constitutes a new copyrightable work; provided, however, that when the deliverable consists of modifications to pre-existing works, the license shall extend only to those modifications that can be separately identified and only to the extent that open licensing is permitted under the terms of any licenses or other legal restrictions on the use of pre-existing works.
(b)(1) With respect to copyrightable work identified in paragraph (a) of this section, the grantee or subgrantee must grant to the public a worldwide, non-exclusive, royalty-free, perpetual, and irrevocable license to—
(i) Access, reproduce, publicly perform, publicly display, and distribute the copyrightable work;
(ii) Prepare derivative works and reproduce, publicly perform, publicly display and distribute those derivative works; and
(iii) Otherwise use the copyrightable work, provided that in all such instances attribution is given to the copyright holder.
(2) Grantees and subgrantees may select any open licenses that comply with the requirements of this section, including, at the grantee's or subgrantee's discretion, a license that limits use to noncommercial purposes. The open license also must contain—
(i) A symbol or device that readily communicates to users the permissions granted concerning the use of the copyrightable work;
(ii) Machine-readable code for digital resources;
(iii) Readily accessed legal terms; and
(iv) The statement of attribution and disclaimer specified in 34 CFR 75.620(b).
(c) A grantee or subgrantee that is awarded competitive grant funds must have a plan to disseminate the openly licensed copyrightable works identified in paragraph (a) of this section.
(d)(1) The requirements of paragraphs (a), (b), and (c) of this section do not apply to—
(i) Grants that provide funding for general operating expenses;
(ii) Grants that provide support to individuals (
(iii) Grant deliverables that are jointly funded by the Department and another Federal agency if the other Federal agency does not require the open licensing of its grant deliverables for the relevant grant program;
(iv) Copyrightable works created by the grantee or subgrantee that are not created with Department grant funds;
(v) Peer-reviewed scholarly publications that arise from any scientific research funded, either fully or partially, from grants awarded by the Department;
(vi) Grantees or subgrantees under the Ready To Learn Television Program, as defined in the Elementary and Secondary Education Act of 1965, as amended, Title II, Subpart 3, Sec. 2431, 20 U.S.C. 6775;
(vii) A grantee or subgrantee that has received an exception from the Secretary under 2 CFR 3474.5 and 2 CFR 200.102 (
(viii) Grantees or subgrantees for which compliance with these requirements would conflict with, or materially undermine the ability to protect or enforce, other intellectual property rights or obligations of the grantee or subgrantee, in existence or under development, including those provided under 15 U.S.C. 1051,
(2) The requirements of paragraphs (a), (b), and (c) of this section do not alter any applicable rights in the grant deliverable available under 17 U.S.C. 106A, 203 or 1202, 15 U.S.C. 1051,
(e) The license set out in paragraph (b)(1) of this section shall not extend to any copyrightable work incorporated in the grant deliverable that is owned by a party other than the grantee or subgrantee, unless the grantee or subgrantee has acquired the right to provide such a license in that work.
(f)
(1) A
(2) A
Environmental Protection Agency (EPA).
Proposed rule.
The U.S. Environmental Protection Agency (EPA) is proposing new health and environmental protection standards under the Uranium Mill Tailings Radiation Control Act (UMTRCA) of 1978. The standards proposed in this action would be applicable to byproduct materials produced by uranium in-situ recovery (ISR) and would be implemented by the U.S. Nuclear Regulatory Commission (NRC) and NRC Agreement States. The EPA initially proposed new health and environmental protection standards for ISR facilities on January 26, 2015; however, the EPA has decided to re-propose the rule and seek additional public to comment on changes to the original proposal, including changes in the regulatory framework and approach, based on public comment and new information received from stakeholders.
The first standards for uranium recovery were issued by the EPA in 1983 when conventional mining and milling were the predominant methods of uranium extraction, and were last amended in 1995. Since the early 1990s, ISR has mostly replaced conventional milling. This proposed rule would strengthen the existing regulations for uranium recovery by adopting new standards addressing groundwater hazards specific to ISR facilities. As with the original proposal, the primary focus of this proposal is groundwater protection, restoration and long-term stability.
The most significant changes from the original proposal include: Removing the default 30-year long-term monitoring provision and shifting to a Resource Conservation and Recovery Act (RCRA) Subtitle C corrective action framework as a model rather than a RCRA Subtitle C landfill framework; adding specific criteria and procedures for approving termination of long-term stability monitoring; deleting gross alpha particle activity from proposed Table 1 to subpart F of 40 CFR part 192, and allowing more flexibility for the NRC or Agreement States to determine on a site-specific basis the constituents for which concentration based standards are set. The EPA has also sought to clarify how these standards under UMTRCA complement, and do not overlap with, the requirements of the Safe Drinking Water Act (SDWA).
This action also proposes amendments to certain provisions of the existing rule to address a ruling of the Tenth Circuit Court of Appeals, to update a cross-reference to another environmental standard and to correct certain technical and typographical errors. The proposed rule has been informed by input from the NRC, the U.S. Department of Energy (DOE), states, tribes, industry, environmental groups and other stakeholders, and would promote public health and protect groundwater by reducing the potential for groundwater contamination after production has ceased, and in aquifers adjacent to ISR facilities during uranium recovery.
Comments must be received on or before July 18, 2017.
Submit your comments, identified by Docket ID No. EPA-HQ-OAR-2012-0788, by one of the following methods:
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Ingrid Rosencrantz, Office of Radiation and Indoor Air, Radiation Protection Division, Mailcode 6608T, U.S. Environmental Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460; telephone number: (202) 343-9286; fax number: (202) 343-2304; email address:
The regulated categories and entities potentially affected by the proposed standards include:
This table is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be affected by this proposed action.
• Identify the rulemaking by docket number and other identifying information (subject heading,
• Follow directions—The agency may ask you to respond to specific questions or organize comments by referencing a Code of Federal Regulations (CFR) part or section number.
• Explain why you agree or disagree, suggest alternatives, and substitute language for your requested changes.
• Describe any assumptions and provide any technical information and/or data that you used.
• If you estimate potential costs or burdens, explain how you arrived at your estimate in sufficient detail to allow for it to be reproduced.
• Provide specific examples to illustrate your concerns, and suggest alternatives.
• Explain your views as clearly as possible, avoiding the use of profanity or personal threats.
• Submit your comments by the comment period deadline.
If anyone contacts the EPA requesting to speak at a public hearing concerning this proposed rule by February 21, 2017, the EPA will hold a public hearing. If you are interested in attending a public hearing, contact Mr. Anthony Nesky at (202) 343-9597. If a public hearing is held, the Agency will announce the date, time and venue on the EPA Web site at
The EPA refers to a number of documents that provide supporting information for the Agency's proposed uranium and thorium mill tailings standards. All documents relied upon by the EPA in regulatory decision making may be found in the EPA docket (EPA-HQ-OAR-2012-0788) accessible via
EPA 402/D-14-001, “Considerations Related to Post Closure Monitoring of Uranium In-Situ Leach/In-Situ Recovery (ISL/ISR) Sites,” EPA, 2014.
EPA 402/R-14-003, “Economic Analysis: Proposed Revisions to the Health and Environmental Protection Standards for Uranium and Thorium Mill Tailings Rule (40 CFR part 192),” EPA, 2016.
EPA 530/R-09-007, “Statistical Analysis of Groundwater Monitoring Data at RCRA Facilities—Unified Guidance,” EPA, 2009.
The following abbreviations are used in this preamble:
ISR is a method by which uranium is leached from underground ore bodies by the introduction of a solvent solution, called a lixiviant, through injection wells drilled into the ore zone. The process does not require excavation to extract the ore body from the ground or conventional milling to extract the uranium from the mined ore. After the lixiviant is injected underground, it passes through the ore zone and mobilizes the uranium. The uranium-bearing solution is then pumped to the surface via extraction wells, and the solution is processed to extract the uranium. During uranium production, the fluids injected to mobilize uranium change the chemistry of the aquifer from its original state, thereby mobilizing uranium and many other minerals and metals. Groundwater from the ISR production zone can migrate from the production zone and contaminate nearby groundwater with arsenic, barium, cadmium, chromium, lead, mercury, selenium, silver, nitrate, molybdenum, radium and uranium and other constituents. The standards proposed in this action would minimize the risk of undetected groundwater degradation and constituent migration during and after ISR operations have ceased.
The EPA initially proposed new health and environmental protection standards for ISR facilities on January 26, 2015 (hereinafter “original proposal”), with the intention of finalizing the new standards in 2016.
Several commenters also voiced concerns about information and data collection, including review of Agreement State regulatory programs that address ISRs. Although the EPA requested and collected data and information as outlined in section IV.B of this preamble, the Agency understands stakeholders concerns and are inviting stakeholders to submit additional data and analyses to further clarify the ISR process, including any additional monitoring results and analyses. The EPA will be collecting additional information on state regulatory programs, as recommended by several states.
The EPA is proposing to add new health and environmental protection standards to regulations promulgated under UMTRCA. The proposed standards would regulate byproduct materials produced by ISR, including both surface and groundwater standards, with a primary focus on groundwater protection, restoration and stability. By explicitly addressing the most significant environmental and public health hazards presented by ISR activities, these proposed standards would address the shift toward ISR as the dominant form of uranium recovery that has occurred since the standards for
This rule would provide the necessary framework for consistent and sustainable protection of groundwater at ISR sites that will continue to have beneficial uses even if the aquifer has been exempted from protection under the SDWA.
Groundwater is a scarce resource that is under increasing pressure, particularly in the arid West where groundwater has multiple uses, including for livestock production, crop irrigation, wildlife support, and human consumption. As groundwater resources are depleted, it becomes even more important to preserve those resources for future uses. Stakeholders in these areas are already finding a need to use groundwater that is of lower quality than desired.
While an aquifer or portions of an aquifer may have been exempted from the protections of the SDWA, the aquifer may be needed in the future for human drinking water or other purposes. The standards proposed in this action do not require licensees to improve groundwater quality, only to provide confidence that: (1) In the area mined, the applicable constituent concentration standards (set at either background or health-based levels, whichever is higher), are met and remain stable; and (2) that uranium recovery operations will not endanger adjacent aquifers. EPA requests comment on whether groundwater, once it meets the constituent concentration standards, could or would potentially be used for drinking water or other purposes.
UMTRCA directs the EPA to establish standards of general application, while the NRC is vested with implementing the EPA's standards under its licensing and enforcement authority. The EPA has previously promulgated general standards under UMTRCA for surface disposal of mill tailings from conventional uranium mining and milling, but ISR has become the dominant form of uranium extraction since the 1990s. In 2006, an NRC commissioner observed that ISR-specific rules were needed to provide a national approach to bring predictability to the industry and state regulators. This view was not predicated on specific documented instances of groundwater contamination outside of the ISR production zone. The scope and level of protection of the SDWA differs from the UMTRCA. The purpose of the SDWA UIC program is to prevent endangerment of underground sources of drinking water. In determining whether an aquifer may be exempted from the protection of the SDWA, the EPA does not consider its use for purposes other than human drinking water (
As the highlighted portions of the SDWA regulations below show, there is no requirement to demonstrate poor water quality prior to issuing an aquifer exemption if the aquifer is or could be mineral producing. Under the SDWA's UIC regulations, aquifer exemptions are used to allow for mineral recovery in aquifers that would otherwise be protected as sources of drinking water when certain criteria are met. In the SDWA regulations, § 146.4 provides that: “An aquifer or a portion thereof which meets the criteria for an “underground source of drinking water” in § 146.3 may be determined under § 144.7 of this chapter to be an “exempted aquifer” for Class I-V wells if it meets the criteria in paragraphs (a) through (c) of this section. Class VI wells must meet the criteria under paragraph (d) of this section: (a) It does not currently serve as a source of drinking water; and (b) It cannot now and will not in the future serve as a source of drinking water because: (1) It is mineral, hydrocarbon or geothermal energy producing, or can be demonstrated by a permit applicant as part of a permit application for a Class II or III operation to contain minerals or hydrocarbons that considering their quantity and location are expected to be commercially producible; or (2) It is situated at a depth or location which makes recovery of water for drinking water purposes economically or technologically impractical; or (3) It is so contaminated that it would be economically or technologically impractical to render that water fit for human consumption; or (4) It is located over a Class III well mining area subject to subsidence or catastrophic collapse; or (5) The total dissolved solids content of the ground water is more than 3,000 and less than 10,000 mg/l and it is not reasonably expected to supply a public water system . . .”.
In addition, although a portion of an aquifer may be exempted from the protections of the SDWA, there are no federal requirements preventing recovery and use of the water within exempted aquifers (including where ISR operations were previously conducted) for private drinking water supply, public water supply, or other uses.
UMTRCA provides authority that can be used to protect aquifers during and after uranium recovery operations, regardless of whether the aquifer meets the definition of an underground source of drinking water (USDW) as defined in the EPA's UIC regulations or is exempted from the protections of the SDWA because it meets the existing regulatory criteria for exemption. UMTRCA directs the Administrator to promulgate “standards of general application for the protection of public health, safety, and the environment from radiological and non-radiological hazards associated with the processing, and possession, transfer, and disposal of byproduct material”.
In areas being mined for uranium, the SDWA does not require operators or regulators to collect the level of data needed to definitively confirm or disprove drinking water contamination or contamination of water for other purposes that may also impact humans, such as livestock watering and crop irrigation. Additionally, data that the EPA's UIC Program have received and evaluated at or near at least one ISR facility are consistent with an excursion beyond the boundary of the exempt aquifer (
The proposed 40 CFR part 192, subpart F would afford protections that do not currently exist under federal UIC regulations and would be complementary to existing regulations (
The proposed 40 CFR part 192, subpart F also would ensure that industry maintains responsibility for protection of public health and the environment at uranium ISR facilities during and after uranium recovery operations.
Since ISR alters the chemical composition of groundwater, it creates reasons to be concerned about risk to public health, safety and the environment from radiological and non-radiological hazards associated with the processing and disposal of byproduct material. Industry commenters and others say that there is no need for this rule because the EPA has not identified an instance in which an ISR operation has contaminated a source of drinking water. First, the Agency notes that this proposal addresses groundwater protection at ISR facilities both in and around the production zone and in surrounding aquifers. Focusing on the area of surrounding or adjacent aquifers, the EPA acknowledges that the Agency does not have sufficient information to document a specific instance of contamination of a public source of drinking water caused by an ISR. The Agency remains concerned, however, that the available data may not be capturing some instances of contamination that this proposed rule seeks to prevent. In other words, the Agency remains concerned that the lack of data does not demonstrate that no contamination is occurring, as industry commenters assert, but instead merely demonstrates the lack of data available to be able to make such a determination, especially where there has been limited post-restoration monitoring. The monitoring requirements in this proposal address the issue of lack of data.
As explained in this preamble, in documents supporting this proposal, and as included in the docket for this proposal, there is ample evidence of excursions occurring as the result of ISR facilities. For example, data that the EPA's UIC Program have received and evaluated at or near at least one ISR facility are consistent with an excursion beyond the boundary of the exempt aquifer, leading to elevated uranium levels outside the ISR facility. In addition, there is data in the proposal's Background Information Document (BID) describing numerous excursions from several ISR facilities. Moreover, data in attachment 5 of the BID shows that several ISR facilities have not met background or health-based levels after restoration of the production zone. This data, when considered with the understanding that groundwater flow is often extremely slow, raises concerns that there has been insufficient monitoring conducted by these ISR facilities to identify the actual contamination that may be occurring or may occur in the future beyond the production zone and in sources of drinking water. The EPA solicits comment on industry's assertion that in no case have any excursions from ISR facilities resulted in contamination in aquifers being used as public sources of drinking water or for other uses. In addition, the EPA also requests comment on the kinds of data that would be needed to clearly link ISR operations with off-site contamination or that would support claims that there is no contamination of concern.
The EPA notes that several NRC-regulated ISR facilities are continuing to work toward restoring groundwater, with restoration and monitoring being conducted for as long as 10 years after ceasing production. The Agency understands that restoration does not always meet original background levels as evidenced by the number of restoration goals exceeding background or the levels proposed in Table 1 to subpart F. Additionally, the NRC acknowledges that efficiency could be gained by codifying its longstanding effective regulatory regime into regulations specific to ISR facilities. Historically, restoration and monitoring at ISR facilities are typically conducted for only a short period, and a longer period would provide more confidence to demonstrate that restoration of the affected groundwater is complete and that long-term stability is established with confidence before license termination. The initial and long-term stability monitoring and corrective action program included in this proposal would ensure that both of these requirements are met before ISR facilities can be decommissioned.
At ISR facilities, the groundwater is directly impacted by the injection of lixiviant into the aquifer, which alters the geochemistry of the ore-bearing formation and increases the concentration of radionuclides and other metals in the water. Restoration activities attempt to restore the water quality for specific constituents to the applicable constituent concentration standards inside the production zone. Although subpart D to 40 CFR part 192 (hereinafter “subpart D”) addresses contamination of aquifers, it explicitly addresses only contamination resulting from releases from uranium mill tailings impoundments used to store uranium byproduct material (
As described in the preamble to the 2015 proposal, the EPA solicited technical advice on key issues related to groundwater protection at ISR sites from the Radiation Advisory Committee (RAC) of the Agency's Science Advisory Board (SAB) (80 FR 156). The final report of the SAB/RAC, along with the EPA's response, can be found at:
The SAB/RAC further considered this issue in 2015, and the Agency provided a detailed cross-walk to the 2015 proposed rule to show how the RAC's advice had been addressed. The SAB determined that no further action was needed on its part.
The EPA has evaluated available data for all phases of ISR activities to address the SAB recommendations. Section 5 of the BID analyzes data and examines specific case studies for baseline and restoration, with particular attention given to establishment of baseline at the Dewey-Burdock site in South Dakota (Attachment A). Sections 6 and 7.8 and Attachment F provide extensive analysis of post-restoration monitoring at the Crow Butte, Christensen, Highland, and Irigaray ISR sites, including regression analysis and statistical testing, and cumulative complementary distribution functions (CCDF). Results are presented by analyte, mine unit, and well.
Section 6 addresses in detail SAB recommendations related to influences on groundwater chemistry and their effects on time frames for stability
This action also proposes amendments to certain provisions in the current rule, located at 40 CFR part 192. Specifically, this action addresses a ruling of the Tenth Circuit Court of Appeals, updates a cross-reference to another environmental standard and corrects other technical and typographical errors.
The proposed rule includes a new subpart, subpart F, within 40 CFR part 192, which sets standards to protect groundwater at uranium ISR operations. Specifically, subpart F would set standards of general application to protect groundwater beyond the production zone during ISR operational and restoration phases and to ensure, once the wellfield is restored, that the restoration is complete and stable. The proposed rule includes three types of groundwater protection standards: (1) Constituent concentration standards, (2) initial stability standards, and (3) long-term stability standards. The proposed rule also includes monitoring requirements to establish statistically valid background water quality levels, excursion monitoring (for the operational and restoration phases), and monitoring to meet the initial and long-term stability standards. The proposed rule also includes a requirement to establish a corrective action program. Once finalized, these standards will be implemented by the regulatory agency. Once the regulatory agency incorporates the new standards into its regulations, or takes other appropriate steps to implement the new standards, this will provide a nationally consistent approach for the licensing process for ISR facilities.
The costs and benefits of this rulemaking are described briefly in Table 2 of this preamble. The costs reflect the difference in costs that would be incurred by ISR licensees under the proposed rule and costs that would be incurred by those facilities in the absence of the proposed rule. These incremental costs include added costs associated with monitoring and non-monitoring compliance actions under the proposed rule. For additional details on the incremental costs of the proposed rule, see section V.B of this preamble and section 3 of the document titled, “Economic Analysis: Revisions to the Health and Environmental Protection Standards for Uranium and Thorium Mill Tailings Rule (40 CFR part 192),” available in Docket ID No. EPA-HQ-OAR-2012-0788.
Complying with the proposed standards may require some existing ISR facilities to monitor groundwater for additional constituents that they are not currently monitoring. It would also require all ISR facilities to continue monitoring for a period of at least three years after the initial stability standard is met, and to conduct geochemical modeling and other analysis to demonstrate that the applicable constituent concentration standards will continue to be met in the future. The additional monitoring, modeling and analysis that would be required under this proposed rule could increase costs to ISR facilities. The additional years during which ISR facilities' license, surety, insurance, maintenance and other non-monitoring activities would have to be maintained would also increase costs. The EPA estimates the rule imposes annualized incremental costs on the ISR industry of approximately $11.9 million, including incremental monitoring costs and other non-monitoring costs.
In its economic analysis, the EPA analyzed potential economic impacts of the rule on small entities (7 companies) using a range of assumptions about revenues of firms that own ISR facilities and costs of complying with the rule. The “average revenue” assumption is based on a market price of $55 per pound of U3O8e and production that is 25% of facility capacity. The “low revenue” assumption reflects revenues 10% lower, and the high revenue assumption reflects revenues that would be 20% higher. With average costs, cost-to-sales ratios for small firms range from 0.7% to 3.1% for the low revenue scenario and from 0.5% to 2.3% under the higher revenue scenario. These assumptions are intended to reflect the range of possible market conditions at the time when the rule would take effect (likely 2022 to 2025). Uranium market projections for the longer term are generally optimistic, reflecting growth in nuclear power in China and India and other countries; 57 new reactors are currently under construction with 65% of those projected to come online by 2020, and world-wide electricity consumption is projected to increase by 50% between 2013 and 2035 (only part of the increase is estimated to be met by nuclear energy) (Cameco, 2016). Outlook for the near term, however, is less positive, and the rate of recovery is uncertain.
The EPA acknowledges that current uranium market conditions reflect depressed demand for uranium (due to lingering effects of the Fukushima incident, slow recovery of demand for electricity since the recession and low prices of substitute sources of energy) and some reliance on alternative (non-mine) sources of uranium. As a result, both the price and production of uranium have fallen. The long-term contract price of uranium has declined from around $60 per pound of U3O8e in 2012 to around $40 per pound in 2016. Spot prices have generally been 20% lower than contract prices. While market forces have driven the market price for uranium down by $20 to $30 dollars over the past 5 years, the rule is estimated to increase the cost of producing uranium using ISR methods by between $1.27 per pound U3O8e and $2.45 per pound of U3O8e, depending on the cost scenario.
Because of these market conditions, several ISR facilities that are fully licensed and permitted are not currently producing uranium (including previously operational facilities that have been placed on standby and licensed and permitted facilities that have never gone into production), and development of new ISR facilities has largely been put on hold. Further, several ISR facilities have changed ownership in the past few years, as companies have been forced by market conditions to sell assets. In other words, some ISR firms currently are unable to profitably operate their facilities even in the absence of the rule. Several of the small firms report little or no revenue from sales of uranium. Even the relatively small incremental costs required to comply with the rule's provisions would not currently be affordable for such firms. This is not due to the magnitude of the rule's costs; it is due to current conditions in the world's economy generally and in the market for uranium in particular. The EPA considers that when the market for uranium recovers, as it is projected to do, ISR uranium production and price will increase; under those conditions, facilities that are currently unprofitable without the rule would likely be profitable with the rule's costs included. However, the EPA solicits public
The EPA compared these costs to the potential financial, ecological and human health benefits that would result from the proposed rule. Although the EPA is unable to quantify all the potential benefits, the EPA has identified several categories of benefits that can be attributable to the rule. The proposed rule would require groundwater at ISR facilities to be restored to the constituent concentration standards. Licensees would have to demonstrate stability of groundwater at those constituent concentration standards by completing at least 6 years of monitoring (3 years to meet the initial stability standards plus 3 years to meet the long-term stability standards), and conduct modeling and analysis to demonstrate there is a reasonable assurance that the applicable constituent concentration standards will continue to be met in the future. This provision would minimize the risk of degradation of valuable groundwater resources and the potential exposure of human, domestic livestock or ecological receptors to radiological or other constituents. The proposed rule would also minimize the potential contamination of surface water and potential adverse health impacts resulting from such contamination. In addition, the proposed rule would avoid the potential costs associated with remediating contaminated aquifers; the cost of remediating a single plume of contamination could exceed the nationwide incremental costs associated with the proposed rule. The EPA estimated the cost savings due to avoided pump and treat remediation for hypothetical contaminant migration examples using the Conceptual Mine Unit, under three plume scenarios. For each scenario, the EPA computed the estimated cost savings by computing the difference in the cost of remediating a large plume (which might result if the plume were not detected for many years) and the cost of remediating a small plume discovered through monitoring prior to facility closure. The total estimated avoided costs over the entire remediation episode in this illustration, remediating three different sized plumes, ranged from $23.7 million to $608 million, depending on the scenario. Annualized, these avoided costs range from $1.5 million to $11.1 million per year. To reflect the recognition that the proposed rule would reduce the likelihood of contamination relative to existing regulatory requirements, but not eliminate it entirely, the EPA further assumed a range of probability that the illustrative example contamination episode would be prevented by the proposed rule, but not identified under current requirements. The EPA assumed that the likelihood that the proposed rule would prevent the contamination, but current requirements would not, would range from 20% to 80%. Thus, the values shown in the table are 20% of the lower bound value ($0.3 million) to 80% of the upper bound value ($8.9 million). However, because the EPA is unable to quantify the number or characteristics of contamination episodes that could occur in the absence of the proposed rule, the EPA is unable to estimate nationwide cost savings. Thus, the EPA has not compared these illustrative costs savings with the estimated national costs of the proposed rule or computed the net benefits.
The EPA is proposing the new standards and amendments under its authority in section 275 of the Atomic Energy Act (AEA), as added by section 206 of UMTRCA.
Title I of UMTRCA covers inactive uranium milling sites, nearby contaminated “vicinity properties” and depository sites. The EPA was directed to set general standards that are consistent with the requirements of the Solid Waste Disposal Act (later amended as the Resource Conservation and Recovery Act, or RCRA) to the maximum extent practicable. The Title I standards are located in EPA regulations at 40 CFR part 192, subparts A-C.
This proposed rule is based on Title II of the Act, which covers operating uranium processing or disposal facilities licensed by the NRC or NRC Agreement States. The EPA has authority to promulgate standards of general
In today's action, the EPA is proposing to add a new subpart, subpart F, to the EPA's existing regulations for uranium and thorium mill tailings in 40 CFR part 192. The proposed standards would apply only to ISR facilities and are designed to protect public health, safety and the environment from contamination associated with their uranium recovery operations. The proposed standards are summarized in the following sections.
Subpart F would apply to new and existing ISR facilities, including facilities that have temporarily ceased uranium production (
In the proposed new subpart, the EPA has cross-referenced subpart D to indicate that the existing standards for protecting surface waters and groundwater also apply to ISR facilities. The subpart D standards were initially written to address the handling, storing and disposal of byproduct material produced from the processing of uranium ore.
Consistent with the original proposal, this proposed rule includes the following three types of groundwater protection standards for ISR facilities: (1) Constituent concentration standards (including provisions for Alternate Concentration Limits (ACLs)); (2) initial stability standards; and (3) long-term stability standards.
In this proposal, the appropriate constituent concentration standards for an ISR facility would be determined by the regulatory agency for each licensee. The constituent concentration standard for each constituent would be the highest level of the following values: (1) The lowest regulatory standard for that constituent found in 40 CFR 141.62, 141.66, 141.80, 143.3, 264.94, and Table 1 to subpart A of 40 CFR part 192; (2) that constituent's preoperational background level in the wellfield; or (3) an ACL for that constituent as approved by the regulatory agency. When setting the constituent concentration standards for a licensee, the regulatory agency would consider a minimum of 12 constituents. The regulatory agency would not be required to set standards for all 12 constituents, but the regulatory agency would have to set a constituent concentration standard for each of the listed constituents that is present in or could be affected by the ISR operation. The regulatory agency would have to identify the constituents during the preoperational monitoring phase. The regulatory agency would need to consider the following 12 constituents when setting the constituent concentration standards for an ISR operation: Arsenic, barium, cadmium, chromium, lead, mercury, selenium, silver, nitrate (as N), molybdenum, combined radium-226 and radium-228, and uranium (total). The original proposal included gross alpha particle activity (excluding radon and uranium), however, this constituent was not included in this proposal for the reasons explained in section III.3.2. The EPA is specifically requesting comment on the deletion of gross alpha particle activity (excluding radon and uranium) from the list of constituents. The regulatory agency may also set constituent concentration standards for additional constituents beyond these 12 constituents for situations where the regulatory agency considers concentration standards for other constituents necessary due to facility-specific conditions.
Once these proposed standards are finalized and the regulatory agency implements the subpart F standards, the constituent concentration standards would have to be established in accordance with the provisions in § 192.52 for all new wellfields and expansions to existing wellfields, and for all existing wellfields that are already operating, excluding those that are in and remain in the restoration and stability monitoring phases, as of the date three years after the effective date of this rule. Wellfields that begin and remain in restoration, initial stability monitoring or long-term stability monitoring at a licensed facility prior to the date three years after the effective date of the rule would need to meet the standards established when their license was issued or as otherwise specified by the regulatory agency.
It must be understood that granting an ACL is an indication that restoration has not returned the affected groundwater to either preoperational background levels or other health-based levels. However, there are some overarching principles that must be considered when establishing ACLs. In general, as described in § 192.54, any provisional or final ACL should not pose a substantial present or potential hazard to human health and the environment, as determined by the regulatory agency. Points of exposure are defined in the proposal as locations identified by the regulatory agency that represent possible future areas of exposure where the receptor can come into contact with groundwater (
Under this proposal, when considering setting an ACL, the regulatory agency would consider a list of factors, including potential adverse effects on groundwater quality, physical and chemical characteristics of the constituent, including the potential for migration, hydrogeological characteristics of the area, proximity and withdrawal rates of local groundwater users, current and anticipated future uses of the groundwater, existing quality of the groundwater, potential for health risks, potential to damage wildlife, crops, vegetation and physical structures, the persistence and permanence of the potential effects, adverse impacts on hydraulically connected surface water (including several factors) and the presence of any USDW.
The EPA expects that setting a provisional and final ACL will require consideration of the hydrologic and other characteristics of the wellfield and surrounding area, any potential areas of groundwater withdrawal or discharge and be protective of human health into the foreseeable future.
Consistent with UMTRCA, the Tenth Circuit Court of Appeals in the
In order to understand the hydrogeology and geochemistry of the production zone and surrounding area and to set the preoperational background for the constituent concentration standards, licensees would develop a preoperational monitoring plan for the wellfield. The preoperational monitoring plan would characterize the hydrogeology and geochemistry of the area, support identification of any potential future excursions from the production zone during the operational and restoration phases, and support the monitoring, modeling and other analysis as determined by the regulatory agency to be necessary to meet the proposed initial and long-term stability standards.
The preoperational monitoring determines the groundwater flow regime and the background groundwater concentrations of the 12 listed constituents and any additional constituents required by the regulatory agency. The data collected during this period would be used to select the indicator parameters and set the upper control limits (UCLs) for these parameters. The indicator parameters would be monitored during the operational and restoration phases and, when the UCL is exceeded, indicate that lixiviant or other constituents are migrating beyond the production zone. The preoperational monitoring would be conducted at wells within the production zone and in areas surrounding the production zone, including aquifers immediately above and below the production zone, and in areas laterally adjacent to the production zone, both up and down gradient. A sufficient number of wells would have to be installed and monitored so that the sampling data collected could be used to statistically determine appropriate background levels and support statistical tests, modeling and other analysis determined by the regulatory agency to be necessary during the operational, restoration, initial stability and long-term stability phases. The licensee would collect a sufficient number of sample sets per well over a time period sufficient to indicate a statistically valid background concentration that is not affected by well installation or temporal variations. In areas where temporal (
In addition to monitoring the concentrations of the constituents required by the regulatory agency, the licensee would collect any other data necessary to establish background conditions to support future modeling and other analysis in preparation to meet the proposed long-term stability standards in § 192.52(c)(3).
To ensure that no lixiviant, uranium or other constituents are migrating outside of the production zone, the licensee would monitor groundwater for specified indicator parameters at a set of monitoring wells surrounding the production zone. These excursion monitoring wells would be located around the perimeter of the production zone and in any aquifers immediately above or below the production zone that may be impacted by ISR activities. That is, the excursion monitoring wells need to surround the production zone in three dimensions. The excursion monitoring wells would be of sufficient number, density, and placement to detect the possibility of an excursion from the production zone. The regulatory agency would be responsible for reviewing and, when appropriate, approving well placement and installation, indicator parameters, the UCLs for the indicator parameters, as well as background levels for constituents for which constituent concentration standards are set.
Typical indicator parameters used to identify possible excursions include chloride, conductivity and total alkalinity. Other parameters may be appropriate as well. In the proposed rule, an excursion has occurred when either (1) two indicator parameters exceed their respective UCLs in any excursion monitoring well; or (2) as determined by the regulatory agency, one indicator parameter significantly exceeds its UCL in any excursion monitoring well. The EPA specifically requests comment on this proposed definition of an excursion and suggestions for other approaches for determining when an excursion has occurred. If an excursion occurs, the licensee would need to initiate corrective action in accordance with its facility-specific corrective action program and would be required to test for all constituents for which a constituent concentration standard was established. At a minimum, the constituents from Table 1 that are typically present and that warrant monitoring during an excursion are uranium, radium, arsenic and selenium. The regulatory agency would be allowed to identify additional constituents that are present in the groundwater and need to be monitored on a facility-specific basis.
In some cases, a licensee may have temporarily stopped recovering uranium and the facility may be in a phase commonly called “standby” by the industry. In such instances, the EPA considers the facility to be in the operational phase and the licensee would be required under the proposed rule to continue monitoring and taking actions, such as maintaining an inward hydraulic gradient, to prevent excursions.
Once the licensee believes restoration is near completion and believes they can, over time, demonstrate that the proposed initial stability standards in § 192.52(c)(2) can be met, the EPA expects that the licensee would begin monitoring the groundwater constituent concentrations throughout the wellfield to determine when the initial stability standards have been met. To meet the proposed initial stability standards, the licensee would need to demonstrate stability by providing three consecutive years of quarterly monitoring results showing no statistically significant increasing trend exceeding each established constituent concentration standard. For all monitored constituents, this trend would need to be demonstrated at the 95 percent confidence level. The licensee would be required to develop and implement a compliance monitoring program approved by the regulatory agency that identifies compliance points encompassing the entire affected area of the wellfield.
The purpose of the proposed stability monitoring is to determine whether constituent levels in the entire affected area of the wellfield, including the production zone, have returned to levels below the established constituent concentration standards and stable conditions are established. Hence, compliance wells must include wells previously used as excursion monitoring wells and those previously used as production related wells. The location of the compliance wells used to determine compliance with the initial stability standards would need to be approved by the regulatory agency and would need to be located in areas likely to be affected by ISR operations. Therefore, compliance well would be located within the production zone, adjacent to the production zone and in aquifers located immediately above and below the production zone, as approved by the regulatory agency. The number and location of compliance wells will vary depending on the size and characteristics of the wellfield, but should encompass the entire affected area of the wellfield.
To meet the proposed initial stability standards of § 192.52(c)(2), measurements would need to be taken quarterly at each well. If one or more constituents exceed a constituent concentration standard during the initial stability monitoring, then the licensee would follow the corrective action program approved by the regulatory agency. When monitoring to assess whether the initial stability standards have been met, constituent concentrations may fluctuate above the respective standard. The corrective action program should address the possibility of and the regulatory agency should consider potential responses to an exceedance of the constituent concentration standards while the licensee is establishing a statistically adequate trend. The regulatory agency may allow continued monitoring, if appropriate, or require the licensee to undertake a remedy. Regardless of the action taken, the licensee would be required by the proposed standards to achieve three consecutive years of stable measurements. Furthermore, as in all phases, if lixiviant or other constituents escape the production zone, the licensee would be required to take the necessary actions to return the aquifer to below the constituent concentration standards.
When the licensee demonstrates three consecutive years of quarterly monitoring results showing no statistically significant increasing trends exceeding the established constituent concentration standards at the 95 percent confidence level, then the facility has met the proposed initial stability standards and the licensee may, upon the determination of the regulating agency that the initial stability standards have been satisfied, begin long-term stability monitoring.
During the proposed long-term stability monitoring, the licensee continues quarterly monitoring to demonstrate compliance with the constituent concentration standards using the compliance wells established for monitoring during the initial stability phase. To meet the proposed long-term stability standards in § 192.52(c)(3), the licensee would need to first demonstrate quarterly monitoring results for a minimum of three consecutive years showing no statistically significant increasing trends exceeding the established constituent concentration standards (including any approved ACLs) at the 95 percent confidence level.
To approve cessation of long-term stability monitoring, the regulatory agency would be responsible for determining whether there is reasonable
(i) Conceptual hydrogeochemical modeling for the mine unit/production zone;
(ii) Ground water and solid (core) data used for geochemical model(s), including field parameters;
(iii) Incorporation of ground water data in an initial geochemical model (
(iv) Demonstration that stability (mainly reduction-oxidation or redox) conditions can be maintained in the production zone;
(v) Demonstration that ground water migrating into the production zone will not significantly change the geochemical stability within the production zone;
(vi) Demonstration of alternative geochemical conditions that demonstrate stability (uranium and other elements); and
(vii) Inter-relationships and contradictory claims (unintended consequences) for these various elements need to be identified and assessed in the context of the conceptual hydrogeochemical model.
The EPA requests comment on whether these seven elements should be required at all sites and thus included in the standards in 40 CFR part 192, subpart F.
The regulatory agency has the responsibility to establish the timeframe for long-term stability monitoring, based on facility-specific conditions at the wellfield and the results of long-term stability monitoring, modeling and analysis. If one or more constituents exceed their concentration standard (or approved ACL) or show a statistically significant increasing trend during the long-term stability phase, the regulatory agency may require the licensee to take corrective action as specified in the facility's corrective action program.
Each licensee would be required to develop a corrective action program that addresses the actions it will take when an excursion is detected during the operational and restoration phases, or when monitoring during the stability phases shows a concentration higher than the established constituent concentration standard or a statistically significant increasing trend. Corrective action, as identified in the corrective action program and approved by the regulatory agency, would be initiated as soon as practicable and would begin within 60 days of the date the excursion or exceedance of a constituent concentration standard is detected. The corrective action program would consider a range of possibilities for action from the operational phase through the long-term stability monitoring phase. Corrective action may include removing or treating in place any constituents that exceed the constituent concentration standards (or approved ACL). If the concentration of one or more constituents exceeds the constituent concentration standard (or approved ACL) during long-term stability monitoring, the licensee would be required to take corrective action to restore the groundwater to comply with the proposed constituent concentration standards; once restoration is complete, the licensee would begin again with initial stability monitoring.
As part of this rulemaking, the EPA is also proposing several minor amendments to the provisions in 40 CFR part 192, subparts C and D. These amendments are described in this section and are not related to the new standards for ISR facilities added in 40 CFR part 192, subpart F.
This proposed rule deletes the requirement in § 192.32(a)(2)(v) for the NRC to obtain concurrence from the EPA before the NRC may approve alternative requirements or proposals under AEA section 84(c).
The EPA is also proposing several minor amendments to subparts C and D to correct cross-references, typographical and punctuation errors. These amendments include the following:
As previously indicated, the standards proposed in today's action differ from those standards proposed on January 26, 2015 (80 FR 4156). This section of the preamble describes the most significant changes made to the original proposal and the rationale for those changes. Many of the changes were made in response to public comments and additional information provided by stakeholders. In response to the original proposal, the EPA received over 5,380 public comment letters on the proposed amendments, of which 5,192 were duplicate letters. The comments covered more than 80 different topics and were submitted by a wide range of stakeholders, including private citizens, public interest groups, industry, Indian tribes, state agencies and other federal agencies. For the original proposal, the EPA also held public hearings in Corpus Christi, TX (April 14, 2015); Washington, DC (March 10, 2015); Casper, WY (May 13 and 14, 2015); and Chadron, NE (May 12, 2015), where 114 stakeholders provided comments.
In addition to describing the changes made to the original proposal, this section also discusses and responds to the significant comments that resulted in many of those changes. The significant comments received that did not result in changes to the original proposal are discussed in section IV of the preamble.
For clarity, the EPA has restructured the proposed rule to move the initial and long-term stability standards that were originally included with the monitoring requirements in § 192.53 to the standards in § 192.52. The initial stability standards (called “stability” or “short-term stability” in the original proposal) were proposed in § 192.53(d)(2)(i), and the long-term stability standards were proposed in § 192.53(e)(1)(iii). In this proposal, the initial and long-term stability standards have been moved to § 192.52(c)(2) and (c)(3), respectively.
The original January 2015 proposal listed 13 constituents for which a facility-specific concentration limit must be set for each constituent that is present in the groundwater. In the original proposal, the EPA referred to these facility-specific concentration limits as “groundwater protection standards” and “restoration goals” (see § 192.52(c) of the original proposed rule). Since the use of these two terms may lead to confusion, the EPA is no longer using the term “restoration goals” but is instead using the term “constituent concentration standards” throughout the proposed rule to refer to these facility-specific concentration limits.
In the original proposed rule, the EPA also used the phrase “identified in the groundwater” when referring to constituents for which constituent concentration standards should be established (see § 192.52(c) of the original proposed rule). The EPA intended concentration standards to be set for any constituent that is present in groundwater before or after ISR activities have begun. Some constituents may not be initially present in the groundwater but may become soluble only after lixiviant is injected and groundwater chemistry has been altered. However, the phrase “identified in the groundwater” could be misinterpreted to mean only those that are present during preoperational monitoring. For clarification, the EPA has revised the original proposal to specify that constituent concentration standards must be established for all constituents that are “identified as present or affected by operations in the groundwater.”
In the original proposal, the list of constituents in Table 1 of subpart F included gross alpha particle activity.
The EPA tends to agree with commenters who suggested that gross alpha measurements are likely to be of limited value when other radionuclides of concern are also being sampled. The Agency also recognizes that the uncertainty associated with gross alpha measurements may be greater than those for other constituents, which may make the application of statistical tests especially complicated. However, gross alpha is specified as a constituent to be sampled in other subparts of 40 CFR part 192, and it does have a maximum contaminant level (MCL), which cannot be overlooked. Further, there may be instances where gross alpha measurements provide information regarding the presence of decay products such as lead and polonium. The EPA is specifically requesting comment on the deletion of gross alpha particle activity as one of the original proposal's 13 constituents, whether it provides useful information, and how measurement uncertainty might be addressed.
In the original proposal, the EPA included provisions for preoperational monitoring that were designed to characterize the groundwater flow regime, geology and geochemistry. The EPA originally proposed that preoperational monitoring would measure the background concentrations of radiological and non-radiological constituents, including all the constituents listed in Table 1 of subpart F, and any additional constituents or parameters specified by the regulatory agency or needed for calculations or groundwater modeling. The original proposal required preoperational monitoring be continued for a minimum of one year in order to account for any temporal changes occurring in the aquifer. The EPA also proposed some requirements for the location of the wells, requiring monitoring wells to be located in overlying aquifers, underlying aquifers, inside the exempted aquifer and outside the exempted aquifer, including areas that
The EPA received a number of comments on the duration of the proposed preoperational monitoring requirements. Some commenters supported the one-year timeframe, while others recommended the time period be extended to up to two years. Many commenters cited the NRC Criterion 7 from 10 CFR part 40, Appendix A, which requires uranium mills to complete one or more years of preoperational monitoring before a company can submit a license application. Two commenters noted that some aquifers do not experience seasonal variations in groundwater constituents. For example, commenters asserted there may be no seasonally influenced fluctuation in the concentrations of groundwater constituents in deeper target ore production aquifers.
Based on all of these comments, the EPA has refined the approach to preoperational monitoring. Instead, the Agency is proposing that preoperational monitoring of wells screened in areas where temporal variations are not expected to occur, such as in deep ore zones in confined aquifers, would be allowed to monitor for periods of less than one year. However, the licensee would collect several sets of samples over a time period sufficient to demonstrate seasonal variability does not occur. For example, in some cases, four sets of samples collected over several months would be adequate to determine the background for systems that do not exhibit seasonal changes. In this proposal, sample sets collected over a period of at least one year would still be necessary for facilities that operate in areas where constituent concentrations are expected to exhibit seasonal fluctuations. The regulatory agency would determine whether the licensee's preoperational monitoring is of sufficient duration and that sampling occurs at appropriate intervals to establish the background concentrations for all 12 constituents, as well other constituents identified by the regulatory agency and all indicator parameters. To provide flexibility where appropriate, the EPA did not propose an across-the-board two-year monitoring requirement, although the regulatory agency would be allowed to do what is necessary to reflect seasonal or other variation in background constituent concentrations or flow.
The Agency received several comments on the original proposed requirements for well completions. A general concern expressed by the commenters is that true baseline conditions of the groundwater constituents cannot be established if the well drilling and development methods introduce oxygen into the groundwater. The commenters explained that since oxygen may increase the solubility of uranium, elevated baseline concentrations will lead to artificially high restoration goals. Commenters suggested several methods to alleviate this concern, including air-rotary drilling with recirculated nitrogen gas instead of air and a foam surfactant that contains organic constituents to eliminate oxygen.
After considering these comments, the EPA believes sufficient monitoring should be completed to ensure all perturbations associated with well construction are resolved prior to establishing the background concentrations. To achieve this goal, under this proposed action, the licensee would collect several sets of samples over a time period sufficient to demonstrate baseline conditions that are unaffected by monitoring well construction. In the proposal, the EPA requires the sampling frequency to be sufficient to ensure statistically valid background levels that are not influenced by well construction. The samples used for this purpose may be the same as those used for the temporal variability analyses, if technically feasible. The regulatory agency would determine whether the licensee's well construction follows appropriate protocols and that sampling occurs at appropriate intervals to establish accurate background concentrations.
The EPA originally proposed that preoperational monitoring wells, excursion monitoring wells used during the operational and restoration phases, and compliance wells used during the initial and long-term stability monitoring phases (referred to as “point(s) of compliance”) be located inside and outside of “exempted aquifers” (see the proposed definition for “point(s) of compliance” at 80 FR 4184). In the original proposal, the EPA also defined the term “point(s) of exposure” as the “intersection of a vertical plane with the boundary of the exempted aquifer” and the term “adjacent aquifer” as an aquifer or portion of an aquifer that “shares a border or end point with the exempted aquifer or the exempted portion of an aquifer” (see 80 FR 4183-4184). As the EPA explained in the original proposal, the term “exempted aquifer” refers to aquifers that are exempted from the protections afforded by the SDWA (see 80 FR 4160).
Under the SDWA, the EPA sets health-based standards for drinking water to protect against naturally occurring and anthropogenic contaminants that may be found in surface and groundwater sources of drinking water. Additionally, under SDWA authority, the EPA promulgated Underground Injection Control (UIC) Program regulations to ensure protection of USDWs,
(1) It is mineral, hydrocarbon or geothermal energy producing, or can be demonstrated by a permit applicant as part of a permit application for a Class II or III operation to contain minerals or hydrocarbons that considering their quantity and location are expected to be commercially producible.
(2) It is situated at a depth or location which makes recovery of water for drinking water purposes economically or technologically impractical;
(3) It is so contaminated that it would be economically or technologically impractical to render that water fit for human consumption; or
(4) It is located over a Class III well mining area subject to subsidence or catastrophic collapse.
In this proposal, the EPA has removed references to “exempted aquifers”, deleted the definitions of “adjacent aquifer” and “exempted aquifer” from § 192.51, and removed the phrase “exempted aquifer” from the definition of “background” in § 192.51 and from the requirements specifying where monitoring wells must be located. This change to the original proposal was made to help clarify that these standards under UMTRCA complement, and do not overlap with, the requirements of the SDWA. As discussed in section I.B., the scope and level of protection of the SDWA differs from the UMTRCA as groundwater at uranium ISR sites could have beneficial uses even if the aquifer has been exempted from protection under the SDWA. Since UMTRCA provides authority that can be used to protect aquifers during and after uranium recovery operations, regardless of whether the aquifer meets the definition of an USDW as defined in EPA's UIC regulations or is exempted from the protections of the SDWA, the scope of UMTRCA's protection should be reflected in the regulatory text of these standards rather than relying on the SDWA UIC exemption regulations. Thus, the regulatory text proposed in this action does not depend on or use the term exempt aquifer. Also, although a remote possibility, because ISR facilities may be located in aquifers that are not designated as “exempted aquifers” under the SDWA, under the original proposal there would have been a lack of clarity on how a facility located in a non-exempt aquifer would comply with a rule using “exempt aquifer” boundaries in the regulatory text.
As stated above, this proposed rule is established under the UMTRCA and not under the SDWA; however, both the UMTRCA and the SDWA requirements may apply to ISR facilities. As discussed above and in section I.A., the requirements of these statutes are complementary and not overlapping or duplicative. The SDWA requirements provide for permits to inject lixiviant and recover uranium and possible exemption of the production zone from SDWA requirements. The proposed UMTRCA requirements protect adjacent aquifers that are not exempt from SDWA by requiring monitoring and corrective action, if necessary, during the operational and restoration phases in and around the ore zone after production ceases. The SDWA does not prevent recovery and use of the water within exempted aquifers (including where ISR operations were previously conducted) for private drinking water supply, public water supply, or other uses.
Points of exposure are defined in the proposal as locations identified by the regulatory agency that represent possible future areas of exposure where the receptor can come into contact with groundwater (
In the original proposal, the EPA defined an excursion as “the movement of fluids containing uranium byproduct materials from an ISR production zone into surrounding groundwater” and specified that an excursion has occurred when “. . . any two indicator parameters . . . exceed their respective upper control limits” (see 80 FR 4184).
Although the EPA generally considers that an excursion has occurred when any two parameters are above the UCL, in this proposal, the EPA provides flexibility for the regulatory agency to determine that an excursion has occurred when any single indicator parameter significantly exceeds its UCL. The EPA made this change to the proposed definition because in some situations a single parameter may be sufficiently high to indicate a possible excursion. The EPA emphasizes that this would be a judgement of the regulatory agency, and the Agency's understanding is that it is consistent with current NRC practice.
In this proposal, the EPA also revised the definition of excursion to indicate that an excursion includes the movement of fluids containing lixiviant, as well as any fluids containing uranium byproduct material, because these fluids may migrate outside of the ISR production zone. The EPA replaced the reference to “the ISR production zone” with “ISR wellfield” to indicate a broader scope of consideration is necessary in order to ensure that background is appropriately addressed and to ensure that areas within and surrounding the production zone are stable.
The EPA originally proposed that licensees would be required to monitor for all constituents listed in Table 1 of 40 CFR part 192, subpart F, during the different phases of operation at an ISR facility. In this proposal, the EPA changed this requirement such that facilities would be required only to monitor for those constituents that are expected to be present (
After restoration ends, ISR facilities must demonstrate compliance with the proposed constituent concentration standards, and also demonstrate those levels will persist and remain stable in the future. In the original proposal, to demonstrate stability, the EPA proposed three consecutive years of stability monitoring with stability demonstrated at the 95 percent confidence level followed by long-term monitoring for an additional period of 30-years. The originally proposed long-term stability monitoring would have allowed facilities to cease monitoring once they had completed monitoring for 30 years. However, the original proposal also allowed a licensee to shorten the 30-year long-term stability monitoring period by demonstrating geochemical stability through monitoring and geochemical modeling.
The EPA derived the 30-year long-term stability monitoring period in the original proposal based on consideration of the Agency's statutory mandate to be consistent with the requirements applied to managing hazardous waste under RCRA.
Numerous commenters thought the proposed 30 years of long-term monitoring was not justified, and was excessive and unnecessary. The general positions of these commenters were that these very specific monitoring time frames were outside the EPA's statutory authority under the UMTRCA to promulgate “standards of general application” and that there is no evidence that ISR facilities have impacted offsite underground sources of drinking water. Commenters also thought the requirement would have a significant economic impact, including impacts on leasing and surety costs that would place a number of ISR companies out of business. Other commenters noted that ISR facilities are not equivalent to RCRA hazardous waste facilities and should not be similarly regulated. Some commenters were concerned the long-term monitoring requirements would increase radiologic dose to employees maintaining the processing plant and well fields, which would be inconsistent with the NRC's ALARA (As Low As Reasonably Achievable) regulations found in 10 CFR part 20. However, other commenters strongly supported the 30-year monitoring time frame or recommended a longer time frame. These commenters felt that 30 or more years of monitoring would provide sufficient time to detect instability and potential migration of constituents.
Under UMTRCA, the EPA has authority to promulgate “standards of general application” for the protection of public health, safety and the environment from the radiological and non-radiological hazards associated with the processing and the possession, transfer and disposal of byproduct material at uranium ISR facilities. 42 U.S.C. 2022(b). The Tenth Circuit Court of Appeals has clearly recognized that this authority encompasses the ability for the EPA to include monitoring as part of its “standards of general application.”
While many commenters supported the 30-year monitoring requirement, and some even preferred a longer period, the proposal maintains the same performance-based standards for the long-term stability phase as the original proposal and hence ensures the same level of protection the EPA anticipated in the original proposal. The Agency emphasizes the role of modeling in achieving that objective. As explained in the original proposal, the Agency expected that licensees would make extensive efforts to develop robust models that would significantly shorten the long-term monitoring period. In fact, as presented in the proposal, it would have been possible for a licensee to submit modeling such that no (or minimal) long-term monitoring would be necessary. However, should licensees be unable to provide such modeling, or choose not to, the additional monitoring would have provided the level of confidence necessary for the regulatory agency to determine that long-term stability had been demonstrated. This revised proposal relies on modeling and analysis to as an essential element in concluding that groundwater will continue to meet the applicable constituent concentration standards into the foreseeable future, leading to the Agency's judgment that the revised approach is comparable in protectiveness to the original proposal.
As noted above, other commenters stated that 30 years of monitoring would not add value and would put many companies out of business. ISR facilities that disturb groundwater and mobilize constituents of concern are responsible for restoring disturbed groundwater to background or health-based conditions regardless of the time required to achieve this goal. However, the EPA also agrees with commenters who noted the time period necessary to establish stability at an ISR facility is variable due to differences in geology, hydrology and geochemistry. As reflected by one of the commenters, after 10 years of monitoring at the Kingsville Dome ISR facility, it appears that reducing conditions have not been re-established in the production zone. Restoration at Christensen Ranch has not been approved by the NRC because the NRC found that restoration was not complete and water quality was not stable after completion of uranium recovery in 2005.
This proposal defines the initial stability standards as “three consecutive years of quarterly monitoring results with no statistically significant increasing trends exceeding the constituent concentration standards at the 95 percent confidence level.” These performance-based standards would apply after the licensee completes restoration and, once met, would demonstrate that restoration was initially successful. The EPA requests comment on this approach and the wording of the regulatory text. Alternative language the EPA considered for this proposal for both initial and long term stability, included requiring the licensee to show “ . . . three consecutive years of quarterly monitoring results demonstrating a statistically significant non-increasing trend at the 95 percent confidence level remaining below each constituent concentration standard.” This alternative approach, which would require the licensee to demonstrate that the trend line is either horizontal or decreasing (“non-increasing”), has been applied in the Superfund program. It has the clear advantage of accepting only trend lines that are not increasing, which can provide some additional confidence that the trend is not in a direction that could (eventually) threaten to exceed the constituent concentration standards.
However, based on discussions with the NRC, the agency responsible for implementing this rule after promulgation, it is clear that licensees may see increasing, but not statistically significant trends in constituent concentrations during stability monitoring. Consequently, the EPA opted to change the language to “no statistically significant increasing trend” to provide the NRC flexibility in addressing this specific scenario. Further, the EPA is concerned that specifying a non-increasing trend may introduce complications in applying statistical techniques, particularly when working from the hypothesis that there is no slope to the trend line. The level of natural variation present may itself forestall the ability to determine a non-increasing slope with the level of confidence the EPA believes necessary. The level of statistical significance associated with an increasing trend that would be unacceptable is left to the regulatory agency to determine based on site-specific conditions.
The EPA requests public comment on the proposed approach as well as the alternatives. Specifically, the EPA would like to know whether this language is sufficiently protective and whether there are any other practical approaches the Agency should consider as possible alternatives.
In this proposal, the EPA has defined the long-term stability standards as a two-part test, with the following elements: (1) The licensee must provide an additional three consecutive years of quarterly monitoring data demonstrating no statistically significant increasing trend exceeding the constituent concentration standard for each applicable constituent at the 95 percent confidence level; and (2) the licensee must provide geochemical modeling and other analysis to demonstrate that constituent concentrations within the production zone will be met in the future. The regulatory agency would evaluate the modeling and other analysis and make a determination as to whether there is reasonable assurance that the applicable constituent concentration standards will continue to be met in the future. In this proposal, only after this determination has been made by the regulatory agency would the licensee cease long-term monitoring.
The three-year long-term monitoring period represents a different application of the RCRA paradigm than the 30-year post-closure monitoring. The three-year monitoring period is consistent with RCRA corrective action requirements, which can be seen as analogous with groundwater restoration at ISR sites. The Agency believes the three-year performance standard for the long term is appropriate to provide additional confidence in restoration of these sites and provides sufficient time to conduct a trend analysis, as well as being consistent with RCRA requirements of three years of monitoring to demonstrate no exceedance associated with corrective action. The EPA finds that this alternative approach will provide the necessary protectiveness and is particularly responsive to industry comments regarding the potential costs associated with a 30-year monitoring period.
The EPA originally proposed that facilities be required to take corrective action as soon as practicable but no later than 90 days after an excursion or exceedance is detected. The original proposal also required that the concentrations of constituents be returned to the constituent concentration standards “within the production zone and the maximum constituent level in adjacent aquifers” (see § 192.54(a) of the proposed rule). Groundwater monitoring for a period of at least three years after corrective action had been terminated was proposed with reference to the proposed monitoring requirements for the initial and long-term stability phases.
A few commenters supported the requirement to take corrective action as soon as practicable. However, most commenters disagreed with the original proposed requirement to require ISR facilities to implement a corrective action program within 90 days. One commenter was concerned the compliance costs would be high because the wellfield and associated equipment would have to be maintained at the ISR facility for many years in order for corrective action to be started within the required 90 days. Another commenter thought a longer time period was justified due to the low velocity of groundwater at ISR facilities. This commenter asserted that additional time may be needed for drilling wells and installing pump and treat equipment, particularly during the long-term stability period when equipment has been removed. This commenter recommended a period of two years be allowed for implementing a corrective action program and stated that groundwater may move only 10 to 20 feet over this time period. Another commenter noted that the NRC already has regulations covering corrective action in 10 CFR part 40, Appendix A, Criterion 5D, which specify that a licensee has up to 18 months to implement a corrective action program. One commenter found the proposed requirements for groundwater monitoring confusing and questioned why the proposed rule referenced the initial and long-term stability monitoring requirements. This commenter thought the groundwater monitoring applied to excursions and questioned why additional monitoring was necessary for excursions occurring during the operational phase.
The EPA has made several changes to the corrective action requirements in this proposal. First, the EPA would require ISR facilities to
Second, the EPA is acknowledging that corrective action in the initial stability phase may be different than in the long-term stability phase, as during the initial stability phase data are being collected to show the initial trend and may be more subject to fluctuation. One exceedance may be acceptable during the initial stability phase, but not for the long-term stability phase, without taking corrective action. The EPA is proposing the regulatory agency would have the authority to determine whether an exceedance truly warrants action or continued monitoring while the licensee is trying to establish the data trend during the initial stability phase. The need for action or monitoring during each phase of operation would be anticipated and addressed in the corrective action program. Whether or not the regulatory agency has determined that corrective action is necessary does not negate or affect the proposed initial stability standards requiring three consecutive years of quarterly monitoring results with no statistically significant increasing trends exceeding the constituent concentration standards at the 95 percent confidence level. The corrective action program would have to return the constituent concentrations to levels below the constituent concentration standards established by the regulatory agency.
Finally, the EPA is proposing to change the groundwater monitoring provisions proposed for § 192.54(c) (80 FR 4187) to better reflect the requirements applicable to ISR facilities that experience exceedances of constituent concentration standards during the long-term stability phase. The EPA agrees with a commenter who stated that the proposed rule language for the groundwater monitoring requirements in § 192.54(c) could easily be misinterpreted. The change to the original proposed rule makes it explicit that corrective action is followed by another round of initial stability monitoring followed by long-term stability monitoring. Under this proposal, the ISR facility would need to first meet the three-year initial stability standards, and then meet the long-term stability standards of § 192.53(c)(3)(i) and (ii), before it is eligible to apply to the regulatory agency for approval to cease long-term stability monitoring. These changes to § 192.54(c) would not add any new requirements but simply clarify the requirements that were originally proposed.
Commenters expressed concern that the EPA had not considered the entire spectrum of legal, regulatory and other costs required to hold and preserve the ISR facility, lands and wellfields during the stability monitoring periods. The EPA reviewed and updated the economic analysis to incorporate estimated non-monitoring costs (
Another concern expressed by commenters was that the EPA had not considered additional costs to self-funded regulatory programs, and that these costs would be passed along to the uranium recovery companies. The revised standards reflect the practices that have become more common between the NRC and ISR facilities; therefore, this proposal is not expected to add significant burden to regulatory programs.
Compliance for existing ISR facilities also concerned commenters. As in the proposal, § 192.52(a) of this proposal makes clear that these standards would not apply to wellfields that are currently in and remaining in restoration or stability monitoring.
Commenters also expressed concern that the costs of monitoring were not adequately reflected due to inaccurate assumptions for current monitoring requirements. The EPA adjusted the monitoring costs in the economic analysis based on guidance received from the NRC regarding current monitoring practices and requirements, as opposed to historical practices that were noted by some commenters as common to more developed ISR facilities. Also, a commenter noted that the rule discussion in the proposal preamble at 80 CFR 4186 (§ 192.53(a)(3) of the original proposal) required monitoring well locations outside of the monitoring well ring and that these costs were not included in the economic analysis. The proposal maintains the requirement in the original proposal for down-gradient monitoring wells outside the monitoring well ring where needed, and at the discretion of the regulating agency, especially when an adjacent aquifer is present. Initially, the EPA's proposal required monitoring at locations down-gradient from the wellfield in exempted aquifers. However, placement of down-gradient monitoring wells outside the well ring was not found to be common practice at existing sites and the EPA removed these wells from the cost model. The EPA also assumed in the proposal that monitoring and hydrogeologic and geochemical modeling requirements would allow most sites to demonstrate that groundwater conditions down-gradient of the wellfield would trap any mobilized constituents, thus ensuring that groundwater quality is protected. Reference to the “exempted aquifer” has also been removed from this proposal, as discussed in section III.D of this preamble.
Comments were also received on the methodology used to extrapolate a cost per acre for operating ISR facilities based on a conceptual ISR unit, and while it was acknowledged that the method may be appropriate for fully developed ISR facilities, the commenters were concerned that this methodology may not capture the full costs of implementation for facilities in earlier stages of development. The EPA further reviewed and used available information from facility surety and license reports to estimate and account for the proposed and anticipated number of ISR units at each ISR facility that was included in the cost model.
In light of the adjustments described above, the EPA considers the estimated
Several commenters noted the importance of nuclear power to shift the nation's reliance away from carbon-based energy resources and expressed concern that the proposed standards would reduce the viability of uranium recovery and continued development of nuclear energy. In response to these comments, the EPA reevaluated the incremental costs of the selected option to existing and planned ISR facilities, which further substantiated that this action is not a “significant energy action” as defined in Executive Order 13211 (66 FR 28355, May 22, 2001). The proposed standards, in large part, codify groundwater monitoring practices and requirements already being implemented at permitted operations; further, domestic uranium has historically provided less than 10 percent of total uranium supplied to civilian owners and operators (COOs) of nuclear power stations. Because the proposal would increase the costs of facilities that produce a relatively small share of uranium traded in U.S. markets, the EPA estimate that a $1.96 increase per pound in the cost of ISR uranium production would increase the price of uranium paid by COOs by only $0.11 per pound. Because nuclear generation provides a relatively small share of total domestic electricity, the $0.11 increase in the price of uranium would increase the price of electricity very little (less than 0.1 percent). Although the proposal would slightly increase the costs of domestic uranium production relative to international sources, this rule is not expected to directly and adversely affect productivity, competition or prices in the energy sector. For more information, please see section VI.H of this preamble and sections 5.3 and 6.9 of the document titled, “Economic Analysis: Revisions to the Health and Environmental Protection Standards for Uranium and Thorium Mill Tailings Rule (40 CFR part 192),” available in Docket ID No. EPA-HQ-OAR-2012-0788.
Several commenters expressed concern that the proposed rule would cause an unnecessary waste of groundwater resources beyond diminishing returns, due to prolonged additional restoration to satisfy the proposed requirement for 95 percent statistical confidence of groundwater stability. The EPA disagrees and believes that the 95 percent statistical confidence level is widely accepted and used in other environmental standards. For more information on the 95 percent confidence level, see section IV.D of the preamble.
One commenter stated that the EPA ignored its authority under CERCLA that allows the Agency to require former operators and their successors to clean up post-license termination, thereby unnecessarily increasing monitoring costs for ISR facilities. The EPA does not believe it is appropriate to rely upon expectations of future cleanup rather than make reasonable efforts to prevent groundwater contamination in the first place. The intent of this rule is to protect groundwater and prevent its degradation, thereby eliminating the need for remedial actions under CERCLA that, by the time discovered, could be far costlier. This approach is fully consistent with the EPA's Groundwater Protection Strategy, which emphasizes pollution prevention over remediation. Also, commenters asserted that the groundwater modeling was inadequate, and flawed inputs were used to estimate the duration of remediation to clean up a plume after facility closure. The EPA understands that the contaminant transport models used to estimate costs of remediating a contaminant plume are simplistic, the inputs used are based on limited ISR facility data, and selected parameterizations are based on assumptions. Nevertheless, the flow model provides a reasonable estimate for the duration of an illustrative general pump and treat remediation scenario, based on the EPA's extensive pump and treat remediation experience under CERCLA and other remedial programs, and, upon review, the models and inputs were determined to be adequate to illustrate potential cost savings for purposes of the economic analysis.
In the original proposal, the EPA defined the operational phase of an ISR facility as “the time period during which uranium extraction by in-situ recovery occurs” and noted that “operations end when the operator permanently ceases injection of lixiviant and recovery of uranium-bearing solution for processing” (see 80 FR 4160). However, the EPA notes there are periods when the ISR facility is not actively recovering uranium for various reasons (
The EPA agrees with the commenters who said ISR facilities must be responsible for ensuring that lixiviant and constituents do not migrate outside of the production zone during standby periods. The EPA disagrees with the commenter who suggested ISR facilities that temporarily cease operations should be required to commence restoration. The EPA agrees, however, that during standby periods the migration of constituents mobilized by the prior injection of lixiviant may continue even if the decision is made to stop extracting uranium. Excursions beyond the production zone are more likely to occur if the hydraulic gradient within the wellfield is not maintained. For this reason, the EPA considers standby to be part of the operational phase, and facilities should not cease pumping during standby periods since it is important that an inward hydraulic gradient is maintained during these periods. For this reason, the EPA is proposing that all requirements applicable to the operational phase remain in effect during these standby periods. Provided the licensee complies with the operational phase monitoring and corrective action requirements in the proposed rule, ISR facilities in standby would not need to enter restoration because groundwater in areas surrounding the production zone will be afforded the same level of
As stated in the original proposal, during the restoration phase, the definition of “point(s) of compliance” may include “monitoring, injection, and extraction wells in the production zone” (see 80 FR 4184). Points of compliance during the initial stability and long-term stability phases should include locations within the former production zone, including existing monitoring, injection and extraction wells. To clarify these requirements, in this proposal, the EPA revised the definition of “point(s) of compliance” to indicate that excursion monitoring wells are considered points of compliance during all phases of ISR operation and that during the initial and long-term stability monitoring phases, points of compliance should also include locations, identified by the regulatory agency, where a potential receptor can come into contact with contaminated groundwater. The EPA is specifically requesting comment on the definition of “point(s) of compliance” and how it is applied. Again, the EPA is requesting comment on the definition of point of exposure and conceptual framework for establishing ACLs.
The EPA carefully reviewed and considered comments from a wide range of different groups in preparing this proposal. As discussed in section III of this preamble, the EPA modified and clarified various aspects of the proposed rule based on the information and views provided, including comments on the original proposal. However, not all comments resulted in modifications to the proposed rule. Those significant comments that did not result in changes, together with the EPA's responses, are summarized in this section of the preamble.
Some commenters thought the proposed rules were legally invalid and felt the EPA was overreaching its authority under UMTRCA by proposing standards that are too detailed and prescriptive. The commenters argued the EPA was redefining what UMTRCA established as the EPA's role to set general standards while making the NRC responsible for implementing those standards through its licensing process. These commenters believe that UMTRCA limits the EPA's authority to setting general standards that do not include any prescriptive implementation requirements. Some of these commenters cited a statement from the legislative history of UMTRCA in which a House Committee advised that “[t]he EPA standards and criteria should not interject any detailed or site-specific requirements for management, technology, or engineering methods on licensees or the Department of Energy.”
However, other commenters thought the proposal was an appropriate exercise of the EPA's authority under the UMTRCA because the proposed rule would not supplant the NRC's jurisdiction or impede its licensing authority. They cited the statutory provisions that assign the authority to set standards to the EPA and the authority to implement and enforce the standards to the NRC (See 42 U.S.C. 2022(b), (d)). The commenters thought the proposed standards were an appropriate application of the EPA's authority under the UMTRCA and felt that the EPA had correctly left implementation of the new standards to the NRC and Agreement States.
The Agency disagrees with those commenters who believe the EPA has redefined its role or overreached its authority in developing the new standards for ISR facilities. Section 206 of the UMTRCA clearly authorizes the EPA to promulgate standards of general application for the protection of public health, safety and the environment from radiological and non-radiological hazards associated with the processing and the possession, transfer and disposal of byproduct material at uranium ISR facilities. See 42 U.S.C. 2022(b). The Tenth Circuit Court of Appeals affirmed EPA's authority to set such standards under UMTRCA in two companion cases challenging the original part 192 rules. See
The first of these three components of the proposed standards has two integral parts—numerical constituent concentration standards and groundwater stability standards. This proposal sets forth minimum requirements for the constituent concentration standards, but implementation of those standards on a site-specific basis remains the responsibility of the regulatory agency. However, a numerical concentration standard by itself is not sufficient to address “the risk to public health, safety, and the environment” that the EPA is required by statute to consider when setting general standards. 42 U.S.C. 2022(b)(1). Since ISR facilities alter the natural groundwater flow, this risk includes the risk that constituent concentrations in the groundwater will not remain the same over time if the groundwater remains unstable. Thus, to address this risk, the proposed rule contains a general requirement to demonstrate that groundwater conditions are stable after production ends at a site. For example, to satisfy the proposed initial stability standards, ISR facilities would provide three consecutive years of quarterly monitoring results demonstrating no statistically significant increasing trends exceeding the constituent concentration standards at the 95 percent confidence level. This proposed requirement to demonstrate groundwater stability is an integral part of the standard. The proposed general standard for stability is defined by a level of statistical confidence that is applicable to all sites. EPA believes this level of statistical confidence is necessary at all sites to ensure that the stability standards are sufficiently stringent to address the risk that groundwater exceeding the applicable constituent concentration standards poses to public health, safety and the environment from ISR facilities that have ceased operation. Contrary to some commenters' remarks (see Section
Some commenters argued the long-term monitoring requirements in the original proposal were too prescriptive and that the EPA would be effectively dictating when a license could be terminated. As noted above, the Tenth Circuit has clearly recognized that the EPA's standard-setting authority under UMTRCA enables the EPA to include monitoring as part of its “standards of general application.”
Several comments were also critical of the EPA's authority to require corrective action programs. While the term “standard” includes numerical limitations, such as the concentration-based limits for the listed constituents in groundwater, the EPA has long interpreted this term to also encompass the actions a source must take to reduce, remediate or otherwise avoid release of pollutants. The EPA notes that the existing rule, in subpart D, includes similar non-numerical standards to those included in this proposed rule. For example, 40 CFR 192.32(a)(2)(iii) requires affected sources to implement detection monitoring programs, while 40 CFR 192.32(a)(3)(i) requires uranium mill tailings piles or impoundments to have a permanent barrier.
In sum, the regulatory agency must determine the constituent concentration standards applicable to each site, approve the number, location, and installation of all wells used for monitoring, and determine when the initial and long-term stability standards are satisfied. See
Several commenters concurred with the EPA's assessment that new standards are necessary for ISR facilities. These commenters noted that environmental impacts from ISR are significantly different from the impacts of conventional mining and milling. Commenters supported the EPA's conclusion that a more rigorous approach is warranted for determining background groundwater concentrations. They considered the preoperational monitoring requirements as necessary to establish appropriate concentration-based standards for each ISR facility. They also supported the stability-phase monitoring, which they considered important for demonstrating groundwater stability after restoration and for providing assurance groundwater quality will not degrade over time and that constituent migration will not occur in the future. One commenter felt that more rigorous standards with detailed restoration and long-term stability demonstrations were necessary to bring “coherency and accountability” to ISR facilities. However, other commenters thought the rule was unnecessary and provided a variety of reasons to support their contentions. Most commenters felt the standards were not justified because the industry was already regulated, arguing that the EPA had failed to provide or quantify sufficient evidence that ISR poses a risk, or had failed to consider relevant data. A number of commenters asserted that EPA had not adequately addressed recommendations of the Agency's SAB. Many commenters noted that ISR facilities are already regulated by the EPA, the NRC, and states, and that the success of the existing regulatory oversight over the last 40 years proved that further regulation was not needed. In support of their statements, these commenters stated that there were no documented cases of off-site contamination of drinking water supplies from ISR activities in the United States. Other commenters noted that the new standards were unnecessary because ISR facilities are located in exempted aquifers under the SDWA in 40 CFR 146.4 and cannot serve as sources of drinking water because the EPA has already determined the water is unsafe for human consumption. One commenter stated that the SDWA UIC program has requirements prohibiting injection of fluids where production fluids could migrate into non-exempt aquifers and stated that these existing requirements were sufficient to protect groundwater. Other commenters argued the regulations were unnecessary because ISR facilities already collect background water quality data, restore groundwater impacted during recovery, and monitor for stabilization after restoration under the existing regulations. Some commenters felt the migration of uranium from ISR facilities was unproven. These commenters cited papers they said showed uranium had
The EPA disagrees with commenters who contend that new standards are unnecessary. First, it is in the national interest to protect groundwater resources. Water is becoming a scarce resource, particularly in the arid regions where most ISR currently operate. Groundwater in this region is not exclusively used for human consumption, and has other uses such as livestock production, crop irrigation, and wildlife support. The best way to preserve groundwater for all such uses is to prevent contamination by addressing the source of contamination. The SDWA UIC program plays an important role in protecting underground sources of drinking water. However, as discussed in section I.A. above, the scope and level of protection of the SDWA differs from the UMTRCA. The SDWA does not prevent recovery and use of the water within exempted aquifers (including where ISR operations were previously conducted) for private drinking water supply, public water supply, or other uses. UMTRCA provides authority that can be used to require restoration of the groundwater in the production zone and to protect the groundwater outside the production zone aquifer, during and after uranium recovery operations, regardless of whether the aquifer has been exempted from the protections of the SDWA.
Thus, this proposed rule under UMTRCA is needed to establish generally-applicable groundwater standards for ISR facility restoration and require more extensive monitoring, modeling and analysis to ensure that groundwater restoration will endure. ISR alters the chemical composition of groundwater and creates reasons to be concerned about risk of mobilization of constituents. The EPA notes that several NRC-regulated sites are continuing to work toward restoring groundwater with restoration and monitoring being conducted for as long as 10 years after ceasing production.
Second, the information the EPA has reviewed indicates that current industry practices for restoration and monitoring of the affected aquifer may not be adequate to prevent degradation of water quality at ISR facilities or the more widespread contamination of surrounding groundwater that is suitable for human consumption. Historically, once restoration is halted, stability demonstrations at ISR facilities are typically conducted for only a short period, which may not be adequate to determine that restoration is complete and long-term stability established. Several instances are noted in section III.F.2 where facilities have monitored for lengthy periods after restoration was deemed to be complete, but have not been able to demonstrate stability for even the more limited times typically required under current practice. The initial and long-term stability monitoring and corrective action program included in the new proposed rule would provide greater confidence that both of these requirements are met before ISR facilities can be decommissioned.
Finally, the EPA considers the existing regulations at 40 CFR part 192 to be inadequate for addressing groundwater contamination from ISR facilities. Subparts A, B and C of 40 CFR part 192 apply to inactive uranium milling facilities, vicinity properties, and depository sites (
Regarding comments that the EPA did not request or collect data from industry, the Agency disagrees. The EPA has appropriately considered available data to support its proposed rules and requested additional data from industry. During the SAB's public teleconferences in 2011, industry stakeholders stated that additional data
The EPA further believes the commenters have misinterpreted the SAB recommendation to constructing a database to support modeling and build an evidence base for EPA's rulemaking. In section 3.2, page 8, the SAB discusses the development of such a database. However, in section 3.3, the SAB goes on to recommend that “for the near term,
However, as mentioned earlier, given the concern about data collection and the comments concerning lack of state data, the EPA will consider additional data collection and analysis, including review of affected state regulatory programs. The Agency also takes issue with some comments characterizing the UIC program requirements. An aquifer exemption is not a judgment that the water is unsafe for human consumption. In most, if not all, cases, an ISR facility is provided with an aquifer exemption solely because of the presence of uranium that is economically producible. Further, while the UIC program objective is to prevent endangerment of USDWs, it is the responsibility of the permittee to operate in a manner that does not allow production fluids to migrate into non-exempt aquifers. 40 CFR 144.12(a).
Consistent with the original proposal, this proposed rule does not apply to licensed ISR facilities that are engaged in restoration, initial stability monitoring, or long-term stability monitoring. However, some commenters stated that the original proposed rule should not apply to existing ISR facilities that are currently operating. These commenters noted that it was not clear how an existing ISR facility would comply with the proposed rule for ISR wellfields that are already in the operational, restoration or stability monitoring phase. Commenters stated that preoperational background water quality would have already been established for operational wellfields, but the methods used to establish the background concentrations may not be consistent with the requirements in the proposed rule. They noted that it would not be possible to resample for background water quality for operating wellfields since the aquifers have already been changed by uranium recovery operations.
The EPA sees no need to omit existing ISR facilities from this rule due to preoperational considerations. The NRC already requires ISR facilities to establish background conditions prior to beginning operation under 10 CFR part 40, Appendix A, Criterion A. Under this NRC guideline, an ISR facility must implement a preoperational monitoring program that provides complete baseline data on the facility and its surrounding area. In addition to the NRC guidelines, ISR facilities conduct studies of the ore zone prior to beginning production to collect data necessary for designing the ISR facility. Although the most appropriate monitoring would consist of a statistically representative sample of wells spatially distributed throughout the wellfield, the EPA recognizes that operating facilities cannot collect unaffected background samples at ISR facilities that are already operating. However, facilities that are already operating, but have not yet entered the restoration phase, can use the background data they collected prior to operation to set their constituent concentration standards. Even with limited data, existing ISR facilities can analyze the preoperational data they collected and develop a statistically meaningful data set to use as the basis for the constituent concentration standards and also define other aspects of the system, such as the flow regime, that are necessary to develop site models. Selecting high or the highest values of the chemical monitoring data would not be considered an appropriate basis for establishing background conditions. Further the collection of data to demonstrate stability would be essentially the same for all facilities.
The original proposed rule contained a requirement to gather monitoring data sufficient to demonstrate the stability of groundwater with 95 percent confidence. Some commenters thought the 95 percent confidence level was too restrictive. These commenters stated that the EPA did not address properly the cost, both in dollars and water resources, required to achieve a 95 percent confidence level. Some of these commenters misinterpreted the 95 percent confidence requirement as a restoration goal requiring the constituent concentrations to be reduced by 95 percent, rather than a level of confidence in the statistical tests used to assess stability. Most commenters thought the 95 percent confidence level was too high, while a few thought it was too low. A few comments addressed the general requirements to demonstrate that the hydrogeological and geochemical properties have been returned to preoperational condition and expressed concern the 95 percent confidence level would be required for the statistical tests. Many of these comments indicated a concern with the high variability of these properties at ISR facilities. Concerns were raised that many of the ionic species are reported in the parts per billion and parts per million concentrations and duplication of analysis on the same sample can vary a few parts per million when samples are rerun.
Some commenters thought that the original proposed rule was not sufficiently prescriptive. Several commenters expressed concern with the statistical tests recommended for detecting trends and for the comparison with baseline values. These commenters noted that important details required to implement the statistical tests are not provided in the proposed rule, including whether the statistical analysis is conducted for the well field as a whole, within clusters or well-by-well; what parameter should be tested; and what requirements there are for the tests, particularly for the trend test.
This proposal retains a 95 percent confidence level but makes it clear that
The 95 percent confidence criterion would apply for all constituents. The proposed standards to demonstrate initial and long-term stability with 95 percent confidence would be applied after restoration has been completed to confirm that the restoration was successful and likely to persist. Again, the EPA requests that commenters share examples where the 95 percent confidence level cannot be used or met and the limitations of these examples and the Agency invites commenters to propose other options that would clearly represent a valid and explicit groundwater stability standard that includes a measure of stringency.
The EPA understands that NRC staff has attempted to use the 95 percent confidence level for at least one facility (see the NRC presentation in the BID) but has concerns about its use in every case. The Agency considered changing the level of confidence, however the 95 percent confidence level is the standard used under other regulatory programs, including the EPA's hazardous waste program. It is a widely accepted standard used across many industries that must monitor groundwater. Again, the EPA requests comment on the use of the 95 percent confidence level as part of the stability standard and whether there are better or more practical ways to word the standards such that they present a clear level of stringency.
The costs of conducting the statistical tests are related largely to the number of wells monitored and the duration and frequency of baseline and post-restoration monitoring. These costs are not related to the dollar and resource costs of restoration. The EPA recognizes there is a trade-off between the cost of additional monitoring and the level of confidence achieved in the confirmatory statistical tests. Due to the high variability in hydrogeological and geochemical properties it may be necessary to do more monitoring to compensate for the higher variability.
While the proposed initial and long-term stability standards define stability as attaining 95 percent confidence, the methods to be used to demonstrate compliance would be determined by the regulatory agency. The BID
This proposed action reduces the risk of undetected contamination of groundwater resources surrounding ISR facilities both during uranium production and after production has ceased. During uranium production, the fluids injected to mobilize uranium change the chemistry of the aquifer from its original state, thereby mobilizing uranium and many other minerals and metals. Groundwater from the ISR production zone can migrate from the production zone and contaminate nearby groundwater with arsenic, barium, cadmium, chromium, lead, mercury, selenium, silver, nitrate, molybdenum, radium and uranium and other constituents. The new standards proposed in this action would reduce the risk of groundwater degradation both during the ISR operational phase and after an ISR operator's license is terminated and the facility is closed. This would be achieved through provisions requiring characterization of groundwater prior to uranium recovery and standards set to protect groundwater from excursions during the operational phase and standards for restoration to pre-operating conditions and stability after the operational phase ends. These proposed requirements would significantly reduce the probability that groundwater down-gradient from an ISR facility will become contaminated by radiological and non-radiological constituents. Through monitoring and corrective action programs, the new proposed standards would ensure potential excursions are detected and remedied in a timely manner. The proposed initial and long-term stability standards would ensure the ISR aquifer is stable prior to closure, reducing the potential for contamination to occur after uranium recovery has ceased and the ISR facility's operating license has been terminated following closure.
Using information on the uranium extraction industry, the EPA estimated incremental costs resulting from this proposal. Under this proposal, ISR facilities would be required to complete the following additional activities: (1) A comprehensive preoperational characterization of the area (including characterization of geochemical conditions); (2) monitoring for excursions during the operational and restoration phases; (3) three years of initial stability monitoring; and (4) long-term stability assessment, with a minimum of three years of additional monitoring, with the total duration of the long-term stability monitoring determined by the regulatory agency based on modeling and monitoring of geochemical conditions.
Incremental costs attributable to the proposal are costs that would be higher under the proposal than they would be if 40 CFR part 192 was not revised. If no revisions were made to 40 CFR part 192, ISR facilities would be required by the NRC or agreement states to characterize preoperational conditions,
Under the proposal, the EPA estimates that ISR facilities would incur higher costs, for several reasons: (1) More monitoring wells would be required under the proposal; (2) more constituents would be monitored under the proposal; and/or (3) monitoring during the preoperational and stability phases would be required to continue for a longer period of time under the proposal. In addition, because the overall duration of monitoring prior to closure and license termination would be longer under the proposal, other non-monitoring costs would be incurred for several additional years, compared to requirements in the absence of the proposal.
To estimate the incremental costs for complying with these additional proposed requirements, the EPA used ISR operations listed by the U.S. Energy Information Administration as likely affected ISR operations and a projected 2017 ISR uranium production of 3.3 million pounds. From this analysis, the EPA estimated low, average and high incremental costs of complying with the proposal; average incremental costs of complying with the proposal at approximately $1.96 per pound of uranium and an annual cost of $181,000 to $6.4 million for firms owning ISR facilities, depending on the number and scale of the ISR facilities they own. Nationally, the EPA estimates the incremental total annual cost of the proposal to be approximately $11.9 million, including incremental annualized capital costs and monitoring costs ($4.3 million) and incremental annual non-monitoring costs ($7.6 million). The EPA's estimated national incremental annualized costs for the original proposed rule totaled $13.5 million for monitoring and capital costs alone. Since the original proposal, the EPA learned from discussions with the NRC that many of the monitoring requirements of the proposed rule (and also those of the proposal) would already be embodied in expected NRC license requirements in the absence of the proposal. In addition, the EPA revised some of the rule's requirements to increase flexibility and reduce burden. For these reasons, the difference between the monitoring requirements and costs for the proposal and those for current practice (the incremental monitoring costs of the proposal) are estimated to be considerably lower than the estimates for the proposed rule. This reduction in incremental monitoring costs is largely offset by including, in response to public comment, estimated incremental non-monitoring costs). Overall, the EPA's estimate of incremental annualized costs of complying with the proposed rule is slightly lower than the costs estimated for the original proposal. For additional information regarding the methodology used to estimate the costs, see the technical document titled, “Economic Analysis: Revisions to the Health and Environmental Protection Standards for Uranium and Thorium Mill Tailings Rule (40 CFR part 192)” available in Docket ID No. EPA-HQ-OAR-2012-0788.
The EPA estimated the impact of the proposal on the market for uranium using a simplified model of the U.S. market for uranium in 2017, using 2015 market quantities as a proxy for market quantities in 2017. EPA requests comment on this approach. The partial equilibrium model of the U.S. uranium market estimated market impacts and revealed the following: (a) Changes in the quantity of uranium purchased by U.S. COOs of nuclear power plants; (b) changes in the sales of domestically produced uranium and imports; and (c) changes in the market price for uranium. Based on average incremental costs of complying with the proposal, the EPA found that the market quantity of uranium purchased for use in electric generation is expected to decline by less than 0.01 percent and the market price to increase by approximately 0.2 percent. Domestic ISR facilities are projected to decrease their production by approximately 6.7 percent, and imports of uranium are expected to increase by 0.4 percent. Because the cost of uranium is a very small share of the cost of electricity, the EPA estimates that the cost of generating electricity will likely increase by less than 0.1 percent due to this action. Although the national total annual cost of the proposal (approximately $11.9 million, based on average costs) is well below the $100 million threshold that is one of the criteria used to identify a significant regulatory action, the industry has only a small number of companies operating a small number of ISR facilities.
The EPA used existing and planned ISR operations and the companies that own them as models for the types of facilities and companies affected by the proposal. This proposal would affect approximately 15 ISR facilities that are currently operating or may operate in the near future. The 15 ISR facilities are owned by 9 firms. This action would apply to the following ISR facilities identified by the Energy Information Administration in 2015 as either operating, permitted and licensed, developing, or partially permitted and licensed: (1) Crow Butte (Nebraska) and (2) Smith Ranch-Highland (Wyoming), both owned by Cameco Resources; (3) Alta Mesa (Texas), and (4) Nichols Ranch (Wyoming) both owned by Energy Fuels; (5) Willow Creek, (6) Jab and Antelope, and (7) Moore Ranch (Wyoming), all owned by Uranium One/Rosatom; (8) Hobson-La Palangana and (9) Goliad (Texas), both owned by Uranium Energy Corp.; (10) Lost Creek (Wyoming), owned by Ur-Energy Inc.; (11) Church Rock and (12) Crownpoint (New Mexico), both owned by Laramide; (13) Reno Creek (Wyoming), owned by Bayswater; (14) Dewey Burdock (South Dakota), owned by Azarga Uranium Corp.; and (15) Ross (Wyoming), owned by Peninsula Energy. Three other ISR projects (Kingsville Dome, Rosita, and Vasquez, owned by Uranium Resources, Inc.) are out of scope for the analysis because they are undergoing restoration or reclamation as of 2015. Using the Small Business Administration size standard for NAICS code 212291 (
To evaluate the magnitude of the economic impacts of the proposed revisions to 40 CFR part 192 on firms owning ISR facilities, the EPA estimated the incremental costs that would be incurred by affected facilities including both monitoring and non-monitoring costs, summed costs to the firm-level, and compared each firm's estimated costs to estimated or reported firm revenues. EPA requests comment on this approach.
Compiling these estimated costs at the parent company level and comparing them to estimated sales or reported sales for the parent company, average estimated annualized costs would range from 0.66 percent to 2.78 percent of
The EPA has conducted a qualitative assessment of the benefits of the proposal and has identified three principal benefits. First, the proposed rule would reduce the potential human health risks associated with human exposure to radionuclides, metals and other constituents in well water used for drinking and agriculture. The EPA considers water contaminated with radionuclides to be a potential pathway for exposure to radiation that can cause cancer and other health effects (
Second, the proposal would protect valuable groundwater resources for future generations. Groundwater provides a valuable resource that is increasingly threatened by population growth and technological advances that have significantly increased groundwater extraction. Declining groundwater resources, especially in arid regions where ISR operations are mostly located, are a growing concern. Although the EPA is unable to quantify the value of the groundwater resources that would be protected by the proposal, groundwater resources are likely to become more valuable over time. By reducing the potential for groundwater contamination and ensuring that any migration of constituents from ISR operations is detected early, the proposal would help protect groundwater from contamination. Rapid detection of constituent migration from an ISR operation reduces the overall amount of contamination that must be remediated; early detection can trigger corrective action before a contaminated plume migrates into overlying and underlying aquifers and in areas located down-gradient from ISR facilities, thus reducing the risk of exposure to hazardous constituents. Reducing the risk of contamination of groundwater also protects the surface water bodies to which affected aquifers discharge. By combining sufficient duration of stability monitoring with hydrogeological and geochemical modeling and other analyses to demonstrate that groundwater constituent concentration standards will continue to be met, the proposal would reduce the risk that such migration of constituents above constituent concentration standards might occur after the ISR site is decommissioned and its license terminated.
Finally, the proposed standards would reduce or avoid the costs of remediating contaminated groundwater by reducing the potential for groundwater contamination to occur and by causing any contamination that does occur to be discovered and remedied sooner than would be the case if the new standards were not issued. The costs incurred for cleaning up a plume of contamination may be significant. To illustrate the potential magnitude of the benefits associated with reduced or avoided remediation costs, the EPA compared remediation costs for a model facility under two scenarios: One without the proposed rule and one with the proposed rule. The difference in the total pump and treat remediation under the two scenarios illustrates the cost savings that could result from the rule for this hypothetical contamination episode. Using this approach, the EPA was able to illustrate the benefits of the proposed rule to be between $23.7 million and $608 million in avoided remediation costs over the entire remediation period for a single plume, including capital/well development costs and annual costs. The EPA was unable to estimate the potential avoided costs of remediation that would result from the proposed rule on a national scale because the EPA could not predict the number of incidents of groundwater contamination that would require remediation with and without the rule, or how long it would take for the groundwater contamination to be detected. However, the avoided remediation costs of this rule at the national level could be substantial based
This action is a significant regulatory action that was submitted to the OMB for review. This action is considered a significant regulatory action because it may “raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in the Executive Order.” Accordingly, the EPA has described the need for the proposal, prepared an economic analysis of the potential costs and benefits associated with this action, considered non-regulatory approaches, and submitted the rule to OMB for review. The economic and benefits analysis is contained in the document “Economic Analysis: Final Revisions to the Health and Environmental Protection Standards for Uranium and Thorium Mill Tailings Rule (40 CFR part 192),” December 2016, available in the docket for this action. Any changes made in response to OMB recommendations have been documented in the docket.
This action does not impose an information collection burden under the provisions of the PRA because it does not impose any reporting requirements on affected facilities.
I certify that this action will not have a significant economic impact on a substantial number of small entities under the RFA. The small entities subject to the requirements of this action are small businesses with fewer than 250 employees that are primarily engaged in leaching or beneficiation of uranium, radium or vanadium ores as defined by NAICS code 212291. No small organizations or small governmental entities have been identified that would be impacted by this proposed rulemaking.
The Agency has determined that the seven small firms owning ISR facilities may experience an impact to average estimated annualized costs of between 0.66 percent and 2.78 percent of average company sales, with one firm expected to have a cost-to-sales ratio of below 1 percent, three firms between 1 percent and 2 percent, and three between 2 percent and 3 percent. Details of this analysis are presented in the technical document titled, “Economic Analysis: Revisions to the Health and Environmental Protection Standards for Uranium and Thorium Mill Tailings Rule (40 CFR part 192),” December 2016, available in the docket for this action.
This proposed action does not contain an unfunded mandate of $100 million or more as described in the UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect small governments. The action imposes no enforceable duty on any state, local or tribal governments or the private sector. This action contains no regulatory requirements or obligations that apply to small governments.
This proposed action does not have federalism implications. It will not have substantial direct effects on the states, on the relationship between the national government and the states, or on the distribution of power and responsibilities among the various levels of government.
This proposed action does not have tribal implications, as specified in Executive Order 13175 (65 FR 67249, November 9, 2000). The action imposes requirements on licensees of ISR facilities and not on tribal governments. Thus, Executive Order 13175 does not apply to this action.
Consistent with the EPA Policy on Consultation and Coordination with Indian Tribes, the EPA solicited and considered information submitted by tribal officials during the development of this action.
This proposed action is not subject to Executive Order 13045 because it is not an economically significant regulatory action as defined by Executive Order 12866. This action's health and risk assessments are contained in the document titled “Ground Water Modeling Studies at In-Situ Leaching Facilities and Evaluation of Doses and Risks to Off-Site Receptors from Contaminated Ground Water” available in Docket EPA-HQ-OAR-2012-0788. The EPA evaluated several regulatory strategies for assuring groundwater restoration and stability at ISR facilities and selected the option providing greatest assurance that groundwater systems will remain in a chemically reduced state. By setting new groundwater standards, which include improved monitoring and requirements to plan for and implement corrective measures for excursions and exceedances, this proposed rule reduces children's risk of exposure to contaminated groundwater.
This proposed action is not a “significant energy action” because it is not likely to have a significant adverse effect on the supply, distribution or use of energy. This action proposes standards applicable for uranium ISR facilities that do not directly impact energy supply, distribution or use. The proposed rule would increase the costs of domestic uranium producers relative to foreign producers; however, because domestic-source uranium generally constitutes between 10 percent and 15 percent of total uranium purchased by COOs of nuclear power plants, the EPA does not expect the proposed rule to have a significant impact on uranium quantities or prices available to nuclear power generators, and essentially no impact on the quantity or price of electricity. Thus, the EPA has concluded that this proposed action is not likely to have any adverse effects on productivity, competition, or prices in the energy sector.
This proposed rulemaking does not involve technical standards.
The EPA believes that this proposed action does not have disproportionately high and adverse human health or environmental effects on minority populations, low-income populations or indigenous peoples, as specified in Executive Order 12898 (59 FR 7629, February 16, 1994).
The documentation for this decision in contained in the document titled “Ground Water Modeling Studies at In-Situ Leaching Facilities and Evaluation of Doses and Risks to Off-Site Receptors from Contaminated Ground Water” available in Docket EPA-HQ-OAR-2012-0788. The proposed rule will reduce exposure to all populations by setting new groundwater standards, which include improved monitoring and requirements for planning for and implementing corrective measures when excursions and exceedances occur at ISR facilities. By increasing the level of environmental protection for all affected populations, including minority and low-income populations, this action will have a positive impact on human health and the environment.
Environmental protection, Hazardous substances, Radiation protection, Radioactive materials, Reclamation, Uranium, Waste treatment and disposal, Water resources.
For the reasons stated in the preamble, title 40, Chapter I of the Code of Federal Regulations is proposed to be amended as set forth below:
Sec. 275 of the Atomic Energy Act of 1954, 42 U.S.C. 2022, as added by the Uranium Mill Tailings Radiation Control Act of 1978, Pub. L. 95-604, as amended.
(b) * * *
(3) Compliance with § 192.12(b) may be demonstrated by methods that the Department of Energy has approved for use or methods that the implementing agencies determine are adequate. Residual radioactive materials should be removed from buildings exceeding 0.03 WL so that future replacement buildings will not pose a hazard [unless removal is not practical, see § 192.21(c)]. However, ventilation devices and other radon mitigation methods recommended by the EPA may provide reasonable assurance of reductions from 0.03 WL to below 0.02 WL. In unusual cases, indoor radiation may exceed the levels specified in § 192.12(b) due to sources other than residual radioactive materials. Remedial actions are not required in order to comply with the standard when there is reasonable assurance that residual radioactive materials are not the cause of such an excess.
The revisions read as follows:
(a) Unless otherwise indicated in this subpart, all terms shall have the same meaning as in Title II of the Uranium Mill Tailings Radiation Control Act of 1978, subparts A and B of this part, or parts 190, 260, 261, and 264 of this chapter. For the purposes of this subpart, the terms “waste,” “hazardous waste” and related terms, as used in parts 260, 261, and 264 of this chapter, shall apply to byproduct material.
(f)
(m) * * * This term shall not be construed to include extraordinary measures or techniques that would impose costs that are grossly excessive as measured by practice within the industry or one that is reasonably analogous (such as, by way of illustration only, unreasonable overtime, staffing or transportation requirements, etc., considering normal practice in the industry; laser fusion of soils, etc.), provided there is reasonable progress toward emplacement of a permanent radon barrier. * * *
(a) * * *
(2) * * *
(v) The functions and responsibilities designated in part 264 of this chapter as those of the “Regional Administrator” with respect to “facility permits” shall be carried out by the regulatory agency.
(a) This rule contains standards of general application that the regulatory agency will implement and enforce to protect groundwater at in-situ uranium recovery facilities.
(b) This subpart applies to the management of uranium byproduct materials prior to, during and following the processing of uranium ores utilizing uranium in-situ recovery methods, and to the protection of groundwater at such facilities. Within three years of the effective date of this rule, the regulatory agency shall apply these standards of general application to ISR facilities licensed to process uranium byproduct material.
(a) Unless otherwise indicated in this subpart, all terms shall have the same meaning as in Title II of the Uranium Mill Tailings Radiation Control Act of 1978, subparts A, B, and D of this part, or parts 190, 260, 261, and 264 of this chapter.
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(j)
(k)
(l)
(m)
(n)
(o)
(p)
(q)
(r)
(s)
(t)
(u)
(v)
(w)
(x)
(y)
(z)
(aa)
(bb)
(cc)
(dd)
(ee)
(ff)
(gg)
(hh)
(a) No later than three years after the effective date of this rule, all operating wellfields, new wellfields and expansions of wellfields at ISR facilities must meet the standards in this section. These standards do not apply to those wellfields at licensed ISR facilities that, within three years of the effective date of this rule, are in and remain in the restoration, initial stability monitoring or long-term stability monitoring phases.
(b)
(2) Disposal of solid uranium byproduct materials produced by ISR activities shall conform to the standards in § 192.32.
(c)
(1)
(i) That constituent's preoperational background level in and around the wellfield, as determined by preoperational monitoring conducted under § 192.53(a); or
(ii) the lowest regulatory standard for that constituent found in 40 CFR 141.61, 141.62, 141.66, 141.80, 143.3, 264.94, or Table 1 of subpart A of this part. For any constituent not listed in Table 1 to this subpart, but designated by the regulatory agency for monitoring, a constituent concentration standard at or above the background level should be established from the values in 40 CFR parts 141, 143 or 264, if such values exist. For a constituent not found in 40 CFR parts 141, 143 or 264, the constituent concentration standard above the background level should be established at a concentration level that represents a cumulative excess lifetime risk no greater than 10
(iii) an alternate concentration limit for that constituent as approved by the regulatory agency under § 192.54.
(2)
(3)
(i) Three consecutive years of quarterly monitoring results demonstrating no statistically significant increasing trends that would exceed the constituent concentration standards at the 95 percent confidence level. This showing shall be based on monitoring data collected in accordance with the § 192.53(d); and
(ii) the applicable constituent concentration standards will continue to be met into the future. This showing shall be based on the information collected under § 192.53(d), including monitoring data, geochemical modeling, and other analysis required by the regulatory agency.
Licensees subject to this subpart must conduct a groundwater monitoring program, subject to review and approval by the regulatory agency, at prospective and licensed ISR wellfields. The components of the program include pre-operational monitoring to determine statistically valid background levels, excursion monitoring to identify and correct excursions, and initial and long-term stability monitoring. This program shall address all phases of the uranium recovery activities and must be conducted as follows:
(a)
(1) A sufficient number of wells, at appropriate locations and depths, shall
(2) All monitoring wells must be installed and developed as directed by the regulatory agency to maintain well integrity, allow for accurate sample collection and prevent contamination of samples.
(3) The preoperational monitoring shall include the production zone and areas immediately surrounding the production zone, as identified by the regulatory agency, including up- and down-gradient areas outside of the production zone.
(4) During the preoperational monitoring effort, relevant data documenting geology, hydrology and geochemistry for radiological and non-radiological constituents shall be collected as required by the regulatory agency, both in the production zone and in surrounding areas that may be affected by the ISR operations.
(i) The monitoring effort shall be of sufficient scope and duration to adequately characterize temporal (
(ii) Preoperational monitoring shall be focused on determining background concentrations of constituents and indicator parameters in the following locations:
(A) Points of compliance within the proposed production zone; and
(B) Points of compliance outside the production zone including point of compliance screened in potentially affected overlying and underlying aquifers (when present); and points of compliance screened in upgradient and downgradient aquifers (when present).
(5) The licensee shall employ appropriate statistical techniques to analyze background concentrations measured in individual wells within the wellfield and in any other wells identified by the regulatory agency for the purpose of determining constituent concentration standards. Background concentrations used to establish the constituent concentration standards may be representative of individual wells, multiple wells, or all wells within the proposed production zone and are subject to review and approval by the regulatory agency.
(6) Radiological and non-radiological constituents to be monitored during the preoperational phase shall include:
(i) All constituents listed in Table 1 of this subpart;
(ii) Constituents and parameters as determined by the regulatory agency to be necessary to characterize the geochemistry of the groundwater and to demonstrate that the applicable constituent concentration standards have been met and will continue to be met into the future; and
(iii) Any additional constituents or parameters required by the regulatory agency, such as metals potentially mobilized by the recovery process.
(b)
(1) Indicator parameters, as established by the regulatory agency, shall be monitored in excursion monitoring wells surrounding the production zone, including aquifers above and below the production zone, at a minimum throughout the operational and restoration phases of ISR activities.
(2) If an excursion is detected as evidenced by indicator parameters exceeding established upper control limits, as determined by the regulatory agency, corrective action under § 192.55 must be initiated and constituents listed in Table 1 of this subpart expected to be present (
(c)
(1) Once the regulatory agency determines restoration is complete, the licensee shall begin its initial stability monitoring as described in paragraphs (c)(2), (3), and (4) of this section to meet its initial stability standards as described in § 192.52(c)(2).
(2) The constituents to be monitored at the points of compliance shall include:
(i) All constituents having a constituent concentration standard and expected to be present, as determined by the regulatory agency under § 192.52(c)(1);
(ii) Any additional constituents required by the regulatory agency, such as:
(A) Constituents and parameters necessary to characterize the geochemistry of the groundwater and other analysis to demonstrate that the applicable constituent concentration standards have been met and will continue to be met into the future;
(B) Components of the lixiviant fluids injected during uranium recovery and any fluids injected during restoration; or
(C) Metals potentially mobilized by the uranium recovery process that could reasonably be expected to be found in the groundwater.
(3) If the licensee finds that the initial stability standard in § 192.52(c)(2) cannot be demonstrated for one or more constituents, the regulatory agency may:
(i) Require the licensee to resume active restoration efforts; or
(ii) After all best practicable active restoration activities have been completed, establish a provisional alternate concentration limit according to the requirements of § 192.54. Once initial stability according to the standard in § 192.52(c)(2) at the provisional alternate concentration limit has been documented, the regulatory agency may establish a final alternate concentration limit according to the requirements of § 192.54.
(4) If the regulatory agency determines that a constituent exceeds a constituent concentration standard in § 192.52(c)(1) at a point of compliance, the licensee, as directed by the regulatory agency, must undertake corrective action under § 192.55 until the regulatory agency determines that the exceedance of the constituent concentration standard is adequately remedied.
(d)
(1) Once the regulatory agency determines the initial stability standards have been met, the licensee shall begin conducting long-term stability monitoring as described in paragraph (d)(2) of this section to demonstrate it meets its long-term stability standards, established under § 192.52(c)(3).
(2) The constituents to be monitored at the points of compliance shall include:
(i) All constituents having a constituent concentration standard expected to be present, as determined by the regulatory agency under § 192.52(c)(1);
(ii) Any additional constituents required by the regulatory agency, such as:
(A) Constituents and parameters necessary to characterize the geochemistry of the groundwater and modeling and other analysis to demonstrate that the applicable constituent concentration standards have been met and will continue to be met into the future;
(B) Components of the lixiviant fluids injected during uranium recovery and any fluids injected during restoration; or
(C) Metals potentially mobilized by the uranium recovery process that could
(3) If the regulatory agency finds that one or more constituents at a point of compliance within the wellfield exceeds a constituent concentration standard as defined in § 192.52(c)(1) then, as directed by the regulatory agency, the licensee must undertake corrective action under § 192.55 until the regulatory agency determines that the exceedance of the constituent concentration standard(s) is adequately remedied.
(4) If the licensee finds that the long-term stability standard in § 192.52(c)(3) cannot be demonstrated for one or more constituents, the regulatory agency may:
(i) Require the licensee to resume active restoration efforts; or
(ii) After all best practicable active restoration activities have been completed, establish an alternate concentration limit according to the requirements of § 192.54.
(5) In addition to the long-term stability monitoring requirements described in paragraph (d)(2) of this section, the licensee must provide to the regulatory agency geochemical modeling and other analysis sufficient to demonstrate that the long-term stability standard in § 192.52(c)(3) has been met.
(6) The licensee must continue its long-term stability monitoring until the regulatory agency determines that the long-term stability standard in § 192.52(c)(3) has been met and releases the facility from monitoring.
(a)
(1) The regulatory agency determines that all best practicable active restoration activities have been completed in accordance with the license, and that the previously approved constituent concentration standard under § 192.52(c)(1)(i) or (ii) are not reasonably achievable; and
(2) The constituent will not pose a substantial present or potential hazard to human health or the environment as long as the provisional alternate concentration limit is not exceeded; and
(3) The constituent concentration standard, as determined under paragraph (c)(1) of this section, is satisfied at all points of exposure in the wellfield and in surrounding aquifers.
(b)
(1) The licensee has demonstrated initial groundwater stability as defined in § 192.52(c)(2); and (2) The constituent will not pose a substantial present or potential future hazard to human health or the environment as long as the final alternate concentration limit is not exceeded.
(c) In deciding whether to approve a provisional or a final alternate concentration limit, the regulatory agency shall consider, at a minimum, the following factors:
(1) Potential adverse effects on groundwater quality, considering:
(i) The physical and chemical characteristics of constituents in the groundwater at the site, including their potential for migration;
(ii) The hydrogeological characteristics (
(iii) The quantity of groundwater and the direction of groundwater flow;
(iv) The proximity and withdrawal rates of local groundwater users;
(v) The current and anticipated future uses of groundwater in the region surrounding the site;
(vi) The existing quality of groundwater, including other sources of contamination and their cumulative impact on groundwater quality;
(vii) The potential for health risks caused by human exposure to constituents;
(viii) The potential damage to wildlife, crops, vegetation, and physical structures caused by exposure to constituents; and
(ix) The persistence and permanence of the potential adverse effects.
(2) Potential adverse effects on hydraulically-connected surface-water quality, considering:
(i) The volume and physical and chemical characteristics of the groundwater at the site;
(ii) The hydrogeological characteristics of the site and surrounding land;
(iii) The quantity and quality of groundwater, and the direction of groundwater flow;
(iv) The patterns of rainfall in the region;
(v) The proximity of the site to surface waters;
(vi) The current and future uses of surface waters in the region surrounding the site and any water quality standards established for those surface waters;
(vii) The existing quality of hydraulically-connected surface water, including other sources of contamination and their cumulative impact on surface water quality;
(viii) The potential for health risks caused by human exposure to constituents;
(ix) The potential damage to wildlife, crops, vegetation, and physical structures caused by exposure to constituents; and
(x) The persistence and permanence of the potential adverse effects.
(3) The presence of any underground source of drinking water.
(a) A corrective action program shall be developed by the licensee and approved by the regulatory agency for each ISR site at the time of licensing. The plan shall address a range of possible scenarios (
(b) The licensee shall continue corrective action measures to the extent necessary to achieve and maintain compliance with the constituent concentration standards in § 192.52(c)(1). The regulatory agency will determine when the licensee may terminate corrective action measures based on data from the groundwater monitoring program and other information that provides reasonable assurance that the constituent concentration standards in § 192.52(c)(1) will not be exceeded.
(c) Upon termination of any corrective action initiated during long-term stability monitoring, the licensee shall then be subject to the initial and long-term stability standards specified in § 192.53(c)(2) and (3).
Subpart F shall be effective on [60 DAYS AFTER DATE OF PUBLICATION OF FINAL RULE IN
Environmental Protection Agency (EPA).
Proposed rule.
Trichloroethylene (TCE) is a volatile organic compound widely used in industrial and commercial processes and has some limited uses in consumer and commercial products. EPA identified significant health risks associated with TCE use in vapor degreasing and EPA's proposed determination is that these risks are unreasonable risks. To address these unreasonable risks, EPA is proposing under section 6 of the Toxic Substances Control Act (TSCA) to prohibit the manufacture (including import), processing, and distribution in commerce of TCE for use in vapor degreasing; to prohibit commercial use of TCE in vapor degreasing; to require manufacturers, processors, and distributors, except for retailers of TCE for any use, to provide downstream notification of these prohibitions throughout the supply chain; and to require limited recordkeeping.
Comments must be received on or before March 20, 2017.
Submit your comments, identified by docket identification (ID) number EPA-HQ-OPPT-2016-0387, at
You may be potentially affected by this proposed action if you manufacture (defined under TSCA to include import), process, or distribute in commerce TCE or commercially use TCE in vapor degreasers. The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document applies to them. Potentially affected entities may include:
• Petroleum Refineries (NAICS code 324110).
• Petroleum Lubricating Oil and Grease Manufacturing (NAICS code 324191).
• Petrochemical Manufacturing (NAICS code 325110).
• Industrial Gas Manufacturing (NAICS code 325120).
• Other Basic Inorganic Chemical Manufacturing (NAICS code 325180).
• All Other Basic Organic Chemical Manufacturing (NAICS code 325199).
• Plastics Material and Resin Manufacturing (NAICS code 325211).
• Synthetic Rubber Manufacturing (NAICS code 325212).
• Paint and Coating Manufacturing (NAICS code 325510).
• Adhesive Manufacturing (NAICS code 325520).
• Soap and Other Detergent Manufacturing (NAICS code 325611).
• Polish and Other Sanitation Good Manufacturing (NAICS code 325612).
• All Other Miscellaneous Chemical Product and Preparation Manufacturing (NAICS code 325998).
• Unlaminated Plastics Film and Sheet (except Packaging) Manufacturing (NAICS code 326113).
• All Other Plastics Product Manufacturing (NAICS code 326199).
• Rubber and Plastics Hoses and Belting Manufacturing (NAICS code 326220).
• All Other Rubber Product Manufacturing (NAICS code 326299).
• Cement Manufacturing (NAICS code 327310).
• Ground or Treated Mineral and Earth Manufacturing (NAICS code 327992).
• Iron and Steel Pipe and Tube Manufacturing from Purchased Steel (NAICS code 331210).
• Steel Wire Drawing (NAICS code 331222).
• Copper Rolling, Drawing, Extruding, and Alloying (NAICS code 331420)
• Nonferrous Metal (except Copper and Aluminum) Rolling, Drawing, and Extruding (NAICS code 331491).
• Nonferrous Metal Die-Casting Foundries (NAICS code 331523).
• Powder Metallurgy Part Manufacturing (NAICS code 332117).
• Metal Crown, Closure, and Other Metal Stamping (except Automotive) (NAICS code 332119).
• Saw Blade and Hand Tool Manufacturing (NAICS code 332216).
• Metal Window and Door Manufacturing (NAICS code 332321).
• Power Boiler and Heat Exchanger Manufacturing (NAICS code 332410).
• Other Fabricated Wire Product Manufacturing (NAICS code 332618).
• Machine Shops (NAICS code 332710).
• Precision Turned Product Manufacturing (NAICS code 332721).
• Bolt, Nut, Screw, Rivet, and Washer Manufacturing (NAICS code 332722).
• Metal Heat Treating (NAICS code 332811).
• Metal Coating, Engraving (except Jewelry and Silverware), and Allied Services to Manufacturers (NAICS code 332812).
• Electroplating, Plating, Polishing, Anodizing, and Coloring (NAICS code 332813).
• Oil and Gas Field Machinery and Equipment Manufacturing (NAICS code 333132).
• Cutting Tool and Machine Tool Accessory Manufacturing (NAICS code 333515).
• Small Arms, Ordnance, and Ordnance Accessories Manufacturing (NAICS code 332994).
• Fluid Power Pump and Motor Manufacturing (NAICS code 333996).
• All Other Miscellaneous Fabricated Metal Product Manufacturing (NAICS code 332999).
• Oil and Gas Field Machinery and Equipment Manufacturing (NAICS code 333132).
• Industrial and Commercial Fan and Blower and Air Purification Equipment Manufacturing (NAICS code 333413).
• Cutting Tool and Machine Tool Accessory Manufacturing (NAICS code 333515).
• Pump and Pumping Equipment Manufacturing (NAICS code 333911).
• Fluid Power Pump and Motor Manufacturing (NAICS code 333996).
• Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing (NAICS code 334511).
• Automatic Environmental Control Manufacturing for Residential, Commercial, and Appliance Use (NAICS code 334512).
• Motor and Generator Manufacturing (NAICS code 335312).
• Primary Battery Manufacturing (NAICS code 335912).
• Carbon and Graphite Product Manufacturing (NAICS code 335991).
• Motor Vehicle Brake System Manufacturing (NAICS code 336340).
• Aircraft Manufacturing (NAICS code 336411).
• Other Aircraft Parts and Auxiliary Equipment Manufacturing (NAICS code 336413).
• Guided Missile and Space Vehicle Manufacturing (NAICS code 336414).
• Ship Building and Repairing (NAICS code 336611).
• Dental Equipment and Supplies Manufacturing (NAICS code 339114).
• Other Chemical and Allied Products Merchant Wholesalers (NAICS code 424690).
• Petroleum Bulk Stations and Terminals (NAICS code 424710).
• Hazardous Waste Treatment and Disposal (NAICS code 562211).
• Solid Waste Combustors and Incinerators (NAICS code 562213).
This action may also affect certain entities through pre-existing import certification and export notification rules under TSCA. Persons who import any chemical substance governed by a final TSCA section 6(a) rule are subject to the TSCA section 13 (15 U.S.C. 2612) import certification requirements and the corresponding regulations at 19 CFR 12.118 through 12.127; see also 19 CFR 127.28. Those persons must certify that the shipment of the chemical substance complies with all applicable rules and orders under TSCA. The EPA policy in support of import certification appears at 40 CFR part 707, subpart B. In addition, any persons who export or intend to export a chemical substance that is the subject of this proposed rule are subject to the export notification provisions of TSCA section 12(b) (15 U.S.C. 2611(b)), and must comply with the export notification requirements in 40 CFR part 707, subpart D.
If you have any questions regarding the applicability of this proposed action to a particular entity, consult the technical information contact listed under
Under TSCA section 6(a) (15 U.S.C. 2605(a)), if EPA determines after risk evaluation that a chemical substance presents an unreasonable risk of injury to health or the environment, without consideration of costs or other non-risk factors, including an unreasonable risk to a potentially exposed or susceptible subpopulation identified as relevant to the risk evaluation, under the conditions of use, EPA must by rule apply one or more requirements to the extent necessary so that the chemical substance or mixture no longer presents such risk.
For a chemical substance listed in the 2014 update to the TSCA Work Plan for Chemical Assessments for which a completed risk assessment was published prior to the date of enactment of the Frank R. Lautenberg Chemical Safety for the 21st Century Act, TSCA section 26(l)(4) expressly authorizes EPA to issue rules under TSCA section 6(a) that are consistent with the scope of the completed risk assessment and consistent with the other applicable requirements of TSCA section 6. TCE is such a chemical substance. It is listed in the 2014 update to the TSCA Work Plan and the completed risk assessment was published on June 25, 2014. The scope of the completed risk assessment includes vapor degreasing.
EPA's proposed determination is that the use of TCE in vapor degreasing presents an unreasonable risk of injury to health. Accordingly, EPA is proposing under TSCA section 6 to prohibit the manufacture (including import), processing, and distribution in commerce of TCE for use in vapor degreasing; to prohibit commercial use of TCE in vapor degreasing; and to require manufacturers, processors, and distributors, except for retailers, to provide downstream notification of this prohibition throughout the supply chain (
This proposal is related to the proposed rule on TCE aerosol degreasing and spot cleaning in dry cleaning facilities that published in the
Based on EPA's analysis of worker exposures to TCE, EPA's proposed determination is that the use of TCE in vapor degreasing presents an unreasonable risk to human health. More specifically, this use results in significant non-cancer risks under both acute and chronic exposure scenarios and significant cancer risks from chronic exposures. These adverse health effects include those resulting from developmental toxicity (
As discussed in Unit I.C., EPA is not proposing to prohibit all manufacturing, processing, distribution in commerce, and use of TCE. As such, the application of this proposal's supply chain approach tailored to specific uses that present unreasonable risks to human health is necessary so that the chemical substance no longer presents the identified unreasonable risks.
EPA has evaluated the potential costs of multiple regulatory options, including the proposed approach of prohibiting the manufacture (including import), processing, and distribution in commerce of TCE for use in vapor degreasing; prohibiting the commercial use of TCE in vapor degreasing; and requiring manufacturers, processors, and distributors, except for retailers, to provide downstream notification of these prohibitions throughout the supply chain as well as associated recordkeeping requirements. This analysis (Ref. 3), which is available in the docket, is discussed in Unit VI., and is briefly summarized here.
Alternatives to TCE with similar performance characteristics are readily available. Most of the costs of the rule would be borne by commercial users of TCE in vapor degreasing equipment, because they would have to switch solvents and likely equipment as well. EPA has estimated that the costs to users range from $30M to $45M when annualized over 20 years at a 3% discount rate, and from $32M to $46M over 20 years at a 7% discount rate. These are the total estimated costs of this proposal. The costs of the downstream notification and recordkeeping requirements to manufacturers, processors, and distributors of TCE, estimated to be approximately $3,200 and $4,400 annualized over 20 years using 3% and 7% discount rates respectively. For additional information see Unit 5.1.3 of the Economic Analysis. (Ref. 3) However, because these notification and recordkeeping costs were already accounted for in the economic analysis accompanying the earlier TCE proposal (Ref. 1), they are not included in the total costs for this proposal. EPA accounted for these costs in the prior proposal because it believes the universe of entities distributing TCE for both sets of uses are the same. EPA is taking comment on whether the same firms distribute TCE for these two sets of uses.
Although TCE causes a wide range of non-cancer adverse effects and cancer, monetized benefits included only benefits associated with reducing cancer risks. The Agency does not have sufficient information to include a quantification or valuation estimate for non-cancer benefits in the overall benefits at this time. The monetized benefits for the proposed approach range from approximately $65 to $443 million on an annualized basis over 20 years at 3% and $31 million to $225 million at 7% (Ref. 3). The non-monetized benefits resulting from the prevention of the non-cancer adverse effects associated with TCE exposure from use in vapor degreasers include developmental toxicity, toxicity to the kidney, immunotoxicity, reproductive and endocrine effects, neurotoxicity, and toxicity to the liver (Ref. 2). Some of the effects that can be caused by exposure to TCE, such as cardiac malformations and fetal death, occur in utero and can impact a person for a lifetime; other effects, such as damage to the developing immune system, may first manifest when a person is an adult and can have long lasting impacts. Also see Unit VI.D.
This action is consistent with the 1995 EPA Policy on Evaluating Health Risks to Children (
This proposed rule applies to TCE (Chemical Abstract Services Registry Number 79-01-6) for use in vapor degreasing.
In 2011, global consumption of TCE was 945 million pounds and consumption in the United States was 255 million pounds. TCE is produced within and imported into the United States. Nine companies, including domestic manufacturers and importers, reported a total production and import of 225 million pounds of TCE in 2011 to EPA pursuant to the Chemical Data Reporting (CDR) rule (Ref. 2).
The majority (about 83.6%) of TCE is used as an intermediate chemical for manufacturing refrigerant HFC‐134a. This use occurs in a closed system that has low potential for human exposure (Ref. 2). EPA did not assess this use and is not proposing to regulate this use of TCE under TSCA at this time. However, this does not mean that EPA found that this use or other uses not included in the TCE risk assessment present low risk. Much of the remainder, about 14.7%, is used as a solvent for degreasing of metals. A relatively small percentage, about 1.7%, accounts for all other uses, including TCE use in products, such as aerosol degreasers.
Based on the Toxics Release Inventory (TRI) data for 2012, 38 companies used TCE as a formulation component, 33 companies processed TCE by repackaging the chemical, 28 companies used TCE as a manufacturing aid, and 1,113 companies used TCE for ancillary uses, such as degreasing (Ref. 2). Based on the latest TRI data from 2014, the number of users of TCE has significantly
The use assessed by EPA that is the subject of this proposal, commercial use of TCE in vapor degreasing, is estimated to represent up to 14.7% of total use of TCE. This use is discussed in detail in Unit VI.
A broad set of relevant studies including epidemiologic studies, animal bioassays, metabolism studies, and mechanistic studies show that TCE exposure is associated with an array of adverse health effects. TCE has the potential to induce developmental toxicity, immunotoxicity, kidney toxicity, reproductive and endocrine effects, neurotoxicity, liver toxicity, and several forms of cancer (Ref. 2).
TCE is fat soluble (lipophilic) and easily crosses biological membranes. TCE has been found in human maternal and fetal blood and in the breast milk of lactating women (Ref. 2). EPA's IRIS assessment (Ref. 4) concluded that TCE poses a potential health hazard for non-cancer toxicity including fetal heart malformations and other developmental effects, immunotoxicity, kidney toxicity, reproductive and endocrine effects, neurotoxicity, and liver effects. The IRIS assessment also evaluated TCE and its metabolites. Based on the results of
An evaluation of the overall weight of the evidence of the human and animal developmental toxicity data suggests an association between pre‐ and/or post-natal TCE exposures and potential adverse developmental outcomes. TCE‐induced heart malformations and immunotoxicity in animals have been identified as the most sensitive developmental toxicity endpoints for TCE. Human studies examined the possible association of TCE with various prenatal effects. These adverse effects of developmental TCE exposure may include: Death (spontaneous abortion, perinatal death, pre- or post-implantation loss, resorptions); decreased growth (low birth weight, small for gestational age); congenital malformations, in particular heart defects; and postnatal effects such as reduced growth, decreased survival, developmental neurotoxicity, developmental immunotoxicity, and childhood cancers. Some epidemiological studies reported an increased incidence of birth defects in TCE‐exposed populations from exposure to contaminated water. As for human developmental neurotoxicity, studies collectively suggest that the developing brain is susceptible to TCE toxicity. These studies have reported an association with TCE exposure and central nervous system birth defects and postnatal effects such as delayed newborn reflexes, impaired learning or memory, aggressive behavior, hearing impairment, speech impairment, encephalopathy, impaired executive and motor function and attention deficit disorder (Ref. 2).
Immune‐related effects following TCE exposures have been observed in adult animal and human studies. In general, these effects were associated with enhanced immune response as opposed to immunosuppressive effects. Human studies have reported a relationship between systemic autoimmune diseases, such as scleroderma, with occupational exposure to TCE. There have also been a large number of case reports in TCE‐exposed workers developing a severe hypersensitivity skin disorder, often accompanied by systemic effects to the lymph nodes and other organs, such as hepatitis (Ref. 2).
Studies in both humans and animals have shown changes in the proximal tubules of the kidney following exposure to TCE (Ref. 2). The IRIS TCE assessment concluded that TCE is carcinogenic to humans based on convincing evidence of a causal relationship between TCE exposure in humans and kidney cancer (Ref. 4). A recent review of TCE by the International Agency for Research on Cancer (IARC) also supported this conclusion (Ref. 7). The 12th report on carcinogens (RoC) by the National Toxicology Program also concluded that TCE is reasonably anticipated to be a human carcinogen 2015 (Ref. 8). These additional recent peer reviews are consistent with EPA's classification that TCE is carcinogenic to humans by all routes of exposures based upon strong epidemiological and animal evidence (Refs. 2, 4).
TCE metabolites appear to be the causative agents that induce renal toxicity, including cancer. S‐dichlorovinyl‐L‐cysteine (DCVC), and to a lesser extent other metabolites, appears to be responsible for kidney damage and kidney cancer following TCE exposure. Toxicokinetic data suggest that the TCE metabolites derived from glutathione conjugation (in particular DCVC) can be systemically delivered or formed in the kidney. Moreover, DCVC‐treated animals showed the same type of kidney damage as those treated with TCE (Ref. 2). The toxicokinetic data and the genotoxicity of DCVC further suggest that a mutagenic mode of action is involved in TCE‐induced kidney tumors, although cytotoxicity followed by compensatory cellular proliferation cannot be ruled out. As for the mutagenic mode of action, both genetic polymorphisms (Glutathione transferase (GST) pathway) and mutations to tumor suppressor genes have been hypothesized as possible mechanistic key events in the formation of kidney cancers in humans (Ref. 2).
The toxicological literature provides support for male and female reproductive effects following TCE exposure. Both the epidemiological and animal studies provide evidence of adverse effects to female reproductive outcomes. However, more extensive evidence exists in support of an association between TCE exposures and male reproductive toxicity. There is evidence that metabolism of TCE in male reproductive tract tissues is associated with adverse effects on sperm measures in both humans and animals. Furthermore, human studies support an association between TCE exposure and alterations in sperm density and quality, as well as changes in sexual drive or function and altered serum endocrine levels (Ref. 2).
Neurotoxicity has been demonstrated in animal and human studies under both acute and chronic exposure conditions. Evaluation of multiple human studies revealed TCE‐induced neurotoxic effects including alterations in trigeminal nerve and vestibular function, auditory effects, changes in vision, alterations in cognitive function, changes in psychomotor effects, and neurodevelopmental outcomes. These studies in different populations have consistently reported vestibular system‐related symptoms such as headaches, dizziness, and nausea following TCE exposure (Ref. 2).
Animals and humans exposed to TCE consistently experience liver toxicity. Specific effects include the following structural changes: Increased liver weight, increased DNA synthesis (transient), enlarged hepatocytes, enlarged nuclei, and peroxisome proliferation. Several human studies
TCE is characterized as carcinogenic to humans by all routes of exposure as documented in EPA's IRIS TCE assessment (Ref. 4). This conclusion is based on strong cancer epidemiological data that reported an association between TCE exposure and the onset of various cancers, primarily in the kidney, liver, and the immune system,
Pursuant to TSCA section 6(c), this unit describes the effects of TCE on the environment and the magnitude of the exposure of the environment to TCE. The unreasonable risk determination of this proposal is based solely on risks to human health since those risks are the most serious consequence of use of TCE and are sufficient to support this proposed action. The following is a discussion of the environmental impacts of TCE.
Because of its potential health effects, TCE is subject to state, federal, and international regulations restricting and regulating its use, which are summarized in this unit. None of these actions addresses the unreasonable risks under TSCA that EPA is seeking to address in this proposed rule.
Since 1979, EPA has issued numerous rules and notices pertaining to TCE under its various authorities.
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The Occupational Safety and Health Administration (OSHA) established a permissible exposure limit (PEL) for TCE in 1971. The PEL is an 8-hour time-weighted average (TWA) TCE concentration of 100 ppm. In addition, the TCE PEL requires that exposure to TCE not exceed 200 ppm (ceiling) at any time during an eight hour work shift with the following exception: Exposures may exceed 200 ppm, but not more than 300 ppm (peak), for a single time period up to 5 minutes in any 2 hours (Ref. 11). OSHA acknowledges that many of its PELs are not sufficiently protective of worker health. OSHA has noted that “with few exceptions, OSHA's PELs, which specify the amount of a particular chemical substance allowed in workplace air, have not been updated since they were established in 1971 under expedited procedures available in the short period after the OSH Act's adoption . . . Yet, in many instances, scientific evidence has accumulated suggesting that the current limits are not sufficiently protective” (Ref. 12 at p. 61386), including the PEL for TCE.
To provide employers, workers, and other interested parties with a list of alternate occupational exposure limits that may serve to better protect workers, OSHA's Web page highlights selected occupational exposure limits derived by other organizations. For example, the National Institute for Occupational Safety and Health considers TCE a potential occupational carcinogen and recommended an exposure limit of 25 ppm as a 10-hour TWA in 2003 (Ref. 13). The American Conference of Governmental Industrial Hygienists recommended an 8-hour TWA of 10 ppm and an acute, or short term, exposure limit of 25 ppm in 2004 (Ref. 14).
Many states have taken actions to reduce risks from TCE use. TCE is listed on California's Safer Consumer Products regulations candidate list of chemicals that exhibit a hazard trait and are on an authoritative list and is also listed on California's Proposition 65 list of chemicals known to cause cancer or birth defects or other reproductive harm. In addition, the California Code of Regulations, Title 17, Section 94509(a) lists standards for VOCs for consumer products sold, supplied, offered for sale, or manufactured for use in California (Ref. 15). As part of that regulation, use of consumer general purpose degreaser products that contain TCE are banned in California and safer substitutes are in use.
In Massachusetts, TCE is a designated high hazard substance, with an annual reporting threshold of 1,000 pounds (Ref. 16). Minnesota classifies TCE as a chemical of high concern (Ref. 17). Many other states have considered TCE for similar chemical listings (Ref. 18). Several additional states have various TCE regulations that range from reporting requirements to product contamination limits to use reduction efforts aimed at limiting or prohibiting TCE content in products.
Most states have set PELs identical to the OSHA 100 ppm 8-hour TWA PEL (Ref. 18). Nine states have PELs of 50 ppm (Ref. 18). California's PEL of 25 ppm is the most stringent (Ref. 15). All of these PELs are significantly higher than the exposure levels at which EPA identified unreasonable risks for TCE use for vapor degreasing and would not be protective.
TCE is also regulated internationally and the international industrial and commercial sectors have moved to alternatives. TCE was added to the EU Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH) restriction of substances classified as a carcinogen category 1B under the EU Classification and Labeling regulation in 2009 (Ref. 19). The restriction prohibits the placing on the market or use of TCE as a substance, as a constituent of other substances, or in mixtures for supply to the general public when the individual concentration of TCE in the substance or mixture is equal to or greater than 0.1% by weight (Ref. 19). In 2010, TCE was added to the Candidate List of substances for inclusion in Annex XIV of REACH, or the Authorisation List. Annex XIV includes substances of very high concern that are subject to use
In 2013, the Commission added TCE to Annex XIV of REACH, making it subject to authorization. As such, entities that wanted to use TCE were required to apply for authorization by October 2014, and those entities without an authorization were required to stop using TCE by April 2016. The European Chemicals Agency (ECHA) received 19 applications for authorization from entities interested in using TCE beyond April 2016. Two of those were for vapor degreasing applications (Refs. 20, 21). In each case, the opinion of the Committee for Risk Assessment was that it was not possible to determine a derived no-effect level (DNEL) for the carcinogenicity properties of the substance in accordance with REACH and that the operational conditions and risk management measures in the applications appeared not to limit the risk. Those measures included use in a specific type of closed vapor degreasing system with personal protective equipment (PPE). Final decisions have not yet been made on the applications.
Canada conducted a hazard assessment of TCE in 1993 and concluded that “trichloroethylene occurs at concentrations that may be harmful to the environment, and that may constitute a danger in Canada to human life or health. It has been concluded that trichloroethylene occurs at concentrations that do not constitute a danger to the environment on which human life depends” (Ref. 22). In 2003, Canada issued the Solvent Degreasing Regulations (SOR/2003-283) to reduce releases of TCE into the environment from solvent degreasing facilities using more than 1,000 kilograms of TCE per year (Ref. 23). In 2013, Canada added TCE to the Toxic Substances List—Schedule 1 because TCE “is entering or may enter the environment in a quantity or concentration or under conditions that: (a) Have or may have an immediate or chronic harmful effect on the environment or its biological diversity, and (c) constitute or may constitute a danger in Canada to human life or health.” (Ref. 23).
In Japan, the Chemical Substances Control Law considers TCE a Class II substance (substances that may pose a risk of long‐term toxicity to humans or to flora and fauna in the human living environment, and that have been, or in the near future are reasonably likely to be, found in considerable amounts over a substantially extensive area of the environment) (Ref. 24). Japan also controls air emissions and water discharges containing TCE, as well as aerosol products for household use and household cleaners containing TCE.
TCE is listed in the Australian National Pollutant Inventory, a program run cooperatively by the Australian, State and Territory governments to monitor common pollutants and their levels of release to the environment. Australia classifies TCE as a health, physicochemical and/or ecotoxicological hazard, according to the Australian National Occupational Health and Safety Commission (Ref. 25).
In 2013, EPA identified TCE use as a solvent degreaser (aerosol degreasing and vapor degreasing) and spot remover in dry cleaning operations as a priority for risk assessment under the TSCA Work Plan. This Unit describes the development of the TCE risk assessment and supporting analysis and expert input on vapor degreasing, the use that is the subject of this proposed rule. A more detailed discussion of the risks associated with TCE use in vapor degreasing can be found in Unit VI.
In 2012, EPA released the TSCA Work Plan Chemicals: Methods Document in which EPA described the process the Agency intended to use to identify potential candidate chemicals for near-term review and assessment under TSCA (Ref. 26). EPA also released the initial list of TSCA Work Plan chemicals identified for further assessment under TSCA as part of its chemical safety program (Ref. 27).
The process for identifying these chemicals for further assessment under TSCA was based on a combination of hazard, exposure, and persistence and bioaccumulation characteristics, and is described in the TSCA Work Plan Chemicals Methods Document (Ref. 26). Using the TSCA Work Plan chemical prioritization criteria, TCE ranked high for health hazards and exposure potential and was included on the initial list of TSCA Work Plan chemicals for assessment.
EPA finalized a TSCA Work Plan Chemical Risk Assessment for TCE (TCE risk assessment) in June 2014, following the July 2013 peer review of the December 2012 draft TCE risk assessment. All documents from the July 2013 peer review of the draft TCE risk assessment are available in EPA Docket Number EPA-HQ-OPPT-2012-0723. TCE appears in the 2014 update of the TSCA Work Plan for Chemical Assessments and the completed risk assessment is noted therein. The TCE risk assessment evaluated commercial and consumer use of TCE as a solvent degreaser (aerosol degreasing and vapor degreasing), commercial use of TCE as a spotting agent at dry cleaning facilities, and consumer use of TCE as a spray-applied protective coating for arts and crafts (Ref. 2).
The uses selected for the TCE risk assessment were chosen because they were expected to involve frequent or routine use of TCE in high concentrations and/or have high potential for human exposure (Ref. 2). However, this does not mean that EPA found that other uses not included in the TCE risk assessment present low risk.
As described in the TCE risk assessment, solvent cleaning or degreasing is widely used to remove grease, oils, waxes, carbon deposits, fluxes, and tars from metal, glass, or plastic surfaces. With respect to vapor degreasing, there are two general types of degreasing machines: Batch and in‐line. Batch cleaning machines are the most common type, while in‐line cleaners are typically used in large‐scale industrial operations. There are a number of variations of each general type of machine. Emissions from degreasing machines typically result from:
• Evaporation of the solvent from the interface between the solvent and the air,
• “Carry out” of excess solvent on cleaned parts, and
• Evaporative losses of the solvent during filling and draining of the degreasing machine.
In its assessment of vapor degreasing, the TCE risk assessment concentrated on open top vapor degreasing machines because they are the most prevalent, particularly for smaller operations. The risk assessment identified acute and chronic non‐cancer risks for workers who conduct TCE‐based solvent vapor degreasing at small degreasing facilities, as well as occupational bystanders to those activities. More specifically, the TCE risk assessment identified risks for non-cancer developmental effects resulting from acute exposure. The risk assessment also identified risks for a range of non-cancer health effects resulting from chronic exposure. Within
Margins of exposure (MOEs) were used in this assessment to estimate non-cancer risks for acute and chronic exposures. The MOE is the health point of departure (an approximation of the no-observed adverse effect level) for a specific endpoint divided by the exposure concentration for the specific scenario of concern. The benchmark MOE accounts for the total uncertainty factor based on the following uncertainty factors: Intraspecies, interspecies, subchronic to chronic, and lowest observed adverse effect level (LOAEL) to no-observed adverse effect level (NOAEL). Uncertainty factors are intended to account for (1) the variation in sensitivity among the members of the human population (
The acute inhalation risk assessment used developmental toxicity data to evaluate the acute risks for the TCE use scenarios. As indicated in the TCE risk assessment, EPA's policy supports the use of developmental studies to evaluate the risks of acute exposures. This science-based policy presumes that a single exposure of a chemical at a critical window of fetal development may produce adverse developmental effects (Ref. 5). This is the case with cardiac malformation. EPA reviewed multiple studies for suitability for acute risk estimation including a number of developmental studies of TCE exposure and additional developmental studies of TCE metabolites (Appendix N) (Ref. 2). EPA based its acute risk assessment on the most sensitive health endpoint (
For non-cancer effects, EPA estimated exposures that are significantly greater than the point of departure. The baseline cancer risk is estimated to be 3.66 × 10
The levels of acute and chronic exposures estimated to present low risk for non-cancer effects also result in low risk for cancer.
Given these identified risks, EPA conducted an additional analysis consistent with the scope of the TCE risk assessment to better characterize the risk to workers and occupational bystanders from the use of TCE in batch vapor degreasing machines as well as in two different types of in-line systems (conveyor and continuous web cleaning machines) (Ref. 30). This analysis also evaluated the exposure reductions that would result from switching from an open-top vapor degreasing system to a closed-loop vapor degreasing system. More information on the different types of vapor degreasing machines can be found in Unit VI.A.1. In the supplemental analysis, EPA identified short-term and long-term non-cancer and cancer risks for all types of vapor degreasing machines, although the risks for closed-loop machines are estimated to be lower than for any of the other types (Ref. 30).
On July 29, 2014, EPA held a 2-day public workshop on TCE degreasing (Ref. 31). The purpose of the workshop was to collect information from users, academics, and other stakeholders on the use of TCE as a degreaser in various applications,
On June 1, 2016, EPA convened a Small Business Advocacy Review (SBAR) Panel on TCE in vapor degreasing. The Panel solicited input from eighteen Small Entity Representatives (SERs) and made several recommendations on aspects of this rulemaking. The Panel process, including the final report of the Panel (Ref. 32), is discussed in Unit XII.
Under TSCA section 6(a), if the Administrator determines that a chemical substance presents an unreasonable risk of injury to health or the environment, without consideration of costs or other non-risk factors, including an unreasonable risk to a potentially exposed or susceptible subpopulation identified as relevant to the Agency's risk evaluation, under the conditions of use, EPA must by rule apply one or more requirements to the extent necessary so that the chemical substance no longer presents such risk.
The TSCA section 6(a) requirements can include one or more, or a combination of, the following actions:
• Prohibit or otherwise restrict the manufacturing, processing, or distribution in commerce of such substances (§ 6(a)(1)).
• Prohibit or otherwise restrict manufacturing, processing, or distribution in commerce of such substances for particular uses or for uses in excess of a specified concentration (§ 6(a)(2)).
• Require minimum warning labels and instructions (§ 6(a)(3)).
• Require record keeping or testing (§ 6(a)(4)).
• Prohibit or regulate any manner or method of commercial use (§ 6(a)(5)).
• Prohibit or otherwise regulate any manner or method of disposal (§ 6(a)(6)).
• Direct manufacturers and processors to give notice of the determination to distributors and the public and replace or repurchase substances (§ 6(a)(7)).
EPA analyzed a wide range of regulatory options under TSCA section 6(a) in order to select the proposed regulatory approach. EPA considered whether a regulatory option (or combination of options) would address the identified unreasonable risks so that the chemical substance no longer presents such risks. To do so, EPA initially analyzed whether the regulatory options could reduce risks (non-cancer and cancer) to levels below those of concern, based on EPA's technical analysis of exposure scenarios. For the non-cancer risks, EPA found an option could be protective against the risk if it could achieve the benchmark MOE for the most sensitive non-cancer endpoint. EPA's assessments for these uses indicate that when exposures meet the benchmark MOE for the most sensitive endpoint, they also result in low risk for cancer.
After the technical analysis, which represents EPA's assessment of the potential for the regulatory options to achieve risk benchmarks based on analysis of exposure scenarios, EPA then considered how reliably the regulatory options would actually reach these benchmarks. For the purposes of this proposal, EPA found that an option addressed the risk so that it was no longer unreasonable if the option could achieve the benchmark MOE or cancer benchmark for the most sensitive endpoint. In evaluating whether a regulatory option would ensure that the chemical substance no longer presents the identified unreasonable risks, the Agency considered whether the option could be realistically implemented or whether there were practical limitations on how well the option would mitigate the risks in relation to the benchmarks, as well as whether the option's protectiveness was impacted by environmental justice or children's health concerns.
TSCA section 6(c)(2) requires EPA to consider and publish a statement based on reasonably available information with respect to the:
• Health effects of the chemical substance or mixture (in this case, TCE) and the magnitude of human exposure to TCE;
• Environmental effects of TCE and the magnitude of exposure of the environment to TCE;
• Benefits of TCE for various uses;
• Reasonably ascertainable economic consequences of the rule, including: The likely effect of the rule on the national economy, small business, technological innovation, the environment, and public health; the costs and benefits of the proposed and final rule and of the one or more primary alternatives that EPA considered; and the cost effectiveness of the proposed rule and of the one or more primary alternatives that EPA considered.
In addition, in selecting among prohibitions and other restrictions available under TSCA section 6(a), EPA must factor in, to the extent practicable, these considerations. Further, in deciding whether to prohibit or restrict in a manner that substantially prevents a specific condition of use of a chemical substance or mixture, and in setting an appropriate transition period for such action, EPA must also consider, to the extent practicable, whether technically and economically feasible alternatives that benefit health or the environment will be reasonably available as a substitute when the proposed prohibition or other restriction takes effect.
EPA's analysis of the health effects of and magnitude of exposure to TCE can be found in Units IV and VI, which discuss the TCE risk assessment and EPA's regulatory assessment of the use of TCE in vapor degreasing. A discussion of the environmental effects of TCE can be found in Unit II.D.
With respect to the costs and benefits of this proposal and the alternatives EPA considered, as well as the impacts on small businesses, the full analysis is presented in the economic analysis document (Ref. 3) To the extent information was available, EPA considered the benefits realized from risk reductions (including monetized benefits, non-monetized quantified benefits, and qualitative benefits), offsets to benefits from countervailing risks (
EPA considered the estimated costs to regulated entities as well as the cost to administer and enforce the options. For example, an option that includes use of a respirator would include inspections to evaluate compliance with all elements of a respiratory protection program. EPA took into account reasonably available information about the functionality and performance efficacy of the regulatory options and the ability to implement the use of chemical substitutes or other alternatives (
With respect to the anticipated effects of this proposal on the national economy, EPA considered the number of businesses and workers that would be affected and the costs and benefits to those businesses and workers. In addition, EPA considered the employment impacts of this proposal, as discussed in the economic analysis for this proposal (Ref. 3). EPA found that the direction of change in employment is uncertain, but the expected short term and longer term employment effects are expected to be small.
The benefits of TCE in vapor degreasing are discussed in Unit VI.D., along with the availability of alternatives. The dates that the proposed restrictions would take effect are discussed in Unit X.D., as is the availability of alternatives to TCE vapor degreasing on those dates.
Finally, with respect to this proposal's effect on technological innovation, EPA expects this action to spur innovation, not hinder it. (Ref. 3) An impending ban on the use of TCE in vapor degreasing is likely to increase demand for alternatives, which would be expected to result in the development of new alternatives.
As discussed previously, EPA analyzed a wide range of regulatory options under TSCA section 6(a). One of the options EPA evaluated involved a TSCA section 6(a)(3) requirement for warning labels or instructions on containers of TCE or on vapor degreasing equipment. However, EPA
EPA found that presenting information about TCE on a label would not adequately address the identified unreasonable risks because the nature of the information the user or owner would need to read, understand, act upon, convey, and ensure adherence to is extremely complex. It would be challenging to most users or owners to follow or convey the complex product label instructions required to explain how to reduce exposures to the extremely low levels needed to minimize the risk from TCE. Rather than a simple message, the label would need to explain a variety of inter-related factors, including but not limited to the use of local exhaust ventilation, respirators and assigned protection factor for the user and bystanders, and time periods during pregnancy with susceptibility of the developing fetus to acute developmental effects, as well as effects to bystanders. It is unlikely that label language changes for this use will result in widespread, consistent, and successful adoption of risk reduction measures by users and owners.
While labeling alone would not address the identified unreasonable risks so that TCE used in vapor degreasing no longer presents such risks, EPA recognizes that the TSCA section 6(a)(3) warnings and instruction requirement can be an important component of an approach that addresses identified unreasonable risks with a specific use prohibition. EPA has included a simple downstream notification requirement as part of this proposed rule to ensure that users would be made aware of the ban on the use of TCE in vapor degreasing.
In addition, early in the process, EPA identified two regulatory options under TSCA section 6(a) that do not pertain to this action and were therefore not evaluated for this proposed rulemaking. First, EPA reasoned that the TSCA section 6(a)(1) regulatory option to prohibit the manufacture (including import), processing or distribution in commerce of TCE or limit the amount of TCE which may be manufactured (including imports), processed or distributed in commerce is not germane because the Agency is not proposing to ban or limit the manufacture (including import), processing or distribution in commerce of TCE for uses other than in vapor degreasing, aerosol degreasing or for spot cleaning in dry cleaning facilities at this time. In addition, EPA reasoned that the TSCA section 6(a)(6) regulatory option to prohibit or otherwise regulate any manner or method of disposal of the chemical is not applicable since EPA did not evaluate the risks associated with ongoing TCE disposal.
This Unit describes the current use of TCE in vapor degreasing, the unreasonable risks presented by this use, and how EPA identified which regulatory options address those unreasonable risks so that TCE in vapor degreasing no longer presents such unreasonable risks.
Vapor degreasing is a cleaning process that uses a solvent vapor to remove contaminants such as grease, oils, dust, and dirt from fabricated parts. Solvents such as TCE are boiled in a degreasing unit to produce a hot vapor. When parts are placed into the degreaser, the hot vapor within the unit condenses onto the parts, causing beading and dripping. The dripping action carries the contaminants away from the fabricated part, leaving behind a clean surface. After vapor degreasing, the parts are suspended on a rack in order to drain the solvent (Ref. 30). Vapor degreasing is used in a variety of occupational settings such as metal plating, electronics assembly, metal or composite part fabrication, and repair shops.
Vapor degreasing may take place in batches or as part of an in-line (
The five basic types of batch vapor degreasers are described in the following paragraphs (Ref. 30):
As the name suggests, open-top vapor degreasers are open at the top to allow introduction of the parts to be cleaned. Heating elements at the bottom of the cleaner heat the liquid solvent to above its boiling point. Solvent vapor rises in the machine to the height of chilled condensing coils on the inside walls of the cleaner. The condensing coils cool the vapor, causing it to condense and return to the bottom of the cleaner. Cleaning occurs in the vapor zone above the liquid solvent and below the condensing coils, as the hot vapor solvent condenses on the cooler work surface. The workload or a parts basket is lowered into the heated vapor zone with a mechanical hoist. While the condensing coils reduce the amount of solvent that escapes the vapor zone, they do not eliminate emissions, and throughout the degreasing process, significant vapor emissions of the solvent can occur. These vapor emissions are hazardous to workers operating the machine, as well as nearby workers. In addition, replacing solvent lost to emissions can be costly. In assessing the use of TCE in vapor degreasers, the TCE risk assessment focused on the use of open top vapor degreasing systems.
Vapor emissions of solvent can be reduced by enclosing the vapor degreasing machine. Open top vapor degreasing systems with enclosures operate in the same manner as standard open top vapor degreasing systems, except that the machine is enclosed on all sides during degreasing. The enclosure is opened and closed when adding or removing parts, and solvent is exposed to the air when the cover is open. Nearly all open top vapor degreasing systems regulated by the NESHAP have a cover because that is a more common compliance strategy than complying with the overall emission limit. A variety of additional controls may be needed to comply with the NESHAP, including two-part covers, extended freeboard (the area above the vapor zone), freeboard refrigeration devices, and holding cleaned parts in the freeboard to allow draining. Enclosed vapor degreasing systems may be vented directly to the atmosphere or first vented to an external carbon filter and then to the atmosphere.
Solvent emissions can be further reduced by using a sealed, closed-loop degreasing system. In airtight closed-loop systems, parts are placed into a basket, which is then placed into an airtight work chamber. The door is closed and solvent vapors are sprayed
A refinement of the airtight closed-loop degreasing system is the airless degreasing system. An airless system removes air at some point during the degreasing process. Typically, this takes the form of drawing vacuum, but some machines purge the air with nitrogen. In airless degreasing systems with vacuum drying, a vacuum is generated, typically below 5 torr, which dries the parts. A vapor recovery system recovers the solvent.
The greatest solvent emission reductions are achieved with the airless vacuum-to-vacuum degreasing system. These systems are referred to as airless because the entire cycle is operated under vacuum. Typically, parts are placed into the chamber, the chamber sealed, and then vacuum drawn within the chamber. The parts are then sprayed with hot solvent vapor, which raises the pressure in the chamber. The parts are dried by again drawing vacuum in the chamber. Solvent vapors are recovered through compression and cooling. An air purge then removes residual vapors which can be routed to an optional carbon adsorber and then out a vent. Finally, air is introduced to return the chamber to atmospheric pressure so that the chamber can be opened. These systems have the added benefit of generating vapor at a much lower temperature than open-top degreasing systems because the boiling point of TCE is lower at the lower pressure of these systems.
In contrast to batch degreasers, in-line vapor degreasing systems use an automated parts handling system, often a conveyor, to automatically provide a continuous supply of parts to be cleaned (Ref. 30). Conveyorized vapor degreasing systems are usually fully enclosed except for the conveyor inlet and outlet portals. Conveyorized degreasers are likely used in the same applications as batch vapor degreasers, except that they would be used in larger operations, where the number of parts being cleaned is large enough to warrant the use of a conveyorized system. Conveyorized degreasers use different methods for transporting the parts through the cleaning zone. For example, monorail degreasers use a straight-line conveyor to transport parts into and out of the cleaning zone; these systems are typically used when parts are already being transported through manufacturing areas by a conveyor. Cross-rod degreasers use two parallel chains connected by a rod to support the parts, which are typically loaded manually into perforated baskets or cylinders. Ferris wheel degreasing systems, generally the smallest of the conveyorized degreasers, rotate manually-loaded baskets or cylinders of parts vertically through the cleaning zone and back out. Belt degreasers are used for simple and rapid loading and unloading of parts; the parts are loaded onto a mesh conveyor belt that transports them through the cleaning zone and out the other side.
There are also continuous web cleaning machines (Ref. 30). These in-line degreasers differ from typical conveyorized degreasers in that they are specifically designed for cleaning parts that are coiled or on spools such as films, wires, metal strips, and metal sheets. In continuous web degreasers, parts are uncoiled and loaded onto rollers that transport the parts through the cleaning and drying zones at speeds typically greater than 11 feet per minute. The parts are then recoiled or cut after exiting the machine.
In this unit, EPA explains how it evaluated whether the regulatory options considered would address the unreasonable risks presented by the current use so that TCE in vapor degreasing no longer presents such unreasonable risks. First, EPA characterizes the unreasonable risks associated with the current use of TCE in vapor degreasers. Then, the Agency describes its initial analysis of which regulatory options have the potential to reach the protective non-cancer and cancer benchmarks. The levels of acute and chronic exposures estimated to present low risk for non-cancer effects also result in low risk for cancer. Lastly, this unit evaluates how well those regulatory options would address the identified unreasonable risks in practice.
The estimated 8-hour TWA exposure levels for open top vapor degreasing systems ranged from 2.74 ppm to 491.36 ppm for workers, with the 50th percentile at 55.16 ppm and the 99th percentile at 190.17 ppm. For occupational bystanders, the exposure levels ranged from 0.33 ppm to 440.61 ppm, with the 50th percentile at 20.45 ppm and the 99th percentile at 144.93 ppm. The estimated 8-hour TWA exposure levels for conveyorized degreasers were even higher, ranging from 5.14 ppm to 32,722 ppm for workers, with the 50th percentile and 99th percentile being 180.74 ppm and 1162.6 ppm, respectively. For bystanders, the levels ranged from 0.63 ppm to 29,410 ppm, with the 50th percentile and 99th percentile being 80.93 ppm and 745.11 ppm, respectively. The estimated 8-hour TWA exposure levels for continuous web degreasers were lower overall than for open top vapor degreasing systems or conveyorized degreasers. These estimates ranged from 4.18 ppm to 50.61 ppm for workers, with the 50th percentile and 99th percentile being 8.18 ppm and 22.42 ppm, respectively. For bystanders, the levels ranged from 0.52 ppm to 45.49 ppm, with the 50th percentile and 99th percentile being 3.70 ppm and 17.49 ppm, respectively.
As part of this supplemental analysis, EPA also evaluated the exposure reductions that would result from switching from an open top vapor degreasing system to a closed-loop vapor degreasing system. The data available on TCE emissions from closed-loop systems was not sufficient to enable EPA to distinguish between the three types of closed-loop systems (airtight, airless, and airless vacuum-to-vacuum) with respect to employee exposures. As a result, for the purpose of assessing exposure, EPA assumed that all of the closed-loop systems achieve a 98% reduction in exposure compared to open top vapor degreasing systems (Ref. 30). This assumption leads to exposure estimates of 0.05 ppm to 9.8 ppm for workers.
However, the assumption of a 98% reduction in exposures compared to open top vapor degreasing systems may be an overestimate for airtight systems, and an underestimate for airless vacuum-to-vacuum systems. EPA requests information and data on TCE emissions from all vapor degreasing systems, particularly information and data that would enable EPA to better distinguish between the different types of closed-loop systems.
The SBAR Panel convened in support of this action heard from several SERs who disagreed with EPA's exposure estimates. These SERs indicated that fewer employees were involved in the degreasing operation, or that the machines were operated for fewer hours per day than EPA estimated. However, another SER stated that his degreasing machines run ten hours a day during the week and six hours on Saturdays, which exceeds EPA's estimate. In addition, most SERs thought that EPA's estimated TWAs were too high, and EPA received some monitoring data indicating lower exposures, but several SERs stated that they complied with the recommended exposure limit of the American Conference of Governmental Industrial Hygienists (ACGIH) of 10 ppm, which is within the exposure ranges estimated by EPA. However, EPA specifically requests exposure data, especially data involving employee exposure monitoring.
Chronic exposures from TCE use in vapor degreasing also present risks. For non-cancer effects, the most sensitive of which are developmental, the benchmark MOE is also 10. For chronic exposures associated with open top vapor degreasing systems, conveyorized systems, continuous web systems, and closed-loop systems, the MOEs are 0.00008, 0.00001, 0.00007, and 0.004, respectively. With respect to cancer, the risk posed to workers ranges from 5.16 × 10
The SBAR Panel convened in support of this action heard from several SERs who expressed concerns about the underlying TCE risk assessment. Many of the concerns expressed by these SERs were already expressed in the public comments and the peer review comments on the risk assessment. The Summary of External Peer Review and Public Comments and Disposition document explains how EPA responded to the comments received (Ref. 35).
EPA assessed a number of exposure scenarios associated with risk reduction options in order to find variations in TCE exposure from vapor degreasing, including: Reducing the amount of TCE in the degreasing formulation, with concentrations varying from 5% to 95% by weight in the product, engineering controls, equipment substitution, and use of PPE. EPA also assessed combinations of these options.
For the engineering controls risk reduction option exposure scenarios, EPA evaluated using local exhaust ventilation to improve ventilation near the vapor degreaser, with an assumed 90% reduction in exposure over baseline levels. The equipment substitution risk reduction option was only evaluated with respect to open top vapor degreasing systems, the evaluation assumed substitution of a closed-loop system for the open top
EPA has estimated that, in order to avoid cancer and non-cancer unreasonable risks, the 8-hour TWA exposure should be approximately 1 ppb (Ref. 36). However, EPA's inhalation exposure level estimates for all types of vapor degreasing machines exceed that figure by several orders of magnitude.
Of the control options evaluated by EPA in its supplemental analysis (Ref. 30), which did not include a ban on the use of TCE in vapor degreasing, the only control options that achieved the necessary exposure reductions for workers operating the degreaser involved PPE in addition to other measures. Even switching from an open top vapor degreasing system to a closed-loop system did not achieve the necessary reductions without the addition of PPE with an APF of 10,000. For that control option, equipment substitution plus PPE, EPA estimated that worker exposure levels would be 0.4 ppb. Other combinations of control options, such as reducing the amount of TCE in the solvent solution and PPE with an APF of 10,000, or reducing the amount of TCE in the solvent solution and engineering controls and PPE, achieved exposure reductions of approximately the same magnitude. However, EPA found that these combinations are unlikely to be practical for users because the exposure reductions needed would only be achieved by a reduction in the concentration of TCE in the degreasing solution to 5%. At 5% TCE, the effectiveness of the solution would be greatly reduced. Additional exposure level estimates for various scenarios are available in the supplemental analysis document, which also documents options that did not meet the risk benchmarks and which do not, for purposes of this proposal, address the identified unreasonable risks (Ref. 30).
a.
As discussed in Unit IV, the baseline risk for exposure to workers and occupational bystanders for vapor degreasing does not achieve the non-cancer MOE benchmarks for all non-cancer effects (
The proposed approach would ensure that employees are no longer at risk from TCE exposure associated with vapor degreasing. Prohibiting the manufacturing (including import), processing and distribution in commerce of TCE for use in vapor degreasing would minimize the availability of TCE for vapor degreasing. The downstream notification of these restrictions ensures that processors, distributors, and other purchasers are aware of the manufacturing (including import), processing, distribution in commerce and use restrictions for TCE in vapor degreasing, and helps to ensure that the rule is effectively implemented by discouraging off-label use of TCE manufactured for other uses. Downstream notification is important because EPA is not proposing to prohibit manufacturing, processing and all uses of TCE, just those activities associated with vapor degreasing. This integrated supply chain approach is necessary to address the identified unreasonable risks presented by the use of TCE in vapor degreasing. In addition, the proposed approach would provide staggered compliance dates for implementing the prohibition on manufacturing (including import), processing, distribution in commerce, and commercial use in order to avoid undue impacts on the businesses involved.
Although respirators could reduce exposures to levels that are protective of non-cancer and cancer risks, there are many documented limitations to successful implementation of respirators with an APF of 10,000. Not all workers can wear respirators. Individuals with impaired lung function, due to asthma, emphysema, or chronic obstructive pulmonary disease, for example, may be physically unable to wear a respirator. Determination of adequate fit and annual fit testing is required for a tight fitting full-facepiece respirator to provide the required protection. Also, difficulties associated with selection, fit, and use often render them ineffective in actual application, preventing the assurance of consistent and reliable protection, regardless of the assigned capabilities of the respirator. Individuals who cannot get a good facepiece fit, including those individuals whose beards or sideburns interfere with the facepiece seal, would be unable to wear tight fitting respirators. In addition, respirators may also present communication problems and vision problems, increase worker fatigue, and reduce work efficiency (Ref. 37). According to OSHA, “improperly selected respirators may afford no protection at all (for example, use of a dust mask against airborne vapors), may be so uncomfortable as to be intolerable to the wearer, or may hinder vision, communication, hearing, or movement and thus pose a risk to the wearer's safety or health.” (Ref. 37, at 1189-1190). Nonetheless, it is sometimes necessary to use respiratory protection to control exposure. The OSHA respiratory protection standard requires employers to establish and implement a respiratory protection program to protect their respirator-wearing employees (Ref. 38). This OSHA standard contains a number of implementation requirements,
In addition, OSHA adopted a hierarchy of controls established by the industrial hygiene community used to protect employees from hazardous airborne contaminants, such as TCE (see,
Under this approach, a company could choose to use a closed-loop system coupled with an air exposure limit. In order to reach the health benchmarks, the air exposure limit would have to be 1 ppb as an 8-hour TWA. Based on EPA's analysis, the only way to achieve an air exposure limit of 1 ppb is with a combination of a closed-loop vapor degreaser and a respirator with an APF of 10,000. However, as previously discussed, EPA acknowledges that available data is limited, particularly with respect to the different types of closed-loop vapor degreasers. It is possible that the more sophisticated airless vacuum-to-vacuum closed-loop systems have lower emissions than EPA estimated, and, therefore, respiratory protection with an APF of 10,000 may not be necessary for operators. As part of this approach, EPA believes it would be necessary to establish employee exposure monitoring requirements to ensure that employee exposures are measured accurately and that employees are not exposed to the identified unreasonable risks associated with TCE use in vapor degreasing. EPA would require upfront monitoring representative of each exposed employee's exposures and would model the requirements on comparable OSHA requirements as well as on the New Chemical Exposure Limit (NCEL) requirements that EPA has long used in addressing employee exposure to chemicals undergoing review under TSCA section 5 (Refs. 38-39). The requirements would specify how and when sampling must be performed and how the samples would have to be analyzed.
EPA is not proposing this option because substitutes for TCE are commercially available and implementation of a respiratory protection program is likely to be difficult for many vapor degreasing facilities. In addition, EPA's economic analysis indicates that this option is more expensive than switching to a different solvent or cleaning system. However, EPA requests comment, information, and data on the utility and feasibility of this option and whether, if it were adopted, it should be implemented by specifying the vapor degreasing technology and either requiring specific PPE or compliance with an air exposure limit. If EPA were to specify both the vapor degreasing technology and the required PPE with the alternative air exposure limit in the final rule, EPA would require the vapor degreasing system to be an airless vacuum-to-vacuum closed-loop system and the PPE to have an APF of 10,000 or otherwise meet the air exposure limit of 1 ppb as an 8-hour TWA. As previously discussed, EPA's assessment of worker exposure from closed-loop systems relies on an assumption that emissions from each closed-loop system are 98% less than the emissions from an open top vapor degreasing system. EPA is requesting information on whether releases from the use of TCE in an airless vacuum-to-vacuum closed-loop system would result in air levels that are at or below the air exposure limit of 1 ppb. To the extent that EPA receives information that indicates that this is the case, EPA would consider finalizing this rule to exclude airless vacuum-to-vacuum closed-loop systems. In contrast, this assumption of a 98% reduction may be overly generous for the most basic of the closed-loop systems, and operators of such systems, even when wearing PPE with an APF of 10,000, would continue to be exposed to the identified unreasonable risks. Under the optional approach, companies choosing to keep using TCE would have to comply with all of OSHA's requirements for respiratory protection programs, including fit-testing and medical monitoring.
The proposed option would prevent exposure to TCE from vapor degreasing and thus would prevent the risks of adverse effects and associated impacts. As discussed in Unit IV., TCE exposure is associated with a wide array of adverse health effects. These health effects include those resulting from developmental toxicity (
Cardiac defects, which can result from low-level exposure to TCE, affect the structural development of a baby's heart and how it works. The defects impact how blood flows through the heart and out to the rest of the body. The impact can be mild (such as a small hole in the heart) or severe (such as missing or poorly formed septal wall and valves of the heart). While diagnosis for some cardiac defects can occur during pregnancy, for other cardiac defects, detection may not occur until after birth or later in life, during childhood or adulthood. These cardiac defects can be occult or life- threatening with the most severe cases causing early mortality and morbidity. While the incidences in the following paragraphs reflect adverse health outcomes beyond just exposure to TCE, the general population numbers provide a context for understanding the impact of the adverse health effects TCE can cause.
Nearly 1% or about 40,000 births per year in the United States are affected by cardiac defects (Ref. 40). About 25% of those infants with a cardiac defect have a critical defect. Infants with critical cardiac defects generally need surgery or other procedures in their first year of life. Some estimates put the total number of individuals (infants, children, adolescents, and adults) living with cardiac defects at 2 million (Ref. 40). Cardiac defects can be caused by genetics, environmental exposure, or an unknown cause.
Infant deaths resulting from cardiac defects often occur during the neonatal period. One study indicated that cardiac defects accounted for 4.2% of all neonatal deaths. Of infants born with a non-critical cardiac defect, 97% are expected to survive to the age of one, with 95% expected to survive to 18 years of age. Of infants born with a critical cardiac defect, 75% are expected to survive to one year of age, with 69% expected to survive to 18 years of age (Ref. 41). A child with a cardiac defect is 50% more likely to receive special education services compared to a child without birth defects (Ref. 40).
Treatments for cardiac defects vary. Some affected infants and children might need one or more surgeries to repair the heart or blood vessels. In other instances, a heart defect cannot be fully repaired, although treatments have advanced such that infants are living longer and healthier lives. Many children are living into adulthood and lead independent lives with little or no difficulty. Others, however, may develop disability over time, making it difficult to predict and quantify impacts.
Even though a person's heart defect may be repaired, for many people this is not a cure. They can still develop other health problems over time, depending on their specific heart defect, the number of heart defects they have, and the severity of their heart defect. For example, some related health problems that might develop include irregular heart beat (arrhythmias), increased risk of infection in the heart muscle (infective endocarditis), or weakness in the heart (cardiomyopathy). In order to stay healthy, a person needs regular checkups with a cardiologist. They also might need further operations after initial childhood surgeries (Ref. 40).
Depending upon the severity of the defect, the costs for surgeries, hospital stays, and doctor's appointments to address a baby's cardiac defect can be significant. The costs for the defects may also continue throughout a person's lifetime. In 2004, hospital costs in the United States for individuals with a cardiac defect were approximately $1.4 billion (Ref. 40).
Beyond the monetary cost, the emotional and mental toll on parents who discover that their child has a heart defect while
The emotional and mental toll on a person throughout childhood and into adolescence with a heart defect also should be considered (Ref. 41). Cardiac patients who are children may feel excluded from activities and feel limited in making friends if they have to miss school due to additional surgeries, or may not be able to fully participate in sports or other physical exercise. Children may feel self-conscious of the scars left by multiple surgeries. This, in turn, adds emotional and mental stress to the parents as they observe their child's struggles.
As a person with a heart defect enters adulthood, the emotional or mental toll of a cardiac defect may continue or in other instances the problem may only surface as an adult. If a cardiac defect impacts a person's ability to enter certain careers, this could take a monetary as well as emotional toll on that person and on their parents or families who may need to provide some form of financial support. The monetary, emotional, and mental costs of heart defects can be considerable, and even though neither the precise reduction in individual risk of developing a cardiac defect from reducing TCE exposure or the total
Exposure to TCE can lead to changes in the proximate tubules of the kidney. This damage may result in signs and symptoms of acute kidney failure that include; decreased urine output, although occasionally urine output remains normal; fluid retention, causing swelling in the legs, ankles or feet; drowsiness; shortness of breath, fatigue, confusion, nausea, seizures or coma in severe cases; and chest pain or pressure. Sometimes acute kidney failure causes no signs or symptoms and is detected through lab tests done for another reason.
Kidney toxicity means the kidney(s) has suffered damage that can result in a person being unable to rid their body of excess urine and wastes. In extreme cases where the kidney(s) is impaired over a long period of time, the kidney(s) could be damaged to the point that it no longer functions. When a kidney(s) no longer functions, a person needs dialysis and ideally a kidney transplant. In some cases, a non-functioning kidney(s) can result in death. Kidney dialysis and kidney transplantation are expensive and incur long-term health costs if kidney function fails (Ref. 42).
Approximately 31 million people, or 10% of the adult population, in the United States have chronic kidney disease. In the United States, it is the ninth leading cause of death. About 93% of chronic kidney disease is from known causes, including 44% from diabetes and 28.4% from high blood pressure. Unknown or missing causes account for about 6.5% of cases, or about 2 million people (Ref. 43).
The monetary cost of kidney toxicity varies depending on the severity of the damage to the kidney. In less severe cases, doctor visits may be limited and hospital stays unnecessary. In more severe cases, a person may need serious medical interventions, such as dialysis or a kidney transplant if a donor is available, which can result in high medical expenses due to numerous hospital and doctor visits for regular dialysis and surgery if a transplant occurs. The costs for hemodialysis, as charged by hospitals, can be upwards of $100,000 per month (Ref. 44).
Depending on the severity of the kidney damage, kidney disease can impact a person's ability to work and live a normal life, which in turn takes a mental and emotional toll on the patient. In less severe cases, the impact on a person's quality of life may be limited, while in instances where kidney damage is severe, a person's quality of life and ability to work would be affected. While neither the precise reduction in individual risk of developing kidney toxicity from reducing TCE exposure or the total number of cases avoided can be estimated, these costs must still be considered because they can significantly impact those exposed to TCE.
Human studies have demonstrated that TCE exposed workers can suffer from systemic autoimmune diseases (
Localized scleroderma is more common in children, whereas systemic scleroderma is more common in adults. Overall, female patients outnumber male patients about 4-to-1. Factors other than a person's gender, such as race and ethnic background, may influence the risk of getting scleroderma, the age of onset, and the pattern or severity of internal organ involvement. The reasons for this susceptibility are not clear. Although scleroderma is not directly inherited, some scientists believe there is a slight predisposition to it in families with a history of rheumatic diseases (Ref. 46).
The symptoms of scleroderma vary greatly from person to person with the effects ranging from very mild to life threatening. If not properly treated, a mild case can become much more serious. Relatively mild symptoms are localized scleroderma, which results in hardened waxy patches on the skin of varying sizes, shapes and color. The more life threatening symptoms are from systemic scleroderma, which can involve the skin, esophagus, gastrointestinal tract (stomach and bowels), lungs, kidneys, heart and other internal organs. It can also affect blood vessels, muscles and joints. The tissues of involved organs become hard and fibrous, causing them to function less efficiently.
Severe hypersensitivity skin disorders include exfoliative dermatitis, mucous membrane erosions, eosinophilia, and hepatitis. Exfoliative dermatitis is a scaly dermatitis involving most, if not all, of the skin. Eosinophilia, on the other hand, is a chronic disorder resulting from excessive production of a particular type of white blood cells. If diagnosed and treated early, a person can lead a relatively normal life (Ref. 45).
The monetary costs for treating these various immunotoxicity disorders will vary depending upon whether the symptoms lead to early diagnosis and this early diagnosis can then influence whether symptoms progress to mild or life-threatening outcomes. For mild symptoms, doctors' visits and outpatient treatment could be sufficient, while more severe immunotoxicity disorders, may require hospital visits. Treatments for these conditions with immune modulating drugs also have countervailing risks.
These disorders also take an emotional and mental toll on the person as well as on their families. Their quality of life may be impacted because they no longer have the ability to do certain activities that may affect or
NHL is a form of cancer that originates in a person's lymphatic system. For NHL, there are approximately 19.7 new cases per 100,000 men and women per year with 6.2 deaths per 100,000 men and women per year. NHL is the seventh most common form of cancer (Ref. 47). Some studies suggest that exposure to chemicals may be linked to an increased risk of NHL. Other factors that may increase the risk of NHL are medications that suppress a person's immune system, infection with certain viruses and bacteria, or older age (Ref. 48).
Symptoms are painless, swollen lymph nodes in the neck, armpits or groin, abdominal pain or swelling, chest pain, coughing or trouble breathing, fatigue, fever, night sweats, and weight loss. Depending on the rate at which the NHL is advancing, the approach may be to monitor the condition, while more aggressive NHL could require chemotherapy, radiation, stem cell transplant, medications that enhance a person's immune system's ability to fight cancer, or medications that deliver radiation directly to cancer cells.
Treatment for NHL will result in substantial costs for hospital and doctors' visits in order to treat the cancer. The treatments for NHL can also have countervailing risks and can lead to higher susceptibility of patients to secondary malignancies (Ref. 49). The emotional and mental toll from wondering whether a treatment will be successful, going through the actual treatment, and inability to do normal activities or work will most likely be high. This emotional and mental toll will extend to the person's family and friends as they struggle with the diagnosis and success and failure of a treatment regime. If a person has children, this could affect their mental and emotional well-being and may impact their success in school. The estimated value of the monetized benefit is $32 million to $201 million at 3% and $15 million to $98 million at 7% annualized over 20 years.
The reproductive effect for both females and males can be altered libido. The prevalence of infertility is estimated at about 10-15% of couples with a decreased libido among the factors of infertility (Ref. 50). For females, there can be reduced incidence of fecundability (6.7 million women ages 15 to 44 or 10.9% affected) (Ref. 51), increase in abnormal menstrual cycles, and amenorrhea (the absence of menstruation). Reproductive effects on males can be decreased potency, gynaecomastia, impotence, and decreased testosterone levels, or low T levels. Approximately 2.4 million men age 40 to 49 have low T levels, with a new diagnosis of about 481,000 androgen deficiency cases a year. Other estimates propose a hypogonadism prevalence of about 13 million American men (Ref. 52). Low T levels are associated with aging; an estimated 39% of men 45 or older have hypogonadism, resulting in low T levels (Ref. 53). Hormone therapy and endocrine monitoring may be required in the most severe cases.
The monetary costs of these potential reproductive effects involve doctor's visits in order to try to determine a diagnosis. In some instances, a person or couple may need to visit a fertility doctor.
The impact of a reduced sex drive can take an emotional and mental toll on single people as well as couples. For people trying to get pregnant, decreased fertility can add stress to a relationship as the cause is determined and avenues explored to try to resolve the difficulties in conceiving. A person or couples' quality of life can also be affected as they struggle with a reduced sex drive. Similar to other non-cancer effects discussed previously, while neither the precise reduction in individual risk of developing this disorder from reducing TCE exposure or the total number of cases avoided can be estimated, the Agency still must consider their impact.
Studies have also demonstrated neurotoxicity from acute exposures. Neurotoxic effects observed include alterations in trigeminal nerve and vestibular function, auditory effects, changes in vision, alterations in cognitive function, changes in psychomotor effects, and neurodevelopmental outcomes. Developmental neurotoxicity effects include delayed newborn reflexes, impaired learning or memory, aggressive behavior, hearing impairment, speech impairment, encephalopathy, impaired executive and motor function and attention deficit (Ref. 4).
The impacts of neurotoxic effects due to TCE exposure can last a person's entire lifetime. Changes in vision may impact a person's ability to drive, which can create difficulties for daily life. Impaired learning or memory, aggressive behavior, hearing impairment, speech impairment, encephalopathy, impaired executive and motor function and attention deficit can impact a child's educational progression and an adolescent's schooling and ability to make friends, which in turn can impact the type of work or ability to get work later in life.
Neurotoxicity in adults can affect the trigeminal nerve, the largest and most complex of the 12 cranial nerves, which supplies sensations to the face, mucous membranes, and other structures of the head. Onset of trigeminal neuralgia generally occurs in mid-life and known causes include multiple sclerosis, sarcoidosis and Lyme disease. There is also a co-morbidity with scleroderma and systemic lupus. Some data show that the prevalence of trigeminal neuralgia could be between 0.01% and 0.3% (Ref. 54). Alterations to this nerve function might cause sporadic and sudden burning or shock-like facial pain to a person. One way to relieve the burning or shock-like facial pain is to undergo a procedure where the nerve fibers are damaged in order to block the pain. This treatment can have lasting impact on sensation which may also be deleterious for normal pain sensation. The potential side effects of this
The monetary health costs can range from doctor's visits and medication to surgeries and hospital stays. Depending upon when the neurotoxic effect occurred, the monetary costs may encompass a person's entire lifetime or just a portion.
The personal costs (emotional, mental, and impacts to a person's quality of life) cannot be discounted. Parents of a child with impaired learning, memory, or some other developmental neurotoxic effect may suffer emotional and mental stress related to worries about the child's performance in school, ability to make friends, and quality of the child's life because early disabilities can have compounding effects as they grow into adulthood. The parent may need to take off work unexpectedly and have the additional cost of doctor visits and/or medication.
For a person whose trigeminal nerve is affected, there is an emotional and mental toll as they wonder what is wrong and visit doctors in order to determine a diagnosis. Depending on the severity of the impact to the nerve, they may be unable to work. Doctor visits and any inability to work will have a monetary impact to the person. There are varying costs (emotional, monetary, and impacts to a person's quality of life) from the neurotoxic effects due to TCE exposure. However, while neither the precise reduction in individual risk of developing this disorder from reducing TCE exposure or the total number of cases avoided can be estimated, this is not a reason to disregard their impact.
Specific effects to the liver can include increased liver weight, increase in DNA synthesis (transient), enlarged hepatocytes, enlarged nuclei, and peroxisome proliferation (Ref. 2). In addition, workers exposed to TCE have shown hepatitis accompanying immune‐related generalized skin diseases, jaundice, hepatomegaly, hepatosplenomegaly, and liver failure (Ref. 2).
Some form of liver disease impacts at least 30 million people, or 1 in 10 Americans (Ref. 55). Included in this number is at least 20% of those with nonalcoholic fatty liver disease (NAFLD) (Ref. 55). NAFLD tends to impact people who are overweight/obese or have diabetes. However, an estimated 25% do not have any risk factors (Ref. 55). The danger of NAFLD is that it can cause the liver to swell, which may result in cirrhosis over time and could even lead to liver cancer or failure (Ref. 55). The most common known causes to this disease burden are attributable to alcoholism and viral infections, such as hepatitis A, B, and C. In 2013, there were 1,781 reported acute cases of viral hepatitis A and the estimated actual cases were 3,500 (Ref. 56). For hepatitis B in 2013 there were 3,050 reported acute cases, while the estimated actual incidence was 19,800, and the estimated chronic cases in the United States is between 700,000 to 1.4 million (Ref. 56). For hepatitis C, in 2013 there were 2,138 reported cases; however, the estimated incidence was 29,700 and the estimated number of chronic cases is between 2.7 to 3.9 million (Ref. 56). These known environmental risk factors of hepatitis infection may result in increased susceptibility of individuals exposed to organic chemicals. While the incidences in this paragraph reflect adverse health outcomes beyond just exposure to TCE, the general population numbers provide a context for understanding the impact of the adverse health effects that TCE can cause.
Effects from TCE exposure to the liver can occur quickly. Liver weight increase has occurred in mice after as little as 2 days of inhalation exposure (Ref. 4). Human case reports from eight countries indicated symptoms of hepatitis, hepatomegaly and elevated liver function enzymes, and in rare cases, acute liver failure developed within as little as 2-5 weeks of initial exposure to TCE (Ref. 4).
Chronic exposure to TCE can also lead to liver cancer. There is strong epidemiological data that reported an association between TCE exposure and the onset of various cancers, including liver cancer. The estimated value of the annualized benefit is estimated to be $21 million to $133 million at 3% and $11 million to $71 million at 7% over 20 years.
Additional medical and emotional costs are associated with non-cancer liver toxicity from TCE exposure, although they cannot be quantified. These costs include doctor and hospital visits and medication costs. In some cases, the ability to work can be affected, which in turn impacts the ability to get proper ongoing medical care. Liver toxicity can lead to jaundice, weakness, fatigue, weight loss, nausea, vomiting, abdominal pain, impaired metabolism, and liver disease. Symptoms of jaundice include yellow or itchy skin and a yellowing of the whites of the eye, and a pale stool and dark urine. These symptoms can create a heightened emotional state as a person tries to determine what is wrong with them.
Depending upon the severity of the jaundice, treatments can range significantly. Simple treatment may involve avoiding exposure to the TCE; however, this may impact a person's ability to continue to work. In severe cases, the liver toxicity can lead to liver failure, which can result in the need for a liver transplant, if a donor is available. Liver transplantation is expensive (with an estimated cost of $575,000) and there are countervailing risks for this type of treatment (Ref. 57). The mental and emotional toll on an individual and their family as they try to determine the cause of sickness and possibly experience an inability to work, as well as the potential monetary cost of medical treatment required to regain health are significant.
TCE is commonly used in vapor degreasing systems for a variety of reasons. It is able to dissolve the greases, fats, oils, waxes, resins, gums and rosin fluxes generally used in metalworking operations and it is compatible with most metal substrates. TCE is non-flammable and it has a relatively low boiling point. It is also available at a relatively low cost. Several SERs providing input to the SBAR Panel convened in support of this rulemaking noted that TCE is particularly well-suited for use in vapor degreasing in the narrow tube, razor blade, and aerospace industries (Ref. 32).
Nevertheless, EPA identified a wide variety of technically and economically feasible alternatives for vapor degreasing with TCE. See Unit 4 of the Economic Analysis for a complete discussion of the technically and economically feasible alternatives to TCE. (Ref. 3). While some substitutes, such as methylene chloride or 1-BP, also present risks to workers, there are numerous other solvents available. These include designer solvents such as hydrofluorocarbon (HFC) and hydrofluoroether (HFE) solvent blends and hydrofluoroolefin (HFO), as well as other alternative solvents and cleaning systems, such as terpene-based cleaners, volatile methyl siloxanes, soy-based cleaners, and water-based cleaners.
Alternatives to TCE fall within several broad categories: Drop-in solvent alternatives, non-drop-in solvent alternatives (designer solvents, such as
EPA considered a solvent to be a drop-in alternative if it could be used in an existing vapor degreasing system with only minor modifications. One important consideration for many vapor degreasing machines is the flammability of the solvent. Heating a flammable solvent up to its boiling point increases the likelihood that, if there is a source of ignition or if the vapor concentration exceeds certain limits, the solvent will ignite or explode. Halogens (fluorine, chlorine and bromine) suppress flammability, hence their common use as fire extinguishants. For this reason, halogenated solvents are commonly used in vapor degreasing, although solvent flammability is less of a concern in closed-loop systems operated under vacuum. Depending on the type of vapor degreasing system, the drop-in solvent alternatives identified by EPA include methylene chloride, 1-bromopropane (1-BP or n-propyl bromide), and perchloroethylene. Like TCE, methylene chloride and perchloroethylene are hazardous air pollutants (HAPs) under the Clean Air Act and their use is regulated under the Halogenated Solvent NESHAP (40 CFR part 63, subpart T). Therefore, facilities that switch from TCE to methylene chloride or perchloroethylene will still be regulated by the NESHAP. In addition, although 1-BP is not currently listed as a HAP, EPA is currently considering a petition to list this chemical (Ref. 59).
There are significant hazards associated with all three of these drop-in replacements for TCE in vapor degreasing systems. However, based on EPA's analysis, the adverse effects associated with TCE exposure occur at exposure levels below the levels at which the adverse effects associated with the replacement chemicals occur (Ref. 58). With respect to methylene chloride, in August 2014, EPA issued a risk assessment of its use for paint and coating removal and EPA intends to issue a proposal to regulate this use of methylene chloride. While EPA has not specifically assessed the risks associated with using methylene chloride in vapor degreasing applications for this rulemaking, there are a number of hazard concerns associated with this chemical. The potential effects of methylene chloride exposure include death, liver toxicity, kidney toxicity, reproductive toxicity, specific cognitive impacts, and cancer (Ref. 60). Some of these effects result from a very short, acute exposure; others follow years of occupational exposure. Acute exposures may cause confusion and respiratory suppression in humans and there have been a number of deaths associated with worker exposures in homes and other job sites due to the buildup of carbon monoxide in the blood. Methylene chloride is likely to be carcinogenic in humans, so chronic exposures may increase cancer risk. Chronic exposures to methylene chloride may also lead to liver effects. However, these adverse effects are generally seen at higher exposure levels than those associated with TCE toxicity.
With respect to environmental effects, methylene chloride is volatile and releases of methylene chloride are likely to evaporate to the atmosphere, or if released to soil, migrate to groundwater (Ref. 59). It has a global warming potential (GWP) of 8.7 relative to carbon dioxide and thus can act as a greenhouse gas. Methylene chloride has been shown to biodegrade over a range of rates and conditions and is considered to be moderately persistent in the environment. Measured bioconcentration factors suggest that its bioconcentration potential is low.
EPA also has concerns for 1-BP. In May of 2016, a peer review meeting was held on EPA's draft TSCA Work Plan Chemical Risk Assessment for 1-BP. This draft assessment specifically evaluated the risks associated with the use of 1-BP in vapor degreasing (Ref. 61). According to the peer review draft, most acute exposure scenarios for vapor degreasing identified risks for adverse developmental effects that may occur as a result of a single exposure to 1-BP during a critical window of susceptibility. Likewise, chronic exposure risks for adverse neurological and developmental effects were identified in the draft risk assessment for all uses evaluated without engineering controls. In addition, the draft weight-of-evidence analysis for the cancer endpoint is sufficient to support a probable mutagenic mode of action for 1-BP carcinogenesis. However, these adverse effects are generally seen at higher exposure levels than those associated with TCE toxicity.
1-BP is a volatile liquid with high vapor pressure, moderate water solubility, and high mobility in soil (Ref. 61). It is expected to exhibit low adsorption to soil and thus can migrate rapidly through soil to groundwater. 1-BP is slowly degraded by sunlight and reactants when released to the atmosphere. Based on the estimated half-life of nine to twelve days, long range transport via the atmosphere is possible. Biotic and abiotic degradation studies have not shown this substance to be persistent (overall environmental half-life less than two months). While no measured bioconcentration studies for 1-BP are available, an estimated bioaccumulation factor of 12 suggests that bioconcentration and bioaccumulation in aquatic organisms are low.
EPA is also concerned about the adverse health effects associated with perchloroethylene (tetrachloroethylene) exposure. Based on the available human epidemiologic data and experimental and mechanistic studies, EPA has concluded that it poses a potential human health hazard for noncancer toxicity to the central nervous system, kidney, liver, immune and hematologic system, and on development and reproduction. (Ref. 62) Neurotoxicity has been identified as a sensitive endpoint following either oral or inhalation exposure. In addition, EPA has determined that perchloroethylene (tetrachloroethylene) is likely to be carcinogenic to humans by all routes of exposure (Ref. 62). As with methylene chloride and 1-BP, the adverse health effects associated with perchloroethylene (tetrachloroethylene) are generally seen at higher exposure levels than those associated with TCE toxicity. Perchloroethylene presents low to moderate risk to aquatic organisms (Ref. 62). It is moderately persistent, with a low bioaccumulation potential.
In contrast, aqueous cleaning systems present less risk to workers. Water-based cleaners have been used for many years in applications where users originally used TCE or other chlorinated solvents in vapor degreasing. In these systems, water-based cleaners are used to clean grease or oil from parts, the parts are rinsed, sometimes with deionized water if a spot free part is required for the next process, and dried. The cleaner concentrate, typically made up of boric acid or gluconic acid and other constituents, is generally diluted to between about 5% and 20% in a heated wash bath, depending on the cleaning task and the agitation in the equipment. The rinse is generally heated as well. Often driers composed of air knives that drive the water from the part are used.
Depending on the circumstances, several different types of equipment capable of using water-based cleaners can replace vapor degreasing machines that use TCE. Ultrasonic cleaning systems have transducers for generating the ultrasonic action in a bath. There are some immersion systems where the parts are placed on a platform and moved up and down in the cleaning
Water-based cleaners have a few characteristics to consider when evaluating replacements for TCE vapor degreasing (Ref. 63). Since TCE is used primarily to clean metal parts, the water cleaners often contain rust or corrosion inhibitors, which typically are present at very low concentrations, to protect the metals (Ref. 61). In addition, in order to be used in spray equipment, water-based cleaners must be formulated with a non-foaming surfactant. However, there are numerous water-based cleaners available on the market that have been formulated for these purposes (Ref. 64). In addition, the SBAR Panel convened in support of this rulemaking heard from several SERs about the increased water use associated with aqueous cleaning systems (more than 10,000 gallons a day). While this water can be reused in the degreasing system, any effluent is considered industrial wastewater for which a permit may be required under the Clean Water Act (Ref. 32).
SERs providing input to the SBAR Panel noted that, in general the use of TCE in vapor degreasing is declining very rapidly in certain sectors, but is still the method of choice for some, especially for small, intricate parts and substrates (
Based on this input from the SERs, EPA is specifically requesting additional comments, information, and data to assist EPA in evaluating the availability of alternatives to TCE in vapor degreasing applications, including information on the costs to achieve TCE exposure reductions or to transition to alternative chemicals or processes. In addition, EPA will consider granting a time-limited exemption, under the authority of TSCA section 6(g), for a specific condition of use for which EPA can obtain documentation: That the specific condition of use is a critical or essential use for which no technically and economically feasible safer alternative is available, taking into consideration hazard and exposure; that compliance with the proposed ban would significantly disrupt the national economy, national security, or critical infrastructure; or that TCE vapor degreasing in a specific application, as compared to reasonably available alternatives, provides a substantial benefit to health, the environment, or public safety. To this end, EPA requests comment on a process for receiving and evaluating petitions and requesting EPA promulgate critical use exemption rules. Under this process, entities who believe that their specific condition of use is a critical or essential use under TSCA section 6(g) would submit a petition for an exemption rulemaking with supporting documentation that they believe demonstrates that the use meets the statutory criteria. EPA would review the petition for completeness and, if the documentation warrants further action, respond to the petition by publishing a proposal in the
EPA urges vapor degreasing facilities to think strategically about their choices should TCE be banned for their use or if they are in the market to replace or upgrade vapor degreasing equipment for other reasons. To the extent that a process currently using TCE in a vapor degreasing system can be converted to a significantly less toxic alternative, such as an aqueous cleaning system, it will avoid significant risks to workers and also reduce the likelihood that further actions on toxic solvents by EPA or other regulatory authorities will spur another process change.
This unit describes the estimated costs of the proposed and alternative regulatory actions that EPA considered.
The health endpoints associated with TCE exposure are serious. The following is a discussion of the impacts of the most significant cancer and non-cancer effects associated with TCE exposure, including the severity of the effect, the manifestation of the effect, and how the effect impacts a person during their lifetime.
The risk reduction from preventing TCE exposure cannot be comprehensively quantified or monetized even though the adverse effects are well-documented, the TCE risk assessment estimating these risks has been peer-reviewed, and the benefits of reducing the risk of these health endpoints can be described. It is relatively straightforward to monetize the benefits of reducing the risk of the costs of the effects of cancer (kidney cancer, liver cancer, non-Hodgkin's lymphoma) due to TCE exposure. The estimated value of the annualized benefit is estimated to be $65 million to $447 million at 3% and $32 million to $227 million at 7% over 20 years. It is currently not possible to monetize the benefits of reducing the risks of the costs of non-cancer effects (all developmental toxicity, kidney toxicity, immunotoxicity, reproductive toxicity, neurotoxicity, and liver toxicity) of TCE exposure. There are two reasons for this. First, dose response information and concentration response functions in humans are not available. This information would allow EPA to estimate the number of population-level non-cancer cases that would be avoided by reducing exposures to levels corresponding with MOE benchmarks. Second, even it were possible to calculate the number of cases avoided, EPA may not be able to monetize the benefits of these avoided cases due to limitations in data needed to apply established economic methodologies. However, being unable to quantitatively assess individual risk and population-level non-cancer cases avoided from TCE exposure does not negate the impact of these effects. Similarly, the inability to monetize an adverse effect does not reflect the severity of the effect, the lifetime nature of the impact, or the magnitude of the benefit in preventing the adverse impact from TCE exposure, such as a cardiac malformation, on a person. In considering the benefits of preventing TCE exposure, EPA considered the type of effect, the severity of the effect, the duration of the effect, and costs and other monetary impacts of the health endpoint.
The alternative options that EPA considered are unlikely to result in the same health benefits as the proposed rule for the reasons discussed in Unit VI. However, EPA was unable to quantify the differences in benefits that would result from the alternatives.
The details of the costs of the proposed approach for use of TCE in vapor degreasing are discussed in Unit VI.C. Under the proposed option, costs to users of TCE in vapor degreasing applications range from $30 million to $45 million (annualized at 3% over 20 years) and $32 million to $46 million (annualized at 7% over 20 years). Costs of downstream notification and recordkeeping for manufacturers, processors, and distributors on an annualized basis over 20 years are $3,200 and $4,400 using 3% and 7% discount rates respectively. However, the costs of the downstream notification and recordkeeping requirements were already accounted for in the prior proposal on TCE use in aerosol degreasing and as a spotting agent in dry-cleaning facilities, and thus are not included in the total costs for this proposal.
The primary alternative that EPA considered is a requirement that TCE be used for vapor degreasing only in certain closed systems and that workers operating the systems and in the immediate area wear PPE with an APF of 10,000. The estimated annualized costs of this option are $32 million to $46 million annualized over 20 years at 3% and $34 million to $47 million annualized over 20 years at 7%.
The monetized benefits for preventing the risks resulting from TCE exposure from this use significantly outweigh the estimated costs. Simply comparing the costs and monetized benefits of prohibiting the manufacture (including import), processing, and distribution in commerce of TCE for use in vapor degreasing, prohibiting commercial use of TCE in vapor degreasing, and requiring downstream notification demonstrates that the monetized benefits of this proposed action outweigh the costs. However, EPA believes that the balance of costs and benefits cannot be fairly described without considering the additional, non-monetized benefits of mitigating the non-cancer adverse effects as well as cancer. As discussed previously, the multitude of potential adverse effects associated with TCE exposure can profoundly impact an individual's quality of life. Some of the adverse effects associated with TCE exposure can be immediately experienced and can affect a person from childhood throughout a lifetime (
While the risk of non-cancer health effects associated with TCE exposure cannot be quantitatively estimated, the qualitative discussion in this Unit highlights how some of these non-cancer effects occurring much earlier in life from TCE exposure may be as severe as cancer's mortality and morbidity and thus just as life-altering. These effects include not only medical costs but also personal costs such as emotional and mental stress that are impossible to accurately measure.
While the impacts of non-cancer effects cannot be monetized, EPA considered the impacts of these effects in deciding how best to address the unreasonable risks presented by TCE use in vapor degreasing. Considering only monetized benefits would significantly underestimate the impacts of TCE-induced non-cancer adverse outcomes on a person's quality of life to perform basic skills of daily living, including the ability to earn a living, the ability to participate in sports and other activities, and the impacts on a person's family and relationships.
Thus, considering costs, benefits that can be monetized (risk of cancer), and benefits that cannot be quantified and subsequently monetized (risk of developmental toxicity, kidney toxicity, immunotoxicity, reproductive toxicity, neurotoxicity, and liver toxicity), including benefits related to the severity of the effects and the impacts on a person throughout her/his lifetime in terms of medical costs, effects on earning power and personal costs, and the emotional and psychological costs, the benefits of preventing exposures to TCE emissions from vapor degreasing systems outweigh the costs. Further, if EPA were to consider only the benefits that can be monetized in comparison to the cost, the monetized benefits from preventing kidney and liver cancer and non-Hodgkin's lymphoma from the use of TCE in vapor degreasing (the annualized monetized benefits on a 20 year basis range from approximately $65 million to $447 million at 3% and $32 million to $227 million at 7%) far outweigh the costs of the proposal to ban the use of TCE in vapor degreasing (the annualized costs on a 20 year basis range from approximately $30 million to $45 million at 3% and $32 million to $46 million at 7%). Considering the costs and benefits of the proposed and alternative options, while both address the unreasonable risks from TCE exposure, the proposed approach is more cost effective because it achieves the same or greater benefits at lower costs. For more information, see Section 7 in the Economic Analysis.
A discussion of the uncertainties associated with this proposed rule can be found in the TCE risk assessment (Ref. 2) and in the supplemental analysis (Ref. 30) for use of TCE in vapor degreasing. A summary of these uncertainties follows.
EPA used a number of assumptions in the TCE risk assessment and supporting analysis to develop estimates for occupational exposure scenarios and to develop the hazard/dose‐response and risk characterization. EPA recognizes that the uncertainties may underestimate or overestimate actual risks. These uncertainties include the possibility that releases of and exposures to TCE vary from one vapor degreasing machine to the next. EPA attempted to quantify this uncertainty by evaluating multiple scenarios to establish a range of releases and exposures. In estimating the risk from vapor degreasing, there are uncertainties in the number of workers exposed to TCE and in the inputs and algorithms of the models used to estimate exposures.
In addition to the uncertainties in the risks, there are uncertainties in the cost and benefits. The uncertainties in the benefits are most pronounced in estimating the benefits from preventing the non-cancer adverse effects because these benefits generally cannot be monetized due to the lack of concentration-response functions in humans leading to the ability to estimate the number of population-level non-cancer cases and limitations in established economic methodologies. Additional uncertainties in benefit calculations include the potential risks for adverse health effects that the alternatives may pose and the estimates of the alternatives that users might choose to adopt. While there are some products that have comparable risks, there are a number of alternatives that are likely to be of lower risk, although EPA is unable to estimate the incremental change in the risk. To account for this uncertainty, EPA includes a lower and a higher estimate for the benefits from eliminating exposure to TCE. The lower benefits estimate assumes no benefits for TCE users that keep the same vapor degreasing machines and switch to methylene chloride, perchloroethylene, 1-BP, or designer solvent alternatives, assumes that TCE users switching to any other alternative suffer no adverse health effects associated with the alternatives (
In addition, under certain assumptions EPA's economic analysis estimates that some TCE users will see a cost savings when switching to aqueous systems and certain other solvents. Standard economic theory suggests that financially rational companies would choose technologies that maximize profits so that regulatory outcomes would not typically result in a cost savings for the regulated facilities. There could be several reasons that cost savings might occur in the real world. Potential reasons include lack of complete information or barriers to obtaining information on the cost savings associated with alternatives as well as investment barriers or higher interest rates faced by firms. Additionally, there may be costs
There are also uncertainties in the estimates of the number of affected vapor degreasing machines, and for numbers of processors and distributors of TCE-containing products not prohibited by the proposed rule who are required to provide downstream notification and/or maintain records. The estimate for number of facilities using TCE-containing vapor degreasing machines is based upon available industry information and an industry expert (Ref. 3). To estimate the number of processors, EPA relied on public 2012 CDR data. The number of sites is reported in the CDR data as a range. The midpoint of the reported ranges was used to estimate the total number of sites using the chemical. Furthermore, the CDR data only includes processors immediately downstream of those reporting to CDR. Finally, EPA estimated the number of wholesaler firms distributing products containing TCE by taking a ratio of the number of Chemical and Allied Products Merchant Wholesaler firms to Basic Chemical Manufacturing firms and applying it to the estimated number of manufacturers and processors of TCE (Ref. 3).
EPA will consider additional information received during the public comment period. This includes public comments, scientific publications, and other input submitted to EPA during the comment period.
Section 9(a) of TSCA provides that, if the Administrator determines in her discretion that an unreasonable risk may be prevented or reduced to a sufficient extent by an action taken under a Federal law not administered by EPA, the Administrator must submit a report to the agency administering that other law that describes the risk and the activities that present such risk. If the other agency responds by declaring that the activities described do not present an unreasonable risk or if that agency initiates action under its own law to protect against the risk within the timeframes specified by TSCA section 9(a), EPA is precluded from acting against the risk under sections 6(a) or 7 of TSCA.
TSCA section 9(d) instructs the Administrator to consult and coordinate TSCA activities with other Federal agencies for the purpose of achieving the maximum enforcement of TSCA while imposing the least burden of duplicative requirements. For this proposed rule, EPA has consulted with OSHA.
OSHA assures safe and healthful working conditions for working men and women by setting and enforcing standards and by providing training, outreach, education and assistance. OSHA adopted an eight-hour time weighted average PEL of 100 ppm along with a ceiling limit in 1971 shortly after the agency was formed. It was based on the ACGIH recommended occupational exposure limit that was in place at that time. OSHA recognizes that the TCE PEL and many other PELs issued shortly after adoption of the OSHA Act in 1970 are outdated and inadequate for ensuring protection of worker health. OSHA recently published a Request for Information on approaches to updating PELs and other strategies to managing chemicals in the workplace (Ref. 12). OSHA's current regulatory agenda does not include revision to the TCE PEL or other regulations addressing the risks EPA has identified when TCE is used in vapor degreasing or the uses identified in a prior proposal (Ref. 1), aerosol degreasing or for spot cleaning in dry cleaning facilities (Ref. 12).
This proposed rule and the related proposal (Ref. 1), which EPA intends to finalize together, address risks in both workplace (both private- and public-sector) and consumer settings from exposure to TCE in vapor degreasers, aerosol spray degreasers, and as a spot cleaner at dry cleaning facilities. With the exception of TSCA, there is no Federal law that provides authority to prevent or sufficiently reduce these cross-cutting exposures. No other Federal regulatory authority, when considering the exposures to the populations and within the situations in its purview, can evaluate and address the totality of the risk that EPA is addressing in this proposal and the prior proposal on TCE uses (Ref. 1). For example, OSHA may set exposure limits for workers but its authority is limited to the workplace and does not extend to consumer uses of hazardous chemicals. Further, OSHA does not have direct authority over state and local employees, and it has no authority at all over the working conditions of state and local employees in states that have no OSHA-approved State Plan under 29 U.S.C. 667. Other Federal regulatory authorities, such as CPSC, have the authority to only regulate pieces of the risks posed by TCE, such as when used in consumer products.
Moreover, recent amendments to TSCA, Public Law 114-182, alter both the manner of identifying unreasonable risk under TSCA and EPA's authority to address unreasonable risk under TSCA, such that risk management under TSCA is increasingly distinct from analogous provisions of the Consumer Product Safety Act (CPSA), the Federal Hazardous Substances Act, or the OSH Act. These changes to TSCA reduce the likelihood that an action under the CPSA, FHSA, or the OSH Act would reduce the risk of TCE from these uses to a sufficient extent under TSCA. Whereas (in a TSCA section 6 rule) an unreasonable risk determination sets the objective of the rule in a manner that excludes cost considerations, 15 U.S.C 2605(b)(4)(A), subject to time-limited conditional exemptions for critical chemical uses and the like, 15 U.S.C. 2605(g), a consumer product safety rule under the CPSA must include a finding that “the benefits expected from the rule bear a reasonable relationship to its costs.” 15 U.S.C. 2058(f)(3)(E). Additionally, recent amendments to TSCA reflect Congressional intent to “delete[] the paralyzing `least burdensome' requirement,” 162 Cong. Rec. S3517 (June 7, 2016). However, a consumer product safety rule under the CPSA must impose “the least burdensome requirement which prevents or adequately reduces the risk of injury for which the rule is being promulgated.”15 U.S.C. 2058(f)(3)(F). Analogous requirements, also at variance with recent revisions to TSCA, affect the availability of action under the FHSA relative to action under TSCA. 15 U.S.C. 1262. Gaps also exist between OSHA's authority to set workplace standards under the OSH Act and EPA's amended obligations to sufficiently address chemical risks under TSCA. To set PELs for chemical exposure, OSHA must first establish that the new standards are economically feasible and technologically feasible. 79 FR 61387 (2014). But under TSCA, EPA's substantive burden under TSCA § 6(a) is
TSCA is the only regulatory authority able to prevent or reduce risks from these uses of TCE to a sufficient extent across the range of uses and exposures of concern. In addition, these risks can be addressed in a more coordinated, efficient and effective manner under TSCA than under two or more different laws implemented by different agencies. Furthermore, there are key differences between the newly amended finding requirements of TSCA and those of the OSH Act, CPSA, and the FHSA. For these reasons, in her discretion, the Administrator does not determine that unreasonable risks from the use of TCE in vapor degreasers, aerosol spray degreasers, and as a spot cleaner at dry cleaning facilities may be prevented or reduced to a sufficient extent by an action taken under a Federal law not administered by EPA.
If EPA determines that actions under other Federal laws administered in whole or in part by EPA could eliminate or sufficiently reduce an unreasonable risk, section 9(b) of TSCA instructs EPA to use these other authorities unless the Administrator determines in the Administrator's discretion that it is in the public interest to protect against such risk under TSCA. In making such a public interest finding, TSCA section 9(b)(2) states: “the Administrator shall consider, based on information reasonably available to the Administrator, all relevant aspects of the risk . . . and a comparison of the estimated costs and efficiencies of the action to be taken under this title and an action to be taken under such other law to protect against such risk.”
Although several EPA statutes have been used to limit TCE exposure, as discussed in Unit III.A., regulations under these EPA statutes have limitations because they largely regulate releases to the environment, rather than direct human exposure. SDWA only applies to drinking water. CAA does not apply directly to worker exposures or consumer settings where TCE is used. Under RCRA, TCE that is discarded may be considered a hazardous waste and subject to requirements designed to reduce exposure from the disposal of TCE to air, land and water. RCRA does not address exposures during use of products containing TCE. Only TSCA provides EPA the authority to regulate the manufacture (including import), processing, and distribution in commerce, and use of chemical substances.
For these reasons, the Administrator does not determine that unreasonable risks from the use of TCE in vapor degreasers, aerosol spray degreasers, and as a spot cleaner at dry cleaning facilities could be eliminated or reduced to a sufficient extent by actions taken under other Federal laws administered in whole or in part by EPA.
EPA has used scientific information, technical procedures, measures, methods, protocols, methodologies, and models consistent with the best available science. For example, EPA based its proposed determination of unreasonable risk presented by the use of TCE in vapor degreasing systems on the completed risk assessment, which followed a peer review and public comment process, as well as using the best available science and methods (Ref. 2). A supplemental analysis was performed to better characterize the exposed populations and estimate the effects of various control options. This supplemental analysis was performed consistent with the methods and models used in the risk assessment. These analyses were developed for the purpose of determining whether the particular risks are unreasonable. They were also developed to support risk reduction by regulation under section 6 of TSCA, to the extent risks were determined to be unreasonable. It is reasonable and consistent to consider these analysis in this rulemaking for such relevant purposes.
The extent to which the various information, procedures, measures, methods, protocols, methodologies or models, as applicable, used in EPA's decision have been subject to independent verification or peer review is adequate to justify their use, collectively, in the record for this rule. Additional information on the peer review and public comment process, such as the peer review plan, the peer review report, and the Agency's response to comments, can be found on EPA's Assessments for TSCA Work Plan Chemicals Web page at
This proposal relies on general provisions in the proposed Part 751, Subpart A, which can be found at 81 FR 91592 (December 16, 2016).
This proposal would prohibit the manufacture (including import), processing, distribution in commerce, and commercial use of TCE in vapor degreasing.
EPA has authority under TSCA section 6 to require that a substance or mixture or any article containing such substance or mixture be marked with or accompanied by clear and adequate warnings and instructions with respect to its use, distribution in commerce, or disposal or with respect to any combination of such activities. Many TCE manufacturers and processors are likely to manufacture or process TCE or TCE containing products for other uses that would not be regulated under this proposal. Other companies may be strictly engaged in distribution in commerce of TCE, without any manufacturing or processing activities, to customers for uses that are not regulated. As discussed in the prior proposal on TCE use in aerosol degreasers and as a spot remover agent in dry cleaning facilities, EPA is proposing a requirement for downstream notification by manufacturers (including importers), processors, and distributors of TCE for any use to ensure compliance with the proposed prohibitions on the manufacture, processing, distribution in commerce, and commercial use of TCE. Downstream notification is necessary for effective enforcement of the rule because it provides a record, in writing, of notification on use restrictions throughout the supply chain, likely via modifications to the Safety Data Sheet. Downstream notification also increases awareness of restrictions on use, which is likely to decrease unintentional uses of TCE. Downstream notification represents minimal burden and is necessary for effective enforcement of the rule. The specific requirement, that persons who manufacture (including import), process, or distribute in commerce TCE for any use would have to provide written notification of the restrictions to persons to whom TCE is shipped, was included in an earlier proposal on TCE use (Ref. 1). The specific recordkeeping requirements were also contained in the prior proposal (Ref. 1). Those provisions would require manufacturers (including importers), processors, and distributors of TCE for any use to retain documentation of the identity and
As presented in the prior proposal (Ref. 1), the estimated costs of downstream notification and recordkeeping on an annualized basis over 20 years are $3,200 and $4,400 using 3% and 7% discount rates respectively.
TSCA section 15 makes it unlawful to fail or refuse to comply with any provision of a rule promulgated under TSCA section 6. Therefore, any failure to comply with this proposed rule when it becomes effective would be a violation of TSCA section 15. In addition, TSCA section 15 makes it unlawful for any person to: (1) Fail or refuse to establish and maintain records as required by this rule; (2) fail or refuse to permit access to or copying of records, as required by TSCA; or (3) fail or refuse to permit entry or inspection as required by TSCA section 11.
Violators may be subject to both civil and criminal liability. Under the penalty provision of TSCA section 16, any person who violates TSCA section 15 could be subject to a civil penalty for each violation. Each day of operation in violation of this proposed rule when it becomes effective could constitute a separate violation. Knowing or willful violations of this proposed rule when it becomes effective could lead to the imposition of criminal penalties and imprisonment. In addition, other remedies are available to EPA under TSCA sections 7 and 17.
Individuals, as well as corporations, could be subject to enforcement actions. TSCA sections 15 and 16 apply to “any person” who violates various provisions of TSCA. EPA may, at its discretion, proceed against individuals as well as companies. In particular, EPA may proceed against individuals who report false information or cause it to be reported.
As proposed in the prior action on TCE use (Ref. 1), the downstream notification requirements and the recordkeeping requirements applicable to manufacturers (including importers) and processors of TCE for any use and persons who distribute TCE in commerce for any use (other than retailers) would take effect 45 days after the final rule is issued. EPA is proposing to make the ban on manufacturing (including importing), processing, or distributing in commerce TCE for vapor degreasing uses, the downstream notification requirements, and the recordkeeping requirements effective 18 months after publication of the final rule. The ban on the use of TCE in vapor degreasing systems would take effect six months after that, or two years after publication of the final rule. EPA heard from the SERs who provided input to the SBAR Panel that converting from a vapor degreasing system that uses TCE to one that does not is often a time-intensive process (Ref. 32). SERs had different ideas on how long it would take for the conversion process. One SER observed that many users do not know exactly how clean their products must be, or how clean their existing system gets them. According to this SER, testing is needed to determine the required cleaning efficiency, and it can take six months for the testing. Changing to a new system could take an additional twelve to eighteen months. Another SER agreed with the estimate of two years for a changeover, while still another SER thought it could take anywhere from six months to four years. In light of this input, EPA believes that it is reasonable to establish the compliance date for the prohibition on TCE in vapor degreasing at two years from the date the final rule is promulgated. EPA believes that, in most cases, the transition can be made within this time, but EPA requests comment on whether there are special situations which may require more time.
EPA would like to encourage as many companies as possible to adopt less hazardous technologies, such as aqueous cleaning systems, instead of switching to an alternative that also presents health risks for workers, albeit of a lower magnitude than TCE. EPA's analysis indicates that the best answer for many vapor degreasing operations may be a switch to water-based cleaners, even though there are higher upfront costs. An effective system that works for a given application and that is acceptable to customers must be researched and designed, new equipment and cleaning solutions must be purchased, new permits may be required, operating and safety procedures must be updated, and affected employees must learn to operate the new equipment. However, once the system is up and running properly, operation of the system on an annual basis is likely to be less expensive and much less hazardous to employees than a vapor degreasing system using TCE.
EPA requests comment on its analysis of the alternatives and the impacts of switching to less hazardous cleaners. EPA is particularly interested in comments and information on water and energy use associated with water-based cleaners and other less-toxic solvents, as well as on the costs of conversion from a system that uses TCE and the length of time such a conversion would take.
EPA is also requesting comment on potential incentives for vapor degreasing facilities to switch to less toxic alternatives. TSCA does not provide the authority for EPA to offer incentives such as tax credits, so there are a limited number of regulatory incentives available to EPA. One potential incentive would be a delayed implementation date for a ban on TCE use in vapor degreasing. This incentive would allow vapor degreasing facilities that intend to convert to aqueous cleaning systems a longer period of time to make the conversion. One way to administer this incentive would be to require vapor degreasing facilities to specifically request an extension for a certain length of time. Of course, in order to limit misuse of this extension opportunity, EPA would have to also require documentation of the facility's clear intention to convert to an aqueous cleaning system. This might include a description of the steps the company has already taken to implement a change to aqueous substitutes, or a description of the specific plan for implementing the change within the extension period requested, with some sort of documentation, such as a contract to purchase equipment. EPA also notes that TSCA section 6(d) generally provides that compliance dates for the start of a ban or phase-out promulgated under section 6(a) must be as soon as practicable, but not later than five years after the rule is promulgated, except for those critical or essential uses exempted under TSCA section 6(g). EPA requests comments on all aspects of this potential incentive, including comments on the length of time that should be allowed for an extension, what documentation should be required, and which technologies or solvents should be eligible for an extension and how to define them. EPA also requests comments on other potential incentives or regulatory flexibilities that EPA could incorporate to encourage the adoption of safer degreasing technologies. Finally, in keeping with the SBAR Panel recommendation regarding flexibility for small businesses, EPA requests comment on whether there are flexibilities other than delayed implementation dates that would be particularly advantageous for small
The following is a listing of the documents that are specifically referenced in this document. The docket includes these documents and other information considered by EPA, including documents referenced within the documents that are included in the docket, even if the referenced document is not physically located in the docket. For assistance in locating these other documents, please consult the technical person listed under
Additional information about these statutes and Executive Orders can be found at
This action is an economically significant regulatory action that was submitted to the Office of Management and Budget (OMB) for review under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011). Any changes made in response to OMB recommendations have been documented in the docket. EPA prepared an economic analysis of the potential costs and benefits associated with this action, which is available in the docket and summarized in Unit VII. (Ref. 3).
The information collection requirements in this proposed rule have been submitted to OMB for review and comment under the PRA, 44 U.S.C. 3501
The information collection activities required under the proposed rule include a downstream notification requirement and a recordkeeping requirement. The downstream notification would require companies that ship TCE to notify companies downstream in the supply chain of the prohibitions of TCE in the proposed rule. The proposed rule does not require the regulated entities to submit information to EPA. The proposed rule also does not require confidential or sensitive information to be submitted to EPA or downstream companies. The recordkeeping requirement mandates companies that ship TCE to retain certain information at the company headquarters for three years from the date of shipment. These information
An agency may not conduct or sponsor, and a person is not required to respond to a collection of information unless it displays a currently valid OMB control number. The OMB control numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9.
Submit your comments on the Agency's need for this information, the accuracy of the provided burden estimates, and any suggested methods for minimizing respondent burden to EPA using the docket identified at the beginning of this proposed rule. You may also send your ICR-related comments to OMB's Office of Information and Regulatory Affairs via email to
Pursuant to section 603 of the RFA, 5 U.S.C. 601
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As required by section 609(b) of the RFA, EPA also convened a Small Business Advocacy Review (SBAR) Panel to obtain advice and recommendations from small entity representatives that potentially would be subject to the rule's requirements. The SBAR Panel evaluated the assembled materials and small-entity comments on issues related to elements of an IRFA. A copy of the full SBAR Panel Report is available in the rulemaking docket. The Panel recommended that EPA seek additional information on critical uses; availability, effectiveness, and costs of alternatives; implementation timelines; and exposure information to provide flexibility to lessen impacts to small entities, as appropriate. Throughout this preamble, EPA has requested information with respect to these and other topics. The Panel made the following specific recommendations:
a.
• No technically and economically feasible safer alternative is available;
• Compliance with the ban would significantly disrupt the national economy, national security, or critical infrastructure; or
• The specific condition of use, as compared to reasonably available alternatives, provides a substantial benefit to health, the environment, or public safety.
To that end, the Panel recommended that EPA include in its proposal specific targeted requests for comment directed towards identifying critical uses (such as the aeronautics industry and national security) and obtaining information to justify exemptions. The Panel also recommended that EPA request public comment on allowing the use of TCE in closed-top vapor degreasing systems with the use of appropriate PPE.
b.
• Evaluate the feasibility of using alternatives, including the cost, relative safety, and other barriers (such as space constraints, cleaning efficiency, increased energy use, cycle time, boiling points, and water use restrictions); and
• Take into consideration the current and future planned regulation of compounds the Agency has listed as alternatives.
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This action does not contain an unfunded mandate of $100 million or more as described in UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect small governments. The requirements of this action would primarily affect persons who commercially use TCE in vapor degreasing equipment. The total estimated annualized cost of the proposed rule is approximately $30 million to $45 million at 3% and $32 million to $46 million at 7% (Ref. 3).
EPA has concluded that this action has federalism implications, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999), because regulation under TSCA section 6(a) may preempt state law. EPA provides the following preliminary federalism summary impact statement. The Agency consulted with state and local officials early in the process of developing the proposed action to permit them to have meaningful and timely input into its development. EPA invited the following national organizations representing state and local elected officials to a meeting on May 13, 2015, in Washington DC: National Governors Association; National Conference of State Legislatures, Council of State Governments, National League of Cities, U.S. Conference of Mayors, National Association of Counties, International City/County Management Association, National Association of Towns and Townships, County Executives of America, and Environmental Council of States. A summary of the meeting with these organizations, including the views that they expressed, is available in the docket (Ref. 67). Although EPA provided these organizations an opportunity to provide follow-up comments in writing, no written follow-up was received by the Agency.
This action does not have tribal implications, as specified in Executive Order 13175 (65 FR 67249, November 9, 2000). This rulemaking would not have substantial direct effects on tribal government because TCE is not manufactured, processed, or distributed in commerce by tribes. TCE is not regulated by tribes, and this rulemaking would not impose substantial direct compliance costs on tribal governments. Thus, EO 13175 does not apply to this action. EPA nevertheless consulted with tribal officials during the development of this action, consistent with the EPA Policy on Consultation and Coordination with Indian Tribes.
EPA met with tribal officials in a national informational webinar held on May 12, 2015 concerning the prospective regulation of TCE under TSCA section 6, and in another teleconference with tribal officials on May 27, 2015 (Ref. 68). EPA also met with the National Tribal Toxics Council (NTTC) in Washington, DC and via teleconference on April 22, 2015 (Ref. 68). In those meetings, EPA provided background information on the proposed rule and a summary of issues being explored by the Agency. These officials expressed concern for TCE contamination on tribal lands and supported additional regulation of TCE.
This action is subject to Executive Order 13045 (62 FR 19885, April 23, 1997), because it is an economically significant regulatory action as defined by Executive Order 12866, and EPA believes that the environmental health or safety risk addressed by this action has a disproportionate effect on children, specifically on the developing fetus. Accordingly, we have evaluated the environmental health or safety effects of TCE used in vapor degreasing on children. The results of this evaluation are discussed in Units I.F., II.C., IV., and VI.C. of this preamble and in the economic analysis (Ref. 3).
Supporting information on the exposures and health effects of TCE exposure on children is also available in the Toxicological Review of Trichloroethylene (Ref. 4) and the TCE risk assessment (Ref. 2).
This proposed rule is not subject to Executive Order 13211 (66 FR 28355, May 22, 2001), because this action is not expected to affect energy supply, distribution in commerce, or use. This rulemaking is intended to protect against risks from TCE, and does not affect the use of oil, coal, or electricity.
This proposed rulemaking does not involve technical standards, and is therefore not subject to considerations under NTTAA section 12(d), 15 U.S.C. 272 note.
Executive Order 12898 (59 FR 7629, February 16, 1994) establishes federal executive policy on environmental justice. Its main provision directs federal agencies, to the greatest extent practicable and permitted by law, to make environmental justice part of their mission by identifying and addressing, as appropriate, disproportionately high and adverse health or environmental effects of their programs, policies and activities on minority populations and low-income populations in the U.S. Units IV. and VI. of this preamble address public health impacts from TCE. EPA has determined that there would not be a disproportionately high and adverse health or environmental effects on minority, low income, or indigenous populations from this proposed rule.
Environmental protection, Chemicals, Export certification, Hazardous substances, Import certification, Recordkeeping.
Therefore, 40 CFR part 751, as proposed to be added at 81 FR 91592 (December 16, 2016), is proposed to be further amended to read as follows:
15 U.S.C. 2605.
(a) After [
(b) After [
Environmental Protection Agency (EPA).
Proposed rule.
Methylene chloride, also called dichloromethane, is a volatile chemical that has a variety of uses, including paint and coating removal. N-methylpyrrolidone (NMP) is a solvent used in a variety of applications, including paint and coating removal. For each of these chemicals, EPA has identified risks of concern associated with their use in paint and coating removal. EPA proposes a determination that these are unreasonable risks. EPA is proposing to prohibit the manufacture (including import), processing, and distribution in commerce of methylene chloride for consumer and most types of commercial paint and coating removal under section 6 of the Toxic Substances Control Act (TSCA). EPA is also proposing to prohibit the use of methylene chloride in these commercial uses; to require manufacturers (including importers), processors, and distributors, except for retailers, of methylene chloride for any use to provide downstream notification of these prohibitions throughout the supply chain; and to require recordkeeping. EPA is proposing an initial ten-year time-limited exemption from these proposed regulations on methylene chloride for coating removal uses critical for national security. First, EPA is proposing to prohibit the manufacture (including import), processing, and distribution in commerce of NMP for all consumer and commercial paint and coating removal; to prohibit the use of NMP for all commercial paint and coating removal; to require, consistent with methylene chloride restrictions, downstream notification of these prohibitions throughout the supply chain; to require recordkeeping; and to provide a time-limited exemption from these proposed regulations on NMP for coating removal uses critical for national security. For NMP, as an alternate proposal, EPA is proposing that (1) commercial users of NMP for paint and coating removal establish a worker protection program for dermal and respiratory protection and not use paint and coating removal products that contain greater than 35 percent NMP by weight (except for product formulations destined to be used by DoD or its contractors performing work only for DOD projects); and (2) processors of products containing NMP for paint and coating removal reformulate products such that these products do not exceed a maximum of 35 percent NMP by weight, identify gloves that provide effective protection for the formulation, and provide warning and instruction labels on the products.
Comments must be received on or before April 19, 2017.
Submit your comments, identified by docket identification (ID) number EPA-HQ-OPPT-2016-0231, at
You may potentially be affected by this proposed action if you manufacture (defined under Toxic Substances Control Act (TSCA) to include import), process, distribute in commerce, or use methylene chloride or NMP for paint and coating removal. Paint and coating removal, also referred to as paint stripping, is the process of removing paint or other coatings from a surface. The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document applies to them. Potentially affected entities may include:
This action may also affect certain entities through pre-existing import certification and export notification rules under TSCA. Persons who import any chemical substance governed by a final TSCA section 6(a) rule are subject to the TSCA section 13 (15 U.S.C. 2612) import certification requirements and the corresponding regulations at 19 CFR
If you have any questions regarding the applicability of this proposed action to a particular entity, consult the technical information contact listed under
Under TSCA section 6(a) (15 U.S.C. 2605(a)), if EPA determines after risk evaluation that a chemical substance presents an unreasonable risk of injury to health or the environment, without consideration of costs or other non-risk factors, including an unreasonable risk to a potentially exposed or susceptible subpopulation identified as relevant to the risk evaluation, under the conditions of use, EPA must by rule apply one or more requirements to the extent necessary so that the chemical substance or mixture no longer presents such risk.
With respect to a chemical substance listed in the 2014 update to the TSCA Work Plan for Chemical Assessments for which a completed risk assessment was published prior to the date of enactment of the Frank R. Lautenberg Chemical Safety for the 21st Century Act, TSCA section 26(l)(4) (15 U.S.C. 2625(l)(4)) expressly authorizes EPA to issue rules under TSCA section 6(a) that are consistent with the scope of the completed risk assessment and consistent with the other applicable requirements of TSCA section 6. Methylene chloride and NMP are such chemical substances (Ref. 1). They are listed in the 2014 update to the TSCA Work Plan and the completed risk assessments were published in 2014 and 2015, respectively. The scope of each completed risk assessment includes consumer and commercial paint and coating removal.
EPA proposes a determination that the uses of methylene chloride or NMP in paint and coating removal present an unreasonable risk of injury to health. Accordingly, for methylene chloride, EPA is proposing under section 6 of TSCA to prohibit the manufacture (including import), processing, and distribution in commerce of methylene chloride for all consumer and for most types of commercial paint and coating removal uses. EPA is also proposing under TSCA section 6 to prohibit the use of methylene chloride for commercial paint and coating removal in the specified sectors, which include painting and decorating, floor refinishing, automotive refinishing, civilian aircraft refinishing, graffiti removal, renovations and contracting, bridge repair and repainting, and marine craft refinishing and repair. EPA is not proposing at this time to regulate the use of methylene chloride in commercial furniture refinishing, also referred to as furniture stripping or refinishing conducted by professionals or commercial workers. EPA is also proposing to exempt certain uses of methylene chloride for coating removal that EPA proposes are critical for national security.
EPA is also proposing to require that any paint or coating removal products containing methylene chloride that continue to be distributed be packaged in containers with a volume no less than 55 gallons, except for formulations specifically manufactured for the Department of Defense, which may be distributed in containers with volumes no less than 5 gallons. EPA is also proposing to require manufacturers (including importers), processors, and distributors, except for retailers, of methylene chloride for any use to provide downstream notification of these requirements and prohibitions throughout the supply chain; and to require limited recordkeeping. More details on this supply chain approach are in Unit VI.C.3.
EPA intends to issue a separate proposal on methylene chloride in paint and coating removal in commercial furniture refinishing, but plans to issue one final rule covering both this proposal and the future proposed rule on methylene chloride in paint and coating removal in commercial furniture refinishing. More information on such a future proposal that would directly address methylene chloride in paint and coating removal in furniture refinishing is in Unit XI.
For NMP, EPA is co-proposing two different options to reduce the unreasonable risks presented by NMP in paint and coating removal for consumers and commercial users. EPA is co-proposing these two options because the Agency is interested in public consideration of these approaches, and is soliciting comments regarding the extent to which these approaches could reduce the unreasonable risks the Agency has identified.
Under the first approach co-proposed for NMP (option 1), EPA is proposing to prohibit the manufacture (including import), processing, and distribution in commerce of NMP for all consumer and commercial paint and coating removal, with exemptions for certain coating removal uses that EPA proposes are critical to national security. EPA is also proposing to prohibit the commercial use of NMP for paint and coating removal, with exemptions for certain coating removal uses that EPA proposes are critical to national security. These exemptions include the condition that any exempt paint and coating removal products containing NMP be packaged in containers with a volume no less than 5 gallons. Unlike the option proposed for methylene chloride, these exemptions do not include the use of NMP in furniture refinishing. EPA is also proposing to require manufacturers (including importers), processors, and distributors, except for retailers, of NMP for any use to provide downstream notification of these prohibitions throughout the supply chain; and to require limited recordkeeping.
Under the second approach proposed for NMP, EPA is proposing a reformulation, PPE, and labeling approach. This would require product reformulation to limit the concentration of NMP in paint and coating removal products; testing of product formulations to identify specialized gloves that provide protection; relabeling of products to provide additional information to consumers; an occupational dermal and respiratory protection program for commercial use of NMP in paint and coating removal, downstream notification when distributing NMP for other uses, and limited recordkeeping. Under this approach, no exemption is proposed for coating removal identified as critical for national security because paint and coating removal products containing NMP would continue to be available for these national security uses under this option, even without establishing a national security exemption.
EPA is requesting public comment on these proposals.
Based on EPA's analysis of worker and consumer populations' exposures to methylene chloride and NMP in paint and coating removal, EPA proposes a determination that methylene chloride and NMP in paint and coating removal present an unreasonable risk to human
It is important to note that while both methylene chloride and NMP are used in paint and coating removal, products containing NMP have in recent years become increasingly popular substitutes for users interested in avoiding the health effects or odors known to be associated with products containing methylene chloride. While exposures to these chemicals have been assessed using different health endpoints, EPA proposes a determination that the use of either methylene chloride or NMP in paint and coating removal presents unreasonable risks. For this reason, EPA proposes to address the unreasonable risks presented by both chemicals in one rule.
Although EPA proposes to determine that the identified risks to workers exposed to methylene chloride in commercial furniture refinishing are unreasonable, EPA is not proposing to regulate these risks at this time. EPA intends to issue a separate proposal addressing the use of methylene chloride in paint and coating removal in commercial furniture refinishing. See Unit XI.
As discussed in Unit V.C., EPA is not proposing to prohibit all manufacturing, processing, distribution in commerce, and use of methylene chloride or NMP, of which paint and coating removal is estimated to comprise 25% and 9% of the use of each chemical, respectively (Refs. 2 and 3).
EPA proposes to determine that the identified risks from methylene chloride and NMP in paint and coating removal are unreasonable. Apart from that proposed determination, EPA has evaluated the potential costs of the proposed approach of (1) prohibiting the manufacture (including import), processing, and distribution in commerce of methylene chloride for all consumer paint and coating removal in the sectors specified in section I.C of this preamble, exempting specific uses critical to national security; (2) prohibiting the commercial use of methylene chloride for paint and coating removal in the specified sectors; (3) requiring any paint and coating removal products containing methylene chloride to be packaged for distribution in commerce in containers with volumes no less than 55 gallons so as to reduce diversion to restricted uses, except for formulations specifically manufactured for the Department of Defense; (4) requiring manufacturers (including importers), processors, and distributors, except for retailers, to provide downstream notification of these prohibitions throughout the supply chain; and (5) requiring associated recordkeeping requirements. EPA has also evaluated the costs of the two co-proposed options for NMP. Under the first option, this includes (1) prohibiting the manufacture (including import), processing, and distribution in commerce of NMP for all paint and coating removal, exempting specific uses critical to national security; (2) prohibiting the commercial use of NMP for paint and coating removal exempting specific uses critical to national security; (3) requiring any paint and coating removal products containing NMP to be packaged for distribution in commerce in containers with a volume no less than 5 gallons; (4) requiring manufacturers (including importers), processors, and distributors of NMP for any use, except for retailers, to provide downstream notification of these prohibitions throughout the supply chain; and (5) requiring associated recordkeeping requirements. Under the second option, this includes: (1) Prohibiting the manufacture, processing, and distribution in commerce of paint and coating removal products containing more than 35 percent NMP by weight except for products used for critical national security uses; (2) Requiring product formulators to test gloves for the product formulations being processed and distributed in commerce for other than exempt critical national security uses to identify specialized gloves that provide protection for users and keep records relevant to these tests; (3) Requiring product formulators to label products with information for consumers about the risks presented by the products and how to reduce these risks during use, including identifying which specialized gloves provide protection against the specific formulation; (4) Requiring product formulators to provide information for commercial users about reducing risks when using the product, via product labels, SDS, and other methods of hazard communication, and to keep records; (5) Prohibiting the commercial use of paint and coating removal products that contain more than 35 percent by weight of NMP, except for critical national security uses; and (6) Requiring commercial users to establish worker protection programs for dermal and respiratory protection, including hazard communication and training, and to require their employees to wear specialized gloves, impervious clothing that covers most of the body, and a respirator with an assigned protection fact (APF) of 10 or compliance with an alternative air exposure limit.
This analysis, which is available in the docket, is discussed in Units VII.A. and XVII.A., and is briefly summarized here.
Costs of the proposed approach and relevant alternate approaches for each chemical are discussed in Units VII.A. for methylene chloride and XVII.A. for NMP. Costs for the whole proposal follow. Costs to users of methylene chloride or NMP for paint and coating removal under the first co-proposed approach for NMP are $2,517,000 to $50,801,000 annualized for 20 years at a discount rate of 3% and $3,114,000 to $50,916,000 at a discount rate of 7%. Costs to users of methylene chloride or NMP for paint and coating removal under the second co-proposed approach for NMP are $114,164,860 to $124,893,000 annualized for 20 years at a discount rate of 3% and $114,658,000 to $125,438,000 at a discount rate of 7%. As described in more detail in the Economic Analysis (Ref. 4) and supplement to the Economic Analysis (Ref. 127), there are estimated to be approximately 13,000 commercial firms and 2,002,000 consumers who use methylene chloride or NMP in paint and coating removal that would be affected; costs per firm and for each household are estimated to include costs of alternative formulations of paint removal products, additional time spent applying or removing paint with alternative methods or substitute products, and other cost factors. For product processors and formulators, the costs of paint and coating removal product reformulations for methylene chloride and NMP under the first co-proposed approach for NMP are estimated to be approximately $17,000 to $34,000 per year (annualized at 3% over 20 years) and $23,000 to $43,000 (annualized at 7% over 20 years). For product processors and formulators, the costs of paint and coating removal product reformulations for methylene
In summary, total costs of the proposed rule under the first co-proposed approach for NMP are estimated to be $2,763,000 to $51,070,000 annualized over 20 years at 3% and $3,361,000 to $51,163,000 annualized over 20 years at 7% (Ref. 4). Total costs of the proposed rule under the second co-proposed approach for NMP are estimated to be $114,196,000 to $124,893,000 annualized over 20 years at 3% and $114,658,000 to $125,438,000 annualized over 20 years at 7% (Ref. 127).
Although methylene chloride in paint and coating removal can cause a wide range of non-cancer adverse effects, cancer, and death and NMP can cause a variety of developmental non-cancer adverse effects, monetized benefits included only the subset of benefits associated with reducing cancer risks or deaths that occur at a known rate among users or bystanders. Methodological limitations prevent EPA from being able to include a quantification or monetary valuation estimate of the other non-cancer benefits at this time, and thus there is not a quantification or monetary valuation estimate for the overall total benefits. Based on the costs and benefits that EPA can estimate, the monetized benefits for the proposed approach range from approximately $14,354,000 to $14,558,000 on an annualized basis over 20 years at 3% and $13,791,000 to $13,919,000 at 7% (Ref. 4). EPA also considered non-monetized benefits that would result from the prevention of non-cancer adverse effects associated with methylene chloride or NMP in paint and coating removal, including nervous system effects, liver toxicity, kidney toxicity, and reproductive effects from exposure to methylene chloride in paint and coating removal; and developmental toxicity, fetal death, fetal body weight reductions, kidney toxicity, liver toxicity, immunotoxicity, and reproductive toxicity from exposure to NMP in paint and coating removal (Refs. 2 and 3).
This action is consistent with the 1995 EPA Policy on Evaluating Health Risks to Children (
In the TSCA Work Plan Risk Assessment for NMP, EPA identified developmental toxicity as the most sensitive endpoint for NMP exposure (
This proposed rule would apply to methylene chloride (CASRN 75-09-2) when used in paint and coating removal except for several specified uses, including as part of commercial furniture refinishing and uses critical to national security.
Methylene chloride is a solvent used in a variety of industrial, commercial and consumer use applications, including (Ref. 2):
Minor uses of methylene chloride include (Ref. 2):
According to the 2012 Chemical Data Reporting (CDR) information, approximately 260 million pounds of
Individuals, including workers, consumers, and the general population, are exposed to methylene chloride from industrial/commercial and consumer sources in different settings such as homes and workplaces, and through multiple routes (inhalation, dermal, and ingestion).
The use assessed by EPA that is the subject of this proposal, methylene chloride in paint and coating removal, represents about 25% of total use of methylene chloride. This is a decrease from the 1980s, when approximately 50% of the total methylene chloride market was composed of paint removal use (Ref. 2). Paint and coating removal is the application of a chemical or use of another method to remove, loosen, or deteriorate any paint, varnish, lacquer, graffiti, surface protectants, or other coatings from a substrate. Substrates can include objects, vehicles, architectural features, or structures. This use is discussed in detail in Unit VI.B.
Although the TSCA Work Plan Chemical risk assessment for methylene chloride focused on the chemical's use in paint and coating removal, EPA announced in December 2016 its designation of methylene chloride as one of the ten chemical substances that will undergo risk evaluation pursuant to section 6(b)(2)(A) of TSCA (81 FR 91927). The Agency is proceeding with this proposed rule addressing methylene chloride in paint and coating removal in accordance with TSCA section 26(l) and asks for comment on its decision to pursue risk management for specific conditions of use of methylene chloride while preparing to conduct a risk evaluation of remaining conditions of use of methylene chloride under TSCA section 6(b).
Methylene chloride is a likely human carcinogen, a neurotoxicant, and acutely lethal. Acute and chronic exposures to methylene chloride are primarily associated with neurological and hepatic effects. The primary target organ of methylene chloride acute toxicity is the brain, and neurological effects result from either direct narcosis or the formation of carbon monoxide. Carbon monoxide is one of the metabolic byproducts of methylene chloride, and reversibly binds to hemoglobin as carboxyhemoglobin. Part of the effect of methylene chloride on the central nervous system comes from the accumulation of carboxyhemoglobin in the blood, which can lead to sensory impairment, dizziness, incapacitation, loss of consciousness, heart failure, and death (Ref. 2). Hemoglobin in the fetus has a higher affinity for carbon monoxide than does adult hemoglobin. Thus, the neurotoxic and cardiovascular effects may be exacerbated in fetuses and in infants with higher residual levels of fetal hemoglobin when exposed to high concentrations of methylene chloride (Ref. 2).
During acute exposures, methylene chloride primarily affects the brain, though effects on lung, liver, and kidney have also been reported in humans following acute exposures. Acute exposures to methylene chloride can be fatal; acute lethality in humans following inhalation exposure is related to central nervous system depressant effects. Effects include loss of consciousness and respiratory depression, resulting in irreversible coma, hypoxia, and eventual death. Acute non-lethal effects in humans are similarly related to the central nervous system and can include incapacitation, loss of consciousness, heart failure, and coma. Other acute non-lethal effects in humans include neurobehavioral deficits measured in psychomotor tasks, such as tests of hand-eye coordination, visual evoked response changes, and auditory vigilance (Ref. 2).
Since 1976, more than 40 deaths have been attributed to methylene chloride when used in paint and coating removal (Ref. 7); in some cases, two or more individuals have died during a single job when air concentrations quickly reached lethal levels, potentially in less than 10 minutes. In other situations, individuals have died when entering rooms or facilities in which paint or coating removal was previously conducted and air concentrations of methylene chloride remained dangerously high (Ref. 7).
Chronic exposures to methylene chloride are associated with cancer and non-cancer hepatic effects. Methylene chloride is likely to be carcinogenic in humans with a mutagenic mode of action. This mutagenic mode of action is supported by the weight of evidence from multiple
Non-cancer effects of chronic exposure to methylene chloride are primarily hepatic; the liver is the most sensitive target for non-cancer toxicity. Lifetime exposure in rats dosed with different concentrations is associated with hepatic vacuolation, degeneration, or liver necrosis. Other non-cancer effects of chronic methylene chloride exposure include renal tubular degeneration in rats and mice, testicular atrophy in mice, and ovarian atrophy in mice (Ref. 2).
Pursuant to TSCA section 6(c), EPA in this unit describes the effects of methylene chloride on the environment and the magnitude of the exposure of the environment to methylene chloride. The proposed unreasonable risk determination, however, is based solely on risks to human health since these risks are the most serious consequence of use of methylene chloride and are sufficient to support this proposed action.
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Ecotoxicity studies for methylene chloride have been conducted in fish, aquatic invertebrates, and aquatic plants. Based on available data, in the methylene chloride risk assessment EPA concluded that methylene chloride has low aquatic toxicity for fish, aquatic invertebrates, and aquatic plants (Ref. 2).
While methylene chloride is moderately persistent, given its low bioaccumulation and low hazard for aquatic toxicity, the magnitude of potential environmental impacts on ecological receptors is judged to be low for the environmental releases associated with methylene chloride in paint removal. This should not be misinterpreted to mean that methylene chloride does not pose environmental
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This section summarizes current state, federal, and international regulations and restrictions on methylene chloride, with a focus on its use in paint and coating removal. None of these actions imposes requirements to the extent necessary so that methylene chloride does not present the unreasonable risk described in this proposed rule.
Methylene chloride has been the subject of U.S. federal regulations by EPA, the Consumer Product Safety Commission (CPSC), the Food and Drug Administration (FDA), and the Occupational Safety and Health Administration (OSHA). EPA and other agencies have taken actions (see below) to address the serious human health risks from specific sources and routes of methylene chloride exposure, but none of these actions sufficiently mitigate the risks that EPA is proposing to address under TSCA section 6(a).
EPA has issued several final rules and notices pertaining to methylene chloride under EPA's various authorities.
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Regulation of methylene chloride by other agencies includes:
• In 1987, CPSC issued a statement of policy explaining that CPSC considers household products containing methylene chloride to be hazardous substances and providing guidance on labeling of such products. Labels of products containing methylene chloride are required to state that inhalation of methylene chloride vapor has caused cancer in certain laboratory animals, and the labels must specify precautions to be taken during use by consumers (52 FR 34698, September 14, 1987). In 2016, CPSC was petitioned by the Halogenated Solvents Industry Alliance to amend the statement of interpretation and enforcement policy regarding labeling of household products containing methylene chloride; CPSC published that petition for public comments (81 FR 60298, September 1, 2016).
• In 1989, FDA banned methylene chloride as an ingredient in all cosmetic products because of its animal carcinogenicity and likely hazard to human health (21 CFR 700.19). Before 1989, methylene chloride had been used in aerosol cosmetic products, such as hairspray (54 FR 27328 (June 29, 1989)).
• OSHA has taken steps to reduce exposure to methylene chloride in occupational settings. In 1997, OSHA lowered the permissible exposure limit (PEL) for methylene chloride from an eight-hour time-weighted average (TWA) of 500 parts per million (ppm) to an eight-hour TWA of 25 ppm and a 15-minute short-term exposure limit
• The Department of Housing and Urban Development (HUD) has prohibited methylene chloride and other hazardous chemicals for use in removing lead-based paint by HUD contractors and anyone receiving grants or engaging in the HOME Program, which was created by the National Affordable Housing Act of 1990 (Ref. 9).
• The National Institute for Occupational Safety and Health (NIOSH) considers methylene chloride a potential occupational carcinogen and currently recommends an exposure limit of the “lowest feasible concentration” of methylene chloride (Ref. 10). NIOSH and OSHA in 2013 issued a hazard alert for bathtub refinishing with methylene chloride, warning that methylene-chloride based products are extremely dangerous and that the best way to prevent exposure is to use products that do not contain methylene chloride (Ref. 11).
Several states have taken actions to reduce or make the public aware of risks from methylene chloride. For example, since 2011 methylene chloride has been prohibited from use in graffiti removal in the District of Columbia and 11 states (California, Connecticut, Delaware, Illinois, Indiana, Maine, Maryland, Michigan, New Jersey, New York, and Rhode Island) (Ref.12). Iowa, Indiana, South Carolina, and other states have established detection monitoring regulations for methylene chloride (567 IAC 113.15, 329 IAC 10-21-15, S.C. Code Regs. 16-107.198, Appx. III). In Alaska, methylene chloride is listed as a carcinogenic hazardous substance (18 AAC 75.341). Methylene chloride is listed on California's Safer Consumer Products regulations candidate list of chemicals that exhibit a hazard trait and are on an authoritative list of either chemical hazard traits or potential exposure concerns (Ref. 13). Methylene chloride is also listed on California's Proposition 65 list of chemicals known to cause cancer, birth defects, or reproductive harm (Ref. 13). In Minnesota, it has been found that methylene chloride may negatively affect the nervous system and cause cancer (Minn. R. 4717.8200, Minn. R. 4717.8100). The state of Washington has listed methylene chloride as a human carcinogen and a chemical of high concern to children (WAC 296-62-07473, WAC 173-334-130). In Pennsylvania, it is listed as an environmental and special hazardous substance (34 Pa. Code XIII, Ch. 323.2(a)).
All states have set PELs identical to the OSHA 25 ppm eight-hour time weighted average (TWA) PEL (79 FR 61384, October 10, 2014), however it is worth noting that California, Oregon, and Washington, which have a state PEL identical to the OSHA PEL, have slightly different requirements than OSHA for medical evaluation, fit testing for respirators, and implementation timelines related to methylene chloride (8 CCR 5502, OAR 437-002-1052, WAC 296-62-07470). The OSHA PEL is considerably higher than the levels at which EPA identified risks of concern for methylene chloride in paint and coating removal and would not be protective for the unreasonable risks identified.
Methylene chloride is also regulated internationally and industrial and commercial sectors in certain other countries have moved to alternatives.
In Canada, the Canadian Minister of the Environment published in 2003 a Notice under Part 4 of the “Canadian Environmental Protection Act, 1999” requiring the preparation and implementation of pollution prevention plans for methylene chloride (Ref. 14). This Notice targets persons involved in the use of methylene chloride for the following activities: Aircraft paint stripping; flexible polyurethane foam blowing; pharmaceuticals and chemical intermediates manufacturing and tablet coating; industrial cleaning; and adhesive formulations. Also in 2003, Environment Canada published a Code of Practice for the reduction of methylene chloride emissions from the use of paint and coating removal products in commercial furniture refinishing and other stripping applications (Ref. 14). This Code of Practice was developed by a multi-stakeholder technical working committee, which consisted of industry representatives (
In the European Union, the European Commission amended its Registration, Evaluation, Authorization, and Restriction of Chemical substances in 2010 to incorporate restrictions for the use of methylene chloride in paint removers. Methylene chloride is banned in the European Union from: (1) Placement on the market in a new product for consumers/professionals after December 2010; (2) placement on the market in any product for consumers/professionals after December 2011; and (3) use by professionals after June 2012. Member States could allow the use of methylene chloride if they have a program to license and train professionals in the following: Awareness; evaluation and management of risks; use of adequate ventilation; and use of appropriate personal protective equipment (Ref. 15). The United Kingdom has issued a derogation to allow professional use of methylene chloride (Ref. 16). In addition, industrial installations using methylene chloride must have effective ventilation, minimize evaporation from tanks, and have measures for safe handling of methylene chloride in tanks, adequate personal protective equipment, and adequate information and training for operators. Paint and coating removers containing methylene chloride in a concentration equal to or greater than 0.1% by weight must include a label: “Restricted to industrial use and to professionals approved in certain EU Member States—verify where use is allowed” (Ref. 15).
In 2013, EPA identified methylene chloride in paint and coating removal as a priority for risk assessment under the TSCA Work Plan. This unit describes the development of the methylene chloride risk assessment and supporting analysis and expert input on the uses that are the subject of this proposed rule. A more detailed discussion of the risks associated with methylene chloride in paint and coating removal can be found in Unit VI.C.1.
In 2012, EPA released the “TSCA Work Plan Chemicals: Methods Document” in which EPA described the process the Agency intended to use to identify potential candidate chemicals for near-term review and assessment under TSCA (Ref. 17). EPA also released the initial list of TSCA Work Plan chemicals identified for further assessment under TSCA as part of its chemical safety program (Ref. 1).
The process for identifying these chemicals for further assessment under TSCA was based on a combination of hazard, exposure, and persistence and bioaccumulation characteristics, and is
EPA finalized a TSCA Work Plan Chemical Risk Assessment for methylene chloride (methylene chloride risk assessment) in August 2014, following the 2013 peer review of the 2012 draft methylene chloride risk assessment. All documents from the 2013 peer review of the draft methylene chloride risk assessment are available in EPA Docket Number EPA-HQ-OPPT-2012-0725. The completed risk assessment is included in that docket.
The methylene chloride risk assessment evaluated health risks to consumers, workers, and bystanders from inhalation exposures to methylene chloride when used in paint and coating removal (Ref. 2). EPA assumes workers and consumers would be adults of both sexes 16 and older, including pregnant women. EPA assumes bystanders in commercial or occupational settings would be worker non-users or adjacent workers, while bystanders in residential settings would be individuals of any age group (
The methylene chloride risk assessment characterized human health effects associated with paint removal with methylene chloride. Based on the physical-chemical properties of methylene chloride and the paint and coating removal use scenarios described in the assessment, EPA assessed inhalation as the predominant route of exposure to methylene chloride during paint removal. Though highly volatile compounds such as methylene chloride may also be absorbed through the skin, EPA does not have the data nor the methodology to assess methylene chloride dermal exposure during paint removal. As a result, the assessment may underestimate total exposures to methylene chloride during paint removal due to this inability to evaluate dermal exposure (Ref. 2).
The methylene chloride risk assessment identified risks of concern following acute (short-term) and chronic exposures for workers and consumers conducting paint removal with methylene chloride, as well as for exposed bystanders, including residents of homes in which paint removal is conducted and worker non-users adjacent to other workers conducting paint removal. The acute risks identified include death; neurological impacts such as coma, incapacitation, loss of consciousness, and dizziness; and liver effects. The chronic risks identified include brain, liver, lung, and hematopoietic cancers and liver damage (Ref. 2).
Margins of exposure (MOEs) were used in this assessment to estimate non-cancer risks for acute exposures (for consumers and workers) and chronic exposures (for workers). The MOE is the point of departure (an approximation of the no-observed adverse effect level (NOAEL)) for a specific health endpoint divided by the exposure concentration for the specific scenario of concern. The benchmark MOE accounts for the total uncertainty in a point of departure, including: (1) The variation in sensitivity among the members of the human population (
Methylene chloride is a likely human carcinogen; cancer risks determine the estimated incremental increased probability of an individual in an exposed population developing cancer over a lifetime following exposure to the chemical under specified use scenarios. Standard cancer benchmarks used by EPA and other regulatory agencies are an increased cancer risk of 1 in 1,000,000 ranging to 1 in 10,000 (
The levels of acute and chronic exposures estimated to present low risk for non-cancer effects also result in low risk for cancer.
The assessment identified the following risks from acute exposures to methylene chloride when used in paint and coating removal (Ref. 2):
• Acute risks of incapacitation, coma, or death in workers exposed to methylene chloride in paint removers when no respiratory protection is used. In some industries with high exposure scenarios, these risks of incapacitation or death are present even when respiratory protection is used.
• Acute risks of neurological effects for most workers. These risks are present even when respiratory protection is used.
• Acute risks of neurological effects for consumer users of methylene chloride as a paint remover.
• Acute risks of neurological effects for bystanders (including children and worker non-users) in the location in which paint removers containing methylene are used by either residents or commercial users. These risks are also present for exposures to methylene chloride in a location after the paint removal work is complete, because methylene chloride can remain in the air in spaces that are enclosed, confined, or lacking ventilation.
Based on the risk assessment scenarios, EPA identified the following non-cancer risks from chronic exposures to methylene chloride in paint and coating removal (Ref. 2):
• Non-cancer risks for liver effects for most workers (including worker non-users, or adjacent workers) in industries conducting paint removal.
• Non-cancer risks occur for most workers (including adjacent workers) when exposed to paint removers containing methylene chloride even when wearing respiratory protection in the exposure scenarios that predominantly demonstrate variations in exposure conditions (
The assessment identified the following cancer risks from chronic exposures to methylene chloride when used in paint removal (Ref. 2):
• Cancer risks for workers (including adjacent workers) exposed to methylene chloride as a paint remover in various industries. These cancer risks include liver cancer, lung cancer, brain cancer, non-Hodgkin lymphoma, and multiple myeloma.
• The greatest cancer risks occur for workers exposed to methylene chloride when used as a paint remover who have no respiratory protection and are exposed for an extended period.
Following the methylene chloride risk assessment, EPA conducted supplemental analyses to inform risk management. These analyses are consistent with the scope of the methylene chloride risk assessment and were based on the peer-reviewed methodology used in the methylene chloride risk assessment. They included identification of baseline and central tendency exposure scenarios, impacts of reduced methylene chloride content in paint removers, addition of local exhaust ventilation (LEV), use of personal protective equipment (PPE), additional consumer exposure scenarios, and methods of monitoring to determine workplace exposures. The results of EPA's analyses are available in this rulemaking docket (Refs. 19, 20, and 21). Prior to promulgation of the final rule, EPA will peer review the “Respirator and Glove Specifications for Workers Exposed to Methylene Chloride in Paint and Coating Removal,” “Supplemental Consumer Exposure and Risk Estimation Technical Report for Methylene Chloride in Paint and Coating Removal”, and “Recommendation for an Existing Chemical Exposure Concentration Limit (ECEL) for Occupational Use of Methylene Chloride and Workplace Air Monitoring Methods for Methylene Chloride” (Refs. 19, 20, 21).
In addition to the consultations described in Unit XXIII.C., EPA engaged in discussions with experts on and users of paint removers (Ref. 22). The purpose of these discussions was to hear from users, academics, manufacturers, and members of the public health community about practices related to paint removal in various industries and by consumers; the importance of methylene chloride and NMP in paint removal; frequently-used substitute chemicals or alternative paint removal methods; engineering control measures and personal protective equipment currently in use or feasibly adoptable for paint removal; and other risk reduction approaches that may have already been adopted or considered for commercial or consumer paint removal. Informed by these discussions and by industry and other governmental research, EPA has concluded that alternatives to methylene chloride and NMP are available for nearly all paint removal uses.
EPA is continuing to gather information, to the extent practicable, regarding the availability of alternatives to methylene chloride for furniture refinishing. EPA plans to continue to engage stakeholders to identify what methods may be available as alternatives to methylene chloride. After collecting the information, EPA expects to address this use of methylene chloride so that the substance no longer poses an unreasonable risk and intends to issue separately a proposal in the future. Also see Unit XI.
Under TSCA section 6(a), if the Administrator determines that a chemical substance presents an unreasonable risk of injury to health or the environment, without consideration of costs or other non-risk factors, including an unreasonable risk to a potentially exposed or susceptible subpopulation identified as relevant to the Agency's risk evaluation, under the conditions of use, EPA must by rule apply one or more requirements to the extent necessary so that the chemical substance no longer presents such risk.
TSCA section 6(a) requirements can include one or more, or a combination of, the following actions:
• Prohibit or otherwise restrict the manufacturing, processing, or distribution in commerce of such substances (§ 6(a)(1)).
• Prohibit or otherwise restrict the manufacturing, processing, or distribution in commerce of such substances for particular uses or for uses in excess of a specified concentration (§ 6(a)(2)).
• Require minimum warning labels and instructions (§ 6(a)(3)).
• Require recordkeeping or testing (§ 6(a)(4)).
• Prohibit or regulate any manner or method of commercial use (§ 6(a)(5)).
• Prohibit or otherwise regulate any manner or method of disposal (§ 6(a)(6)).
• Direct manufacturers and processors to give notice of the determination to distributors and the public and replace or repurchase substances (§ 6(a)(7)).
EPA analyzed a wide range of regulatory options under section 6(a) for each use in order to select the proposed regulatory approach (Refs. 23 and 24). For each use, EPA considered whether a regulatory option (or combination of options) would address the identified unreasonable risks so that the chemical substance no longer presents such risks. EPA found that an option that could reduce exposures such that they would achieve the benchmark MOE for the most sensitive non-cancer endpoint would address the risk of concern for other non-cancer endpoints. Additionally, EPA's assessments for methylene chloride in paint and coating removal found that exposures that meet the benchmark MOE for the most sensitive non-cancer endpoint would also not result in cancer risks of concern.
After the technical analysis, which represents EPA's assessment of the potential for the regulatory options to achieve risk benchmarks based on analysis of exposure scenarios, EPA then considered how reliably the regulatory options would actually reach these benchmarks. For the purposes of this proposal, EPA found that an option addressed the risk so that it was no longer unreasonable if the option could achieve the benchmark MOE or cancer benchmark for the most sensitive endpoint. In considering whether a regulatory option would ensure the chemical no longer presents the unreasonable risk, the Agency considered whether the option could be realistically implemented or whether there were practical limitations on how well the option would mitigate the risks
TSCA section 6(c)(2) requires EPA to consider and publish a statement based on reasonably available information with respect to the:
• Health effects of the chemical substance or mixture (in this case, methylene chloride) and the magnitude of human exposure to methylene chloride;
• Environmental effects of methylene chloride and the magnitude of exposure of the environment to methylene chloride;
• Benefits of methylene chloride for various uses;
• Reasonably ascertainable economic consequences of the rule, including: The likely effect of the rule on the national economy, small business, technological innovation, the environment, and public health; the costs and benefits of the proposed and final rule and of the one or more primary alternatives that EPA considered; and the cost-effectiveness of the proposed rule and of the one or more primary alternatives that EPA considered.
In addition, in selecting among prohibitions and other restrictions available under TSCA section 6(a), EPA must factor in, to the extent practicable, these considerations. Further, in deciding whether to prohibit or restrict in a manner that substantially prevents a specific condition of use of a chemical substance or mixture, and in setting an appropriate transition period for such action, EPA must also consider, to the extent practicable, whether technically and economically feasible alternatives that benefit health or the environment will be reasonably available as a substitute when the proposed prohibition or other restriction takes effect.
EPA's analysis of the health effects and magnitude of exposure to methylene chloride can be found in Units IV.B., VI.C.1. and VI.D., which discuss the methylene chloride risk assessment and EPA's regulatory assessment of methylene chloride in paint and coating removal. A discussion of the environmental effects of methylene chloride is in Unit II.D.
With respect to the costs and benefits of this proposal and the alternatives EPA considered, as well as the impacts on small businesses, the full analysis is presented in the Economic Analysis (Ref. 4). To the extent information was reasonably available, EPA considered the benefits realized from risk reductions (including monetized benefits, non-monetized quantified benefits, and qualitative benefits), offsets to benefits from countervailing risks (
EPA considered the estimated costs to regulated entities as well as the cost to administer and enforce the options. For example, an option that includes use of a respirator would include inspections to evaluate compliance with all elements of a respiratory protection program (Ref. 25). In understanding the burden, EPA took into account reasonably available information about the functionality and performance efficacy of the regulatory options and the ability to implement the use of chemical substitutes or other alternatives. Reasonably available information included the existence of other Federal, state, or international regulatory requirements associated with each of the regulatory options as well as the commercial history for the options. A discussion of the costs EPA considered and a discussion of the cost-effectiveness of the proposal and the primary alternate regulatory options that EPA considered is in Units VI.F. and VII.A. In addition, a discussion of the impacts on small businesses is in Unit XXIII. and in the Initial Regulatory Flexibility Analysis and Report from the Small Business Advocacy Review Panel (Refs. 26 and 27).
With respect to the anticipated effects of this proposal on the national economy, EPA considered the number of businesses and workers that would be affected and the costs and benefits to those businesses and workers. In addition, EPA considered the employment impacts of this proposal, as discussed in section 9.2 of the Economic Analysis (Ref. 4). EPA found that the direction of change in employment is uncertain, but EPA expects the short term and longer-term employment effects to be small.
The benefits of methylene chloride in paint and coating removal are discussed in Unit VI.B., along with the availability of alternatives. The dates that the proposed restrictions would take effect are discussed in Unit X. The availability of alternatives to methylene chloride in paint and coating removal on those dates is discussed in Unit VI.E.
Finally, with respect to this proposal's effect on technological innovation, EPA expects this action to spur innovation, not hinder it. An impending prohibition on this use of methylene chloride is likely to increase demand for alternatives, which EPA expects would result in the development of new alternatives. See also section 9.3 in the Economic Analysis (Ref. 4).
EPA analyzed a wide range of regulatory options under TSCA section 6(a). There are a range of regulatory options under TSCA; only those pertaining to these risks were evaluated in detail. An overview of the regulatory options not evaluated in detail follows.
First, EPA reasoned that the TSCA section 6(a)(1) regulatory option to prohibit the manufacture, processing or distribution in commerce of methylene chloride or limit the amount of methylene chloride which may be manufactured, processed or distributed in commerce is not germane because EPA is not proposing to ban or limit the manufacture, processing or distribution in commerce of methylene chloride for uses other than paint and coating removal.
In addition, EPA determined that the TSCA section 6(a)(6) regulatory option to prohibit or otherwise regulate any manner or method of disposal of the chemical is not applicable since EPA did not assess risks associated with methylene chloride disposal.
Another option EPA evaluated would require warning labels and instructions on paint and coating removal products containing methylene chloride, pursuant to TSCA section 6(a)(3) (Ref. 28). However, EPA reasoned that warning labels and instructions alone could not significantly mitigate the unreasonable risks presented by methylene chloride in paint and coating removal. EPA based its reasoning on an analysis of 48 relevant studies or meta-analyses, which found that consumers and professionals do not consistently pay attention to labels for hazardous substances; consumers, particularly those with lower literacy levels, often do not understand label information; consumers and professional users often base a decision to follow label information on previous experience and perceptions of risk; even if consumers
These conclusions are based on the weight-of-evidence analysis that EPA conducted of the available literature on the efficacy of labeling and warnings. This analysis indicates that a label's effectiveness at changing user behavior to comply with instructions and warnings depends on the attributes of the label and the user, and how those interact during multiple human information processing stages, including attention, comprehension, judgement, and action (Ref. 28).
Numerous studies have found that product labels and warnings are effective to some degree. However, the extent of the effectiveness has varied considerably across studies and some of the perceived effectiveness may not reflect real-world situations. This is because interactions among labels, users, the environment, and other factors greatly influence the degree of a label's effectiveness at changing user behavior (Ref. 28). In addition, while some studies have shown that certain components of labels and warnings tend to have some influence, it is less clear how effective labels and warnings are likely to be over time, as users become habituated to both the labels and the products.
Presenting information about methylene chloride on a product label would not adequately address the unreasonable risk presented by this use of this chemical because the nature of the information the user would need to read, understand, and act upon is extremely complex. When the precaution or information is simple or uncomplicated (
Any use of labels to promote or regulate safe product use should be considered in the context of other potential risk reduction techniques. As highlighted by a 2014 expert report for the Consumer Product Safety Commission (CPSC), “safety and warnings literature consistently identify warnings as a less effective hazard-control measure than either designing out a hazard or guarding the consumer from a hazard. Warnings are less effective primarily because they do not prevent consumer exposure to the hazard. Instead, they rely on persuading consumers to alter their behavior in some way to avoid the hazard” (Ref. 29). Specifically regarding methylene chloride, effective personal protection resulting in risk reduction would require this altered behavior to include the appropriate use of a supplied-air respirator. Consumer users are particularly unlikely to acquire and correctly use such an apparatus in response to reading a warning label (Ref. 19). Any labeling aiming to reduce risks to consumer or commercial users of these products would need to sufficiently and clearly explain the importance of the supplied-air respirator, and would still leave the user with the problem of obtaining and properly using the supplied-air respirator, which is a particularly expensive piece of equipment (Ref. 4). Further, for the effective use of a respirator, particularly an air-supplied respirator, there would need to be fit-testing of the respirator and training in its use.
While EPA reasons that revised labeling will not address the unreasonable risk presented by methylene chloride in paint and coating removal, as a result of recommendations from the Small Business Advocacy Review (SBAR) Panel to solicit information from the public about the potential efficacy of labeling, following advice from the small entity representatives who participated in the SBAR process (Ref. 27), EPA requests public comments on enhanced labeling requirements for consumer paint and coating removal products containing methylene chloride as a method for reducing exposure to methylene chloride in these products. More information about the SBAR process, the Panel recommendations, and advice from small businesses related to this proposal are in Unit XXIII. and in the Panel Report (Ref. 27).
While this regulatory option alone would not adequately address the unreasonable risks, EPA recognizes that the TSCA section 6(a)(3) warnings and instruction requirement can be an important component of an approach that addresses unreasonable risks associated with a specific use prohibition. EPA has included a downstream notification requirement as part of the proposed rule to ensure that users would be made aware of the prohibition on the use of methylene chloride in paint and coating removal.
An additional regulatory option receiving limited evaluation was a training and certification program for commercial paint and coating removers, similar to the certification process required under EPA's Lead-Based Paint Renovation, Repair, and Painting Rule (73 FR 21692, April 22, 2008). This option was recommended by the small entity representatives as part of the SBAR process (Ref. 27). EPA considered this option as an approach to reducing risks from methylene chloride in paint and coating removal. However, unlike the process for training and certification of commercial workers required under the Lead-Based Paint Renovation, Repair, and Painting Rule, effective risk reduction from commercial use of methylene chloride for paint and coating removal would require additional regulation of distributors of these products. When considering this approach, given the Agency's experience with the training and certification program under the Lead-Based Paint Renovation, Repair, and Painting Rule, EPA viewed the costs and challenges involved in regulating distributors and ensuring that only trained and certified commercial users are able to access these paint and coating removal products as a significant limitation for this approach. EPA seeks public comment on the feasibility of such a program and its potential to reduce risks of exposure to methylene chloride for workers and bystanders so that those risks are no longer unreasonable.
This unit describes the current use of methylene chloride in paint and coating removal, the unreasonable risks presented by this use, and how EPA identified which regulatory options reduce the risks so that they are no longer unreasonable.
The methylene chloride uses that are the focus of this action are:
1. Any consumer use of methylene chloride for paint and coating removal, and
2. Any commercial use of methylene chloride for paint and coating removal except for commercial furniture refinishing, which EPA intends to address in a separate proposal, as described in Unit XI. While EPA proposes to determine that the identified risks from methylene chloride in commercial furniture refinishing are unreasonable, EPA plans to continue public engagement before proposing regulations for methylene chloride in this industry. Additional information is in Unit XI. This is one of the recommendations from SBAR Panel (Ref. 27),
EPA proposes to exempt specific paint and coating removal with methylene chloride from critical corrosion-sensitive components of military aviation and vessels, which the Department of Defense identified as critical for national security purposes. The details of this national security use are in Unit VIII.
Methylene chloride has been used for decades in paint and coating removal in products intended for both commercial and consumer uses. Paint and coating removal, also referred to as paint stripping, is the process of removing paint or other coatings from a surface. Coatings can include paint, varnish, lacquer, graffiti, polyurethane, or other coatings sometimes referred to as high-performance or specialty coatings; surfaces may be the interior or exterior of buildings, structures, vehicles, aircraft, marine craft, furniture, or other objects. Paint and coating removal can be conducted in occupational or consumer settings. These surfaces, or substrates, include a variety of materials, such as wood, metals, plastics, concrete, and fiberglass. A variety of industries include paint and coating removal in their business activities, including professionals involved in renovations, bathtub refinishing, automotive refinishing, furniture refinishing, art restoration and conservation, aircraft repair, marine craft repair, and graffiti removers (Ref. 3).
Paint and coatings can be removed by chemical, mechanical, or thermal means. Chemical paint removers can include solvents, such as methylene chloride or NMP, caustic chemicals, or other categories of chemicals. Solvents aid in removing paints and coatings by permeating the top of the coating and dissolving the bond between the coating and the substrate (Ref. 30). Following the application of the chemical paint remover, the coating can be more easily peeled, scraped, or mechanically removed from the substrate. Techniques for applying the paint remover chemical include manual coating or brushing, tank dipping, flow-over systems, and spray applications (manually or through automation). Pouring, wiping and rolling are also possible application techniques and application can be manual or automated (Ref. 3).
In the construction trades, methylene chloride is used to remove paint and coatings from walls, trim, architectural features, patios or decks, ceilings, bathtubs, floors, etc. to prepare them for new coatings during residential and commercial building renovation. Methylene chloride is typically applied to the surface using a hand-held brush. It is then left on to soften the old coating (Ref. 4). Once curing has occurred, the old coating is scraped or brushed off and the surface is cleaned. For bathtub refinishing, methylene chloride is poured and brushed onto a bathtub using a paintbrush and then scraped from the bathtub after leaving the remover to cure for 20 to 30 minutes (Ref. 4). Consumers use methylene chloride in similar ways.
Commercially, methylene chloride is also used to remove paint and coatings from civilian aircraft, marine craft, cars, trucks, railcars, tankers, storage vessels, and other vehicles or their component parts to prepare for new coatings. Similar to the constructions trades, applications in the transportation industry tend to be brushed on and scraped off. More information on specific techniques for commercial paint removal and by consumers are in the methylene chloride risk assessment and supplemental materials (Refs. 2, 19, 20, 21, and 31).
Though many users are switching to substitutes and alternative methods, methylene chloride use persists because it is readily available and works quickly on nearly all coatings without damaging most substrates. In addition, some users may prefer methylene chloride because it is less flammable than some other solvents. However, it is extremely volatile, has strong fumes, and evaporates quickly so that it must be reapplied for each layer of paint or coating to be removed. Additionally, paint and coating removal products formulated with methylene chloride tend to contain high concentrations of co-solvents that are flammable, reducing one perceived advantage of methylene chloride products.
Chemical products for paint and coating removal are used across several industries as well as by consumers or hobbyists, and products intended for one type of use—such as aircraft renovation—have been used in other situations, such as bathtub refinishing (Refs. 11, 32, and 33). Products intended for one specific type of paint removal project can be easily used in a different setting. Additionally, consumers can easily use products intended for or marketed to professional users since paint removal products are readily available at big box and local hardware stores, as well as paint specialty stores.
EPA has identified 59 different products for paint and coating removal that contain methylene chloride, formulated by 10 different firms. This is approximately 54% of the total number of paint and coating removal products EPA identified (109 products) (Ref. 34). Commercial uses of these products include automotive refinishing, furniture refinishing, art conservation and restoration, pleasure craft building and repair, aircraft paint removal, graffiti removal, bathtub refinishing, and renovations in residences or other buildings. Though the number of workers and consumers exposed to methylene chloride during paint and coating removal is uncertain, EPA has several estimates based on industry data and information gathered for rulemakings promulgated previously under other statutes, such as the Clean Air Act, intended to address different risks. As described in more detail in the Economic Analysis, EPA estimates that 32,600 workers annually are exposed to methylene chloride during paint and coating removal activities (Ref. 4). Of them, 15,000 are estimated to be exposed during furniture refinishing; 17,600 are estimated to be exposed during other commercial paint and coating removal processes (Ref. 4).
Consumer use of methylene chloride in paint and coating removal is similar to commercial use but is carried out by do-it-yourself (DIY) consumers and occurs in consumer settings, such as homes, workshops, basements, garages,
In this unit, EPA explains how it evaluated whether the regulatory options considered would address the risks presented by this use as necessary so that the risks are no longer unreasonable. First, EPA characterizes the unreasonable risks associated with the current use of methylene chloride in paint and coating removal. Then, EPA describes its initial analysis of which regulatory options have the potential to achieve standard non-cancer and cancer benchmarks. The levels of acute and chronic exposures estimated to present no risks of concern for non-cancer effects also result in no risks of concern for cancer. Lastly, this section evaluates how well those regulatory options would address the unreasonable risk in practice.
1.
Similarly, foreign-born workers are overrepresented in the construction trades. In the U.S. population overall, 17% of workers in all industries are foreign-born, whereas in the construction trades, 28% of workers are foreign-born (Ref. 4). As a result, they may primarily speak a language other than English and could be characterized as having limited English proficiency. Under Executive Order 13166, EPA and other agencies are charged with examining and identifying the needs of individuals with limited English proficiency (65 FR 50121, August 11, 2000). Like Hispanic workers, foreign-born workers are disproportionately at risk of exposure to methylene chloride when used in paint and coating removal in the construction trades.
EPA's identification of the current disproportionate risks of methylene chloride exposure faced by Hispanic and foreign-born workers in the construction trades is part of the analysis conducted as part of EPA's efforts towards environmental justice. Executive Order 12898 (59 FR 7629, February 16, 1994) establishes federal executive policy on environmental justice; EPA's compliance with this executive order is detailed in Unit XXIII.
Although EPA anticipates that most consumers conducting paint and coating removal with methylene chloride would likely exclude children from the room in which the project was being carried out, it is unclear if they would exclude them from the house overall during and after the product application. Additionally, if the project involved removing the coating from a bathtub, households with only one bathroom would present challenges for bystander exclusion for several hours. As a result, children present in homes where paint and coating removal is being conducted, by family members or by professionals, face acute risks of central nervous system impacts.
EPA was not able to model scenarios in which paint and coating removal was conducted in an apartment building, hotel, or other residence or place in which children may be present other than single-family homes. However, the findings related to bystander exposure suggest risks for children and other
For exposures in commercial settings, EPA assessed acute risks and chronic risks, including cancer risks. For acute risks, EPA assessed four occupational scenarios based on eight-hour TWA exposure concentrations and different variations in exposure conditions, such as presence or absence of respirators and the protection factor of any respirator used. For each commercial use evaluated in the assessment, EPA modeled scenarios using assumed parameters similar to typical use conditions within those industries, such as whether work was conducted indoors or outdoors and what quantity of methylene chloride was estimated to be used. For these acute workplace estimates, the acute methylene chloride exposure concentration evaluated for risk was the eight-hour TWA air concentration in milligrams per cubic meter reported for the various relevant industries. In the risk assessment, EPA assumed that some workers could be rotating tasks and not necessarily carrying out paint and coating removal tasks using methylene chloride on a daily basis. This type of exposure was characterized as acute in this assessment because the worker's body was estimated to have sufficient time to remove methylene chloride and its metabolites before the next encounter with methylene chloride during paint and coating removal (Ref. 2).
For chronic exposure scenarios, EPA varied not only the parameters described above, but also the number of working days exposed to methylene chloride during paint and coating removal (ranging from 125 to 250 days per year) and exposed working years (varying the number of years the worker was assumed to be exposed) (Ref. 2). Overall, EPA evaluated cancer and chronic non-cancer risks for 16 occupational scenarios.
Worker inhalation exposure data were taken from peer-reviewed literature sources, as cited in the risk assessment (Ref. 2). These data sources often did not indicate whether monitored exposure concentrations were for occupational users or bystanders. Therefore, EPA assumed that these exposure concentrations were for a combination of users and bystanders. EPA evaluated scenarios both with and without respirator use and a range of respirator assigned protection factors (APFs), but did not estimate the overall frequency of respirator use because supporting data on the prevalence of respirator use for these commercial uses was unavailable. Similarly, EPA made assumptions about the exposure frequencies and working years because data were not found to characterize these parameters, and estimated various exposure frequencies (125 and 250 days per year) and working years (20 and 40 years). Thus, EPA evaluated occupational risks by developing hypothetical scenarios under the varying exposure conditions described previously (Ref. 2).
It is important to note that EPA relied on monitoring data for these occupational exposure estimates. Many air concentrations reported and used in the risk assessment exceeded the current OSHA PEL of 25 ppm; in some industries where paint and coating removal was conducted by immersion in tanks or vats of methylene chloride, air concentrations were measured at above 7,000 milligrams per cubic meter, or 2,016 ppm. Even in industries with lower expected exposures, air concentrations frequently were reported in excess of 250 milligrams per cubic meter, or 72 ppm, such as during graffiti removal and automotive refinishing (Ref. 2). The risks associated with these dramatically high air concentrations are discussed in Unit VI.C.1.e.
For consumer and residential bystander exposures, EPA assessed exposure scenarios under which the individual user was presumed to work on one of several types of paint and coating removal projects (coffee table, chest of drawers, or bathtub). These scenarios take into account that consumers do not reliably use personal protective equipment (respirators) or have access to engineering controls (
EPA developed seven consumer exposure scenarios for the assessment. Similar to the worker exposure assessment, the following factors were considered in developing the exposure scenarios (Ref. 2):
• The type of application (
• The location where the product is applied, which relates to exposure factors such as the room volume and its air exchange rate with outdoor air;
• The house volume and air exchange rate, for reasons similar to those for the product use location; and
• Precautionary behaviors such as opening windows in the application room, the user leaving the application room during the wait period, related changes to the air exchange rates, and the proximity of the user to the source of methylene chloride emissions.
In the absence of representative air monitoring data for consumer users and residential bystanders using paint and coating removal products containing methylene chloride, EPA used the Multi-Chamber Concentration and Exposure Model to estimate consumer and bystander inhalation exposure concentrations (Ref. 2).
EPA's estimates of the exposures during paint and coating removal with methylene chloride experienced by commercial users and bystanders and consumer users and bystanders were used to assess the risks of this use of methylene chloride. The full exposure estimates and risk findings are described in the methylene chloride risk assessment; risk findings are also summarized in Unit VI.C.1.e.
In addition to estimating likely exposures under current use patterns (baseline exposures), for both commercial and consumer users, EPA assessed a number of exposure scenarios associated with risk reduction options in order to identify variations in methylene chloride exposure during paint and coating removal. All variations in the scenarios were applied to industry-specific exposure inputs and evaluated with exposure parameters that were modified to reflect either a reasonable worst-case scenario (also called the baseline) or a scenario in which exposures were moderated by several factors (also called the central tendency scenario). The risk reduction options that varied between scenarios included engineering controls, use of PPE, and well as combinations of these options (Ref. 19).
• Under the PPE risk reduction option exposure scenarios, EPA evaluated respirators with APF 10 to 10,000 for acute and chronic risks, including cancer risks.
• For the engineering controls risk reduction option exposure scenarios, EPA evaluated exposures using local exhaust ventilation (LEV) to improve ventilation near the activity of workers (using furniture refinishing operations as a model), with an assumed 90% reduction in exposure levels.
Overall, EPA evaluated dozens of distinct exposure scenarios for commercial paint and coating removal with methylene chloride; exposure reductions for consumer users are expected to be similar to the acute risk evaluations for professional contractors or workers in furniture refinishing operations, since these commercial activities are most similar to the types of projects in which consumers would engage (Refs. 19 and 20).
EPA assessed acute risks for central nervous system effects from inhalation for all consumer, occupational, and bystander exposure scenarios of paint and coating removal with methylene chloride. For consumers, EPA identified risks of concern for all scenarios, with some consumer scenarios demonstrating risks within the first hour of product use when paint and coating removal was conducted indoors (such as in a workshop or bathroom), regardless of whether the product formulation was brush or spray. Risks for incapacitating nervous system effects were found in some indoor scenarios (such as in a bathroom) within four hours of product use. MOEs for consumer acute risks from exposures of one hour or less ranged from 1.6 to 0.2; this equates to estimated exposures that are between six and 50 times greater than those that are expected to produce no risks of concern (Ref. 2).
For residential bystanders, EPA identified risks of concern for all scenarios, even assuming that any bystander in the house was not in the room where the paint and coating removal occurred. Depending on the parameters of the scenario, MOEs for acute risks ranged from 2.9 to 0.5, or between three and 20 times greater than those that are expected to produce no risks of concern (Ref. 2).
For commercial users, the occupational scenarios in which acute risks for central nervous system effects were identified included nearly all occupational scenarios, irrespective of the absence or presence of respirators, and in both the central-tendency and worst-case assumed air concentrations of methylene chloride. Additionally, EPA found acute risks for incapacitating central nervous system effects for workers who had no respiratory protection in most industries, or with respirators with APFs of 10 or 25 in the industries with highest likely exposures, such as professional contractors, aircraft refinishers, and workers using immersion methods for paint and coating removal in several industries. MOEs for acute risks ranged from an average of 0.11 (automotive refinishing) to 0.037 (graffiti removal), with a lowest end of 0.0063 (workplaces engaged in paint and coating removal using immersion methods). In general, these workplaces are estimated to present exposure levels between 100 times to greater than 1,000 times more than those that are of concern. Not only workers, but also occupational bystanders, or workers engaged in tasks other than paint and coating removal, would be at acute risk for central nervous system effects (Ref. 2). Therefore, EPA's proposed determination is that acute methylene chloride exposures during paint and coating removal present unreasonable risks.
In the risk assessment, EPA also assessed risks of chronic exposure to methylene chloride during paint and coating removal by commercial users and occupational bystanders (Ref. 2). The methylene chloride risk assessment used liver toxicity as the critical endpoint for chronic exposure. EPA assessed risks for liver toxicity for occupational and bystander exposure scenarios of paint and coating removal with methylene chloride.
Workers and occupational bystanders in most industries evaluated were identified as at risk for non-cancer liver toxicity as a result of chronic exposure to methylene chloride during paint and coating removal under typical exposure scenarios. When workers were exposed repeatedly at facilities they were at risk, even for scenarios evaluated with workers wearing respiratory protection with APF 50 (Ref. 2). The concern is for workers engaging in long-term use of the product (
For commercial users and bystanders, EPA also assessed cancer risks as a result of chronic exposure to methylene chloride in paint and coating removal. Workers and occupational bystanders showed were estimated to have an excess cancer risk greater than 1 in 1,000,000 for all of the commercial scenarios evaluated if exposed to paint and coating removal with methylene chloride for 250 days per year for 40 years with no respiratory protection. Depending on industry, cancer risks ranged from 6 in 10,000 (graffiti removal) to 2.5 in 1,000 (aircraft refinishing), with a maximum of 4 in 1,000 (workplaces using immersion methods, such as dip tanks for miscellaneous metal items). Workers in all industries showed a relative reduction in cancer risks when estimated to be working for 125 days per year for 20 years with a respirator with APF 50, with cancer risks in some industries estimated to be below benchmark levels in these scenarios. Therefore, EPA's proposed determination is that chronic methylene chloride exposures during paint and coating removal present unreasonable risks.
The SBAR Panel convened in support of this action heard from several SERs who expressed concerns about the underlying methylene chloride risk assessment (Ref. 27). Many of the concerns expressed by these SERs were already expressed in the public comments and the peer review
2.
The results of EPA's assessment of consumer uses, exposures, and risks indicate that regulatory options for consumer uses such as reducing the concentration of methylene chloride or advising the use of respirators could not achieve the target MOE benchmarks for acute exposures (benchmark MOE is 10). Similarly, the results of EPA's evaluation indicate that regulatory options for occupational exposures such as reducing the concentration of methylene chloride in products used for paint and coating removal and using local exhaust ventilation to improve ventilation, in the absence of PPE, could not achieve the target MOE benchmarks (benchmark MOE is 10) for non-cancer endpoints for acute and chronic exposures and common cancer risk benchmarks for chronic exposures (Refs. 19 and 20). The results also demonstrate that all risk reduction options meeting the benchmark MOEs and common cancer benchmarks for methylene chloride in paint and coating removal require the use of a respirator, whether used alone or in conjunction with additional levels of protection or the use of an air exposure limit. Therefore, EPA found the options of setting a maximum concentration of methylene chloride in products under TSCA section 6(a)(2) unable to reduce exposures to the risk benchmarks. Options found not to meet the risk benchmarks and, for the purposes of this proposal, found unable to address the unreasonable risk, are documented in EPA's supplemental technical reports on methylene chloride in paint and coating removal (Refs. 19 and 20).
3.
The options that had the potential to address the unreasonable risks presented by methylene chloride when used for paint and coating removal by consumers, or within the commercial uses proposed for regulation, or for both consumer and these commercial uses included:
a. A supply-chain approach, which would include prohibiting the manufacturing (including import), processing, and distribution in commerce of methylene chloride for paint and coating removal under TSCA section 6(a)(2) for the consumer and commercial uses proposed for regulation; prohibiting the commercial use of methylene chloride in paint and coating removal under TSCA section 6(a)(5) for the commercial uses proposed for regulation; requiring that all paint and coating removers containing methylene chloride be distributed in volumes no less than 55-gallon containers under TSCA section 6(a)(2); requiring downstream notification when distributing methylene chloride under TSCA section 6(a)(3); and limited recordkeeping under TSCA section 6(a)(4);
b. Variations on such an approach, such as just prohibiting the manufacturing, processing, and distribution in commerce of methylene chloride for paint and coating removal under TSCA section 6(a)(2) for consumer use and for the commercial uses proposed for regulation or just prohibiting the commercial use of methylene chloride for paint and coating removal under TSCA section 6(a)(5) for the commercial uses proposed for regulation;
c. Additional variations on such an approach, such as prohibiting the manufacturing, processing, and distribution in commerce of methylene chloride for paint and coating removal under TSCA section 6(a)(2) for the consumer and commercial uses proposed for regulation and requiring downstream notification (
d. Requiring a respiratory protection program, including PPE (a supplied-air respirator with APF 1,000 or 10,000) with an alternative air exposure limit of 1 part per million (ppm) achieved through engineering controls or ventilation alone or in combination with a supplied-air respirator at a lower APF, in commercial facilities where methylene chloride is used for paint and coating removal under TSCA section 6(a)(5) for the commercial uses proposed for regulation.
A discussion of the regulatory options that could potentially reach the risk benchmarks for consumer use, commercial uses proposed for regulation, or both is in this unit, along with EPA's evaluation of how well those regulatory options would address the unreasonable risks in practice.
As discussed in Unit VI.C.1., the risks for exposure to consumers, workers, and bystanders for methylene chloride in paint and coating removal vary. The MOEs for non-cancer endpoints range from 50 to 1,000 times below the benchmark MOEs for central nervous system effects (the acute health impact) or liver toxicity (the chronic health impact). Similarly, the increased risk of cancer (including brain, liver, and lung cancer) in some industries is 100 to nearly 1,000 times greater than common cancer benchmarks (Ref. 2). Under this proposed option, exposures to methylene chloride during paint and coating removal would be completely eliminated. As a result, non-cancer and cancer risks would be eliminated.
The proposed approach would reduce the risks to workers, consumers, and bystanders from methylene chloride in paint and coating removal for the uses proposed for regulation so that those risks are no longer unreasonable. Prohibiting the manufacturing, processing and distribution in commerce of methylene chloride for paint and coating removal for the uses proposed for regulation would minimize the overall availability of methylene chloride for paint and coating removal for these uses. Importantly, this proposed regulation is protective of consumer users. EPA cannot regulate consumer use under TSCA section 6(a)(5). The prohibition of the commercial use of methylene chloride for paint and coating removal in the uses proposed for regulation would reduce commercial demand for methylene chloride paint and coating removal products, reduce the likelihood that other types of products formulated with methylene chloride would be used for paint and coating removal, and significantly reduce the potential for consumer use of commercial paint and coating removal products containing methylene chloride. Workers and occupational bystanders would not be exposed to methylene chloride for paint and coating removal in the uses proposed for regulation, and the risk to consumers and residential bystanders would be minimized because commercial paint and coating removal products containing methylene chloride would not be available in volumes smaller than 55-gallon containers. This large volume requirement would ensure that consumers, who typically buy products in much smaller volumes, would not be able to easily divert products from the supply chain intended for commercial furniture refinishing or uses proposed to be critical to national security. EPA seeks comment on the impact to commercial furniture refinishers of a requirement that paint and coating removal products containing methylene chloride be sold only in 55-gallon containers for commercial paint and coating removal. This request for comment is one of the recommendations of the SBAR Panel, described earlier in Unit V.C. and in more detail in Unit XXIII.C. (Ref. 27). Based on the recommendations from the SBAR Panel, EPA is requesting comment on whether the rule should allow paint and coating removal products containing methylene chloride to be sold in 30-gallon containers, rather than limiting the volume to 55-gallon containers. EPA is also requesting comment on the feasibility of implementing appropriate industrial hygiene controls associated with 30- or 55-gallon containers in order to minimize potential disruptive impacts to those industrial processes where technically feasible substitutes are currently unavailable. The downstream notification of these restrictions ensures that processors and distributors are aware of the manufacturing, processing, distribution in commerce and use restrictions for methylene chloride in paint and coating removal, and enhances the likelihood that the risks associated with this use of methylene chloride are addressed throughout the supply chain. Downstream notification also streamlines compliance and enhances enforcement, since compliance is improved when rules are clearly and simply communicated (Ref. 39). This integrated supply chain proposed approach mitigates the risk to consumers and commercial workers and occupational bystanders in the uses proposed for regulation from methylene chloride in paint and coating removal.
Without downstream notification, unsophisticated purchasers in particular are likely to be unfamiliar with the prohibitions regarding this use and mistakenly use methylene chloride for paint and coating removal, thereby exposing themselves and bystanders to unreasonable risks. Thus, under these variations, EPA anticipates that many users would not actually realize the risk benchmarks. Therefore, these variations fail to protect against the unreasonable risks.
Another regulatory option that EPA considered was to prohibit only the commercial use of methylene chloride for paint and coating removal in the uses proposed for regulation. This approach would reduce both non-cancer and cancer risks for commercial settings, but it would not reduce risks to consumers so that they are no longer unreasonable. By prohibiting use in the commercial sector alone, without a prohibition on the manufacture, processing, and distribution in commerce of paint and coating removal products containing methylene chloride for consumer and commercial use in the uses proposed for regulation, this approach would not address consumer risks as distributors of paint and coating removal products containing methylene chloride could continue to distribute to consumers methylene chloride marked as a paint and coating remover, including products labeled and marketed as “professional strength” or “commercial grade” products. Since it is foreseeable that consumers would continue to purchase products labeled and marketed in this fashion, and consumers would continue to be exposed far above the health benchmarks, they would not be protected from the unreasonable risks posed by methylene chloride.
Although respirators, specifically SCBAs, could reduce exposures to levels that are protective of non-cancer and cancer risks, not all workers may be able to wear respirators. Individuals with impaired lung function due to asthma, emphysema, or chronic obstructive pulmonary disease, for example, may be physically unable to wear a respirator. Determination of adequate fit and annual fit testing is required for tight fitting full-face piece respirators to provide the required protection. Individuals with facial hair, like beards or sideburns that interfere with a proper face-to-respirator seal, cannot wear tight fitting respirators. In addition, respirators may also present communication problems, vision problems, worker fatigue, and reduced work efficiency (63 FR 1152, January 8, 1998). According to OSHA, “improperly selected respirators may afford no protection at all (for example, use of a dust mask against airborne vapors), may be so uncomfortable as to be intolerable to the wearer, or may hinder vision, communication, hearing, or movement and thus pose a risk to the wearer's safety or health.” (63 FR 1189-1190). Nonetheless, OSHA views respiratory protection as a backup method which is used to protect employees from toxic materials in those situations where feasible engineering controls and work practices are not available or are insufficient to protect employee health (63 FR 1156-1157). The OSHA respiratory protection standard (29 CFR 1910.134) requires employers to establish and implement a respiratory protection program to protect their respirator-wearing employees. This OSHA standard contains several requirements,
In addition, OSHA adopted a hierarchy of controls established by the industrial hygiene community and used to protect employees from hazardous airborne contaminants, such as methylene chloride (29 CFR 1910.1052). According to this hierarchy, substitution of less toxic substances, engineering controls, administrative controls, and work practice controls are the preferred method of compliance for protecting employees from airborne contaminants and are to be implemented first, before respiratory protection is used. OSHA permits respirators to be used where engineering controls are not feasible or during an interim period while such controls are being implemented.
Given equipment costs and the costs of establishing a respiratory protection program, which involves training, respirator fit testing, and the establishment of a medical monitoring program, EPA anticipates that most companies would choose to switch to substitutes instead of adopting a program for this type of PPE to continue using methylene chloride for paint and coating removal because this type of PPE program is not cost-effective. Further, even if cost were not an impediment, there are many limitations to the successful implementation of respirators with an APF of 1,000 or 10,000 in a workplace. As recommended by the SBAR panel, EPA is requesting comment on and information about workplace experience with respiratory protection programs and air monitoring for methylene chloride (Ref. 27). Specifically, EPA seeks comment on whether companies would opt to substitute an alternate chemical or process instead of implementing a worker protection program for PPE. EPA also requests comment on the scientific and technical support used for development of the 1 ppm air exposure limit (Ref. 21) for methylene chloride and the feasibility of implementing and enforcing this performance-based approach. Additionally, EPA is requesting comment on the cost to achieve reduced exposures in the workplace or to transition to alternative chemicals or technologies.
EPA also considered requiring a combination of local exhaust ventilation and supplied-air respirators with APF of 1,000 or 50, with a performance-based alternative to the respirator of an air exposure limit of 1 ppm as an eight-hour TWA. When properly executed, this option would reduce risks to the health benchmarks for workers and bystanders (Refs. 19, 21, and 38). However, while this option has the benefit of incorporating engineering controls and the use of respirators with a lower APF, the limitations to successful implementation of the use of supplied-air respirators in the workplace discussed previously are still present. EPA is requesting comment on
Furthermore, neither of the variations of relying upon respiratory protection for commercial paint and coating removal with methylene chloride addresses consumer risks. EPA does not have the authority to require that consumers change use practices or wear PPE. Even if this approach were coupled with a TSCA section 6(a)(2) prohibition on the manufacture, processing and distribution in commerce of methylene chloride for consumer use in paint and coating removal, this would not protect consumers because they would foreseeably continue to buy and use paint and coating removal products containing methylene chloride intended for commercial users,
Therefore, considering the increased complexity of a respiratory protection program involving supplied-air respirators as well as the general inability to require that consumers adhere to a respiratory protection program resulting in little mitigation of risks to consumers, an option focusing on respiratory protection would not address the unreasonable risks presented by these uses.
The proposed option would prevent exposure to methylene chloride from paint and coating removal and thus would prevent the risks of adverse effects and associated impacts. As discussed in Unit II.C., the range of adverse health effects includes effects on the nervous system, liver, respiratory system, kidneys, and reproductive systems (Ref. 2). These health effects associated with exposure to methylene chloride are serious and can have impacts throughout a lifetime. The following is a discussion of the impacts of significant acute, chronic non-cancer, and cancer effects associated with methylene chloride exposure during paint and coating removal, including the severity of the effect, the manifestation of the effect, and how the effect impacts a person during their lifetime.
There are increased risks of death and nervous system effects for many of the approximately 17,600 workers in 8,600 commercial facilities or companies that use methylene chloride for paint and coating removal for the commercial uses proposed to be regulated, as well as for the estimated 1.3 million consumers and residential bystanders who use or are exposed to paint and coating removers containing methylene chloride each year (Ref. 4).
Although the fact that deaths occur as a result of exposure to methylene chloride is well documented, the exact number of deaths specifically attributable to methylene exposure is unclear. In 2012, the Centers for Disease Control and Prevention Morbidity and Mortality Weekly Report (MMWR) published results of an investigation into deaths among bathtub refinishers using methylene chloride. The authors of the investigation and the MMWR editors emphasized that the reported number of deaths due to methylene chloride is an underestimate and subject to at least three limitations: A lack of reporting to the OSHA incident database by self-employed individuals, no equivalent database to track consumer incidents and fatalities, and the likelihood that deaths due to methylene chloride exposures are misattributed to heart disease, since the pathology is similar (Ref. 33).
Based on data from OSHA, CPSC, state records, and publicly reported information, EPA has identified 49 fatalities since 1976 resulting from consumer or commercial worker exposure to methylene chloride during paint and coating removal, including for uses not proposed for regulation. However, as described earlier, this is likely an underestimate of the deaths that have occurred. As highlighted in the MMWR report from 2012 and OSHA alert from 2016, health effects from methylene chloride exposure are often misattributed to other causes (Refs. 32 and 33). For example, in several cases, workers were seen in hospital emergency rooms with symptoms of solvent exposure, were not properly diagnosed, and were sent back to the same work that ultimately killed them (Ref. 32).
Thus, EPA is unable to quantify the precise number or frequency of deaths that occur as a result of exposure to methylene chloride during paint and coating removal. However, the sporadically-occurring deaths outside of bathtub refinishing that have been documented as caused by methylene chloride, and the undocumented deaths that have been misattributed to heart disease should not be ignored merely because they cannot be monetized. Death following exposure to methylene chloride during paint and coating removal are characterized by family members as suddenly tragic, particularly when the deceased is young. In 1986 in Colorado, a worker died two hours into his first day on the job using methylene chloride to remove coatings from furniture (Ref. 40). In 2014 in New York, a 20-year old worker died while helping his father with a job refinishing a hotel bathtub (Ref. 41).
Fatalities have also occurred among more experienced workers. In 1990 in Georgia, a worker died while repairing a plastic-coated metal rack; he was found to have fainted and fallen into the tank of methylene chloride the company used to strip rack coatings (Ref. 7). In several instances, pairs of workers were killed while working on the same paint removal project with methylene chloride, such as renovating a squash court or the floor tile of a bathroom in a federal office building (Ref. 40).
In other cases, workers died when helping co-workers in distress. In South Carolina, in 1986, several workers were
These sudden, unexpected deaths are not limited to commercial users or occupational bystanders exposed to methylene chloride during paint and coating removal. Consumer fatalities have been recorded, such as the woman who died in her house in 1990 in Ohio after removing paint from furniture with methylene chloride, as reported to the American Association of Poison Control Centers (Ref. 7). Consistent with the underreporting of commercial deaths, EPA estimates there are unreported consumer deaths due to exposure to methylene chloride during paint and coating removal.
These deaths clearly have a significant impact on families, workplaces, and communities, and yet not all of them can be monetized. Similarly, the serious health effects and lifetime impacts on workers who do not die but who are hospitalized with heart failure, coma, or other effects also cannot be quantified or monetized. However, the impacts of these effects should not be ignored. One example is a case in 2012 in California, where one man attempted to save a co-worker who had collapsed while cleaning a paint-mixing tank. The collapsed worker died, and the man attempting to rescue him was incapacitated within several seconds and lost consciousness. Though he survived, he required resuscitation, hospitalization for four days, and lengthy follow-up treatments (Ref. 7). The impacts on workers with severe but non-fatal nervous system impacts include monetary, personal health, and emotional suffering costs that cannot be quantified or monetized, but again, should not be ignored. These severe nervous system impacts can include coma and heart failure (Ref. 2).
Even when less severe, the nervous system effects of acute exposure to methylene chloride can have considerable adverse consequences on an individual, particularly if one is exposed as a bystander who is unaware of why these nervous system effects are occurring. Commercial and consumer users as well as bystanders in workplaces and residences are at risk of dizziness and sensory impairment during most uses of methylene chloride for paint and coating removal. Similarly, chronic exposure to methylene chloride presents risks to the nervous system of commercial users, consumer users, and bystanders exposed to methylene chloride in paint and coating removal.
Chronic exposures in occupational settings put users and bystanders at risk of cognitive impairment (affecting eye-hand coordination, tracking tasks, auditory vigilance); adverse effects on autonomic, neuromuscular, and sensorimotor functions (Ref. 2); and long-term effects on specific cognitive-neurological measures (
Specific effects to the liver include hepatic vacuolation and non-alcoholic fatty liver disease (NAFLD) (Ref. 2). Some form of liver disease impacts at least 30 million people, or 1 in 10 Americans. Included in this number is at least 20% of those with NAFLD. NAFLD tends to impact people who are overweight/obese or have diabetes. However, an estimated 25% do not have any risk factors. The danger of NAFLD is that it can cause the liver to swell, which may result in cirrhosis over time and could even lead to liver cancer or failure (Ref. 42). The most common known causes to this disease burden are attributable to alcoholism and viral infections, such as hepatitis A, B, and C. These known environmental risk factors of hepatitis infection may result in increased susceptibility of individuals exposed to organic chemicals such as methylene chloride.
Chronic exposure to methylene chloride can also lead to liver cancers including hepatocellular carcinomas (HCC), hepatocellular adenomas, and biliary tract cancer (Ref. 2). The monetizable benefits associated with reducing the risk of liver cancers associated with methylene chloride exposure are discussed in Unit VII.B. However, the impacts of these cancers should not be measured only as dollar valuations. For example, because HCC is frequently diagnosed only after an individual's health has deteriorated, survival is usually measured in months. As a result, “HCC is responsible for a large proportion of cancer deaths worldwide . . . HCC classically arises and grows in silent fashion, making its discovery challenging prior to the development of later stage disease” (Ref. 43). Recommended treatments are aggressive interventions such as the removal of the tumors or sections of the liver; the life expectancy of patients with HCC is a mean survival rate of 6 to 20 months. Advanced cases can metastasize to any organ system, and tends to spread to bones and lungs. Bone pain related to metastasis is frequently the initial presenting symptom of HCC (Ref. 43).
Additional medical and emotional costs are associated with cancer and non-cancer liver toxicity following chronic exposure to methylene chloride in paint and coating removal, although these costs cannot be quantified. These costs include medical visits and medication costs. In some cases, the ability to work can be affected, which in turn impacts the ability to get proper medical care. Liver toxicity can lead to jaundice, weakness, fatigue, weight loss, nausea, vomiting, abdominal pain, impaired metabolism, and liver disease.
Depending upon the severity of the jaundice, treatments can range significantly. Simple treatment may involve avoiding exposure to methylene chloride and other solvents; however, this may impact an individual's ability to continue to work. In severe cases, liver toxicity can lead to liver failure, which can result in the need for a liver transplant. Even if a donor is available, liver transplantation is expensive (with an estimated cost of $575,000) and there are countervailing risks for this type of treatment (Ref. 44). The mental and emotional toll on an individual and their family as they try to identify the cause of sickness and possibly experience an inability to work, as well as the potential monetary cost of medical treatment required to regain health, are significant.
4.
NHL is a form of cancer that originates in the lymphatic system. Approximately 19 new cases per 100,000 adults per year are diagnosed, with approximately 6.2 deaths per 100,000 adults annually (Ref. 45). NHL is the seventh most common form of cancer (Ref. 46). Other factors that may increase the risk of NHL are medications that suppress a person's immune system, infection with certain viruses and bacteria, or older age (Ref. 47).
Symptoms of NHL are swollen lymph nodes in the neck, armpits or groin, abdominal pain or swelling, chest pain, coughing or trouble breathing, fatigue, fever, night sweats, and weight loss. Depending on the rate at which the NHL advances, treatment may consist of monitoring, chemotherapy, radiation, stem cell transplant, medications that enhance the immune system's ability to fight cancer, or medications that deliver radiation directly to cancer cells (Ref. 47).
Multiple myeloma is a related hematopoietic cancer, formed by malignant plasma cells. Multiple myeloma is characterized by low blood counts, bone and calcium problems, infections, kidney problems, light chain amyloidosis, and various forms of abnormal plasma cell growth. Often, multiple myeloma has no clinical symptoms until it reaches an advanced stage (Ref. 48).
Treatments for NHL or multiple myeloma result in substantial costs for hospital and doctors' visits in order to treat the cancer. Treatments for NHL or multiple myeloma can also have countervailing risks and can lead to patients' higher susceptibility for secondary malignancies (Refs. 47 and 48). The emotional and mental toll from wondering whether a treatment will be successful, going through the actual treatment, and inability to do normal activities, or work will most likely be high (Ref. 49). This emotional and mental toll could extend to the person's family and friends as they struggle with the diagnosis and success and failure of a treatment regime.
Researchers at the National Cancer Institute found that “associations of astrocytic brain cancer were observed with likely exposure to carbon tetrachloride, methylene chloride, tetrachloroethylene, and trichloroethylene, but were strongest for methylene chloride. . . . Risk of astrocytic brain tumors increased with probability and average intensity of exposure, and with duration of employment in jobs considered exposed to methylene chloride . . . These trends could not be explained by exposures to the other solvents” (Ref. 50).
Cancers that originate in the brain, which include astrocytic brain cancers, are relatively rare. Astrocytic brain cancers are estimated to have an incidence of approximately 10 cases per 1 million people per year, depending on how these types of cancers are defined (Ref. 51). Astrocytic tumors are characterized by varying degrees of growth potential and infiltration into nearby tissues. They include tumors that can spread quickly through the brain stem (brain stem gliomas); affect the pineal gland, which controls the sleeping and waking cycle (pineal astrocytic tumors); grow slowly and can be relatively easily cured (pilocytic astrocytoma); grow slowly but often spread into nearby tissues (diffuse astrocytoma); grow quickly and spread into nearby tissues (anaplastic astrocytoma); and grow quickly, spread quickly into nearby tissues, and usually cannot be cured (glioblastoma) (Ref. 51).
For astrocytic brain cancers, like other primary malignant brain tumors, initial clinical symptoms are frequently headaches and seizures. Lower-grade tumors may persist undetected for years, whereas the faster-growing or faster-spreading tumors may rapidly provoke neurological decline. Other symptoms may include nausea, vomiting, headache, and confusion as a result of increased intracranial pressure (Ref. 51).
Treatment for astrocytic brain cancers varies by the type and stage of the tumor; it can include pharmacological treatment (for many patients, this includes steroids and anti-convulsants if they are experiencing seizures), surgery (depending on location of the tumor, they may be removed or separated from the brain), chemotherapy, hormone modulation, or combinations of these treatments (Ref. 51). Like most cancer treatments, these can have countervailing risks. Additionally, the emotional and mental tolls described in earlier sections are relevant to these cancer treatments as well (Ref. 49).
BAC is a small percent of lung cancers (between 2% to 4%) and has unique characteristics. It is notable for its weak relationship with cigarette smoking; about one-third of patients in the United States with BAC were never smokers. Additionally, because it rarely spreads outside the lungs, it is often initially diagnosed as pneumonia or other lung inflammations (Ref. 52). Most patients do not present clinical symptoms (Ref. 52) and are only diagnosed following radiography or biopsy. Treatment requires surgery (Ref. 52). This has clear countervailing risks, and even if successful in removing any tumors present, the BAC may return.
9.
Exposure to methylene chloride can lead to changes in the proximal tubules of the kidney. This damage may result in signs and symptoms of acute kidney failure that include; decreased urine output, although occasionally urine output remains normal; fluid retention, causing swelling in the legs, ankles or feet; drowsiness; shortness of breath; fatigue; confusion; nausea; seizures or coma in severe cases; and chest pain or pressure. Sometimes acute kidney failure causes no signs or symptoms and is detected through lab tests done for another reason.
Kidney toxicity means the kidney has suffered damage that can result in a person being unable to rid their body of excess urine and wastes. In extreme cases where the kidney is impaired over a long period of time, the kidney could be damaged to the point that it no longer functions. When a kidney no longer functions, a person needs dialysis and ideally a kidney transplant. In some cases, a non-functioning kidney can result in death. Kidney dialysis and kidney transplantation are expensive and incur long-term health costs if kidney function fails (Ref. 56).
The monetary cost of kidney toxicity varies depending on the severity of the damage to the kidney. In less severe cases, doctor visits may be limited and hospital stays unnecessary. In more severe cases, a person may need serious medical interventions, such as dialysis or a kidney transplant if a donor is available, which can result in high medical expenses due to numerous hospital and doctor visits for regular dialysis and surgery if a transplant occurs. The costs for hemodialysis, as charged by hospitals, can be upwards of $100,000 per month (Ref. 57).
Depending on the severity of the kidney damage, kidney disease can impact a person's ability to work and live a normal life, which in turn takes a mental and emotional toll on the patient. In less severe cases, the impact on a person's quality of life may be limited while in instances where kidney damage is severe, a person's quality of life and ability to work would be affected. While neither the precise reduction in individual risk of developing kidney toxicity from reducing exposure to methylene chloride during paint or coating removal or the total number of cases avoided can be estimated, these costs must still be considered because they can significantly impact those exposed to methylene chloride.
For almost every situation in which methylene chloride is used to remove paints or coatings, EPA is aware of technically and economically feasible chemical substitutes or alternative methods that are reasonably available. The two situations for which EPA does not know of technically and economically feasible alternatives are the uses that EPA proposes are critical for national security, described in more detail in Unit VIII., and commercial furniture refinishing, discussed in more depth in Unit XI. With respect to the specific coating removal uses that EPA proposes are critical for national security, described in Unit VIII., EPA does not believe that technically and economically feasible alternatives are reasonably available at this time. With respect to the furniture refinishing uses described in Unit XI., EPA is still investigating whether economically feasible alternatives are reasonably available.
EPA considered chemical substitutes and alternative methods consistent with the requirements of TSCA section 6(c)(2)(C) and as similarly recommended by the SBAR panel (Ref. 27). A full industry profile characterizing manufacturers, processors and end users of methylene chloride for paint and coating removal and a use and substitutes analysis are included in sections 2 and 3 of EPA's economic assessment (Ref. 4). As described below, EPA proposes that alternatives are technologically feasible, economically feasible, reasonably available, and present fewer hazards to human health than methylene chloride in paint and coating removal. EPA requests comment on whether its conclusion that substitutes for methylene chloride identified are available and technically and economically feasible is accurate and whether its consideration of alternatives was sufficient to satisfy the requirements of TSCA section 6(c)(2)(C).
Research into the efficacy of chemical substitutes has identified products currently available for commercial and consumer users of methylene chloride for paint and coating removal, for a variety of coatings on numerous substrates (Refs. 58 and 59). Research by the European Association for Safer Coating Removal in 2006 found that for every use that was studied of methylene chloride in paint and coating removal, there was a suitable substitute (Ref. 60). Other non-chemical methods of paint removal are also available (Ref. 31). Additionally, in most commercial sectors, users have voluntarily adopted substitute chemicals or methods, either due to financial considerations, customer requests, concern for worker or individual health and safety, decreased discharges to air and water, reduced clean-up costs, or reduced cost of protective equipment and respiratory protection programs (Ref. 22).
Many producers of paint and coating removal products containing methylene chloride also produce paint and coating removal products with substitute chemicals (Ref. 4). This was emphasized by a small business who makes such products (Ref. 22); other small businesses separately described the limitations of many alternatives (Ref. 27). Thus, there is already precedent for producers reformulating products to meet demand from commercial or individual customers. Additionally, methylene chloride is prohibited from use in graffiti removal in California,
Based on the frequent use of substitute chemicals or alternative methods for paint and coating removal in all industries discussed here, and the formulation and distribution of substitute chemicals for paint and coating removal by all formulators of products containing methylene chloride (Ref. 4), EPA finds that technically and economically feasible alternatives to methylene chloride are reasonably available for all uses proposed for regulation.
Primary chemical substitutes for methylene chloride in paint and coating removal include products formulated with benzyl alcohol; dibasic esters; acetone, toluene, and methanol (collectively ATM); and caustic chemicals. EPA evaluated these products for efficacy, toxicity, relative hazards compared to methylene chloride, and other hazards that might be introduced by use of these products (such as environmental toxicity, increased global warming potential, and increased flammability or other hazards to users). Overall, while the efficacies of the substitutes are comparable to the efficacy of methylene chloride, none of the substitute chemicals already available has the level of toxicity associated with methylene chloride.
Products based on benzyl alcohol formulations have been identified as efficacious paint and coating removers in various industry sectors (Refs. 22 and 27). Consumer products containing benzyl alcohol are available for sale (Refs. 22, 27, 35, 58, 59, and 61). There are fewer hazard concerns compared to methylene chloride-based products, and the levels at which benzyl alcohol causes toxicity are higher than for methylene chloride, suggesting lower toxicity (Ref. 34). The relative inhalation exposure potential is lower for benzyl alcohol than for methylene chloride. The relative dermal exposure potential of benzyl alcohol is similar to methylene chloride (Ref. 34). Benzyl alcohol-based paint removers are expected to result in lower risks than methylene chloride products, primarily due to lower toxicity (Ref. 29).
Dibasic ester products can include dimethyl succinate, dimethyl glutarate and dimethyl adipate. They are generally viewed as efficacious products by commercial users in several sectors, though, because they evaporate slowly, they require a longer dwell time than methylene chloride (Ref. 22, 27). In general, the hazards associated with dibasic esters are less severe and occur at concentrations higher than methylene chloride (Ref. 34). Regarding differential exposures between dibasic esters and methylene chloride, the relative inhalation exposure potential is lower for dibasic esters than for methylene chloride (Ref. 34). The relative dermal exposure potentials of dibasic esters are similar to methylene chloride. Taken together, dibasic ester-based paint removers are expected to result in lower risks than methylene chloride products, primarily due to lower toxicity (Ref. 34).
ATM products contain acetone, toluene, and methanol. Products containing these chemicals may remove coatings very quickly, but may not be effective on every type of coating (Refs. 22 and 27). Acetone, toluene, and methanol evaporate quickly and are very flammable (Ref. 62). However, it is important to note that acetone, toluene, and/or methanol are present in most paint removers that contain methylene chloride, as co-solvents (Ref. 34). As a result, the main difference between paint removers that contain methylene chloride (and typically also contain acetone, toluene, and/or methanol) and ATM products is the absence of methylene chloride. Acetone is readily absorbed via inhalation and the relative inhalation exposure potential is similar to methylene chloride (Ref. 34). Acetone in particular is significantly less toxic than methylene chloride. Toluene and methanol are readily absorbed via inhalation, but the relative inhalation exposure potential is lower than for methylene chloride (Ref. 34). Dermal exposure to acetone, toluene and methanol is slightly less than for methylene chloride (Ref. 34). Taken together, ATM-based paint removers are expected to result in lower cancer risks (Ref. 36).
Products with caustic chemicals typically include calcium hydroxide or magnesium hydroxide. In many uses, they can be effective products, particularly when multiple coatings are being removed from a substrate. Caustic products have been reported to remove up to 30 coats in 24 hours, and in some cases, they have no increased dwell time compared to methylene chloride (Ref. 23). In contrast to methylene chloride-based products, there are no cancer or other repeat dose endpoints of concern associated with caustic products (Ref. 34). Caustic products pose acute concerns due to their physical chemical properties and can cause chemical burns (Ref. 36). It is important to note that products containing methylene chloride may also cause chemical burns. Additionally, the risks associated with caustic-based products are entirely acute, and can be mitigated by appropriate protective equipment more easily than the acute and chronic risks presented by methylene chloride.
In summary, when NMP is excluded from consideration, the most likely chemical substitutes for methylene chloride in paint and coating removal do not pose a risk of cancer to users, generally have lower exposure potential than methylene chloride, and when acute risks are present, as in the case of caustic chemicals, those risks are self-limiting by the nature of the adverse effects (since a user experiencing those effects is likely to take immediate action to mitigate or cease the effect of the caustic chemical). The chemical formulations that seem to present some risks of concern are ATM products, since they contain toluene and methanol. However, these chemicals are also present in most paint removers that contain methylene chloride, as co-solvents. As a result, no additional risks would be introduced were users to substitute a typical methylene chloride product (which would likely contain acetone, toluene, and/or methanol as co-solvents) with ATM products.
In addition to examining toxicity to humans, EPA reviewed available data on the chemicals in the baseline and alternative products for aquatic toxicity, persistence and bioaccumulation data, as a basis for examining potential environmental toxicity. Only one chemical evaluated (citrus terpenes) may have significant impacts on aquatic toxicity, with concern for environmental persistence and/or bioaccumulation. This chemical is contained in NMP-based paint removal products (Ref. 34).
EPA is also mindful of the risks that may be introduced by substitute chemicals or methods to increase global warming, and has examined the global warming potential of the chemical components of likely chemical substitutes for methylene chloride in paint and coating removal. Methylene chloride presents concerns for global warming; it has a GWP of 8.7 (see Unit II.D.2.). The GWP values of likely substitute chemicals in paint and coating removal are: 0 GWP (benzyl alcohol, ATM) or not assessed (caustics, dibasic esters) (Ref. 23). As such, EPA has not identified any increased risk of global warming that would be introduced by use of chemical products
In addition to human and environmental toxicity, other hazards associated with chemical methods for paint and coating removal are risks of fire due to flammability of the chemical product, and poisoning or acute injury. Risks of fire are serious when using solvents such as paint and coating removal chemicals. The flammability of methylene chloride is lower than some of the substitute organic solvents. However, many paint and coating removal products containing methylene chloride also contain more flammable chemicals as part of the formulation (Ref. 34). Paint and coating removal products sold to consumers that contain methylene chloride frequently have flammability warnings prominently on them (Ref. 35). Other chemical paint and coating removal products, such as those based on benzyl alcohol and dibasic esters, have low flammability and do not present an increased risk of fire from products containing methylene chloride (Ref. 23). Even among products that fall within the same general product composition category, there is meaningful variability in the specific formulations of paint remover products, and thus in their flammability. Furthermore, it is impracticable for EPA to predict the specific product formulations for which use will increase as a result of prohibitions on methylene chloride in paint and coating removal. It is therefore impracticable for EPA to forecast whether the flammability of popular paint and coating removers would generally increase or decrease as a result of the proposed rule.
In addition to using substitute chemical products, non-chemical methods for paint and coating removal are frequently used. These include thermal removal, sanding, hydroblasting, abrasive blasting, and laser removal (Refs. 22 and 31). Acute and chronic physical hazards (
In this overview, when considering alternatives to methylene chloride that would be available, NMP generally was not considered because, under the first co-proposed option for NMP in this proposed rule, this chemical would also be prohibited from use in paint and coating removal. However, under the second co-proposed approach for reducing the risks of NMP in paint and coating removal, products containing NMP would be available for commercial and consumer paint and coating removal, with restrictions. Details of the two co-proposed options are in Unit XVI.3. EPA identified developmental risks following acute exposures for consumers and acute and chronic exposures for commercial users of paint and coating removal products containing NMP following exposure through dermal contact, inhalation, and vapor-through-skin. More information on the risks EPA identified related to NMP are in Unit XVI.B.1.
This unit describes the estimated costs of the proposed and alternative regulatory actions that EPA considered for methylene chloride in paint and coating removal. More information on the benefits and costs of this proposal as a whole can be found in Unit XXIII.
The proposed approach is necessary so that methylene chloride in paint and coating removal no longer presents an unreasonable risk. It is also more cost effective than other regulatory options the Agency identified as potentially reducing risks so that they are no longer unreasonable, because it achieves the benefits of reducing the unreasonable risks so they are no longer unreasonable for a lower cost than the primary alternative option. For more information, see section 6 in the Economic Analysis (Ref. 4).
As stated previously in this notice, the proposed approach includes:
• Prohibiting manufacturing (including import), processing, and distribution in commerce of methylene chloride for consumer paint and coating removal and commercial paint and coating removal for the uses proposed for regulation;
• Prohibiting commercial use of methylene chloride for paint and coating removal for the uses proposed for regulation;
• Requiring that any products containing methylene chloride intended or used for paint and coating removal be distributed in volumes no less than 55-gallon containers;
• Requiring downstream notification of the prohibition on manufacturing (including import) processing, and distribution of methylene chloride for paint and coating removal for the prohibited uses; and
• Requiring limited recordkeeping.
Technically and economically feasible substitutes to methylene chloride for paint and coating removal are reasonably available for the uses proposed to be regulated. The supply chain approach ensures protection of consumers from the unreasonable risk by precluding the off-label purchase of commercial products by consumers.
The proposed approach is relatively easy to enforce because key requirements are directly placed on a small number of suppliers and because the supply chain approach minimizes to the greatest extent the potential for methylene chloride products to be intentionally or unintentionally misdirected into the prohibited uses. Enforcement under the other options would be much more difficult since the key requirements are directly placed on the large number of product users. As described in a recent article on designing more effective rules and permits, “the government can implement rules more effectively and efficiently when the universes of regulated sources are smaller and better-defined. This is because, other factors being equal, governments can more easily identify, monitor, and enforce against fewer, rather than more, entities” (Ref. 63). Under other options, enforcement activities must target firms that might perform the activity where a use of methylene chloride is restricted or prohibited. Identifying which establishments might use paint and coating removers is difficult because paint and coating removal is not strictly specific to any industry (Ref. 4).
EPA proposes that the identified risks from methylene chloride and in paint and coating removal are unreasonable risks. Apart from that proposed determination, EPA has evaluated the potential costs and benefits of the proposed approach and alternative approaches.
The details of the costs of the proposed approach for use of methylene chloride in paint and coating removal by consumers and in commercial uses proposed for regulation are discussed in Unit I.E. and in the Economic Analysis (Ref. 4). Under the proposed option for methylene chloride and the first co-proposed option for NMP, costs to users of paint and coating removal products containing methylene chloride are $4,217,000 to $23,436,000 annualized for 20 years at a discount rate of 3% and $4,592,000 to $23,485,000 at a discount rate of 7%. Costs of paint and coating removal product reformulations are estimated to be approximately $10,000 to $20,000 per year (annualized at 3% over 20 years) and $14,000 to $24,000 (annualized at 7% over 20 years). Costs of downstream notification and recordkeeping on an annualized basis over 20 years are $40 and $60 using 3% and 7% discount rates respectively. Agency costs for enforcement are estimated to be approximately $114,401 and $111,718 annualized over 20 years at 3% and 7%, respectively (Ref. 4).
Total costs of the proposed rule relevant to methylene chloride in paint and coating removal under the first co-proposed option for NMP are estimated to be $4,247,000 to $23,446,000 annualized over 20 years at 3% and $4,612,000 to $23,495,000 annualized over 20 years at 7% (Ref. 4).
Under the proposed option for methylene chloride and the second co-proposed option for NMP, costs to users of paint and coating removal products containing methylene chloride are $67,087,960 to $68,726,960 annualized for 20 years at a discount rate of 3% and $67,369,940 to $69,006,940 at a discount rate of 7%. Costs of paint and coating removal product reformulations, costs of downstream notification, and Agency costs for enforcement are estimated to be the same as under the first co-proposed option for NMP (Refs. 4 and 127).
Total costs of the proposed rule relevant to methylene chloride in paint and coating removal under the second co-proposed option for NMP are estimated to be $67,098,000 to $68,747,000 annualized over 20 years at 3% and $67,384,000 to $69,034,000 annualized over 20 years at 7% (Refs. 4 and 127).
Alternatives that EPA considered include the use of PPE as well as an option that would prohibit the use of methylene chloride in paint and coating removal for consumers and for the commercial uses proposed for regulation without the companion prohibition on manufacture, processing, or distribution in commerce for these uses or the downstream notification requirements. As discussed in Unit VI.C.3., EPA found that PPE options did not address the risks presented by methylene chloride in paint and coating removal so that the risks would no longer be unreasonable. This is because consumers could not be required to adopt PPE, resulting in a significant gap in protection for consumers. In addition, EPA also assumed that no commercial users would adopt PPE because the per-facility costs were prohibitively expensive.
EPA also found that a use prohibition alone without downstream notification requirements would not address the unreasonable risks. EPA estimated the costs of this option to be $4,239,000 to $23,442,000 annualized over 20 years at 3% and $4,604,000 to $23,491,000 annualized over 20 years at 7% (Ref. 4).
EPA is not fully able to quantify the full monetary benefits that would accrue from preventing all deaths due to methylene chloride in paint and coating
The monetized subset of benefits for preventing the risks resulting from methylene chloride in paint and coating removal by consumers and by commercial workers for the uses proposed for regulation do not outweigh the estimated monetary costs. EPA believes that the balance of costs and benefits cannot be fairly described without considering the additional, non-monetized benefits of mitigating the non-cancer adverse effects as well as cancer. As discussed previously, the multitude of potential adverse effects associated with methylene chloride in paint and coating removal can profoundly impact an individual's quality of life. Some of the adverse effects associated with methylene chloride exposure can be immediately experienced and can result in sudden death; others can have impacts that are experienced for a shorter portion of life, but are nevertheless significant in nature. While the risk of non-cancer health effects associated with methylene chloride exposure during paint and coating removal cannot all be quantitatively estimated, the qualitative discussion highlights how some of these non-cancer effects may be as severe as cancer and thus just as life altering. These effects include not only medical costs but also personal costs such as emotional and mental stress that are impossible to accurately measure. Considering only monetized benefits would significantly underestimate the impacts of methylene chloride-induced non-cancer adverse outcomes on a person's quality of life.
Thus, considering costs; the subset of benefits that can be monetized (risk of cancer and risk of death in some sectors); and the remaining benefits that cannot be quantified and subsequently monetized (risk of nervous system effects, liver toxicity, reproductive effects, and kidney toxicity), including benefits related to the severity of the effects and the impacts on a person throughout a lifetime in terms of medical costs, effects on earning power and personal costs, emotional and psychological costs, and the disproportionate impacts on Hispanic communities and individuals with limited English proficiency; the benefits of preventing exposure to methylene chloride in paint and coating removal by an estimated 1.3 million consumers and estimated 17,600 commercial workers for the uses proposed for regulation outweigh the costs.
As described in Unit V.B. and in the Economic Analysis, EPA considered the anticipated effects of this proposal on the national economy. While the impacts of this rule as a whole are described in Unit XXIII.C. and the impacts of the methylene chloride component of this proposal are described in more detail in Unit VII.A. and in Section 9.3 of the Economic Analysis (Ref. 4), EPA does not anticipate these impacts having an effect on the overall national economy. EPA anticipates that a majority of small businesses will have cost impacts of less than one percent of the annual revenue, and the majority of small business bathtub refinishing facilities and professional contractors will have cost impacts greater than one percent of annual revenue.
The proposed approach is anticipated to drive technological innovation by formulators of paint and coating removal products containing methylene chloride, as they continue to develop substitute products, and refine such products already available. It is also anticipated to drive technological innovation by formulators of chemical paint and coating removal products with different chemistries as well as manufacturers and retailers of alternative methods of paint and coating removal. See also section 9.3 in the Economic Analysis (Ref. 4).
The proposed approach is anticipated to have a positive impact on public health, as described in Unit VI.D. There is anticipated to be a positive impact on the environment, as a result of decreased use of methylene chloride, which is a hazardous air pollutant, as described in Unit III.A.
As part of interagency collaboration with the Department of Defense (DOD) on this proposed rule, EPA is aware that there are specific military uses for which methylene chloride is essential for paint and coating removal and for which there are no technically feasible alternatives currently available. The military readiness of DOD's warfighting capability is paramount to ensuring national security, which includes ensuring the maintenance and preservation of DOD's warfighting assets. DOD has identified mission-critical uses for methylene chloride for ensuring military aviation and vessel readiness. These mission-critical items require the use of methylene chloride for the removal of coatings from mission-critical corrosion-sensitive components on military aviation and vessels, including safety-critical components made of specialty metallic, nonmetallic, and composite materials. As described in this section, EPA proposes to exempt these uses from the regulations proposed on methylene chloride in paint and coating removal. This exemption is proposed for an initial ten-year period from the publication date of a final rule. EPA will engage with DOD to identify any potential extension that may need to be granted, by further rulemaking, after those ten years.
DOD has actively sought to reduce its use of methylene chloride in paint and coating removal since 1990. DOD has replaced most of its usage of methylene chloride for paint and coating removal with mechanical methods, benzyl alcohol products, other solvents, and laser ablation. For instance, the Navy's Fleet Readiness Center Southwest has undertaken a successful 20-year effort and eliminated all but a single use on safety-critical components. In an effort to reduce the use of all HAPs such as methylene chloride, the Army has conducted tests to identify and test the effectiveness of HAP-free paint and coating removers on military high-performance coatings (Ref. 61). In another example, the Air Force in December 2015 significantly reduced the use of methylene chloride for removing coatings on flight control parts and is now using substitute chemical products, primarily those with benzyl alcohol formulations (Ref. 65). This phase-out was driven by worker safety concerns and the destructive impact the methylene chloride product had on the installation's industrial wastewater treatment processes. The Air Force
In light of these efforts to identify and adopt alternative chemicals or methods, it is unlikely that DOD has overlooked potential substitutes. DOD continues and will continue to pursue potential substitutes. However, for mission-critical corrosion-sensitive components on military aviation and vessels, including safety-critical components, DOD has found that currently available substitute chemicals for paint and coating removal have one or more technical limitations. In these critical and essential applications, currently available substitute chemicals cannot completely remove specific military high performance or chemical resistant coatings, resulting in improperly applied, incompletely adhering replacement coatings. The impacts of this are early coating failure, corrosion of underlying critical parts, shortened service life for critical components (some of which are no longer manufactured), and reduced availability and mission readiness of military aircraft and vessels.
Substitute chemicals currently available are also incompatible with underlying metallic, nonmetallic and composite materials, resulting in material damage to critical components (
Additionally, substitute chemicals or methods currently available do not support the coating removal requirements of safety inspection, non-destructive inspection, material assessment, or field repair processes. This results in an inability to properly perform safety inspections for critical components, leading to undetected fractures and defects. The impacts of this are increased risk of catastrophic failure of safety critical parts.
Under TSCA section 6(g)(1)(B), EPA may grant an exemption from a requirement of a TSCA section 6(a) rule for a specific condition of use of a chemical substance or mixture if compliance with the requirement would significantly disrupt the national economy, national security, or critical infrastructure. Based on discussions and information provided by DOD, EPA has analyzed the need for the exemption and concurs with DOD that compliance with the proposed regulations on the use of methylene chloride in paint and coating removal would significantly impact national security. DOD has demonstrated that the reduced mission availability of aircraft and vessels for military missions or, in the worst case, the loss of individual military aircraft and vessels, are potential impacts to military readiness that could result from the proposed prohibition of methylene chloride in paint and coating removal. Due to the importance of these military systems for national security, EPA has determined that these uses of methylene chloride for removal of specialized coatings from military aviation and vessel mission-critical corrosion-sensitive components, including safety-critical components, is critical for national security and the safety of personnel and assets. EPA includes in this exemption corrosion-sensitive military aviation and vessel mission-critical components such as landing gear, gear boxes, turbine engine parts, and other military aircraft and vessel components composed of metallic materials (specifically high-strength steel, aluminum, titanium, and magnesium) and composite materials that not only require their coatings be removed for inspection and maintenance but also would be so negatively affected by the use of technically incompatible, substitute paint removal chemicals or methods that the safe performance of the vessel or aircraft could be compromised.
EPA proposes to grant this exemption for a period of 10 years from the date of promulgation of a final rule, with a potential for extension, by further rulemaking, after review by EPA in consultation with DOD. The conditions for this exemption would be: (1) The use of methylene chloride for coating removal by DOD or its contractors performing this work only for DOD projects is limited to the mission-critical corrosion-sensitive components on military aviation and vessels, including safety-critical components; and (2) this paint and coating removal must be conducted at DOD installations, at Federal industrial facilities, or at DOD contractor facilities performing this work only for DOD projects. This exemption granted under TSCA(6)(g)(1)(B) does not impact or lessen any requirements for compliance with other statutes under which the use, disposal, or emissions of methylene chloride is regulated.
As described in Unit VI.C.3., under the proposed approach, any paint and coating removal products containing methylene chloride would be required to be distributed in packaged volumes no less than 55-gallon containers. As part of the exemption for uses identified as critical for national security, for those formulations specifically manufactured for DOD, suppliers may provide paint and coating removal products containing methylene chloride to DOD in containers with a volume no less than 5 gallons. Allowing selective use for national security purposes does not disrupt the efficacy of the supply chain approach described in Unit VI.C.3.
In addition to the exemption described in this unit, EPA will consider granting additional time-limited exemptions, under the authority of TSCA section 6(g), for a specific condition of use for which EPA can obtain documentation: that the specific condition of use is a critical or essential use for which no technically and economically feasible safer alternative is available, taking into consideration hazard and exposure; that compliance with the proposed rule would significantly disrupt the national economy, national security, or critical infrastructure. To this end, EPA requests comment on a process for receiving and evaluating petitions and requesting EPA promulgate critical-use exemption rules. Under this process, entities who believe that their specific condition of use is a critical or essential use under TSCA section 6(g) would submit a petition for an exemption rulemaking with supporting documentation that they believe demonstrates that the use meets the statutory criteria. EPA would review the petition for completeness and, if the documentation warrants further action, respond to the petition by publishing a proposal in the
A discussion of the uncertainties associated with this proposed rule can be found in the methylene chloride risk assessment (Ref. 2) and in the additional analyses for methylene chloride in commercial and consumer paint and coating removal (Refs. 19, 20, and 38). A summary of these uncertainties follows.
EPA used a number of assumptions in the methylene chloride risk assessment and supporting analysis to develop estimates for occupational and consumer exposure scenarios and to develop the hazard/dose‐response and risk characterization. EPA recognizes that the uncertainties may underestimate or overestimate actual risks. These uncertainties include the likelihood that releases of and exposures to methylene chloride vary from one paint and coating removal project to the next. EPA attempted to quantify this uncertainty by evaluating multiple scenarios to establish a range of releases and exposures. In estimating the risk from methylene chloride in paint and coating removal, there are uncertainties in the number of workers, bystanders, and consumers exposed to methylene chloride and in the inputs to the models used to estimate exposures.
In addition to the uncertainties in the risks, there are uncertainties in the cost and benefits. The uncertainties in the benefits are most pronounced in estimating the benefits from preventing deaths due to methylene chloride that have been underreported in most commercial sectors. Additional significant uncertainties in benefits include the entirety of prevention of the non-cancer adverse effects, including underreported deaths (described in Unit VI.E.), because these benefits generally cannot be monetized due to the lack of concentration response functions in humans leading to the ability to estimate the number of population-level non-cancer cases and limitations in established economic methodologies. Additional uncertainties in benefit calculations arose from EPA's use of a forecast from an industry expert to estimate the categories of alternatives that users might choose to adopt and the potential risks for adverse health effects that the alternatives may pose. While there are no products or methods that have comparable cancer or lethal risks, these substitute products and alternative methods do present hazards. Without information on what alternative methods or chemicals users of methylene chloride for paint and coating removal are likely to switch to, and estimates of the exposures for those alternatives, EPA is unable to quantitatively estimate any change in non-cancer risks due to use of substitute chemicals or alternative methods instead of using methylene chloride for commercial or consumer paint and coating removal.
Additional uncertainties include any benefits accrued by commercial users of methylene chloride for paint and coating removal who would benefit from using substitute chemicals and alternative processes. These users would be able to reduce or eliminate costs incurred for emissions control, hazardous waste disposal, or wastewater treatment, which are all required for commercial users of methylene chloride for any purpose.
In addition to these uncertainties related to benefits, there are uncertainties related to the cost estimates. As noted earlier, there is uncertainty in EPA's estimates of which chemical substitutes or alternative methods users may adopt instead of methylene chloride for paint and coating removal, which in turn produces uncertainty as to the cost of those substitutes or methods. EPA has estimated the cost of substitute chemicals, and, in some sectors, some increase in costs due to increased labor required by some substitute methods, but is not able to fully characterize the total costs to all sectors for using substitute chemicals or alternative products. It is possible that some users with paint removal projects that require removing multiple layers of coatings may ultimately save time by switching to a substitute chemical that is more effective than methylene chloride for this particular use. However, changes in time gained or lost during paint and coating removal projects cannot be estimated for all users potentially affected by this proposed rule. In addition, under certain assumptions EPA's economic analysis estimates that some users of methylene chloride for paint and coating removal will see a cost savings when switching to substitutes. Standard economic theory suggests that financially rational companies would choose technologies that maximize profits so that regulatory outcomes would not typically result in a cost savings for the regulated facilities. There could be several reasons that cost savings might occur in the real world. Potential reasons include lack of complete information or barriers to obtaining information on the cost savings associated with alternatives as well as investment barriers or higher interest rates faced by firms. Additionally, there may be costs associated with these alternatives that are not adequately accounted for in the analysis. To evaluate the effect of this uncertainty, EPA has included a sensitivity analysis that sets the cost savings to zero for these compliance alternatives (Ref. 4 at Section 7). EPA also recognizes that these firms might experience positive costs of compliance rather than zero costs, so that the actual total costs could be higher than those in the sensitivity analysis. However, EPA has no current basis to estimate these potentially higher costs, since the available data appear to show that there are lower cost substitutes available. EPA requests comments on these assumptions.
Additionally, there are uncertainties due to the estimates of the number of affected commercial and consumer users, and for numbers of processors and distributors of methylene chloride-containing products not prohibited by the proposed rule who are required to provide downstream notification and/or maintain records.
EPA will consider additional information received during the public comment period. This includes scientific publications and other input submitted to EPA during the comment period.
This proposal relies on general provisions in the proposed Part 751, Subpart A, which can be found at 81 FR 91592 (December 16, 2016).
The rule, when final, would (1) prohibit the manufacturing, processing, and distribution in commerce of methylene chloride for paint and coating removal for consumer uses and for all commercial uses excluding for commercial furniture refinishing (see Unit XI.) and exempting those defined as critical for national security (see Unit VIII.); (2) prohibit commercial use of methylene chloride for paint and coating removal except for commercial
The prohibition on manufacturing, processing, and distributing in commerce methylene chloride for consumer paint and coating removal would take effect 180 days after publication of a final rule. Similarly, the prohibition on manufacturing, processing, and distributing in commerce methylene chloride for any non-prohibited paint and coating removal commercial uses in containers with volumes less than 55 gallons would take effect 180 days after publication of a final rule. The prohibition on commercial use of methylene chloride for paint and coating removal except in furniture refinishing or for critical national security uses would take effect 270 days after publication of a final rule. These are reasonable transition periods because, as noted in Unit VI.E. and by the small businesses participating in the SBAR process, many formulators of paint and coating removers containing methylene chloride also manufacture products for this use that do not contain methylene chloride (Ref. 27). In addition, alternative paint removal products exist at comparable expense for users to purchase. Six months from publication of the final rule is sufficient time to allow for existing stocks to move through the market place and to allow manufacturers, processers and distributors and users to plan for and implement product substitution strategies.
EPA has authority under TSCA section 6 to require that a substance or mixture or any article containing such substance or mixture be marked with or accompanied by clear and adequate minimum warnings and instructions with respect to its use, distribution in commerce, or disposal or with respect to any combination of such activities. Many manufacturers and processors of methylene chloride are likely to manufacture or process methylene chloride or products containing methylene chloride for other uses that would not be regulated under this proposed rule. Other companies may be strictly engaged in distribution in commerce of methylene chloride, without any manufacturing or processing activities, to customers for uses that are not regulated. EPA is proposing a requirement for downstream notification by manufacturers, processors, and distributors of methylene chloride for any use to ensure compliance with the prohibition on manufacture, processing, distribution in commerce, and commercial use of methylene chloride for the uses proposed for regulation. Downstream notification is necessary for effective enforcement of the rule because it provides a record, in writing, of notification on use restrictions throughout the supply chain, likely via modifications to the Safety Data Sheet. Downstream notification also increases awareness of restrictions on the use of methylene chloride for paint and coating removal, which is likely to decrease unintentional uses of methylene chloride by these entities. Downstream notification represents minimal burden and is necessary for effective enforcement of the rule. The estimated cost of downstream notification on an annualized basis over 20 years is $40 and $60 using 3% and 7% discount rates respectively (Ref. 4).
The effective date of the requirement for this notification would be 45 days after publication of the final rule. This is a reasonable transition period because regulated entities would only need to provide additional information on their SDS, which are routinely produced and updated.
Section 15 of TSCA makes it unlawful to fail or refuse to comply with any provision of a rule promulgated under TSCA section 6. Therefore, any failure to comply with this proposed rule when it becomes effective would be a violation of section 15 of TSCA. In addition, section 15 of TSCA makes it unlawful for any person to: (1) Fail or refuse to establish and maintain records as required by this rule; (2) fail or refuse to permit access to or copying of records, as required by TSCA; or (3) fail or refuse to permit entry or inspection as required by section 11 of TSCA.
Violators may be subject to both civil and criminal liability. Under the penalty provision of section 16 of TSCA, any person who violates section 15 could be subject to a civil penalty for each violation. Each day in violation of this proposed rule when it becomes effective could constitute a separate violation. Knowing or willful violations of this proposed rule when it becomes effective could lead to the imposition of criminal penalties for each day of violation and imprisonment. In addition, other remedies are available to EPA under TSCA.
Individuals, as well as corporations, could be subject to enforcement actions. Sections 15 and 16 of TSCA apply to “any person” who violates various provisions of TSCA. EPA may, at its discretion, proceed against individuals as well as companies. In particular, EPA may proceed against individuals who report false information or cause it to be reported.
At this time, following input from small entity representatives received during the SBAR process, and based on the SBAR panel recommendations, EPA is not proposing to regulate methylene chloride when used in paint and coating removal in commercial furniture refinishing, also referred to as professional furniture refinishing (Ref. 27). Although EPA proposes to determine that risks to workers using methylene chloride for commercial furniture refinishing are unreasonable, EPA is seeking additional information about this industry to inform development of future proposed restrictions on methylene chloride in commercial furniture refinishing.
Commercial furniture refinishing consists of several processes, including but not limited to repair, reupholstery, repainting, and depainting or removing paints and coatings, sometimes referred to as furniture stripping. EPA has defined furniture stripping as paint and coating removal from furniture; it includes application of a chemical or use of another method to remove, loosen, or deteriorate any paint, varnish, lacquer, graffiti, surface protectants, or other coating from wood, metal, or other types of furniture, doors, radiators, or cabinets. Furniture stripping can be conducted separately or as a part of furniture refinishing. EPA has defined commercial furniture stripping as furniture stripping conducted in a commercial facility performed by an
As described in the methylene chloride risk assessment, to carry out furniture stripping, or to remove paint, lacquer, varnish, or other coatings from wood or metal furniture (or similar items such as doors, radiators, and cabinets), chemical paint and coating removal products may be applied to the furniture by either dipping the furniture in an open tank containing the chemicals, brushing or spraying the product onto the furniture surface, or manually applying the chemical product with a brush, rag, or aerosol spray. Larger furniture refinishing facilities conducting furniture stripping may pump the chemical product through a brush. The application method depends on the size and structure of the furniture as well as the capabilities of the facility (Ref. 2). Some firms may use alternative methods of paint and coating removal, such as sanding or heat/thermal guns, but EPA's information to date indicates that paint and coating removal on furniture is primarily conducted with chemical removers (Refs. 22, 27, 31, 66 and 27).
The area where furniture refinishing workers conducting furniture stripping apply paint and coating removal chemicals typically has a sloped surface to allow for collection and recycling of unused chemical product. Larger facilities use a flow tray to apply the paint and coating removal product or chemical to parts. The flow tray is a sloped, shallow tank with a drain at the lower end. Some facilities may use a dip tank to immerse whole pieces or parts of furniture in the chemical product (Refs. 2 and 22).
After a worker applies the chemical product or immerses the piece of furniture in it, the paint and coating remover is left to soak, or “dwell,” on the furniture surface to soften the paint, coating, or varnish. Once soaking is complete, a worker manually scrapes or brushes the unwanted coating from the furniture surface. The worker then transfers the furniture to a washing area where they wash the waste chemical and paint or coating sludge from the furniture. Workers can wash the treated furniture with low-pressure washing operations or high-pressure water jets or high-pressure wands. Wash water may contain oxalic acid to brighten the wood surface. Wash water is collected and either recycled or disposed of as waste. After washing, the worker transfers the furniture to a drying area where it is allowed to dry before being transferred to other refinishing processes (
Based on industry research and discussions with stakeholders, EPA is aware that most commercial furniture refinishing firms primarily use chemical methods for paint and coating removal, and that methylene chloride or methylene chloride-based products are the types of chemical paint removers primarily and, in some firms, exclusively, used. Some commercial furniture refinishers, including some small businesses participating in the SBAR process, have said that although they make limited use of acetone for some types of furniture, they have not found any workable substitutes for methylene chloride as a primary paint and coating removal method (Refs. 22 and 27). More information on the potential use of substitutes for furniture refinishing is provided in Unit XI.E.
The methylene chloride risk assessment and additional supplemental analyses identified acute and chronic risks from inhalation of methylene chloride during paint and coating removal by consumers, commercial users, and bystanders in residences or workplaces (individuals not using the paint and coating remover but nearby a user) (Refs. 2, 19, 20, and 38). This includes an assessment of the risks from methylene chloride when used in commercial furniture refinishing. EPA estimates that, annually, there are approximately 15,000 workers at 4,900 commercial refinishing operations conducting paint and coating removal with methylene chloride (Ref. 4).
In addition to estimating likely exposures under current use patterns, for both commercial and consumer users, EPA assessed a number of exposure scenarios associated with risk reduction options in order to identify variations in methylene chloride exposure during paint and coating removal. All variations in the scenarios were applied to industry-specific exposure inputs and evaluated with exposure parameters that were modified to reflect either a reasonable worst-case scenario (also called the baseline) or a scenario in which exposures were moderated by several factors (also called the central tendency scenario). The risk reduction options varied between scenarios and included engineering controls and use of personal protective equipment (PPE), as well as combinations of these options (Ref. 19).
• Under the PPE risk reduction option exposure scenarios, EPA evaluated respirators with APF 10 to 10,000 for acute and chronic risks, including cancer risks.
• For the engineering controls risk reduction option exposure scenarios, EPA evaluated using local exhaust ventilation (LEV) to improve ventilation near the activity of workers in furniture refinishing operations, with an assumed 90% reduction in exposure levels.
Overall, EPA evaluated several distinct exposure scenarios for paint and coating removal with methylene chloride for commercial furniture refinishing. Additionally, EPA evaluated several distinct exposure scenarios for miscellaneous paint and coating removal conducted by immersion of the object in vats or tanks of methylene chloride (dip methods), since this has been reported as a method of paint and coating removal during furniture refinishing (Refs. 19 and 27).
The results of these evaluations of exposure scenarios demonstrate that the scenarios meeting all relevant health benchmarks for all scenarios of methylene chloride in paint and coating removal in commercial furniture refinishing requires: (1) A respiratory protection program using a supplied-air respirator with APF of 1,000 or 10,000, depending on type of method used for applying methylene chloride or workplace characteristics, such as the size of the facility; (2) reducing exposures with LEV that can achieve 90% efficiency in air flow plus worker respiratory protection with APF 1,000; or (3) elimination of exposure to methylene chloride by using an alternative method of paint and coating removal (Ref. 19). Although non-cancer risks and cancer risks were estimated using separate measures, exposure
The acute inhalation risk assessment used central nervous system effects to evaluate the acute risks for occupational, consumer, and bystander exposure during paint and coating removal with methylene chloride. A risk of concern was identified if the MOE estimate was less than the benchmark MOE of 10 (Ref. 2).
EPA assessed acute risks for central nervous system effects from inhalation for workers using methylene chloride for commercial furniture refinishing and for immersion methods of paint and coating removal for various objects, including furniture. Acute risks were estimated in this sector, even in the presence of respirators with APF 10 or APF 25. MOEs for acute risks in commercial furniture refinishing ranged from a central tendency of 0.08 to 0.035, with a high end of 0.0063 (workplaces engaged in paint and coating removal using immersion methods). In general, these workplaces are estimated to present exposure levels between 125 times to greater than 1,500 times more than those that are expected to produce no risks of concern. Not only workers, but also occupational bystanders, or workers engaged in tasks other than paint and coating removal, would be at acute risk for central nervous system effects.
EPA also assessed risks of chronic exposure to workers using methylene chloride for commercial furniture refinishing. The methylene chloride risk assessment used liver toxicity as the critical endpoint for chronic exposure. The selected exposure scenarios represented inhalation exposures with a range of conservative assumptions. As described earlier, the assumptions were then varied, such as use of PPE (supplied-air or other respirator) and duration of time spent in contact with the product (days and years). EPA assessed risks for liver toxicity (with effects that include vacuolation and fatty liver) for occupational and bystander exposure scenarios of paint and coating removal with methylene chloride.
Workers and occupational bystanders in this industry were estimated to be at risk of non-cancer liver toxicity as a result of chronic exposure to methylene chloride during paint and coating removal under typical exposure scenarios. When workers' exposures were estimated at facilities repeatedly reporting moderate or high methylene chloride air concentration levels, EPA estimated that there were risks of concern for these workers, even for scenarios evaluated with workers wearing respiratory protection with APF 50. Among all of the occupational scenarios, the greatest risk of concern is for workers engaging in long-term use of the product (
For commercial users and bystanders, EPA also assessed cancer risks as a result of chronic exposure to methylene chloride in paint and coating removal in commercial furniture refinishing. Methylene chloride is a likely human carcinogen; cancer risks determine the incremental increased probability of an individual in an exposed population developing cancer over a lifetime following exposure to the chemical under specified use scenarios. Common cancer benchmarks used by EPA and other regulatory agencies are an increased cancer risk of one in one million or one in ten thousand (
In the methylene chloride risk assessment, when exposure for workers and occupational bystanders was estimated in facilities conducting commercial furniture refinishing, EPA identified excess cancer risks if these workers and bystanders were exposed to paint and coating removal with methylene chloride for 250 days per year for 40 years with no respiratory protection. Cancer risks ranged from 2 in 10,000 to 8 in 10,000, with a maximum of 5 in 1,000 (workplaces using immersion methods) (Ref. 2).
For commercial users and occupational bystanders in commercial furniture refinishing, acute and chronic risks were assessed based on the typical occupational exposure parameters, which may include several hours per day of exposure over several years of work. For these reasons, any risk mitigation measures must address not only acute risks, but also chronic risks, including both cancer and non-cancer effects. For these reasons, the most sensitive endpoint for risk mitigation must be considered, whether it derives from acute or chronic exposure.
Acute exposure to methylene chloride during paint and coating removal can be fatal; since 1980, at least seven workers have died while using methylene chloride for commercial furniture refinishing. Data from OSHA indicate that the circumstances of death vary. For example, some workers collapse while conducting paint and coating removal over or near dip tanks, frequently falling into the tanks and subsequently dying. This was the case in 1985 in Pennsylvania, 1986 in Colorado, 1990 in Connecticut, and
These are likely not the only deaths in commercial furniture refinishing due to methylene chloride; as discussed in Unit VI.E., many deaths due to methylene chloride have not been recorded due to a lack of reporting to the OSHA incident database by self-employed individuals and the likelihood that deaths due to methylene chloride exposures are misattributed to heart disease, since the pathology is similar (Ref. 33).
In addition to fatalities, methylene chloride exposure during commercial wood refinishing has caused acute effects, such as the 1996 case of a cabinet manufacturer employee who experienced chronic headaches found to be due to methylene chloride exposure when the doors at his facility were closed in the winter months (Ref. 69).
In most commercial furniture refinishing facilities using methylene chloride for paint and coating removal, worker and occupational bystander exposure concentrations are orders of magnitude above what would be necessary to achieve the benchmark MOE of 10 for acute and chronic non-cancer effects. For acute health effects such as nervous system impacts, EPA estimated an MOE of 0.08 for workers in commercial furniture refinishing. For chronic non-cancer health effects such as liver toxicity, workers in this industry have an MOE of 0.6 to 0.3 (Ref. 2). For a description of MOEs and their use in risk assessment, see Unit IV.B.
In each case, workers in commercial furniture refinishing using methylene chloride for paint and coating removal are exposed at a level that is generally 125 to 1,500 times higher than what EPA has found to be a level that would not present acute or chronic non-cancer risks of concern. These risks of concern are for effects such as death, multiple adverse chronic health effects, and the subsequent lifetime impacts from these effects. Additionally, individuals occupationally exposed to methylene chloride in paint and coating removal may also be impacted by an increased risk for several types of cancer. The cancer risks to workers in commercial furniture refinishing using methylene chloride for paint and coating removal range from 8 cases in 10,000 people to 5 cases in 1,000 people (workplaces using immersion methods) (Ref. 2).
EPA's risk estimates are corroborated by research conducted independently investigating working conditions at commercial furniture refinishing and OSHA enforcement of their methylene chloride standard. In 1990, as a result of several cases of methylene chloride poisoning during paint and coating removal in commercial furniture refinishing in Colorado, occupational medicine specialists from the University of Colorado surveyed the 21 small shops in the Denver area engaged in commercial furniture refinishing. These researchers found that of the 21 shops, no workers wore respirators at all in seven shops, and in 14 facilities, workers occasionally wore half-face respirators with organic vapor cartridges (which do not provide respiratory or eye protection from methylene chloride). In ten of the 21 shops, workers experienced acute nervous system effects, such as dizziness or nausea while working to remove coatings from furniture. The researchers concluded that “current safety practices in small-scale furniture-stripping shops may be inadequate to keep methylene chloride exposure levels in compliance with latest recommendations, and serious or fatal overexposure can occur” (Ref. 70).
When considering the benefits of preventing exposure to methylene chloride in paint and coating removal in commercial furniture refinishing, EPA considered the type of effect, the severity of the effect, the duration of the effect, and costs and other impacts of the health endpoint. The health endpoints associated with exposure to methylene chloride are serious. Unit VI.E. presents a detailed discussion of the impacts of the most significant acute, chronic non-cancer, and cancer effects associated with methylene chloride exposure during paint and coating removal, including the severity of the effect, the manifestation of the effect, and how the effect impacts a person during their lifetime. These effects include nervous system effects resulting from acute exposures, such as sensory impairment, incapacitation (loss of consciousness), and death; and effects resulting from chronic, occupational exposures including liver toxicity and liver cancer, hematopoietic cancers, brain cancer, lung cancer, reproductive effects, and kidney toxicity.
There are increased risks of death, nervous system effects, and liver, lung, brain, reproductive, and kidney effects for the approximately 15,000 workers in 4,900 commercial facilities or companies that use methylene chloride for paint and coating removal during commercial furniture refinishing each year (Ref. 4).
Although EPA is not proposing to regulate the use of methylene chloride in paint and coating removal for commercial furniture refinishing, EPA has identified potential requirements for methylene chloride in paint and coating removal for commercial furniture refinishing that could reduce exposures so that the risks presented would no longer be unreasonable. EPA is providing advanced notice of these potential approaches and is seeking comment on them.
Under this approach, exposures to methylene chloride during paint and coating removal in commercial furniture refinishing would be completely eliminated. As a result, not only non-cancer risks, but also cancer risks would be eliminated.
A full-face (or helmet/hood) self-contained breathing apparatus (SCBA) when used in the pressure demand mode or other positive pressure mode has an APF of 10,000. EPA's analysis found that use of a SCBA with an APF of 10,000 would, in all scenarios evaluated, control the methylene chloride exposure to levels that allow for meeting the benchmarks for non-cancer and cancer risks. In some commercial furniture refinishing facilities using methylene chloride for paint and coating removal, workers with a supplied-air respirator with an APF of 1,000 would experience reduced exposures to methylene chloride such that their risks would be reduced to benchmark levels (Ref. 19). It is important to note that current OSHA requirements for dermal and eye protection when using methylene chloride in any way would be maintained under this approach, in addition to other requirements for work practices, training, and hazard communication put forth in OSHA's Methylene Chloride Standard (29 CFR 1910.1052).
EPA seeks comment on whether commercial furniture refinishing operations have these types of respiratory protection programs in place, any experiences in complying with the current OSHA methylene chloride standard, methods of reducing costs associated with these programs, and recommended approaches for small businesses considering a respiratory protection program that would include supplied-air respirators.
EPA also considered requiring a combination of local exhaust ventilation and respirators with APF of 1,000 or 50, with a performance-based option of an air exposure limit of 1 ppm as an eight-hour TWA. When properly executed, this option would reduce risks to the health benchmarks for workers and bystanders (Refs. 19 and 38). However, while this option has the benefit of incorporating engineering controls and the use respirators with a lower APF, the limitations to successful implementation of the use of supplied-air respirators in the workplace discussed previously are still present.
Further, this option would also require the use of prescriptive and expensive engineering controls to ensure that the exposures are below the benchmark cancer risks (Ref. 19). In an examination of the impacts of its methylene chloride standard, OSHA in 2010 found that furniture refinishing facilities in particular have not installed ventilation systems that would lower worker exposures to methylene chloride (Ref. 68). OSHA's assessment found that this is largely due the fact that most of these facilities are part of small businesses, and they tend to be less able to have sufficient capital to purchase the ventilation systems. Additionally, this type of ventilation requires make-up air systems, which have an additional cost and which, in cold climates, would need to heat the air and thus increase energy costs (Ref. 68).
Even if these engineering controls were installed, research conducted by the National Institutes of Occupational Safety and Health (NIOSH), as well as independent researchers, has indicated that ventilation alone is generally not able to reduce methylene chloride exposures below 25 ppm (Refs. 68 and 71), and there is no indication that a level close to 1 ppm (an acceptable exposure limit) could be reached.
EPA is at this time seeking additional information to inform its consideration of the reasonably ascertainable economic consequences of an action that would address the risks of commercial furniture refinishing so that they are no longer unreasonable, as required under TSCA section 6(c)(2)(A)(iv). This section presents the information EPA currently has and identifies the information that EPA is seeking. While the costs of potential risk management actions are not a legally permissible basis for EPA to reassess its proposed unreasonable risk determination, see TSCA section 6(b)(4)(A), costs are relevant to deciding among alternative risk management approaches that reduce risk so that a chemical substance no longer presents unreasonable risk and in establishing compliance dates for a risk management approach that is ultimately selected.
Primary chemical substitutes for methylene chloride in commercial paint and coating removal more generally include products formulated with benzyl alcohol; dibasic esters; acetone, toluene, and methanol (ATM); and caustic chemicals. These substitute chemicals, their hazards, and their environmental impacts are described in more detail in Unit VI.E. EPA has learned that these chemicals are generally not suitable for paint and coating removal in furniture refinishing since they either are ineffective at removing particular coatings frequently found on furniture (such as varnish, lacquer, or older paint formulations in multiple layers); are formulated to include large amounts of water and thus
In addition to substitute chemical products, EPA has identified non-chemical methods for commercial paint and coating removal that can be used more generally as alternatives to methylene chloride. Frequently-used alternative methods to chemical paint and coating removal include thermal removal, sanding, hydroblasting, abrasive blasting, and laser removal (Refs. 22 and 27). These methods are already frequently in use in various industries for paint and coating removal (Refs. 22, 27, and 31); they and their acute and chronic hazards to workers are described in more detail in Unit VI.E.
For commercial furniture refinishing, EPA has learned that all firms engage in varying amounts of mechanical or hand-sanding but do not consider it a primary method of paint and coating removal (Refs. 22 and 27). Additionally, despite the hand scraping or brushing that is required to remove waste paint from furniture and other objects for which methylene chloride has been used to remove paint or coatings, most stakeholders described sanding as too time consuming or labor intensive to use routinely as a primary method of paint and coating removal. Additionally, though many other commercial sectors have adopted various soft media blasting techniques for delicate substrates, such as using soda blasting on fiberglass vehicle parts, EPA has not found this to be a practice used in commercial furniture refinishing (Refs. 22 and 27).
EPA is seeking additional information to inform its consideration of the impacts on commercial furniture refinishing if use of methylene chloride as a paint and coating remover were prohibited or restricted.
• What percent of business for firms in this sector is paint and coating removal, versus furniture repair, reupholstery, or other furniture refinishing functions?
• How likely is it that firms in this sector would close if methylene chloride were prohibited from use in paint and coating removal in this sector?
• What would the impact be on this sector if all firms were prohibited from using methylene chloride for paint and coating removal, and thus any changes in work processes or dwell time would be universally experienced?
• Have firms had any success with substitute chemicals or alternative methods of paint and coating removal? If not, which aspects of the chemical or method renders the substitute or alternative ineffective?
Related to the approach that would require a respiratory protection program, including either a supplied-air respirator with either APF 1,000 or APF 10,000, or engineering controls or ventilation to reach an exposure limit of 1 ppm:
• What is the current experience of firms in this sector with supplied-air respirators and/or engineering controls?
• What is the current experience of firms in this sector with ventilation systems, makeup-air systems, and other engineering controls?
• What types of exposures do workers in firms in these sectors currently experience?
EPA has found that commercial furniture refinishing primarily uses methylene chloride for paint and coating removal and that no current chemical substitutes are seen as useful alternatives. However, in recent decades, substitute products have been developed for other types of paint and coating removal, and it is possible that new substitute chemicals or products could be developed to address the special coatings or substrates involved in commercial furniture refinishing. Several formulators and research organizations are exploring possibilities for efficacious and cost-effective substitute chemicals.
Additionally, outside of the United States, commercial furniture refinishers have adopted methods that are alternatives to chemical paint and coating removal. For example, most paint and coating removal in Sweden is conducted by thermal methods, such as heat guns or heat lamps, including for commercial furniture refinishing (Ref. 72). In Denmark, firms engaging in commercial furniture refinishing are reported to use large microwave furnaces, which can hold large pieces of furniture (Ref. 73).
These alternative methods and the research into substitute chemicals indicate that it is now and in the future may increasingly be possible to remove paint and coatings from furniture without methylene chloride. If that were the case, EPA would be able to more straightforwardly identify the costs and impacts of any proposed regulation of methylene chloride for paint and coating removal in commercial furniture refinishing. EPA is seeking additional information on the use and development of substitute chemicals and alternative methods that would be useful in commercial paint and coating removal on furniture, including information on:
• What are the current considerations when selecting a paint and coating removal chemical for furniture refinishing or refinishing of other wood objects or surfaces?
• What are the current considerations when selecting a paint and coating removal method for furniture refinishing or refinishing of other wood objects or surfaces?
• Are there substitute chemicals or alternative methods in use beyond what EPA has identified in this notice?
• Are any new paint and coating removal product formulations or chemistries under development?
• Are any new paint and coating removal methods in development for furniture refinishing, or refinishing of other wood objects or surfaces?
To learn more about paint and coating removal in furniture refinishing, foreseeable impacts of any proposed regulations, and alternatives to methylene chloride, EPA plans to hold a series of stakeholder meetings. These meetings will focus on current practices related to methylene chloride for paint and coating removal in commercial furniture refinishing; any substitute chemicals or alternative methods currently in use or under development;
EPA will announce dates and locations of these meetings in a future notice in the
EPA views this section as an Advanced Notice of Proposed Rulemaking, and intends to issue a Notice of Proposed Rulemaking following the series of stakeholder meetings and further analysis on the cost impacts of regulatory action on this industry. Following that proposal and public comment period, EPA intends to finalize together the regulations proposed and the future proposal related methylene chloride in commercial furniture refinishing.
This proposed rule would apply to N-methylpyrrolidone (Chemical Abstract Services Registry Number (CASRN) 872-50-4) when used in paint and coating removal.
NMP is a solvent used in a variety of industrial, commercial and consumer use applications, including (Ref. 3):
• Petrochemical processing, acetylene recovery from cracked gas, extraction of aromatics and butadiene, gas purification, lube oil extraction;
• Plastics engineering, as a reaction medium for the production of high-temperature polymers such as polyethersulfones, polyamideimides and polyaramids;
• Use in coatings, as a solvent for acrylic and epoxy resins, polyurethane paints, waterborne paints or finishes, printing inks, synthesis/diluent of wire enamels, coalescing agent;
• Production of agricultural chemicals: Solvent and/or co-solvent for liquid formulations;
• Electronics cleaning: Cleaning agent for silicon wafers, photoresist stripper, auxiliary in printed circuit board technology; and
• Industrial and domestic cleaning, including as a component in degreasers and paint removers.
According to the 2012 CDR information, approximately 180 million pounds of NMP were produced or imported into the U.S. that year (Ref. 3).
Individuals, including workers, consumers, and the general population are exposed to NMP from industrial/commercial and consumer sources, in different settings such as homes and workplaces, and through multiple routes (inhalation, dermal, and vapor-through-skin).
According to data in the 2014 TRI, 386 facilities reported releases or transfers of NMP and the top 100 facilities disposed of or released a total of 10.2 million pounds of NMP (Ref. 6).
The use assessed by EPA that is the subject of this proposal, NMP in paint and coating removal, represents about 9% of total use of NMP (Ref. 3). Paint and coating removal is the application of a chemical or use of another method to remove, loosen, or deteriorate any paint, varnish, lacquer, graffiti, surface protectants, or other coating from a substrate. Substrates can include objects, vehicles, architectural features, or structures. This use is discussed in detail in Unit XVI.A.
Although the TSCA Work Plan Chemical risk assessment for NMP focused on the chemical's use in paint and coating removal, EPA announced in December 2016 its designation of NMP as one of the ten chemical substances that will undergo risk evaluation pursuant to TSCA section 6(b)(2)(A) (81 FR 91927). The Agency is proceeding with this proposed rule addressing NMP in paint and coating removal in accordance with TSCA section 26(l) and asks for comment on its decision to pursue risk management for specific conditions of use of NMP while preparing to conduct a risk evaluation of remaining NMP conditions of use under TSCA section 6(b).
NMP is a developmental toxicant (Ref. 3). A broad set of relevant studies including animal bioassays in rats, mice, and rabbits show that maternal NMP exposure is associated with dose-dependent adverse developmental impacts on the fetus (including body weight reductions and fetal death). Developmental toxicity is the most sensitive endpoint. Other adverse impacts resulting from NMP exposure include effects on maternal body weight; alterations in blood cell counts; liver, kidney, splenic, thymus, and testicular effects; and neurotoxicity.
Nearly every study that evaluated developmental toxicity of NMP exposure identified some type of adverse effect depending on the route of exposure and the internal dose achieved. Moreover, a review of effect levels reveals that these effects are observed within a comparable dose range when administered doses are converted to internal doses for a series of gestational exposure studies in rats. The NOAELs for these comparable developmental studies typically ranged from 100 to 200 mg/kg/day for oral exposure, 237 mg/kg/day for dermal exposure, and 479 to 612 mg/m
Chronic effects of NMP exposure include fetal body weight decreases. These effects were consistent among multiple studies with different dosing regimens and across exposure routes. Reduced fetal body weight is a sensitive endpoint that is considered a marker for fetal growth restriction, which is often assumed to be representative of chronic exposures. Decreases in fetal and postnatal body weights occur at similar dose levels (Ref. 3).
There is one case report of the fetus of a pregnant woman dying in utero at week 31 of pregnancy. The worker was exposed throughout pregnancy to NMP by inhalation and dermal exposure, but the exposure levels were unknown. The worker's tasks involved other chemicals, including acetone and methanol. During week 16 of the pregnancy, the worker cleaned up a spill of NMP using latex gloves that dissolved in the NMP. She was ill for the next 4 days and experienced malaise, headache, nausea and vomiting. While this study provides some evidence that NMP may be fetotoxic, the lack of quantitative exposure data precluded its use in the TSCA Work Plan Chemical Risk Assessment for NMP (Ref. 3).
Chronic effects of NMP exposure include systemic effects following
An additional effect of chronic NMP exposure is reproductive toxicity, though these findings are significantly less frequent or consistent than the occurrence of developmental effects. When observed, reproductive effects were variable in occurrence and dose effect range. Several rat studies identified some type of testicular effect, including testicular lesions, atrophy or smaller testes. Similarly, a small number of rat studies noted some effects related to developmental neurotoxicity in postnatal development and behavior following maternal exposure (Ref. 3).
In addition to developmental toxicity, exposure to NMP presents other acute and chronic toxicity concerns. Acute effects include skin, eye, and possible respiratory irritation. Human volunteer chamber studies revealed some discomfort during exposure. Prolonged exposures to neat (
Section 6(c) of TSCA requires that EPA state the effects of NMP on the environment and the magnitude of the exposure of the environment to NMP. The proposed unreasonable risk determination, however, is based solely on risks to human health since these risks are the most serious consequence of use of NMP and are sufficient to support this proposed action.
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When released to water, NMP is not expected to adsorb to suspended solids or sediment in the water column based upon its Koc value. Based on its low soil organic carbon partitioning coefficient (log Koc = 0.9), NMP is expected to possess high mobility in soil; releases of NMP to soil may volatilize from soil surfaces or migrate through soil and contaminate groundwater (Ref. 3).
EPA was not able to locate measured bioconcentration studies for NMP; however, the estimated bioaccumulation factor of 0.9 and estimated bioconcentration factor of 3.16 suggest that bioaccumulation and bioconcentration in aquatic organisms is low. Based on the available environmental fate data, NMP is expected to have low bioaccumulation potential and low persistence (Ref. 3).
This section summarizes current state, federal, and international regulations and restrictions on NMP, with a focus on its use in paint and coating removal. None of these actions imposes requirements to the extent necessary so that NMP does not present the unreasonable risk described in this proposed rule.
While many of the statutes that EPA is charged with administering provide statutory authority to address specific sources and routes of NMP exposure, none of these can address the serious human health risks from NMP exposure that EPA is proposing to address under TSCA section 6(a).
• NMP is listed on the Toxics Release Inventory (TRI) and is therefore subject to reporting pursuant to Section 313 of the Emergency Planning and Community Right-to-Know Act (EPCRA) (Ref. 6).
• NMP is on The Clean Air Act (CAA) Section 111, Standards of Performance for New Stationary Sources of Air Pollutants—Equipment Leaks Chemical List (40 CFR 68.130)
• NMP is currently approved for use by EPA as a solvent and co-solvent inert ingredient in pesticide formulations for both food and non-food uses and is exempt from the requirements of a tolerance limit (Ref. 74).
In 2013, the Consumer Product Safety Commission issued a fact sheet warning the public about hazards of paint sand coating removal products, including those containing NMP, and included recommendations for PPE when using products containing this chemical (Ref. 62).
Several states have taken actions to reduce or make the public aware of risks from NMP. California has set worker protection regulations that require workers to wear gloves when using NMP, and workplace to meet a permissible exposure limit of 1 ppm as an eight-hour time-weighted average (TWA) (Ref. 3). Additionally, NMP is listed as an informational candidate on California's Safer Consumer Products regulations candidate list of chemicals that exhibit a hazard trait and are on an authoritative list and is also listed on California's Proposition 65 list of chemicals known to cause cancer or birth defects or other reproductive harm (Ref. 3).
In Washington, NMP is listed as a chemical of high concern under the Children's Safe Product Act (Ref. 3). Minnesota classifies NMP as a chemical of high concern and several other states have placed NMP on similar chemical listings. Additional states have
NMP is currently on the candidate list of substances of very high concern for authorization in the European Union. In August 2013, the Dutch National Institute for Public Health and the Environment submitted a proposal for the restriction of NMP to the European Chemicals Agency under the Registration, Evaluation, Authorisation and Restriction regulation. The Risk Assessment Committee modified the restriction proposal and the combined opinion will be sent to the European Commission for final decision. The Risk Assessment Committee recommended using long-term exposure Derived No Effect Levels for pregnant workers (the most sensitive population) for both inhalation and dermal exposure (Ref. 3).
Other countries have also recognized the risks of NMP. When Canada conducted a categorization of the Domestic Substances List for its Chemicals Management Plan in 2006, NMP met Canada's human health categorization criteria. NMP has been the subject of a Tier II health risk assessment in Australia under that country's Inventory Multi-tiered Assessment and Prioritisation. It is currently subject to labeling and related requirements based on concern for skin, eye and respiratory irritation and for reproductive toxicity. These government assessments consider NMP to be of low environmental concern (Ref. 3). Australia concluded that further risk management is required and additional assessment (Tier III) is needed to determine if current exposure controls are adequate to protect workers and the public when NMP is used in domestic products (Ref. 3).
In 2013, EPA identified NMP in paint and coating removal as a priority for risk assessment under the TSCA Work Plan. This unit describes the development of the NMP risk assessment and supporting analysis and expert input on the uses that are the subject of this proposed rule. A more detailed discussion of the risks associated with NMP in paint and coating removal can be found in Units XVI.B.1. and XVI.D.
Using the TSCA Work Plan chemical prioritization criteria, discussed in Unit IV.A., NMP ranked high for health hazards and exposure potential and was included on the initial list of TSCA Work Plan chemicals for assessment. NMP appeared in the 2012 TSCA Work Plan for Chemical Assessments and in the 2014 update of the TSCA Work Plan for Chemical Assessments.
EPA finalized a TSCA Work Plan Chemical Risk Assessment for NMP (NMP risk assessment) in 2015, following the 2013 peer review of the 2012 draft NMP risk assessment. All documents from the 2013 peer review of the draft NMP risk assessment are available in EPA Docket Number EPA-HQ-OPPT-2012-0725. The completed risk assessment is included in that docket.
The NMP risk assessment evaluated health risks to consumers, workers, and bystanders from dermal and inhalation exposures to NMP when used in paint and coating removal (Ref. 3). EPA assumes workers and consumers would be adults of both sexes 16 years and older, including pregnant women. EPA assumes bystanders in residential settings would be individuals of any age group (
The NMP risk assessment characterized human health effects associated with paint removal with NMP. Based on the physical-chemical properties of NMP and the paint stripping use scenarios described in the assessment, EPA views dermal exposure as the predominant route of exposure to NMP during paint removal, including absorption of vapor-through-skin.
The NMP risk assessment identified developmental risks of concern following acute (short-term) and chronic (repeated) exposures for workers conducting paint removal with NMP. Specifically, these developmental effects include increased fetal resorptions (fetal death) from acute exposures and decreased fetal body weight from chronic exposures (Ref. 3). EPA identified acute risks of concern for consumers using NMP for paint and coating removal in the more complete array of scenarios described in the supplemental analyses, which used the same modeling methods as the risk assessment (Refs. 75 and 76).
Margins of exposure (MOEs) were used in the risk assessment and supplemental analyses to estimate non-cancer risks for acute and chronic exposures. For an explanation of MOEs, see Unit IV.B. For NMP, EPA identified acute or chronic non-cancer risks of concern if the MOE estimates were less than the benchmark MOE of 30 (Ref. 3). The health endpoint used for the benchmark MOE for acute exposure to NMP is fetal death; the health endpoint used for the benchmark MOE for chronic exposure to NMP is decreased infant birth weight. These are the most sensitive adverse health effects from exposure to NMP.
The NMP risk assessment and supplemental analyses estimated acute risks of fetal death for consumers from the use of paint and coating removers containing NMP, and acute and chronic non-cancer risks of decreased infant birth weight for workers from the use of paint and coating removers containing NMP. Exposure scenarios with MOEs below the benchmark MOE present risks of concern. Typically, non-cancer adverse effects are more likely to result from exposure scenarios with MOEs multiple orders of magnitude below the benchmark MOE. For non-cancer effects, EPA estimated exposures that are significantly larger than the point of departure (Ref. 3). Specifically, the assessment identified risks of fetal death from acute exposures of:
• Four or fewer hours per day, when gloves were not used.
• Greater than 4 hours per day, and risks were not mitigated by personal protective equipment such as respirators or gloves.
The assessment identified risks of decreased infant birth weight from chronic (repeated) exposures of:
• Four or fewer hours per day, when gloves were not used.
• Greater than 4 hours per day, and risks were not mitigated by personal protective equipment such as respirators or gloves.
• Over the course of a work-week (5 days)
Given the risks identified in the NMP risk assessment, the agency undertook further analysis to consider whether that use of NMP in paint and coating removal poses an unreasonable risk.
Following the NMP risk assessment, EPA conducted supplemental analyses
In addition to the consultations described in Unit XXIII., EPA initiated discussions with experts on and users of paint removers (Ref. 22). For more information on these discussions, see Unit IV.D.
Under TSCA section 6(a), if the Administrator determines that a chemical substance presents an unreasonable risk of injury to health or the environment, without consideration of costs or other non-risk factors, including an unreasonable risk to a potentially exposed or susceptible subpopulation identified as relevant to EPA's risk evaluation, under the conditions of use, EPA must by rule apply one or more requirements to the extent necessary so that the chemical substance no longer presents such risk.
The TSCA section 6(a) requirements can include one or more, or a combination of, the following actions:
• Prohibit or otherwise restrict the manufacturing, processing, or distribution in commerce of such substances (§ 6(a)(1)).
• Prohibit or otherwise restrict the manufacturing, processing, or distribution in commerce of such substances for particular uses or for uses in excess of a specified concentration (§ 6(a)(2)).
• Require minimum warning labels and instructions (§ 6(a)(3)).
• Require recordkeeping or testing (§ 6(a)(4)).
• Prohibit or regulate any manner or method of commercial use (§ 6(a)(5)).
• Prohibit or otherwise regulate any manner or method of disposal (§ 6(a)(6)).
• Direct manufacturers and processors to give notice of the determination to distributors and the public and replace or repurchase substances (§ 6(a)(7)).
EPA analyzed a wide range of regulatory options under section 6(a) for each use in order to select the proposed regulatory approach (Refs. 23 and 24). For each use, EPA considered whether a regulatory option (or combination of options) would address the unreasonable risk so that it no longer presents such risk. To do so, EPA initially analyzed whether the regulatory options could reduce risks to levels below those of concern, based on EPA's technical analysis of exposure scenarios.
After the technical analysis, which represents EPA's assessment of the potential for the regulatory options to achieve risk benchmarks based on analysis of exposure scenarios, EPA then considered how reliably the regulatory options would actually reach these benchmarks. For the purposes of this proposal, EPA found that an option addressed the risk so that it was no longer unreasonable if the option could achieve the benchmark MOE or cancer benchmark for the most sensitive endpoint. In considering whether a regulatory option would ensure the chemical no longer presents the unreasonable risk, EPA considered whether the option could be realistically implemented or whether there were practical limitations on how well the option would mitigate the risks in relation to the benchmarks, as well as whether the option's protectiveness was impacted by environmental justice or children's health concerns.
As noted previously, TSCA section 6(c)(2) requires EPA to consider and publish a statement based on reasonably available information with respect to the:
• Health effects of the chemical substance or mixture (in this case, NMP) and the magnitude of human exposure to NMP;
• Environmental effects of NMP and the magnitude of exposure of the environment to NMP;
• Benefits of NMP for various uses;
• Reasonably ascertainable economic consequences of the rule, including: The likely effect of the rule on the national economy, small business, technological innovation, the environment, and public health; the costs and benefits of the proposed and final rule and of the one or more primary alternatives that EPA considered; and the cost-effectiveness of the proposed rule and of the one or more primary alternatives that EPA considered.
In addition, in selecting among prohibitions and other restrictions available under TSCA section 6(a), EPA must factor in, to the extent practicable, these considerations. Further, in deciding whether to prohibit or restrict in a manner that substantially prevents a specific condition of use of a chemical substance or mixture, and in setting an appropriate transition period for such action, EPA must also consider, to the extent practicable, whether technically and economically feasible alternatives that benefit health or the environment will be reasonably available as a substitute when the proposed prohibition or other restriction takes effect.
EPA's analysis of health effects and magnitude of exposure to NMP can be found in Units XIV.B., XVI.B. and XVI.C., which discuss the NMP risk assessment and EPA's regulatory assessment of the use of NMP in paint and coating removal. A discussion of the environmental effects of NMP is in Unit XII.D.
With respect to the costs and benefits of this proposal and the alternatives EPA considered, as well as the impacts on small businesses, the full analysis is presented in the Economic Analysis (Ref. 4). The regulatory options and consideration of TSCA section 6(c)(2) factors are discussed in more detail in Unit V for methylene chloride in paint and coating removal and in Unit XV. for NMP in paint and coating removal.
To the extent information was reasonably available, EPA considered the benefits realized from risk reductions (including monetized benefits, non-monetized quantified benefits, and qualitative benefits), offsets to benefits from countervailing risks (
EPA considered the estimated costs to regulated entities as well as the cost to administer and enforce the options. For example, an option that includes use of a respirator would include inspections to evaluate compliance with all elements of a respiratory protection program (Ref. 25). In understanding the burden, EPA took into account the reasonably available information about the functionality and performance efficacy of the regulatory options and the ability to implement the use of chemical substitutes or other alternatives. Reasonably available information included the existence of other Federal, state, or international regulatory requirements associated with each of the regulatory options as well as the commercial history for the options. A discussion of the costs EPA considered and a discussion of the cost-effectiveness of the proposal and the primary alternate regulatory options that EPA considered is in Units XVI.E. and XVII.A. In addition, a discussion of the impacts on small businesses is in Unit XXIII. and in the Initial Regulatory Flexibility Analysis and Report from the Small Business Advocacy Review Panel (Refs. 26 and 27).
With respect to the anticipated effects of this proposal on the national economy, EPA considered the number of businesses and workers that would be affected and the costs and benefits to those businesses and workers. In addition, EPA considered the employment impacts of this proposal, as discussed in the Economic Analysis (Ref. 4). EPA found that the direction of change in employment is uncertain, but EPA expects the short term and longer-term employment effects to be small.
The benefits of NMP in paint and coating removal are discussed in Unit XVI.A., along with the availability of alternatives. The dates that the proposed restrictions would take effect are discussed in Unit XX. The availability of alternatives to methylene chloride in paint and coating removal on those dates is discussed in Unit XVI.D.
Finally, with respect to this proposal's effect on technological innovation, EPA expects this action to spur innovation, not hinder it. An impending prohibition on this use of NMP is likely to increase demand for alternatives, which EPA expects would result in the development of new alternatives. See section 9.3 in the Economic Analysis (Ref. 4).
EPA analyzed a wide range of regulatory options under TSCA section 6(a). There are a range of regulatory options under TSCA; only those pertaining to these risks were evaluated in detail. An overview of the regulatory options not evaluated in detail follows.
First, EPA reasoned that the TSCA section 6(a)(1) regulatory option to prohibit the manufacture, processing or distribution in commerce of NMP or limit the amount of NMP which may be manufactured, processed or distributed in commerce is not applicable because EPA is not proposing to ban or limit the manufacture, processing or distribution in commerce of NMP for uses other than paint and coating removal.
In addition, EPA reasoned that the TSCA section 6(a)(6) regulatory option to prohibit or otherwise regulate any manner or method of disposal of the chemical is not applicable since EPA did not assess risks associated with NMP disposal.
Another option EPA evaluated would be to only require warning labels and instructions on paint and coating removal products containing NMP, pursuant to section 6(a)(3) (Ref. 30). EPA reasoned that warning labels and instructions alone could not mitigate the risks as necessary so that NMP no longer presents an unreasonable risk (either to users in the general population or to users who are women of childbearing age). For a further discussion of why EPA believes that labeling alone will not effectively mitigate the unreasonable risks, see Unit V.C. EPA's general observations about labeling, described in that unit, are also applicable in the case of NMP. Specifically regarding NMP, effective personal protection resulting in risk reduction would require not only the appropriate donning and doffing of specialized gloves that are not easily available to consumers, but also identification of which type of glove is protective against particular formulations of paint and coating removal products containing NMP (Ref. 75). Any labeling aiming to reduce risks to consumer or commercial users of these products would need to sufficiently and clearly explain this, and would still leave the user with the problem of obtaining and properly using the appropriate gloves and (in the case of commercial users or consumers using the product for several days at a time) the appropriate respirator. With respect to consumer risks in particular, a label on a product that is easily available to consumers, that directs the user to obtain and use safety equipment that is not easily available to consumers, is especially unlikely to be correctly followed.
A regulatory option receiving limited evaluation was a training and certification program for commercial paint and coating removers, similar to the certification process required under EPA's Lead Renovation, Repair, and Painting Rule (73 FR 21692, April 22, 2008). This option was recommended by the small entity representatives as part of the SBAR process (Ref. 27). EPA considered this option as an approach to reducing risks from NMP in paint and coating removal. However, unlike the process for training and certification of commercial workers required under the Lead Renovation, Repair, and Paint Rule, effective risk reduction from commercial use of NMP for paint and coating removal would require additional regulation of distributors of these products. When considering this approach, given the Agency's experience with the training and certification program under the Lead Renovation, Repair, and Paint Rule, EPA viewed the costs and challenges involved in regulating distributors and ensuring that only trained and certified commercial users are able to access these paint and coating removal products as a significant limitation for this approach. EPA seeks public comment on the feasibility of such a program and its potential to reduce risks of exposure to NMP for workers so that those risks are no longer unreasonable.
This unit describes the current use of NMP in paint and coating removal, the unreasonable risks presented by this use, and how EPA identified which regulatory options reduce the risks so that they are no longer unreasonable.
As described previously in Units I.A. and VI.B., paint and coating removal, also referred to as paint stripping, is the process of removing paint or other coatings from a surface of a substrate, such as an object or structure (Ref. 3). More information on specific techniques for paint removal in each industry and by consumers are in the NMP risk assessment and supplemental materials (Refs. 3, 75, and 76).
Chemical products for paint and coating removal are used across several industries as well as by consumers or hobbyists, and products intended for one type of use—such as aircraft renovation—have been used in other
EPA has identified 64 different products for paint and coating removal that contain NMP, formulated by 21 different firms. This is approximately 59% of the total number of paint and coating removal products EPA identified (109 products) (Ref. 34). Though the number of workers and consumers exposed to NMP during paint and coating removal is uncertain, EPA has several estimates based on industry data. As described in Unit VI.B., commercial uses include automotive refinishing, furniture refinishing, art conservation and restoration, pleasure craft building and repair, aircraft paint removal, graffiti removal, bathtub refinishing, and renovations in residences or other buildings. As described in more detail in the Economic Analysis, EPA estimates that 30,300 workers annually are exposed to NMP during paint and coating removal activities (Ref. 4).
Consumer use of NMP in paint and coating removal is similar to commercial use, but occurs in consumer settings, such as homes, workshops, basements, garages, and outdoors. Paint and coating removal products containing NMP are the same as those used in many commercial settings, and the process consumers use is similar to commercial methods of brushing or spraying on the paint and coating removal product, allowing time to pass for the product to penetrate the coating, and then scraping the loosened coating from the surface.
When consumers interested in DIY paint and coating removal choose to use chemical paint removers (Ref. 77), they frequently receive advice to use products that contain NMP, without any reference to the risks presented by NMP or even solvents in general (Refs. 78 and 79). Manufacturers and retailers of paint and coating removal products containing NMP frequently sell them to consumers in small containers with marketing language or labeling that state they are biodegradable, `plant-based', or contain `no harsh fumes' and implies they are `green' or `safe' (Ref. 35). Products containing NMP are not required to be labeled with that information or any information about personal protection or risk reduction. These products are frequently sold at home improvement retailers or automotive supply stores that sell products to consumers as well as professional users (Ref. 35). Additionally, due to the wide availability of products available on the Internet and through various additional suppliers that serve commercial and consumer customers, consumers are able to purchase a variety of paint and coating removal products containing NMP. EPA estimates that the majority of users of paint and coating removal products containing NMP are consumers, rather than occupational users. EPA estimates that approximately 732,000 consumers annually use paint removal products containing NMP (Ref. 4).
In this section, EPA explains how it evaluated whether the regulatory options considered would address the unreasonable risks presented by the use of NMP in paint and coating removal. First, EPA characterizes the unreasonable risks associated with the current use of NMP in paint and coating removal. Then, EPA describes its initial analysis of which regulatory options have the potential to achieve non-cancer benchmarks. Lastly, this section evaluates how well those regulatory options would address the unreasonable risk in practice.
EPA assumed that consumer and commercial users would generally be adults of both sexes (16 years old and older, including women of childbearing age), although exposures by teenagers and even younger individuals may be possible in consumer settings. However, risk estimates focused on the most susceptible life stage, which are pregnant women and their developing fetus, because developmental toxicity is one of the most sensitive health effects associated with NMP exposure (Ref. 3).
For exposures in commercial settings, EPA assessed exposure scenarios under which the worker was presumed to work on either an indoor project (such as work by professional contractors, furniture stripping and other settings) or an outdoor or semi-enclosed space (such as graffiti removal on the exterior of a building, outdoor escalator, or elevator).
In the NMP risk assessment, EPA developed six occupational user
• The weight fraction of NMP in the paint and coating removal product;
• Skin surface area of the worker in contact with the paint removal product; and
• Duration of contact (in hours) with the paint removal product.
Within each of the six workplace scenarios, EPA evaluated five permutations, by modifying the parameters of the scenario to include different combinations of personal protective equipment (PPE). These permutations were (1) respirator with assigned protection factor (APF) of 10, and gloves; (2) respirator APF 10 only; (3) gloves only; (4) neither respirator nor gloves; and (5) not directly using the product (nearby worker) (Ref. 3).
EPA used air concentration data and estimates found in literature sources to serve as inhalation exposure concentration inputs to the physiologically-based pharmacokinetic modeling for occupational exposures to NMP. This modeling was used to derive internal dose estimates for acute and chronic occupational exposures, and predicted absorption of liquid or vapor by the individual in the scenario when using the paint and coating removal product containing NMP (Ref. 3).
For consumer exposures, EPA assessed exposure scenarios under which the individual was presumed to work on one of several types of paint and coating removal projects (table and chairs, chest of drawers, or bathtub), with inputs reflecting that consumers do not reliably use personal protective equipment (effective gloves) or have access to engineering controls (
EPA developed seven consumer exposure scenarios for the assessment. Similar to the worker exposure assessment, the following factors were considered in developing the exposure scenarios (Ref. 3):
• The type of application (
• The location where the product is applied, which relates to exposure factors such as the room volume and its air exchange rate with outdoor air;
• The house volume and air exchange rate, for reasons similar to those for the product use location; and
• Precautionary behaviors such as opening windows in the application room, the user leaving the application room during the wait period, related changes to the air exchange rates, and the proximity of the user to the source of NMP emissions.
In the absence of representative air monitoring data for consumers using paint and coating removal products containing NMP, EPA used the Multi-Chamber Concentration and Exposure Model to estimate consumer inhalation exposure concentrations. The predicted air concentrations from the exposure modeling for users and non-users were inputs to the physiologically-based pharmacokinetic modeling software and used to define consumers' moment-by-moment air concentration inhaled and in contact with unobstructed skin. The parameters and data sources for the model are described in the NMP risk assessment (Ref. 3).
EPA's estimates of the exposures individuals experienced during the acute and chronic scenarios of commercial or consumer use of paint and coating removal products containing NMP were used to assess the risks of these uses of NMP. The full exposure estimates and risk findings are described in the NMP risk assessment; risk findings are also summarized in Unit XVI.B.1.a.
In addition to estimating likely exposures under current use patterns, for both commercial and consumer users, EPA assessed a number of exposure scenarios associated with risk reduction options in order to identify variations in NMP exposure. All variations in the scenarios were evaluated with exposure parameters that were modified to reflect either a reasonable worst-case scenario (also called the baseline) or a scenario in which exposures were moderated by several factors (also called the central tendency scenario). The risk reduction options that were varied between scenarios included material substitution, duration of use, engineering controls, and use of PPE, as well as combinations of these options (Refs. 37, 75, and 76), as follows:
• The material substitution scenarios involved reducing the concentration of NMP in the paint and coating removal product, with concentrations varying from 5, 10, 25, 30, 35, 40, 62.5 and 100% by weight in the product.
• The duration of use scenarios involved, for consumers, variations in the type of activity during which paint removal would be conducted (for example, 7 hours of exposure to NMP when removing paint from a table and 8 chairs; 0.5 hours of exposure to NMP when removing paint from a coffee table). For commercial users, duration of exposure to NMP in paint and coating removers was assessed as job time during a work day (1 to 8 hours).
• Under the PPE risk reduction option exposure scenarios, EPA evaluated consumers wearing specialized gloves, and workers wearing specialized gloves and/or respirators with APF 10.
• For the engineering controls risk reduction option exposure scenarios, EPA evaluated using LEV to improve ventilation near the activity of workers in furniture refinishing operations, with an assumed 90% reduction in exposure levels.
Additionally, EPA evaluated combinations of the options. For consumers, this included material substitution, duration of exposure, and PPE; for workers, this included material substitution, duration of exposure, PPE, and LEV. Engineering controls are not assumed to be practical for consumers as a method of exposure reduction. Overall, EPA evaluated dozens of distinct exposure scenarios for both consumer and commercial paint and coating removal with NMP.
In the risk assessment and supplemental analyses, EPA evaluated risks for fetal death from dermal contact, inhalation, and vapor-through-skin for all consumer, occupational, and bystander exposure scenarios of paint and coating removal with NMP. No risks were identified for occupational or residential bystanders. Acute risks of fetal death were identified for the
For commercial users, the occupational scenarios in which acute risks were identified included four hours of paint removal in one day with no gloves, with or without a respirator, indoors or outdoors, assuming mid-range of the exposure parameters described earlier, such as concentration of NMP in the product (MOEs range from 12 to 15); and four hours of paint removal in one day with or without a respirator and gloves, indoors or outdoors, assuming the higher exposure parameters described earlier (MOEs range from 0.7 to 11.8) (Ref. 3). These risks are present whether the worker is indoors or outdoors, and may be present even in the presence of PPE or ventilation, depending on the duration of use and the concentration of NMP in the product. Therefore, EPA's proposed determination is that acute NMP exposures during paint and coating removal present unreasonable risks.
EPA also assessed risks of chronic exposure to NMP by commercial users, with a short-term chronic exposure that can be defined as a repeat-dose scenario in which the individual is exposed over the course of a work week, rather than over a lifetime. This chronic assessment used decreased fetal body weight as the critical endpoint. EPA assessed risks for decreased birth weight for occupational and bystander exposure scenarios of paint and coating removal with NMP. In the risk assessment, a risk of concern was identified if the MOE estimate was less than the benchmark MOE of 30 for decreased birth weight (Ref. 3).
Risk of decreased birth weight was identified for commercial users of NMP for paint and coating removal in several scenarios, including four hours of paint removal during each day in a work week without gloves, with or without a respirator, indoors or outdoors, assuming the mid-range of the exposure parameters described earlier, such as concentration of NMP in the product (MOEs range from 5.4 to 6.1); and eight hours of paint removal during each day in a work week, with or without a respirator or gloves, indoors or outdoors, assuming the higher exposure parameters described earlier (MOEs range from 0.1 to 3.2) (Ref. 3). Though no risks were identified for occupational bystanders, for workers, these risks are present whether the worker is indoors or outdoors, and may be present even if PPE or ventilation is used, depending on the duration of use and the concentration of NMP in the product (Ref. 3). In some scenarios, this equates to estimated exposures that are more than 10 times greater than those that would produce the benchmark MOE for this endpoint, which assesses risks for fetal death and decreased birth weight. Therefore, EPA's proposed determination is that chronic NMP exposures during paint and coating removal also present unreasonable risks.
The SBAR Panel convened in support of this action heard from several SERs who expressed concerns about the underlying NMP risk assessment (Ref. 27). Many of the concerns expressed by these SERs were already expressed in the public comments and the peer review comments on the NMP risk assessment. The Summary of External Peer Review and Public Comments and Disposition document in the risk assessment docket (EPA-HQ-OPPT-2012-0725) explains how EPA responded to the comments received.
The results of EPA's assessment of consumer uses, exposures, and risks indicate that regulatory options for consumer uses such as reducing the concentration of NMP in a product or advising the use of specialized gloves or respirators individually could not achieve the target MOE benchmarks for acute exposures (Ref. 76). Similarly, the results of EPA's evaluation indicate that regulatory options for occupational exposures such as reducing the concentration of NMP in products used for paint and coating removal and using local exhaust ventilation to improve ventilation, in the absence of PPE, could not achieve the target MOE benchmarks for non-cancer endpoints for acute and chronic exposures (Refs. 37 and 75). The results also demonstrate that all risk reduction options meeting the benchmark MOEs for NMP in paint and coating removal require the use of specialized gloves, whether used alone or in conjunction with additional levels of respiratory protection such as a respirator of APF 10 or the use of an air exposure limit, even when the concentration of NMP in a product was limited to 25 percent. Therefore, EPA found setting a maximum concentration of NMP in products under TSCA section 6(a)(2) alone would not reduce exposures to levels at which risks would be at or below the risk benchmarks. Further, EPA's analysis found that even with specialized gloves and a respirator, workers would be at risk of NMP exposure if they used products with more than 25 percent NMP. Additional exposure level estimates for various scenarios are available in the supplemental analyses, which also document options that did not meet the risk benchmarks and which do not, for purposes of this proposal, address the identified unreasonable risks (Refs. 37, 75, and 76).
The Agency examined two main alternative approaches to addressing the unreasonable risk from NMP in paint and coating removal under current conditions of use by consumers and commercial users. These two approaches are the supply chain approach (and its two primary variations) and the reformulation, labeling, and PPE approach. These
(a) The first co-proposed approach (option 1) is a supply-chain approach, which would include prohibiting the manufacturing, processing, and distribution in commerce of NMP for paint and coating removal under TSCA section 6(a)(2) except for certain uses critical to national security; prohibiting the commercial use of NMP in paint and coating removal under TSCA section 6(a)(5) except for certain uses critical to national security; requiring that all paint and coating removers containing NMP be distributed in containers with volumes no less than 5 gallons under TSCA section 6(a)(2); requiring downstream notification when distributing NMP for other uses under TSCA section 6(a)(3); and limited recordkeeping under TSCA section 6(a)(4);
(b) Variations on such a supply-chain approach, such as just prohibiting the manufacturing, processing, and distribution in commerce of NMP for paint and coating removal under TSCA section 6(a)(2) for consumer and commercial use or just prohibiting the commercial use of NMP for paint and coating removal under TSCA section 6(a)(5);
(c) Additional variations on such a supply-chain approach, such as prohibiting the manufacturing, processing, and distribution in commerce of NMP for paint and coating removal under TSCA section 6(a)(2) for consumer and commercial use and requiring downstream notification (
(d) The second co-proposed approach (option 2), a reformulation, PPE, and labeling approach, which would require (1) product reformulation to limit the concentration of NMP in paint and coating removal products under section 6(a)(2); (2) testing of product formulations to identify specialized gloves that provide protection for users and relevant recordkeeping under section 6(a)(4); (3) relabeling of products intended for consumer use to provide additional information to consumers under section 6(a)(3); (4) an occupational dermal and respiratory protection program for commercial use of NMP in paint and coating removal, including a requirement for hazard communication, specialized gloves and an air exposure limit or respirator under section 6(a)(5); (5) a prohibition on use of NMP above a concentration of 35 percent for commercial paint and coating removal under 6(a)(5); (6) downstream notification when distributing NMP for other uses under TSCA section 6(a)(3); and (7) limited recordkeeping under TSCA section 6(a)(4). Under this co-proposed approach, EPA is not proposing an exemption for coating removal uses identified as critical to national security because paint and coating removal products containing NMP would continue to be available for these national security uses under this option, even without establishing a national security exemption.
A discussion of the regulatory options that could reach the risk benchmarks for consumer use, commercial use, or both is in this unit, along with EPA's evaluation of how well those regulatory options would address the unreasonable risks EPA has identified. EPA requests comment on the two co-proposed regulatory options addressing the use of NMP in paint and coating removal, particularly with regard to the advantages and disadvantages of the different approaches, their potential associated benefits, and whether such approaches would be consistent with EPA's obligation under TSCA to address risks identified as unreasonable.
As discussed earlier, a risk of concern was identified if the MOE estimate was less than the benchmark MOE of 30. As described in Unit XVI.B.1., the baseline risks for workers and consumers from paint and coating removal with NMP were identified as ranging from two to 10 times below the benchmark MOEs of 30 for fetal death (the acute health impact) or low birth weight (the chronic health impact). Under this proposed option, exposures to NMP during paint and coating removal would be eliminated for consumers and workers. As a result, acute and chronic risks would be eliminated.
The first co-proposed approach would ensure that workers and consumers from the general population (as well as workers and consumers who are women of childbearing age) are no longer exposed to unreasonable risks from NMP exposure during paint and coating removal. Prohibiting the manufacturing, processing and distribution in commerce of NMP for paint and coating removal would minimize the overall availability of NMP for paint and coating removal. Importantly, this proposed regulation is protective of consumer users. EPA cannot regulate consumer use under TSCA section 6(a)(5). The prohibition of the commercial use of NMP for paint and coating removal would reduce commercial demand for NMP paint and coating removal products, reduce the likelihood that other types of products formulated with NMP would be used for paint and coating removal, and significantly reduce the potential for consumer use of commercial paint and coating removal products containing NMP. Workers would not be exposed to NMP for paint and coating removal, except for those uses that are proposed to be exempt because they are critical to national security. The risk to consumers would be minimized because commercial paint and coating removal products containing NMP would not be available outside of those directly supplied to DOD for uses identified as critical to national security.
The downstream notification of these restrictions ensures that processors and distributors are aware of the manufacturing, processing, distribution in commerce and use restrictions for NMP in paint and coating removal, and enhances the likelihood that the risks associated with this use of NMP are addressed throughout the supply chain. Downstream notification also streamlines compliance and enhances enforcement, since compliance is improved when rules are clearly and simply communicated (Ref. 39). This integrated supply chain proposed approach completely mitigates the risk to consumers and workers from NMP in paint and coating removal.
Without downstream notification, unsophisticated purchasers in particular are likely to be unfamiliar with the prohibitions regarding this use and mistakenly use NMP for paint and coating removal, thereby exposing themselves and bystanders to unreasonable risks. Thus, under these variations, EPA anticipates that many users would not actually realize the risk benchmarks. Therefore, these variations fail to protect against the unreasonable risks. EPA requests comment on its consideration of and conclusions regarding this option.
Another regulatory option that EPA considered was to prohibit only the commercial use of NMP for paint and coating removal. This approach would reduce risks for commercial settings, but it would not reduce risks to consumers so that they are no longer unreasonable. By prohibiting use in the commercial sector alone, without a prohibition on the manufacture, processing, and distribution in commerce of paint and coating removal products containing NMP for consumer and commercial use, this approach would not address consumer risks as distributors of paint and coating removal products containing NMP could continue to distribute to consumers NMP marked as a paint and coating remover, including products labeled and marketed as “professional strength” or “commercial grade” products. Since it is foreseeable that consumers would continue to purchase products labeled and marketed in this fashion, consumers would continue to be exposed far above the health benchmarks and would not be protected from the unreasonable risks posed by NMP. EPA requests comment on its consideration of and conclusions regarding this option.
Specifically, for labeling targeted to consumers under section 6(a)(3) formulators would be required to provide the following information to consumers on product labels: A warning that irreversible health effects such as fetal death may occur as a result of using the product; instructions to not use the product without a new (
EPA requests comments on the components of this co-proposal, particularly on the maximum percent concentration that would be permitted
EPA also requests comment on the scientific and technical support used for development of the 5 ppm air exposure limit (Ref. 37) for NMP and the feasibility of implementing and enforcing this performance-based approach. Additionally, EPA is requesting comment on the cost to achieve reduced exposures in the workplace or to transition to alternative chemicals or technologies. EPA is requesting comment on whether this alternate option of allowing industrial use at specified exposure levels and with appropriate personal protective equipment should be adopted. Specifically, EPA seeks information on whether this alternative approach would incentivize industry to eliminate NMP use in paint and coating removal wherever technically feasible while minimizing disruptive impacts to those processes where technically feasible substitutes are currently unavailable. EPA also requests comment on whether there should be a phase-in period,
Reducing exposure to NMP requires consideration of routes of exposure as well as user behaviors, such as wearing appropriate PPE (
Specialized gloves are an important component of reducing exposure and, thus, must be effective. The presence of co-solvents in the paint and coating removal product containing NMP can result in inadvertent exposure to NMP. Most paint and coating removal products containing NMP contain co-solvents (Ref. 34). Gloves proven to resist permeation or breakthrough from pure NMP have been shown to experience degradation and permeation with these co-solvents especially those that are small-molecule, volatile solvents. For this reason, it is not possible to know which type of glove provides adequate protection from products containing NMP with any co-solvents without testing the formulation of each product for glove breakthrough and permeation. When working with formulated products, the chemical component with the shortest break-through time must be considered when selecting the appropriate glove type for protection against chemical hazards unless glove-specific test data are available (Ref. 82). Risks may not be reduced if the appropriate gloves are not identified through testing.
Consumers could have access to NMP formulations identical to those available to commercial users. This co-proposed approach would attempt to address the unreasonable risk to consumers through the combination of labeling and product reformulation. The product reformulation would be as discussed previously. If consumers using NMP formulations which did not exceed 35% of NMP were to consistently follow
Under real-world conditions, EPA expects that not all consumers will adequately follow the label to reduce risk to a level above the benchmark MOE. The Agency is requesting comment on whether incomplete adherence to the label might still suffice to reduce risks presented by NMP in paint and coating removal so that those risks are no longer unreasonable. EPA also requests comment on whether the voluntary nature of consumer use and the information provided on the label that would allow consumers to avoid risk below the benchmark MOE if label directions were followed should be a factor in determining whether any remaining risk associated with this exposure scenario is unreasonable, and if so, how.
EPA is also requesting comment on how labels may be constructed to effectively communicate risk and instructions on how to use the product, such as information on label content, placement of information, pictures, and font size and color; how to construct a label to effectively communicate and improve the user's understanding of risk and protective measures. EPA requests that this be supported by data demonstrating the effectiveness of a label approach, particularly as it pertains to susceptible sub-populations or individuals with limited English proficiency or low literacy in any language.
EPA requests comment on the efficacy of this co-proposed option, including on individual components.
Under this approach, risks to consumers are only addressed to the extent that consumers understand and follow the required label information. While the Agency expects that some number of consumers who read the labels of paint and coating removal products containing NMP would understand this information and take appropriate steps to reduce their risks based on label information, as noted in Unit V.C., studies have shown that consumers do not consistently pay attention to labels for hazardous substances; consumers, particularly those with lower literacy levels, often do not understand label information; consumers often base a decision to follow label information on previous experience and perceptions of risk; even if consumers have noticed, read, understood, and believed the information on a hazardous chemical product label, they may not be motivated to follow the label information, instructions, or warnings; and consumers have varying behavioral responses to warning labels.
Even for those consumers who understand and follow the label, EPA expects some number will not follow the label instructions precisely or may be unable to readily locate the specialized gloves or the respirator indicated on the label (Ref. 28). Further, it is unlikely that consumers would have the fit of their respirator tested, which is important part of the proper use, and thus effectiveness, of a respirator, or that they would wear a new pair of specialized gloves for each use of the product containing NMP. EPA emphasizes that product labels are not equivalent to worker protection programs in which risks are reduced through, among other things, training programs, requirements that include proper testing and use of respirators, and requirements to use specialized gloves each time the product is used.
EPA is unable to determine how many consumers would read and take
As under the first co-proposed approach, manufacturers, processors, and distributors would be required to provide downstream notification of these requirements under TSCA section 6(a)(3), and limited recordkeeping would be required under TSCA section 6(a)(4).
EPA is co-proposing these options to prevent exposure to NMP from paint and coating removal and thus prevent the risks of adverse effects and associated impacts. As discussed in Unit XII.C., the range of adverse health effects from NMP includes developmental toxicity resulting in decreased birth weight or fetal death, kidney toxicity, liver toxicity, immunotoxicity, and reproductive toxicity (Ref. 3). These health effects associated with exposure to NMP are serious and can have impacts throughout a lifetime. The following is a discussion of the impacts of significant acute and chronic non-cancer effects associated with NMP exposure during paint and coating removal, including the severity of the effect, the manifestation of the effect, and how the effect impacts a person during their lifetime.
Researchers aiming to improve early childhood health outcomes have identified the most sensitive time in a pregnancy as the first few weeks following conception, before a woman may be aware she is pregnant. In the context of maternal welfare and risk reduction, “women often delay assessing and improving their health until after confirmation of pregnancy, putting their baby at risk during the critical early developmental stages” (Ref. 81). Approximately 35% of pregnancies in the United States are unplanned (Ref. 83); consequently, many women who are pregnant may not have taken or be prepared to take steps to reduce risks to the developing fetus during early stages of pregnancy. Maternal exposure to NMP in paint and coating removal may occur before a woman realizes she is pregnant. As such, even if she is aware of the risks of exposure to NMP, she may not take steps to reduce risks of fetal death.
Even if they are aware of their pregnancy, women may not wish to disclose this fact to their employers; although legal protections are in place, many women “feel they may lose their job, may not be considered for a promotion, or may have a promotion taken away if they announce they are pregnant” (Ref. 81). Similarly, the American College of Occupational and Environmental Medicine has found that “while it is illegal for an employer to terminate a worker because of pregnancy, such fears may not be groundless for some workers” (Ref. 83). Consequently, pregnant women may attempt to “minimize their pregnancy” (Ref. 81) and may not be vocal in their workplace about reducing risks to their pregnancy. This could increase chances of exposure to chemicals such as NMP that present a risk of fetal death.
Exposure to NMP in paint and coating removal during a single day (over 8 hours) was found to present risks of fetal death (Ref. 3). The impacts of fetal death, including miscarriage or stillbirth, include emotional impacts on the woman experiencing the death of a fetus, and also present significant emotional impacts for partners and spouses.
Emotional impacts and other mental health effects of miscarriage or stillbirth can include depression, anxiety, grief, and guilt. Mental health research has consistently identified both miscarriage (defined as fetal death occurring before the 20th week of gestation) and stillbirth (defined as fetal death occurring after the 20th week of gestation) as a significant emotional burden that can persist for more than a year and sometimes up to three years following the event of fetal death (Ref. 84). Compared with their peers, women who have experienced fetal death “exhibit significantly elevated levels of depression and anxiety in the weeks and months following the loss, compared with samples of pregnant, community or postpartum women” (Ref. 85). Psychologists see miscarriage and stillbirth as “an unanticipated, often physically as well as psychologically traumatic event representing the death of a future child and disruption of reproductive plans. Physiologically, it marks the end of a pregnancy, and psychologically it may produce doubts about procreative competence” (Ref. 86). Other descriptions of fetal death similarly characterize it as “a significant psychosocial stressor that results in a high level of dysphoria and grief” (Ref. 87). Consequently, women who experience the death of a fetus are at increased risk for depression, anxiety, and other psychiatric disorders (Ref. 86).
Major depressive disorder has been identified in between 10% to 50% of women after a miscarriage, depending on the measures used (Refs. 88 and 89). According to the National Institutes of Mental Health, persistent depressive disorder is a depressed mood that lasts for at least two years. Symptoms can include difficulty concentrating, sleep pattern disruptions, appetite or weight change, thoughts of suicide or suicide attempts, loss of interest in hobbies or activities, decreased energy, and aches, headaches, or digestive problems without a clear physical cause and that do not ease even with treatment (Ref. 90). Depression can affect an individual's physical health and their ability to work. Additionally, depression in one family member can also result in increased instance of illness or morbidity in other family members (Ref. 91). Treatment can require several types of attempted pharmaceutical or psychological therapies, and, in the case of depression following fetal death, can persist for years (Ref. 89).
Depression is not the only emotional impact of fetal death; many women also experience intense and persistent anxiety. Researchers have found that “a significant percentage of women experience elevated levels of anxiety after a miscarriage up until about 6 months post-miscarriage, and they are at increased risk for obsessive-compulsive and posttraumatic stress disorder” (Ref. 89).
In addition to depression and anxiety, a primary component of the emotional burdens presented by fetal death is guilt. As one researcher explained, women search for answers to what they perceive as an inexplicable trauma: “They will spend enormous amounts of emotional energy trying to explain why it happened . . .. They often blame themselves, even when it is inaccurate, to help make sense of it. Women may torment themselves with guilt and blame, rewriting the story, so to speak: `If I hadn't gone to the grocery store' or `If I didn't stay up so late.' It's a way of coping with the loss” (Ref. 92).
Related to these emotional impacts, one study found that “the mean annual suicide rate within one year after miscarriage was significantly higher (18.1 per 100.000) than the suicide rates both for women who gave birth (5.9) and for women in the general population (11.3) in Finland between 1987 and 1994” (Ref. 86).
Women experiencing miscarriages or stillbirths are not the only individuals affected by fetal death. Researchers have also documented the ways in which the woman's partners are affected by the loss (Ref. 86). Recent research has found that male partners experience more grief over miscarriages than previously assumed (Ref. 92) and that in 25% of the cases studied, the intensity of fathers' grief exceeded that of the mothers' (Ref. 93).
Additional burdens from fetal death can be felt throughout the affected family, including by subsequent children, since the depression, anxiety, and guilt initiated by fetal death may persist during and after any subsequent successful pregnancy (Ref. 92). As a result, future pregnancies and children can be adversely affected by fetal death during the mother's previous pregnancies due to persistent psychological impacts leading to maternal stress or depression that can last up to three years (Refs. 94 and 85). As a result of this stress or depression, complications during subsequent pregnancies can occur. Maternal anxiety or depression during pregnancy is associated with pre-term birth, decreased birth weight, and impacts on fetal brain development as a result of abnormal uterine blood flow and increased maternal cortisol levels (Ref. 94). Maternal anxiety and depression, including that initiated by fetal death during a previous pregnancy, is also
Similarly, a woman's attitude towards a pregnancy does not necessarily correlate with the emotional impact resulting from fetal death. Although ambivalence toward pregnancy was associated with different emotional impacts (greater association with depressive symptoms, rather than grief), they were found to be as intense as in women who were not ambivalent about their pregnancy (Ref. 86).
As a result, fetal death at any stage of a pregnancy, even when experienced by a woman who is ambivalent about that pregnancy, may result in intense emotional impacts and psychological morbidities, for both the mother and other family members; these impacts can include depression and anxiety and, in many cases, could persist and potentially impact future pregnancies and children.
Additionally, it is important to note that fetal death can present health risks to the woman; in some cases, maternal death can result. From 1981 to 1991, the Centers for Disease Control and Prevention (CDC) recorded 62 cases of maternal mortality following spontaneous abortion at or before 20 weeks of fetal gestational age (an overall case fatality rate of 0.7 per 100,000 spontaneous abortions) (Ref. 96). Leading causes of maternal mortality during these incidents of fetal death were infection, hemorrhage, or embolism (Ref. 96). The CDC has noted that this case fatality rate is likely the result of underreporting, and that “the true number of deaths related to pregnancy might increase from 30% to 150% with active surveillance” (Ref. 97).
Even when the effects of fetal death are less severe, a miscarriage or stillbirth can have considerable adverse consequences on an individual, family, or community. Commercial and consumer users of NMP in paint and coating removal are at risk of fetal death from typical use of products containing NMP; although EPA is unable to quantify the precise number or frequency of fetal deaths that may occur as a result of exposure to NMP during paint and coating removal, reducing the risks of exposure would benefit women, their families, and the public at large by reducing risks of fetal death in a population of approximately 12,000 pregnant individuals (consumers and workers) likely to experience acute exposures that present risks of fetal death. Details on how EPA estimated the number of individuals is in section 5.2.1 of the Economic Analysis (Ref. 4).
Rather than accumulating over a lifetime, risks were found for workers exposed to NMP during paint and coating removal over the course of a workweek, or five days. Even when maternal exposure ceased, the decreased fetal body weight was found to be a persistent adverse effect (Ref. 3); consequently, a relatively brief period of maternal repeated exposure to NMP in typical paint and coating removal can cause fetal weight decreases, resulting in life-long impacts. There are increased risks of decreased fetal weight for the subset of pregnant women among the approximately 8,800 female workers in 4,300 commercial facilities or companies that use NMP for paint and coating removal. EPA estimates that there are approximately 500 pregnant women working in these commercial facilities (Ref. 4). A subset of these 500 pregnant would have chronic exposure to NMP at levels that would result in an MOE below the benchmark of 30 for decreased fetal weight (Ref. 3).
Decreased fetal weight can lead to reduced or low birth weight, which can have lifelong effects on a person and their family. Most cases of reduced or low birth weight are pre-term or premature birth; as a result, until recently, health impacts of reduced or low birth weight have been difficult to separate from the effects due to premature birth or gestational age. However, epidemiological, social, and medical research in the past several decades has isolated several health effects of reduced or low birth weight separate from gestational age at birth. Full-term babies may be born at low or reduced birth weights as a result of fetal growth restriction; these infants are usually referred to as small for gestational age, and “may have low birth weight because something slowed or stopped their growth in the womb” (Ref. 98). Low birth weight is typically defined as birth weight of less than 5.5 pounds, or 2,500 grams. Very low birth weight is typically defined as less than 1,500 grams (Ref. 99).
Low birth weight can have significant impacts on childhood development and the incidence of future diseases (Ref. 100); reduced birth weight can cause serious health problems for some children (Ref. 98), as well as long-term impacts on their lives as adults (Ref. 101).
Health impacts of low or reduced birth weight can begin at birth. According to the CDC, low birth weight infants may be more at risk for many health problems as neonates (Ref. 99); other medical authorities report that health impacts for infants with low birth weight include low oxygen levels at birth, inability to maintain body temperature; difficulty feeding and gaining weight; infection; breathing problems such as respiratory distress syndrome; neurologic problems, such as intraventricular hemorrhage (bleeding inside the brain); gastrointestinal problems such as necrotizing enterocolitis (a serious disease of the intestine), and a greater risk of Sudden Infant Death Syndrome (Ref. 102). These effects and health impacts have clear implications for the infant's future health and survival, and can cause emotional stress and anguish for families of the infant.
Effects of reduced or low birth weight can persist beyond infancy. It can affect growth: Low birth weight has been found to be “a major risk factor for children's physical growth in the early
A child's size is not the only potential effect of reduced or low birth weight. Many studies have identified increased risk of cognitive, behavioral, and neurological problems in children and adolescents who had low birth weight or who were small for gestational age (Refs. 106 and 107). A large cohort study that followed infants born at full term with reduced birth weight (small for gestational age) found that “children of both genders who were born [small for gestational age] are at higher risk of learning difficulties” (Ref. 106), with girls with the lowest birth weight experiencing an increased risk of attention problems (Ref. 106).
Other studies have confirmed the impact of reduced or low birth weight on academic success in childhood; researchers note that compared to their normal birth weight siblings, low birth weight children are less likely to be in excellent or very good health in childhood. They also score significantly lower on reading, passage comprehension, and math achievement tests. Low birth-weight children are roughly one-third more likely to drop out of high school relative to other children (Ref. 100).
After childhood, the health, social, and financial impacts of reduced or low birth weight can continue. In many cases, an individual's size may continue to be affected. The difference in growth during adolescence and early adulthood varies by sex. Female adults who were very low birth weight infants tend to be the same size as their peers of average birth weight by age 20, while male adults “remain significantly shorter and lighter than controls” (Ref. 109). However, this may have its own risks: “Since catch-up growth may be associated with metabolic and cardiovascular risk later in life, these findings may have implications for the future adult health of [very low birth weight] survivors” (Ref. 109).
In terms of health effects, low birth weight can continue to have significant negative effects on adults. Researchers have found that low birth weight increases the probability of being in fair or poor health as an adult. Specifically, “low birth weight children are nearly twice as likely as their normal birth-weight siblings to be in problematic health by ages 37-52 (23% versus 12%) (Ref. 100). Specific risks associated with low birth weight (separate from pre-term birth or gestational age) include increased risk of renal disease (Ref. 110); increased risk of asthma, diabetes, stroke, heart attack, or heart disease by age 50 (compared to average weight siblings) (Ref. 100); and increased risk of clinically verified hyperkinetic disorder, including attention deficit hyperactivity disorder (Ref. 111). Adults who were low birth weight babies may be more likely to have certain health issues such as diabetes, heart disease, high blood pressure, metabolic syndrome, and obesity (Ref. 98).
Additionally, there are financial implications for adults who were low birth weight; low birth weight has been found to lower labor force participation and labor market earnings over an individual's lifetime (Ref. 100). Specifically, “low birth weight is linked to a 10% reduction in hourly wages from ages 18-26, compared to the wages of normal birth-weight siblings, but a 22% reduction in wages from ages 37-52. Low birth-weight children, relative to their normal birth-weight siblings, work 7.4% fewer hours in adulthood” (Ref. 100).
Decreased fetal weight and low birth weight are strongly associated with a number of adverse health effects in adults. The Barker Hypothesis (Ref. 112) was among the first to identify a pattern between neonatal health and cardiovascular disease. Subsequent research in laboratory animals and in human epidemiological studies confirmed this pattern and extended the observations to include the relationship between delayed fetal growth, low birth weight and metabolic syndrome, which encompasses a host of adverse outcomes, such as hypertension, insulin resistance, obesity and type 2 diabetes mellitus (Refs. 113, 114, and 115). Diseases such as cardiovascular disease, hypertension, obesity and diabetes mellitus have a tremendous impact on public health. For example, according to the CDC, heart disease remains the nation's leading cause of death (Ref. 116). In addition to causing premature mortality, the monetary costs of cardiovascular disease were estimated at $209.3 billion in direct costs and $142.5 billion in indirect costs, for a total of $351.8 billion (Ref. 116). A number of health disparities are associated with cardiovascular disease. Cardiovascular disease causes more deaths in women than men, and in black Americans, compared to white (Ref. 116). Years of potential life lost before age 75 from heart disease is nearly double for Black or African Americans relative to White, Non-Hispanic Americans (Ref. 116).
Several of these health effects associated with reduced fetal growth and low birth weight fall within the definition of metabolic syndrome, which is generally defined as the presence of 3 or more of the following: Abdominal obesity (waist circumference ≥88 cm in women or ≥102 cm in men); low HDL cholesterol (<50 mg/dL in women or <40 mg/dL in men); elevated triglycerides (≥150 mg/dL); elevated fasting blood glucose (≥100 mg/dL or use of oral hypoglycemic medication or insulin or both); or elevated blood pressure (at least 1 of the following: Systolic ≥130 mmHg, diastolic ≥85 mmHg, or use of antihypertensive medication). Epidemiological studies indicate a strong, consistent association between low birth weight and metabolic syndrome (Ref. 113). The symptoms associated with metabolic syndrome are in turn associated with increased risk of cardiovascular disease and diabetes (Ref. 117).
Collectively, the sign, symptoms and diseases associated with delayed fetal growth and small birth weight present an enormous burden on public health. The extent that the development of adult disease is rooted in reductions in fetal and neonatal growth could limit the success of adult lifestyle changes in modifying these effects. Therefore, prevention must be focused on assuring fetal and neonatal health and preventing adverse impacts on growth rates.
Researchers highlight the fact that low birth weight can occur in every demographic group, and that even though most babies with low birth weight have normal outcomes, as a whole, infants with low birth weight “generally have higher rates of subnormal growth, illnesses, and neurodevelopmental problems. These problems increase as the child's birth weight decreases” (Ref. 118). Additionally, by using sibling comparisons and cohort studies, the effects of low birth weight have been found to persist even when accounting for “the independent effects of birth order, mother's age at birth, birth year cohort, race/ethnicity, family structure, parental income, and parental fertility timing” (Ref. 100).
Though most research has focused on infants with low or very low birth weight, it is important to note that children with reduced, but clinically normal, birth weights (2,500 to 2,999 grams) are also at increased risk from the health, academic, social, and financial effects described.
In this way, reduced or low birth weight resulting from maternal exposure to NMP during paint and coating removal can have serious and life-long impacts on individuals and their families, including their future family members. Even when birth weight is not reduced to the clinical definition of low, the decrease in fetal weight can have significant impacts. Additionally, it is important to note that the impacts of low birth weight go beyond affected individuals and their families; reduced and low birth weight “results in substantial costs to the health sector and imposes a significant burden on society as a whole” (Ref. 101).
Kidney toxicity means the kidney has suffered damage that can result in a person being unable to rid their body of excess urine and wastes. In extreme cases where the kidney is impaired over a long period of time, the kidney could be damaged to the point that it no longer functions. When a kidney no longer functions, a person needs dialysis and ideally a kidney transplant. In some cases, a non-functioning kidney can result in death. Kidney dialysis and kidney transplantation are expensive and incur long-term health costs if kidney function fails (Ref. 56).
The monetary cost of kidney toxicity varies depending on the severity of the damage to the kidney. In less severe cases, doctor visits may be limited and hospital stays unnecessary. In more severe cases, a person may need serious medical interventions, such as dialysis or a kidney transplant if a donor is available, which can result in high medical expenses due to numerous hospital and doctor visits for regular dialysis and surgery if a transplant occurs. The costs for hemodialysis, as charged by hospitals, can be upwards of $100,000 per month (Ref. 57).
Depending on the severity of the kidney damage, kidney disease can impact a person's ability to work and live a normal life, which in turn takes a mental and emotional toll on the patient. In less severe cases, the impact on a person's quality of life may be limited while in instances where kidney damage is severe, a person's quality of life and ability to work would be affected. While neither the precise reduction in individual risk of developing kidney toxicity from reducing exposure to NMP during paint or coating removal or the total number of cases avoided can be estimated, these costs must still be considered because they can significantly impact those exposed to NMP.
Some form of liver disease impacts at least 30 million people, or 1 in 10 Americans. Included in this number is at least 20% of those with NAFLD. NAFLD tends to impact people who are overweight/obese or have diabetes. However, an estimated 25% do not have any risk factors. The danger of NAFLD is that it can cause the liver to swell, which may result in cirrhosis over time and could even lead to liver cancer or failure (Ref. 42). The most common known causes to this disease burden are attributable to alcoholism and viral infections, such as hepatitis A, B, and C. These known environmental risk factors of hepatitis infection may result in increased susceptibility of individuals exposed to organic chemicals such as NMP.
Additional medical and emotional costs are associated with liver toxicity following chronic exposure to NMP in paint and coating removal, although these costs cannot be quantified. These costs include medical visits and medication costs. In some cases, the ability to work can be affected, which in turn impacts the ability to get proper medical care. Liver toxicity can lead to jaundice, weakness, fatigue, weight loss, nausea, vomiting, abdominal pain, impaired metabolism, and liver disease.
Depending upon the severity of the jaundice, treatments can range significantly. Simple treatment may involve avoiding exposure to NMP and other solvents; however, this may impact an individual's ability to continue to work. In severe cases, liver toxicity can lead to liver failure, which can result in the need for a liver transplant. Even if a donor is available, liver transplantation is expensive (with an estimated cost of $575,000) and there are countervailing risks for this type of treatment (Ref. 44). The mental and emotional toll on an individual and their family as they try to identify the cause of sickness and possibly experience an inability to work, as well as the potential monetary cost of medical treatment required to regain health, are significant.
For almost every situation in which NMP is used to remove paints or coatings, EPA is aware of a cost-effective, economically feasible chemical substitutes or alternative methods. The exception is for critical corrosion-sensitive components of military aviation and vessels, for which EPA proposes are critical for national security, and for which EPA proposes an exemption, described in more detail in Unit XVIII.
EPA considered chemical substitutes and alternative methods consistent with the requirements of TSCA Section 6(c)(2)(C) and as similarly recommended by the SBAR panel (Ref.
Research into the efficacy of chemical substitutes has identified products currently available for commercial and consumer users of NMP for paint and coating removal, for a variety of coatings on numerous substrates (Refs. 58 and 59). Additionally, in most commercial sectors, NMP is not in widespread use; most sectors use substitute chemicals or methods, either due to financial considerations, problems with the efficacy of products containing NMP, or concern for worker or individual health and safety (Ref. 22). This was emphasized by a small business that manufactures such products (Ref. 22).
Many producers of paint and coating removal products containing NMP also produce paint and coating removal products with substitute chemicals (Ref. 4). This was emphasized by small businesses participating in the SBAR process (Ref. 27). Thus, there is already precedent for producers reformulating products to meet demand from commercial or individual customers.
Based on the frequent use of substitute chemicals or alternative methods for paint and coating removal in all industries discussed here, and the formulation and distribution of substitute chemicals for paint and coating removal by all formulators of products containing NMP (Ref. 4), EPA found that economically feasible alternatives to NMP are reasonably available for all paint and coating removal uses. Primary chemical substitutes for NMP in paint and coating removal include products formulated with benzyl alcohol; dibasic esters; acetone, toluene, and methanol (ATM); and caustic chemicals. EPA evaluated these products for efficacy, toxicity, relative hazards compared to NMP, and other hazards that might be introduced by use of these products (such as environmental toxicity, increased global warming potential, and increased flammability or other hazards to users).
EPA's analysis compared the hazard and exposure characteristics of the chemical paint and coating removal chemicals and products presumed to be already in use to NMP, to aid in ascertaining the impact on users of moving to alternative products. EPA used authoritative sources to characterize efficacy, hazard endpoints and identify effect and no effect levels. Relative exposure potential was assessed based on physical chemical parameters and concentrations in formulations, and exposure potential was considered to be similar to NMP within an order of magnitude. Product composition was based on publicly available Safety Data Sheets for products advertised for paint and coating removal (Ref. 36).
Products based on benzyl alcohol formulations have been identified as efficacious paint and coating removers in various industry sectors (Refs. 22 and 27). Consumer products containing benzyl alcohol are available for sale (Refs. 22, 27, 35, 58, 59, and 61). Regarding differential hazards between benzyl alcohol and NMP, there are fewer hazard concerns compared to NMP-based products, and the benzyl alcohol NOAELs are higher than for NMP, suggesting lower toxicity (Ref. 34). Regarding differential exposures between benzyl alcohol and NMP, the relative inhalation and dermal exposure potentials are similar to NMP (Ref. 34). Taken together, benzyl alcohol-based paint removers are expected to result in lower risks, primarily due to lower toxicity.
Dibasic ester products can include dimethyl succinate, dimethyl glutarate and dimethyl adipate. Many NMP products contain dibasic esters, and given the efficacy of these products users of these products would not experience much inconvenience if switched to substitute products that contain solely formulations based on dibasic esters, without NMP (Ref. 34). Regarding differential hazards between dibasic esters and NMP, in general, the hazards associated with dibasic esters are less severe and occur at concentrations suggesting lower toxicity (Ref. 34). Regarding differential exposures between dibasic esters and NMP, the relative inhalation exposure potential is similar to NMP. The relative dermal exposure potential for dibasic esters is lower, but similar to, NMP (Ref. 34). Taken together, dibasic ester-based paint removers are expected to result in lower risks, primarily due to lower toxicity.
ATM products contain acetone, toluene, and methanol. Products containing these chemicals may remove coatings very quickly, but may not be effective on every type of coating (Ref. 27). ATM-based products are composed of chemicals that exhibit a range of hazard characteristics. Taken together, the components of ATM-based formulations have comparable hazard concerns to NMP. Regarding differential exposures between ATM and NMP, the relative inhalation exposure potentials for acetone, toluene and methanol are higher than NMP. The relative dermal exposure potentials for acetone, toluene and methanol are lower, but similar to, NMP (Ref. 34).
Products with caustic chemicals typically include calcium hydroxide or magnesium hydroxide. In many uses, they can be an effective product, particularly when multiple coatings are being removed from a substrate. In contrast to NMP-based products, there are no developmental or other repeat dose endpoints of concern associated with caustic products (Ref. 34). Caustic products pose acute concerns due to their physical chemical properties and can cause chemical burns (Ref. 34). The risks associated with caustic-based products are acute, and may be mitigated by appropriate and familiar protective equipment. The risks associated with NMP-based products are both acute and long term (Ref. 3).
In summary, when methylene chloride is excluded from consideration, the most likely chemical substitutes for NMP in paint and coating removal do not pose a risk of acute or chronic developmental effects, generally have lower or similar exposure potential than NMP, and when acute risks are present, as in the case of caustic chemicals, those risks are self-limiting by the nature of the adverse effects. The chemical formulations that seem to present some risks of concern contain toluene and methanol; however, risks from these chemicals can be mitigated by the user more easily than risks presented by NMP. Overall, exclusive use of substitute chemical products for paint and coating removal instead of NMP would remove the risks of chronic effects and acute developmental effects without introducing additional substantial risks to human health.
In addition to examining toxicity to humans, EPA reviewed available data on the chemicals in the baseline and alternative products for aquatic toxicity, persistence and bioaccumulation, as a basis for examining potential environmental toxicity. Only one chemical evaluated may have significant impacts on aquatic toxicity, with concern for environmental persistence and/or bioaccumulation. This chemical is contained in NMP-based paint
EPA is also mindful of the risks that may be introduced by substitute chemicals or methods that increase global warming, and has examined the global warming potential of the chemical components of likely chemical substitutes for NMP in paint and coating removal. NMP does not present concerns for global warming and has a global warming potential (GWP) of 0 (Ref. 3). Similarly, the GWP values of likely substitute chemicals in paint and coating removal are: 0 GWP (benzyl alcohol, ATM) or not assessed (caustics, dibasic esters) (Ref. 24). As such, EPA has not identified any increased risk of global warming that would be introduced by use of chemical products as substitutes for NMP in paint and coating removal.
In addition to human and environmental toxicity, other hazards associated with chemical methods for paint and coating removal are risks of fire due to flammability of the chemical product, and poisoning or acute injury. Risks of fire are serious when using solvents such as paint and coating removal chemicals. Even among products that fall within the same general product composition category, there is meaningful variability in the specific formulations of paint remover products, and thus in their flammability. Furthermore, it is impracticable for EPA to predict the specific product formulations for which use will increase as a result of prohibitions on NMP in paint and coating removal. It is therefore impracticable for EPA to forecast whether the flammability of popular paint and coating removers would generally increase or decrease as a result of the proposed rule.
In addition to using substitute chemical products, EPA has identified non-chemical methods for paint and coating removal that can be used as alternatives to NMP. These methods are already frequently in use in various industries or by consumers for paint and coating removal, and are described in more detail in Unit VI.E.
EPA recognizes that all methods of paint and coating removal can present some hazards. Most of these alternative methods are already in frequent use, including by consumers and workers who currently use NMP or other chemicals for some paint and coating removal. The risks associated with each of these methods, while serious, are generally acute, related to injury, and can be mitigated through readily available and easy-to-implement standard safety practices; in contrast, the acute risks presented by NMP, such as fetal death, require specialized gloves and are not the type of hazard frequently encountered when using household products.
EPA is co-proposing these two options because the Agency believes both deserve consideration by commenters. The first co-proposed approach is necessary so that NMP in paint and coating removal no longer presents an unreasonable risk to the general population or to women of childbearing age. It is more cost effective than other regulatory options EPA identified as potentially reducing risks so that they are no longer unreasonable, because the proposed option achieves the benefits of reducing the unreasonable risks so they are no longer unreasonable for a lower cost than the second co-proposed approach. For more information, see Section 6 in the Economic Analysis (Ref. 4). As stated previously in this notice, the first co-proposed approach includes:
• Prohibiting manufacturing (including import), processing, and distribution in commerce of NMP for use in consumer and commercial paint
• Prohibiting commercial use of NMP for paint and coating removal, except for specified uses critical to national security;
• Requiring that any products containing NMP intended or used for paint and coating removal be distributed in containers with a volume no less than 5 gallons;
• Requiring downstream notification of the prohibition on manufacturing (including import), processing, and distribution of NMP for the prohibited uses; and
• Requiring limited recordkeeping.
Technically and economically feasible alternatives to NMP for paint and coating removal are reasonably available. The supply chain approach ensures protection of consumers from the unreasonable risk by precluding the off-label purchase of commercial products by consumers.
The first co-proposed approach is relatively easy to enforce because key requirements are directly placed on a small number of suppliers and because the supply chain approach minimizes to the greatest extent the potential for NMP products to be intentionally or unintentionally misdirected into the prohibited uses. Enforcement under the other options would be much more difficult since the key requirements are directly placed on the large number of product users. As described in a recent article on designing more effective rules and permits, “the government can implement rules more effectively and efficiently when the universes of regulated sources are smaller and better-defined. This is because, other factors being equal, governments can more easily identify, monitor, and enforce against fewer, rather than more, entities” (Ref. 63). Under other options, enforcement activities must target firms that might perform the activity where a use of NMP is restricted or prohibited. Identifying which establishments might use paint and coating removers is difficult because paint and coating removal is not strictly specific to any industry (Ref. 4).
The second co-proposed approach would allow the continued use of NMP in commercial and consumer paint and coating removal at up to 35 percent NMP by weight, except for exempt critical national security uses which can be at any concentration, provided that commercial users of NMP for paint and coating removal establish a worker protection program for dermal and respiratory protection.
In addition, the co-proposed approach would require formulators of products for either commercial or consumer uses other than critical national security uses to: Reformulate products such that paint and coating products containing NMP do not exceed a maximum of 35 percent NMP by weight in product formulations; test gloves for the product formulations being processed and distributed in commerce to identify specialized gloves that provide protection for users; label products with information for consumers and provide information for commercial users about reducing risks when using the product. This approach would effectively reduce risk for workers. EPA is requesting comment on whether this co-proposed approach would be effective at reducing risks for consumers so that the risks are no longer unreasonable.
EPA proposes that the identified risks from NMP in paint and coating removal are unreasonable. Apart from that proposed determination, EPA has evaluated the potential costs and benefits of the two co-proposed approach and their variations.
The details of the costs of the first co-proposed approach for NMP in commercial and consumer paint and coating removal are discussed in Unit I.E. and in the Economic Analysis (Ref. 4). Under the first co-proposed option, costs to users of paint and coating removal products containing NMP are (−$1,477,000) to $27,617,000 at a discount rate of 3% and (−$1,231,000) to $27,638,000 at a discount rate of 7%. Costs of paint and coating removal product reformulations are estimated to be approximately $7,000 to $14,000 per year (annualized at 3% over 20 years) and $9,000 to $19,000 (annualized at 7% over 20 years). Costs of downstream notification and recordkeeping on an annualized basis over 20 years are $100 and $100 using 3% and 7% discount rates respectively. Agency costs for enforcement are estimated to be approximately $114,401 to $111,718 annualized over 20 years at 3% and 7%, respectively (Ref. 4). Under the first proposed approach, total costs of the proposed rule relevant to NMP in paint and coating removal are estimated to be (−$1,484,000) to $27,624,000 and (−$1,251,000) to $27,668,000 annualized over 20 years at 3% and 7% respectively (Ref. 4).
EPA also found that a use prohibition alone without downstream notification requirements would not address the unreasonable risks. EPA estimated the costs of this option to be $5,164,000 to $30,702,000 annualized over 20 years at 3% and $5,409,000 to $30,839,000 annualized over 20 years at 7% (Ref. 4).
As described in Unit XVII.B., there are no monetizable benefits from mitigating the risks from NMP in consumer and commercial paint and coating removal. Although the alternatives considered are unlikely to result in the same health benefits as the first co-proposed option, EPA was unable to quantify the differences.
Based on the costs and benefits EPA can estimate, the monetized subset of benefits for preventing the risks resulting from NMP in consumer and commercial paint and coating removal do not outweigh the estimated monetary costs. However, EPA believes that the balance of costs and benefits of the proposed regulation of NMP cannot be fairly described without considering the additional, substantial, non-monetized benefits of mitigating the non-cancer adverse effects. As discussed previously, the multitude of potential adverse effects associated with NMP in paint and coating removal can profoundly impact an individual's quality of life. Some of the adverse effects associated with NMP exposure can be immediately experienced and can affect a person from childhood throughout a lifetime (
While the benefits associated with avoiding the health effects associated with NMP exposure during paint and coating removal cannot be monetized or quantitatively estimated, the qualitative discussion highlights how some of these effects may be as severe as more traditionally monetizable effects and thus just as life-altering; therefore the benefits of avoiding these effects are substantial. These effects include not only medical costs but also personal costs such as emotional and mental stress that are impossible to accurately measure. Considering only monetized benefits would significantly underestimate the benefits of avoiding
Thus, considering costs and the benefits that cannot be quantified and subsequently monetized (developmental effects, fetal death, adult body weight reductions, kidney toxicity, liver toxicity, and immunotoxicity), including benefits related to the severity of the effects and the impacts on a person throughout a lifetime in terms of medical costs, effects on earning power and personal costs, emotional and psychological costs, and the disproportionate impacts on Hispanic communities and individuals with limited English proficiency, the benefits of preventing exposure to NMP in paint and coating removal by an estimated 732,000 consumers and an estimated 30,300 commercial workers outweigh the costs.
As described in Unit V.B. and in the Economic Analysis, EPA considered the anticipated effects of this proposal on the national economy. While the impacts of this rule as a whole are described in Unit XXIII.C. and the impacts of the NMP component of this proposal are described in more detail in Unit XVII.A. and in Section 9.3 of the Economic Analysis (Ref. 4), EPA does not anticipate these impacts having an effect on the overall national economy. EPA anticipates that a majority of small businesses will have cost impacts of less than one percent of the annual revenue, and the majority of small business bathtub refinishing facilities and professional contractors will have cost impacts greater than one percent of annual revenue.
The first co-proposed approach is anticipated to drive technological innovation by formulators of paint and coating removal products containing NMP, as they continue to develop substitute products, and refine such products already available. It is also anticipated to drive technological innovation by formulators of chemical paint and coating removal products with different chemistries as well as manufacturers and retailers of alternative methods of paint and coating removal, particularly those with interest in appealing to the consumer uses. See section 9.3 in the Economic Analysis (Ref. 4).
The first co-proposed approach is anticipated to have a positive impact on public health, as described in Unit XVI.C. There is not anticipated to be a significant impact on the environment, for the reasons described in Unit XII.D.
The details of the costs of the second co-proposed approach for NMP in commercial and consumer paint and coating removal are discussed in Unit I.E. and in the supplement to the Economic Analysis (Ref. 127).
Under the second co-proposed option, costs to users of paint and coating removal products containing NMP are $47,076,900 to $56,130,900 (annualized at 3% over 20 years) and $47,245,900 to $56,383,900 (annualized at 7% over 20 years). Costs of paint and coating removal product reformulations are estimated to be approximately $15,100 to $21,100 per year (annualized at 3% over 20 years) and $20,100 to $28,100 (annualized at 7% over 20 years). Agency costs for enforcement are estimated to be approximately $1,024,144 and $998,711 annualized over 20 years at 3% and 7% respectively. Under the second proposed approach, total costs of the proposed rule relevant to NMP in paint and coating removal are estimated to be $47,098,000 to $56,146,000 and $47,274,000 to $56,404,000 annualized over 20 years at 3% and 7% respectively (Ref. 127).
As described in Unit XVII.B., there are no monetizable benefits from mitigating the risks from NMP in consumer and commercial paint and coating removal. Although the second co-proposed option is unlikely to result in the same health benefits as the first co-proposed option, EPA was unable to quantify the differences.
Based on the costs and benefits EPA can estimate, the monetized subset of benefits for preventing the risks resulting from NMP in consumer and commercial paint and coating removal do not outweigh the estimated monetary costs. However, EPA believes that the balance of costs and benefits of the proposed regulation of NMP cannot be fairly described without considering the additional, substantial, non-monetized benefits of mitigating the non-cancer adverse effects. As discussed previously, the multitude of potential adverse effects associated with NMP in paint and coating removal can profoundly impact an individual's quality of life. Considering only monetized benefits would significantly underestimate the benefits of avoiding NMP-induced adverse outcomes on a person's quality of life.
As described in Unit V.B. and in the Economic Analysis, EPA considered the anticipated effects of this proposal on the national economy. While the impacts of this rule as a whole are described in Unit XXIII.C. and the impacts of the NMP component of this proposal are described in more detail in Unit XVII.A. and in the supplement to the Economic Analysis (Ref. 127), EPA does not anticipate these impacts having an effect on the overall national economy.
The second co-proposed approach is anticipated to drive technological innovation by formulators of paint and coating removal products containing NMP, as they continue to develop substitute products, and refine such products already available. It is also anticipated to drive technological innovation by formulators of chemical paint and coating removal products with different chemistries as well as manufacturers and retailers of alternative methods of paint and coating removal, particularly those with interest in appealing to the consumer uses. See the supplement to the Economic Analysis (Ref. 127).
The second co-proposed approach is anticipated to have a positive impact on public health, as described in Unit XVI.C. There is not anticipated to be a significant impact on the environment, for the reasons described in Unit XII.D.
As part of interagency collaboration with the Department of Defense (DOD) on this proposed rule, EPA is aware that there are specific military uses for which NMP is essential for paint and coating removal and for which there are no technically feasible alternatives currently available. The military readiness of DOD's warfighting capability is paramount to ensuring national security, which includes ensuring the maintenance and preservation of DOD's warfighting assets. DOD has identified mission-critical uses for NMP for ensuring military aviation and vessel readiness. These mission-critical items require the use of NMP for the removal of coatings from mission-critical corrosion-sensitive components on military aviation and
DOD continues and will continue to pursue potential substitutes for NMP in paint and coating removal. However, for mission-critical corrosion-sensitive components on military aviation and vessels, including safety-critical components, DOD has found that currently available substitute chemicals for paint and coating removal have one or more technical limitations. These are the same technical limitations described in Unit VIII., which outlines the proposed exemption for methylene chloride for similar uses critical to national security.
Under TSCA section 6(g)(1)(B), EPA may grant an exemption from a requirement of a TSCA section 6(a) rule for a specific condition of use of a chemical substance or mixture if compliance with the requirement would significantly disrupt the national economy, national security, or critical infrastructure. Based on discussions and information provided by DOD, EPA has analyzed the need for the exemption and concurs with DOD that compliance with the proposed regulations on the use of NMP in paint and coating removal would significantly impact national security. DOD has demonstrated that the reduced mission availability of aircraft and vessels for military missions or, in the worst case, the loss of individual military aircraft and vessels, are potential impacts to military readiness that could result from the proposed prohibition of NMP in paint and coating removal. Due to the importance of these military systems for national security, EPA has determined that these uses of NMP for removal of specialized coatings from military aviation and vessel mission-critical corrosion-sensitive components, including safety-critical components, is critical for national security and the safety of personnel and assets. EPA includes in this exemption corrosion-sensitive military aviation and vessel mission-critical components such as landing gear, gear boxes, turbine engine parts, and other military aircraft and vessel components composed of metallic materials (specifically high-strength steel, aluminum, titanium, and magnesium) and composite materials that not only require their coatings be removed for inspection and maintenance but also would be so negatively affected by the use of technically incompatible, substitute paint removal chemicals or methods that the safe performance of the vessel or aircraft could be compromised.
EPA proposes to grant this exemption for a period of ten years from the date of promulgation of a final rule, with a potential for extension, by further rulemaking, after review by EPA in consultation with DOD. The conditions for this exemption would be: (1) The use of NMP at any concentration for coating removal by DOD or its contractors performing this work only for DOD projects is limited to the mission-critical corrosion-sensitive components on military aviation and vessels, including safety-critical components; (2) this paint and coating removal must be conducted at DOD installations, or at Federal industrial facilities, or at DOD contractor facilities performing this work only for DOD projects.
This exemption granted under TSCA(6)(g)(1)(B) does not impact or lessen any requirements for compliance with other statutes under which the use, disposal, or emissions of NMP is regulated.
As described in Unit XVI.B.3., under the proposed approach, any paint and coating removal products containing NMP would be required to be distributed in containers with a volume no less than 5 gallons, as part of the exemption for uses identified as critical for national security. Allowing selective use for national security purposes does not disrupt the efficacy of the supply chain approach described in Unit XVI.B.3.
In addition to the exemption described in this unit, EPA will consider granting additional time-limited exemptions, under the authority of TSCA section 6(g). Details of EPA's request for comment on such exemption are described in Unit VIII.
A discussion of the uncertainties associated with this proposed rule can be found in the NMP risk assessment (Ref. 3) and in the additional analyses for NMP in commercial and consumer paint and coating removal (Refs. 75 and 76). A summary of these uncertainties follows.
EPA used a number of assumptions in the NMP risk assessment and supporting analysis to develop estimates for occupational and consumer exposure scenarios and to develop the hazard/dose‐response and risk characterization. EPA recognizes that the uncertainties may underestimate or overestimate actual risks. These uncertainties include the likelihood that exposures to NMP vary from one paint and coating removal project to the next. EPA attempted to quantify this uncertainty by evaluating multiple scenarios to establish a range of releases and exposures. In estimating the risk from NMP in paint and coating removal, there are uncertainties in the number of workers and consumers exposed to NMP and in the model inputs and algorithms used to estimate exposures.
In addition to the uncertainties in the risks, there are uncertainties in the cost and benefits. The uncertainties in the benefits are most pronounced in estimating the benefits from preventing the entirety of the adverse effects (described in Unit XIV.C.) because these non-cancer benefits generally cannot be monetized due to the lack of concentration response functions in humans leading to the ability to estimate the number of population-level non-cancer cases and limitations in established economic methodologies. Additional uncertainties in benefit calculations arose from EPA's use of a forecast from an industry expert to estimate the categories of alternatives that users might choose to adopt and the potential risks for adverse health effects that the alternatives may pose. While there are no products or methods that have comparable developmental or similar risks, these substitute products and alternative methods do present hazards. Without information on what alternative methods or chemicals users of NMP for paint and coating removal are likely to switch to, and estimates of the exposures for those alternatives. EPA is unable to quantitatively estimate any change in non-cancer risks due to use of substitute chemicals or alternative methods instead of using NMP for commercial or consumer paint and coating removal.
In addition to these uncertainties related to benefits, there are uncertainties related to the cost estimates. As noted earlier, there is uncertainty in EPA's estimates of which chemical substitutes or alternative methods users may adopt instead of NMP for paint and coating removal, which in turn produces uncertainty as to the cost of those substitutes or methods. EPA has estimated the cost of substitute chemicals, but is not able to fully characterize or quantify the total costs to all sectors for using substitute chemicals or alternative products. In addition, under certain assumptions EPA's economic analysis estimates that
Additionally, there are uncertainties due to in the estimates of the number of affected commercial and consumer users, and for numbers of processors and distributors of NMP-containing products not prohibited by the proposed rule who are required to provide downstream notification and/or maintain records.
EPA will consider additional information received during the public comment period. This includes scientific publications and other input submitted to EPA during the comment period.
This proposal relies on general provisions in the proposed Part 751, Subpart A, which can be found at 81 FR 91592 (December 16, 2016).
Under the first co-proposed approach, the rule, when final, would (1) prohibit the manufacturing, processing, and distribution in commerce of NMP for consumer and commercial paint and coating removal, exempting uses defined as critical for national security (see Unit XVIII.); (2) prohibit the commercial use of NMP for paint and coating removal, exempting for uses defined as critical for national security; (3) require any paint and coating removal products containing NMP to be distributed in containers with a volume no less than 5 gallons; (4) require that any commercial use of NMP for paint and coating removal for uses critical to national security include specific worker protections; (5) require manufacturers, processors, and distributors of NMP and all products containing NMP, excluding retailers, to provide downstream notification of the prohibitions; (6) and require recordkeeping relevant to these prohibitions. The prohibition on manufacturing, processing, and distributing in commerce of NMP for all consumer paint and coating removal would take effect 180 days after publication of a final rule. Similarly, the prohibition on manufacturing, processing, and distributing in commerce of NMP for any paint and coating removal for uses other than those exempted as critical for national security in volumes less than 5-gallon containers would take effect 180 days after publication of a final rule. The prohibition on commercial use of NMP for paint and coating removal except for the exempted critical national security uses would take effect 270 days after publication of a final rule. These are reasonable transition periods because, as noted in Unit XVI.D. and by the small businesses participating in the SBAR process, many formulators of paint and coating removers containing NMP also manufacture products for this use that do not contain NMP (Ref. 27). In addition, alternative paint removal products exist at comparable expense for users to purchase. Six months from publication of the final rule is sufficient time to allow for existing stocks to move through the market place and to allow manufacturers, processers and distributors and users to plan for and implement product substitution strategies.
Under the second co-proposed approach, formulators of paint and coating removal products for either commercial or consumer use would be required to: (1) Ensure that their paint and coating removal products containing NMP do not exceed a maximum of 35 percent NMP by weight in product formulations exempting products used for critical national security uses (see Unit XVIII.); (2) Test gloves for the product formulations being processed and distributed in commerce for other than exempt critical national security uses to identify specialized gloves that provide protection for users and keep records relevant to these tests; (3) Label products with information for consumers about the risks presented by products that contain NMP and how to reduce these risks when using the products, including identifying which specialized gloves provide protection against the specific formulation; and (4) Provide information for commercial users about reducing risks when using the product, via product labels, SDS, and other methods of hazard communication. Variations of more than 1% in any component of a paint and coating removal product containing NMP would be considered a separate formulation.
Under this co-proposal, commercial users of NMP for paint and coating removal other than exempt critical national security uses would be prohibited from using paint and coating removal products or formulations that contain more than 35 percent by weight of NMP. They would also be required to establish a worker protection program for dermal and respiratory protection, including hazard communication, training, and requirements that workers wear clothing covering most of the body,
EPA has authority under TSCA section 6 of TSCA to require that a substance or mixture or any article containing such substance or mixture be marked with or accompanied by clear and adequate minimum warnings and instructions with respect to its use, distribution in commerce, or disposal or with respect to any combination of such activities. Many manufacturers and processors of NMP are likely to manufacture or process NMP or products containing NMP for other uses that would not be regulated under this proposed rule. Other companies may be strictly engaged in distribution in commerce of NMP, without any manufacturing or processing activities, to customers for uses that are not regulated. Under both co-proposed approaches, EPA is proposing a requirement for downstream notification by manufacturers, processors, and distributors of NMP for any use to ensure compliance with the prohibition on manufacture, processing,
The effective date of the requirement for this notification would be 45 days after publication of the final rule. This is a reasonable transition period because regulated entities would only need to provide additional information on their SDS, which are routinely produced and updated.
Section 15 of TSCA makes it unlawful to fail or refuse to comply with any provision of a rule promulgated under TSCA section 6. Therefore, any failure to comply with this proposed rule when it becomes effective would be a violation of section 15 of TSCA. In addition, section 15 of TSCA makes it unlawful for any person to: (1) Fail or refuse to establish and maintain records as required by this rule; (2) fail or refuse to permit access to or copying of records, as required by TSCA; or (3) fail or refuse to permit entry or inspection as required by section 11 of TSCA.
Violators may be subject to both civil and criminal liability. Under the penalty provision of section 16 of TSCA, any person who violates section 15 could be subject to a civil penalty for each violation. Each day of operation in violation of this proposed rule when it becomes effective could constitute a separate violation. Knowing or willful violations of this proposed rule when it becomes effective could lead to the imposition of criminal penalties for each day of violation and imprisonment. In addition, other remedies are available to EPA under TSCA.
Individuals, as well as corporations, could be subject to enforcement actions. Sections 15 and 16 of TSCA apply to “any person” who violates various provisions of TSCA. EPA may, at its discretion, proceed against individuals as well as companies. In particular, EPA may proceed against individuals who report false information or cause it to be reported.
Section 9(a) of TSCA provides that, if the Administrator determines in her discretion that an unreasonable risk may be prevented or reduced to a sufficient extent by an action taken under a Federal law not administered by EPA, the Administrator must submit a report to the agency administering that other law that describes the risk and the activities that present such risk. If the other agency responds by declaring that the activities described do not present an unreasonable risk or if that agency initiates action under its own law to protect against the risk within the timeframes specified by TSCA section 9(a), EPA is precluded from acting against the risk under sections 6(a) or 7 of TSCA.
TSCA section 9(d) instructs the Administrator to consult and coordinate TSCA activities with other Federal agencies for the purpose of achieving the maximum enforcement of TSCA while imposing the least burden of duplicative requirements. For this proposed rule, EPA has consulted with OSHA and with CPSC. Both CPSC and OHSA have provided letters documenting this consultation (Refs. 121 and 122).
CPSC protects the public from unreasonable risks of injury or death associated with the use of consumer products under the agency's jurisdiction. Though CPSC has provided guidance to consumers when using products containing NMP, there are no CPSC regulations regarding NMP in paint and coating removal. CPSC currently requires that household products that can expose consumers to methylene chloride vapors must bear appropriate warning labels (52 FR 34698, September 14, 1987). In a letter regarding EPA's proposed rulemaking, CPSC stated that “Some paint removers are distributed for sale to, and use by, consumers and thus would likely fall within CPSC's jurisdiction. However, because TSCA gives EPA the ability to reach both occupational and consumer uses, we recognize that EPA may address risks associated with these chemicals in a more cohesive and coordinated manner given that CPSC lacks authority to address occupational hazards” (Ref. 121).
OSHA assures safe and healthful working conditions for working men and women by setting and enforcing standards and by providing training, outreach, education and assistance. OSHA's methylene chloride standard, 29 CFR 1910.1052, was issued in 1997 and applies to general industry, construction, and shipyard employment. It sets the PEL for airborne methylene chloride to an eight-hour TWA of 25 parts per ppm. OSHA has not set a standard for NMP. OSHA recently published a Request for Information on approaches to updating PELs and other strategies to managing chemicals in the workplace (79 FR 61384, October 10, 2014). OSHA's current regulatory agenda does not include revision to the methylene chloride PEL, establishment of a PEL for NMP, or other regulations addressing the risks EPA has identified when methylene chloride or NMP are used in paint and coating removal (Ref. 122).
This proposed rule addresses risk from exposure to methylene chloride and NMP during paint and coating removal in both workplace and consumer settings. With the exception of TSCA, there is no Federal law that provides authority to prevent or sufficiently reduce these cross-cutting exposures. No other Federal regulatory authority, when considering the exposures to the populations and within the situations in its purview, can evaluate and address the totality of the risk that EPA is addressing in this proposal and the prior proposal on TCE uses (Ref. 1). For example, OSHA may set exposure limits for workers but its authority is limited to the workplace and does not extend to consumer uses of hazardous chemicals. Further, OSHA does not have direct authority over state and local employees, and it has no authority at all over the working conditions of state and local employees in states that have no OSHA-approved State Plan under 29 U.S.C. 667. Other Federal regulatory authorities, such as CPSC, have the authority to only regulate pieces of the risks posed by methylene chloride and NMP, such as when used in consumer products.
Moreover, recent amendments to TSCA, Public Law 114-182, alter both the manner of identifying unreasonable risk under TSCA and EPA's authority to address unreasonable risk under TSCA, such that risk management under TSCA is increasingly distinct from analogous provisions of the Consumer Product Safety Act (CPSA), the Federal Hazardous Substances Act (FHSA), or the OSH Act. These changes to TSCA reduce the likelihood that an action under the CPSA, FHSA, or the OSH Act
TSCA is the only regulatory authority able to prevent or reduce risks of methylene chloride or NMP exposure to a sufficient extent across the range of uses and exposures of concern. In addition, these risks can be addressed in a more coordinated, efficient and effective manner under TSCA than under two or more different laws implemented by different agencies. Furthermore, there are key differences between the newly amended finding requirements of TSCA and those of the OSH Act, CPSA, and the FHSA. For these reasons, in her discretion, the Administrator does not determine that unreasonable risks from the use of methylene chloride and NMP in paint and coating removal may be prevented or reduced to a sufficient extent by an action taken under a Federal law not administered by EPA. However, EPA is requesting public comment on this issue (
If EPA determines that actions under other Federal laws administered in whole or in part by EPA could eliminate or sufficiently reduce an unreasonable risk, section 9(b) of TSCA instructs EPA to use these other authorities unless the Administrator determines in the Administrator's discretion that it is in the public interest to protect against such risk under TSCA. In making such a public interest finding, TSCA section 9(b)(2) states: “the Administrator shall consider, based on information reasonably available to the Administrator, all relevant aspects of the risk . . . and a comparison of the estimated costs and efficiencies of the action to be taken under this title and an action to be taken under such other law to protect against such risk.”
Although several EPA statutes have been used to limit methylene chloride or NMP exposure (Units III.A. and XII.A.), regulations under these EPA statutes have limitations because they largely regulate releases to the environment, rather than direct human exposure. SDWA only applies to drinking water. CAA does not apply directly to worker exposures or consumer settings where methylene chloride or NMP are used. Under RCRA, methylene chloride that is discarded may be considered a hazardous waste and subject to requirements designed to reduce exposure from the disposal of methylene chloride to air, land and water. RCRA does not address exposures during use of products containing methylene chloride or NMP. Only TSCA provides EPA the authority to regulate the manufacture (including import), processing, and distribution in commerce, and use of chemicals substances.
For these reasons, the Administrator does not determine that unreasonable risks from the use of methylene chloride and NMP in paint and coating removal could be eliminated or reduced to a sufficient extent by actions taken under other Federal laws administered in whole or in part by EPA.
EPA has used scientific information, technical procedures, measures, methods, protocols, methodologies, and models consistent with the best available science. For example, EPA based its proposed determination of unreasonable risk presented by the use of methylene chloride and NMP in paint and coating removal on the completed risk assessments, which each followed a peer review and public comment process, as well as using best available science and methods (Refs. 2 and 3). Supplemental analyses were performed to better characterize the exposed populations and estimate the effects of various control options. These supplemental analyses were consistent with the methods and models used in the risk assessment. These analyses were developed for the purpose of supporting a future regulatory determination: To determine either that particular risks are not unreasonable or that those are risks are unreasonable. They were also developed to support risk reduction by regulation under section 6 of TSCA, to the extent risks were determined to be unreasonable. It is reasonable and consistent to consider these supplemental analyses in this rulemaking for such relevant purposes.
The extent to which the various information, procedures, measures, methods, protocols, methodologies or models, as applicable, used in EPA's decision have been subject to independent verification or peer review is adequate to justify their use, collectively, in the record for this rule. Additional information on the peer review and public comment process, such as the peer review plan, the peer review report, and the Agency's response to comments, can be found on EPA's Assessments for TSCA Work Plan Chemicals Web page at
The following is a listing of the documents that are specifically referenced in this document. The docket includes these documents and other information considered by EPA, including documents referenced within the documents that are included in the docket, even if the referenced document is not physically located in the docket. For assistance in locating these other documents, please consult the technical person listed under
Additional information about these statutes and Executive Orders can be found at
This action is an economically significant regulatory action that was submitted to the Office of Management and Budget (OMB) for review under Executive Order 12866 and Executive Order 13563 (76 FR 3821, January 21, 2011). Any changes made in response to OMB recommendations have been documented in the docket. EPA prepared an economic analysis of the potential costs and benefits associated with this action, which is available in the docket and summarized in Units I.E., VII.B., and XVII.B. (Refs. 4 and 127).
The information collection requirements in this proposed rule have been submitted for approval to the Office of Management and Budget (OMB) under the Paperwork Reduction Act, 44 U.S.C. 3501
Under the proposed approach for methylene chloride and both co-proposed approaches for NMP, the information collection activities required under the proposed rule include a downstream notification requirement and a recordkeeping requirement. The downstream notification would require companies that ship methylene chloride or NMP to notify companies downstream in the supply chain of the prohibitions of methylene chloride or NMP in the proposed rule. The proposed rule does not require the regulated entities to submit information to EPA. The proposed rule also does not require confidential or sensitive information to be submitted to EPA or downstream companies. The recordkeeping requirement mandates companies that ship methylene chloride or NMP to retain certain information at the company headquarters for three years from the date of shipment. These information collection activities are necessary in order to enhance the prohibitions under the proposed rule by ensuring awareness of the prohibitions throughout the methylene chloride or NMP supply chain, and to provide EPA with information upon inspection of companies downstream who purchased methylene chloride or NMP. EPA believes that these information collection activities would not significantly impact the regulated entities.
Under the second co-proposed approach for NMP, processors of paint and coating removal products containing NMP must test gloves for permeability for each formulation they process. One type of gloves may not be appropriate for all NMP paint remover formulations because the permeability of the product will vary based on the other solvents and chemicals used in the formulation. The testing requirements for glove permeability and the labeling requirements mandate that processors paint removers containing perform glove permeability testing on each paint remover product containing NMP and update their current product labels to contain warnings and instructions for consumers on how to reduce exposures to NMP. Without the reporting requirements, processors of these products might not provide information about the specific types of protective gloves to users. Requiring that labels of paint and coating removal products containing NMP include information about which specific types of gloves provide dermal protection from the specific product formulation provides information that is essential for knowing how to reduce exposures while carrying out paint and coating removal with NMP. Requiring additional warnings and instructions to consumers provides information about the risks presented by the product and how those risks can be reduced. EPA believes that these information collection activities would not significantly impact the regulated entities.
An agency may not conduct or sponsor, and a person is not required to respond to a collection of information unless it displays a currently valid OMB control number. The OMB control numbers for the EPA's regulations in 40 CFR are listed in 40 CFR part 9.
Submit your comments on the Agency's need for this information, the accuracy of the provided burden estimates, and any suggested methods for minimizing respondent burden to EPA using the docket identified at the beginning of this proposed rule. You may also send your ICR-related comments to OMB's Office of Information and Regulatory Affairs via email to
Pursuant to section 603 of the RFA, 5 U.S.C. 601
2.
3.
4.
For NMP, EPA is co-proposing two approaches. Under the first co-proposed approach, EPA is proposing to prohibit the manufacture (including import), processing, and distribution in commerce of NMP for all consumer and commercial paint and coating removal, exempting uses identified in the proposed rule as critical to national security; and to prohibit the commercial use of NMP for paint and coating removal, exempting uses identified as critical to national security. EPA is proposing to require that any paint or coating removal products containing NMP that continue to be distributed be packaged in no less than 5-gallon containers. EPA is also proposing to require manufacturers (including importers), processors, and distributors, except for retailers, of NMP for any use to provide downstream notification of these prohibitions throughout the supply chain; and to require limited recordkeeping. For the second co-proposed approach for NMP, commercial users would be required to implement and maintain a detailed program for worker protection, including dermal and respiratory protection. Additionally, product processors would be required to carry out testing to identify gloves that are protective against each product formulation, labeling product with that information, and provide additional information on the label to consumers regarding risks of using the product and instructions on how to reduce those risks. As in the first co-proposal, EPA is also proposing to require manufacturers (including importers), processors, and distributors, except for retailers, of NMP for any use to provide downstream notification of these prohibitions throughout the supply chain; and to require limited recordkeeping. More details on these two co-proposals are in Unit XVI.B.3.
Under the proposed approach for methylene chloride and first co-proposed approach for NMP, complying with the prohibitions, the downstream notification, and the recordkeeping requirements involve no special skills. However, implementing the use of substitute chemicals or alternative paint and coating removal processes may involve special skills or expertise in the sector in which the paint and coating removal is conducted.
For the second co-proposed approach for NMP, commercial users would be required to implement and maintain a detailed program for worker protection, which would involve special skills or expertise in industrial hygiene. Similarly, product processors would be required to carry out testing to identify gloves that are protective against each product formulation, could involve special skills or expertise. Labeling products to comply with new requirements would not involve special skill, particularly since EPA proposes to identify specific information for labels of paint and coating removal products containing NMP. As in the first co-proposal for NMP, the downstream notification and the recordkeeping requirements require no special skills.
5.
OSHA's methylene chloride standard, 29 CFR 1910.1052, was issued in 1997 and applies to general industry, construction, and shipyard employment. This proposal does not duplicate OSHA's methylene chloride standard. Nor does the proposed rule conflict with the OSHA standard: it would not prohibit actions required to meet OSHA's methylene chloride standard and it would not require actions in violation OSHA's methylene chloride standard.
CPSC requires that consumer products that contain methylene chloride be labeled with a statement regarding the cancer risks presented by inhalation of methylene chloride fumes. This proposal does not impose requirements that would duplicate or conflict with CPSC's labeling requirements for methylene chloride.
Regarding NMP, there are no OSHA or CPSC regulations. EPA's proposal is not duplicative of other Federal rules nor does it conflict with other Federal rules.
6.
The primary alternative considered by EPA for methylene chloride in paint and coating removal was to allow the commercial use of methylene chloride in paint and coating removal and require a respiratory protection program, including PPE, air monitoring, and either a supplied-air respirator of APF 1,000 or 10,000 or an air exposure limit achieved through engineering controls or ventilation in commercial facilities where methylene chloride is used for paint and coating removal. Depending on air concentrations and proximity to the paint and coating removal, other employees in the area would also need to wear respiratory protection equipment. While this option would address the risks presented by methylene chloride in paint and coating removal, so that they would no longer be unreasonable, the Economic Analysis indicates that this option is more expensive than switching to a substitute chemical or alternative paint and coating removal method (Ref. 4). However, as recommended by the SBAR panel, EPA is seeking comment on and additional information about air monitoring and the use of supplied-air respirators in firms conducting paint and coating removal with methylene chloride (Ref. 27).
EPA is co-proposing two approaches to address risks presented by NMP in commercial and consumer paint and coating removal. Those approaches are described above. EPA considers both of these approaches to be primary regulatory alternatives.
As required by section 609(b) of the RFA, EPA also convened a SBAR Panel to obtain advice and recommendations from small entity representatives that potentially would be subject to the rule's requirements. The SBAR Panel evaluated the assembled materials and small-entity comments on issues related to elements of an IRFA. A copy of the full SBAR Panel Report (Ref. 27) is available in the rulemaking docket.
The Panel recommended that EPA seek additional information in five specific areas: Exposure information, regulatory options, alternatives, cost information, and risk assessment. Specifically, the Panel recommendations were: (1) Exposure information: EPA should request workplace monitoring information during the comment period for worker exposure levels from companies for methylene chloride and NMP in paint and coating removal. EPA should request additional information regarding the frequency of use currently of PPE, and consider that information when weighing alternative options in the proposed rulemaking for methylene chloride and NMP in paint and coating removal. (2) Regulatory options: EPA should consider and seek public comments on enhanced labeling requirements for consumer paint removal products containing methylene chloride or NMP to reduce exposure to methylene chloride and NMP. EPA should consider and seek public comments on a control option such as a certification program similar to the Lead Renovation, Repair and Painting program with increased training and education for commercial users of paint removers. EPA should delay any proposed regulatory action on methylene chloride for the commercial furniture refinishing industry while it gathers additional information to characterize the impacts on this industry of restrictions on use of methylene chloride in paint and coating removal. EPA should request comment on current practices in the furniture refinishing industry on limiting exposure to methylene chloride used in paint and coating removal. EPA should request comment on the feasibility of methylene chloride only being sold in 30-55- gallon drums. EPA should address the proposed regulatory actions as distinctly as possible in the one proposed rulemaking addressing both methylene chloride and NMP in paint and coating removal. (3) Alternatives: EPA should ensure that its analysis of the available alternatives to methylene chloride and NMP in paint and coating removal comply with the requirements of TSCA section 6(c)(2)(C) and include consideration, to the extent legally permissible and practicable, of whether technically and economically feasible alternatives that benefit health or the environment, compared to the use being prohibited or restricted, will be reasonably available as a substitute when the proposed requirements would take effect. Specifically, EPA should evaluate the feasibility of using alternatives, including the cost, relative safety, and other barriers; and take into consideration the current and future planned regulation of compounds the agency has listed as alternatives. (4) Cost information: EPA should request additional information on the cost to achieve reduced exposures in the workplace or to transition to alternative chemicals or technologies. (5) Risk assessments: EPA should recognize the concerns that the SERs had on the risk assessments by referring readers to the risk assessments and the Agency's Summary of External Peer Review and Public Comments and Disposition document for each risk assessment, which addresses those concerns, in the preamble of the proposed rulemaking.
Throughout this preamble, EPA has requested information with respect to these and other topics.
This action does not contain an unfunded mandate of $100 million or more as described in UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect small governments. The requirements of this action would primarily affect manufacturers, processors, and distributors of methylene chloride or NMP. The total estimated annualized cost of the proposed rule under the first co-proposed approach for NMP is $4,185,000 to $23,423,000 and $4,550,000 to $23,472,000 annualized over 20 years at 3% and 7%, respectively (Ref. 4). The total estimated annualized cost of the proposed rule under the second co-proposed approach for NMP is $114,196,000 to $125,893,000 and $114,658,000 to $125,438,000 annualized over 20 years
The EPA has concluded that this action has federalism implications, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999), because regulation under TSCA section 6(a) may preempt state law. EPA provides the following federalism summary impact statement. The Agency consulted with state and local officials early in the process of developing the proposed action to permit them to have meaningful and timely input into its development. EPA invited the following national organizations representing state and local elected officials to a meeting on May 13, 2015, in Washington DC: National Governors Association; National Conference of State Legislatures, Council of State Governments, National League of Cities, U.S. Conference of Mayors, National Association of Counties, International City/County Management Association, National Association of Towns and Townships, County Executives of America, and Environmental Council of States. A summary of the meeting with these organizations, including the views that they expressed, is available in the docket (Ref. 124). Although EPA provided these organizations an opportunity to provide follow-up comments in writing, EPA received no written follow-up.
This action does not have tribal implications, as specified in Executive Order 13175 (65 FR 67249, November 9, 2000). This rulemaking would not have substantial direct effects on tribal government because methylene chloride or NMP are not manufactured, processed, or distributed in commerce by tribes. Tribes do not regulate methylene chloride or NMP, and this rulemaking would not impose substantial direct compliance costs on tribal governments. Thus, EO 13175 does not apply to this action. EPA nevertheless consulted with tribal officials during the development of this action, consistent with the EPA Policy on Consultation and Coordination with Indian Tribes.
EPA met with tribal officials in a national informational webinar held on May 12, 2015 concerning the prospective regulation of methylene chloride and NMP in paint and coating removal under TSCA section 6, and in another teleconference with tribal officials on May 27, 2015 (Ref. 125). EPA also met with the National Tribal Toxics Council (NTTC) in Washington, DC and via teleconference on April 22, 2015 (Ref. 125). In those meetings, EPA provided background information on the proposed rule and a summary of issues EPA explored. These officials expressed support for EPA regulation to reduce the risks presented by methylene chloride and NMP in paint and coating removal.
This action is subject to Executive Order 13045 because it is an economically significant regulatory action as defined by Executive Order 12866, and the EPA believes that the environmental health or safety risk addressed by this action has a disproportionate effect on children, specifically on the developing fetus. Accordingly, we have evaluated the environmental health or safety effects of methylene chloride and NMP in paint and coating removal on children. This action's health and risk assessment of exposure by children to methylene chloride and NMP in paint and coating removal are contained in Units I.F., VI.C.1.c., and XVI.B.1.c. of this preamble. Supporting information on methylene chloride and NMP exposures and the health effects of methylene chloride or NMP exposure by children is available in the Toxicological Review of Methylene Chloride (Ref. 5), the NMP risk assessment (Ref. 3), and the methylene chloride risk assessment (Ref. 2).
This proposed rule is not subject to Executive Order 13211 (66 FR 28355, May 22, 2001), because this action is not expected to affect energy supply, distribution in commerce, or use. This rulemaking is intended to protect against risks from methylene chloride and NMP in paint and coating removal, and does not affect the use of oil, coal, or electricity.
This proposed rulemaking does not involve technical standards, and is therefore not subject to considerations under NTTAA section 12(d), 15 U.S.C. 272 note. However, under one of the co-proposals for NMP discussed in Unit XVI, EPA is proposing to require processors of paint and coating removal products that contain NMP to identify, through testing, gloves that provide an impervious barrier to dermal exposure during normal and expected duration and conditions of exposure. EPA has identified two potentially-applicable voluntary consensus standards for this process: ASTM International Standard F739, “Standard Test Method for Permeation of Liquids and Gases through Protective Clothing Materials under Conditions of Continuous Contact,” and ASTM International F1194-99, “Standard Guide for Documenting the Results of Chemical Permeation Testing of Materials Used in Protective Clothing Materials.” EPA is not proposing specific provisions for conducting and documenting glove testing, nor is EPA proposing to incorporate these voluntary consensus standards by reference. EPA requests comment on whether the regulation should include additional requirements on glove testing for processors and, if so, how that should be accomplished.
Executive Order 12898 (59 FR 7629, February 16, 1994) establishes federal executive policy on environmental justice. Its main provision directs federal agencies, to the greatest extent practicable and permitted by law, to make environmental justice part of their mission by identifying and addressing, as appropriate, disproportionately high and adverse health or environmental effects of their programs, policies and activities on minority populations and low-income populations in the U.S. Units VI.C.1.b.,VI.D.10., XVI.B.1.b., and XVI.C.6. of this preamble address public health impacts from methylene chloride and NMP in paint and coating removal. This proposed rule would address the current disproportionate risk to Hispanic workers (of all races) and foreign-born workers in the construction trades, where these two populations are overrepresented compared to the general U.S. adult population (Ref. 4). Though this proposed rule would eliminate risks of exposure to NMP and methylene chloride when used in paint and coating removal in the construction trades, because workers in these two populations currently are overrepresented in this trade, these populations would disproportionately benefit from this risk reduction. The EPA places particular emphasis on the public health and environmental conditions affecting minority populations, low-income populations,
Environmental protection, Chemicals, Export notification, Hazardous substances, Import certification, Recordkeeping.
Therefore, 40 CFR part 751, as proposed to be added at 81 FR 91592 (December 16, 2016), is proposed to be further amended as follows:
15 U.S.C. 2605, 15 U.S.C. 2625(l)(4).
This subpart sets certain restrictions on the manufacture (including import), processing, distribution in commerce, and uses of methylene chloride (CASRN 75-09-2) to prevent unreasonable risks to health associated with human exposure to methylene chloride for the specified uses.
The definitions in subpart A of this part apply to this subpart unless otherwise specified in this section. In addition, the following definitions apply:
After [
(a) After [
(b) After [
(c) After [
(d) Any paint and coating removal from critical corrosion-sensitive components of military aviation and vessels must be conducted under the following restrictions:
(1) All paint and coating removal from critical corrosion-sensitive components of military aviation and vessels using methylene chloride must be conducted at DOD installations, or at deployed locations under the control of DOD organizations, or at locations of DOD contractors performing coating removal work from corrosion-sensitive components of military aviation and vessels for DOD.
Each person who manufactures, processes, or distributes in commerce methylene chloride for any use after [
(a) Each person who manufactures, processes, or distributes in commerce any methylene chloride after [
(1) The name, address, contact, and telephone number of companies to whom methylene chloride was shipped;
(2) A copy of the notification provided under § 751.109; and
(3) The amount of methylene chloride shipped.
(b) The documentation in (a) must be retained for 3 years from the date of shipment.
This subpart sets certain restrictions on the manufacture (including import), processing, distribution in commerce, and uses of N-methylpyrrolidone (NMP) (CASRN 872-50-4) to prevent unreasonable risks to health associated with human exposure to NMP for the specified uses.
The definitions in subpart A of this part apply to this subpart unless otherwise specified in this section. In addition, the following definitions apply:
After [
(a) After [
(b) After [
(c) After [
(d) Any paint and coating removal from critical corrosion-sensitive components of military aviation and vessels must be conducted under the following restrictions:
(1) All paint and coating removal from critical corrosion-sensitive components of military aviation and vessels using NMP must be conducted at DOD installations; DOD owned, contractor operated locations; or contractor owned, contractor operated locations performing paint and coating removal from critical corrosion-sensitive components of military aviation and vessels for DOD.
(2) [Reserved].
Each person who manufactures, processes, or distributes in commerce NMP for any use after [
(a) Each person who manufactures, processes, or distributes in commerce any NMP after [
(1) The name, address, contact, and telephone number of companies to whom NMP was shipped;
(2) A copy of the notification provided under § 751.209; and
(3) The amount of NMP shipped.
(b) The documentation in (a) must be retained for 3 years from the date of shipment.
(a)
(2) Conduct glove testing for each separate formulation of NMP, with a variation of more than 1 percent in any component of a paint and coating removal product containing NMP considered a separate formulation.
(i) The processor must be able to demonstrate that the gloves provide an impervious barrier to prevent dermal exposure during normal and expected duration and conditions of exposure.
(ii) The processor must subject the gloves to the expected conditions of exposure, including the likely combinations of chemical substances to which the gloves may be exposed in the work area.
(3) Provide a label securely attached to each NMP paint and coating removal product and not in the form of a booklet or other pull off type labeling. Label information must be prominently displayed and in an easily readable font size. Each separate NMP paint and coating removal product must be labeled with the following information:
(i) A notice that 40 CFR 751.205 requires commercial users of NMP paint and coating removal products to establish an occupational dermal and respiratory protection program, including the use of specialized gloves and an air exposure limit or respirator.
(ii) A warning to consumers that fetal death and other irreversible health effects may occur as a result of using the NMP product;
(iii) An identification of the formulation-specific gloves that will provide protection from the NMP product and a direction to use a new pair of those gloves for each time the NMP product is used;
(iv) A direction for consumers to either use the product outdoors or adequately ventilate the workspace by opening windows and adding fans;
(v) A warning for consumers to not apply the product as a spray;
(vi) A direction to wear clothing that covers exposed skin;
(vii) A direction to use a respirator with an Assigned Protection Factor (APF) of 10. Refer to § 751.205(c)(3)(ii) for respirators having an APF of 10 or greater;
(b)
(1) Any paint and coating removal from critical corrosion-sensitive components of military aviation and vessels must be conducted under the following restrictions:
(i) All paint and coating removal from critical corrosion-sensitive components of military aviation and vessels using NMP must be conducted at DOD installations; or at government owned, contractor operated locations; or at contractor owned and contractor operated locations performing paint and coating removal from critical corrosion-sensitive components of military aviation and vessels for DOD.
(ii) [Reserved].
(2) [Reserved].
(c)
(1)
(ii)
(A) Each affected employee must be trained to know at least the following:
(
(
(
(
(
(B) Each affected employee must demonstrate an understanding of these elements and the ability to use PPE properly before being allowed to perform work requiring the use of PPE.
(C) Retraining is required when previous training is rendered obsolete, whether due to changes in the workplace or the type of PPE, or when the employer has reason to believe that a previously-trained employee does not have the understanding and skill required by this subparagraph.
(2)
(ii)
(A) Formulation-specific gloves as indicated on the NMP paint and coating removal product label. A new pair must be supplied and worn each time the NMP product is used.
(B) Impervious clothing covering the exposed areas of the body (
(iii)
(A) Testing the material used to make the chemical protective clothing and the construction of the clothing to establish that the protective clothing will be impervious for the expected duration and conditions of exposure. The testing must subject the chemical protective clothing to the expected conditions of exposure, including the likely combinations of chemical substances to which the clothing may be exposed in the work area.
(B) Evaluating the specifications from the manufacturer or supplier of the chemical protective clothing, or of the material used in construction of the clothing, to establish that the chemical protective clothing will be impervious to the chemical substance alone and in likely combination with other chemical substances in the work area.
(3)
(A) Procedures for selecting respirators for use in the workplace.
(B) Medical evaluations of employees required to use respirators.
(C) Fit testing procedures.
(D) Procedures for proper use of respirators.
(E) Procedures and schedules for cleaning, disinfecting, storing, inspecting, repairing, discarding, and otherwise maintaining respirators.
(F) Procedures to ensure adequate air quality, quantity, and flow of breathing air for atmosphere-supplying respirators.
(G) Procedures for regularly evaluating the effectiveness of the program.
(H) Recordkeeping.
(ii)
(A) Any NIOSH-certified air-purifying elastomeric half-mask respirator equipped with N100 (if oil aerosols absent), R100, or P100 filters;
(B) Any appropriate NIOSH-certified N100 (if oil aerosols absent), R100, or P100 filtering facepiece respirator;
(C) Any NIOSH-certified air-purifying full facepiece respirator equipped with N100 (if oil aerosols absent), R100, or P100 filters. A full facepiece air-purifying respirator, although it has a higher APF of 50, is required to provide full face protection because the PMN substance presents significant exposure concern for mucous membranes, eyes, or skin;
(D) Any NIOSH-certified negative pressure (demand) supplied-air respirator equipped with a half-mask; or
(E) Any NIOSH-certified negative pressure (demand) self-contained breathing apparatus (SCBA) equipped with a half mask.
(d)
(1)
(2)
(3)
(i)
(ii)
(B) Employees whose exposures are represented by initial monitoring results above the ECEL must continue to wear the respirators required in subsection (d) of this section until such time as two monitoring results below the ECEL, sampled at least 24 hours apart, are obtained.
(C) Within 15 days of the date exposure monitoring results are received, the employer must provide the results to each person whose exposure is represented by the monitoring. If the result is above the ECEL, the employer must also provide the employee with information on the actions the employer will take to reduce employee exposures to the ECEL or below.
(iii)
(A) Every 6 months for those employees whose initial monitoring results are between 0.5 ECEL and the ECEL, until such time as 2 results below 0.5 ECEL, from samples collected at least 24 hours apart, are obtained,
(B) Every 3 months for those employees whose initial monitoring results are at or above the ECEL. If 2 results below the ECEL, from samples collected at least 24 hours apart, are obtained, then frequency may be reduced to every 6 months. If 2 results below 0.5 ECEL, from samples collected at least 24 hours apart, are obtained, then exposure monitoring under this subsection need not be repeated unless there is a process, equipment, environment, or personnel change.
(C) At any time when process, equipment, environment, or personnel changes may reasonably cause new or additional exposures to NMP.
(e)
(1)
(i) A list of each NMP paint and coating removal product present in the work area. The list must be maintained in the work area and must use the identity provided on the appropriate
(ii) The methods the employer will use to inform contractors of the presence of NMP paint and coating removal products in the employer's workplace and of the provisions of this part applicable to the NMP products if employees of the contractor work in the employer's workplace and are reasonably likely to be exposed to the NMP products while in the employer's workplace.
(2)
(i) Information provided to employees under this paragraph must include:
(A) The requirements of this section.
(B) The location and availability of the written hazard communication program.
(ii) Training provided to employees must include:
(A) The potential human health hazards of the NMP paint and coating removal products as specified on the label.
(B) The measures employees can take to protect themselves from the NMP paint and coating removal products, including specific procedures the employer has implemented to protect employees from exposure to the substance, including appropriate work practices, emergency procedures, personal protective equipment, engineering controls, and other measures to control worker exposure.
(3)
Each person who manufactures, processes, or distributes in commerce NMP for any use after [
(a) Each person who manufactures, processes, or distributes in commerce any NMP after [
(1) The name, address, contact, and telephone number of companies to whom NMP was shipped;
(2) A copy of the notification provided under § 751.209; and
(3) The amount of NMP shipped.
(b) The documentation in (a) must be retained for 3 years from the date of shipment.
Office of the Secretary (OST), Department of Transportation (DOT).
Supplemental Notice of Proposed Rulemaking (SNPRM).
This SNPRM proposes to require air carriers, foreign air carriers, and ticket agents to clearly disclose to consumers at all points of sale customer-specific fee information, or itinerary-specific information if a customer elects not to provide customer-specific information, for a first checked bag, a second checked bag, and one carry-on bag wherever fare and schedule information is provided to consumers. This SNPRM further proposes to require each covered carrier to provide useable, current, and accurate (but not transactable) baggage fee information to all ticket agents that receive and distribute the carrier's fare and schedule information, including Global Distribution Systems and metasearch entities. On covered carrier and ticket agent Web sites, the SNPRM would require the baggage fee information to be disclosed at the first point in a search process where a fare is listed in connection with a specific flight itinerary, adjacent to the fare. The SNPRM would permit carriers and ticket agents to allow customers to opt-out of receiving the baggage fee information when using their Web sites.
Comments must be received by March 20, 2017. Comments received after this date will be considered to the extent practicable.
You may file comments identified by the docket number DOT-OST-2017-0007 by any of the following methods:
•
•
•
•
Kimberly Graber or Blane A. Workie, Office of the Assistant General Counsel for Aviation Enforcement and Proceedings, U.S. Department of Transportation, 1200 New Jersey Ave. SE., Washington, DC 20590, 202-366-9342 (phone),
The Notice of Proposed Rulemaking, titled Transparency of Airline Ancillary Service Fees and Other Consumer Protection Issues, Docket No. DOT-OST-2014-0056, 79 FR 29970, May 23, 2014 (Consumer Protection NPRM), contained a number of proposals to enhance consumer protections, including a proposal to require the disclosure of certain airline ancillary service fees. This proposed disclosure requirement was one of the more controversial provisions of the rulemaking and generated significant comments from consumers, airlines, ticket agents and other interested parties. In light of the comments on this issue, the Department is issuing this SNPRM, which focuses solely on the issue of transparency of certain ancillary service fees. The other issues in the 2014 NPRM are being addressed separately. See RIN 2105-AE11, Enhancing Airline Passenger Protections III; and RIN 2105-AE57, Enhancing Airline Passenger Protections IV.
In this SNPRM, the Department proposes to require disclosure at all points of sale of the customer-specific fees for first and second checked bag and carry-on bag but does not propose to require disclosure of the fee for advance seat assignment. In addition, the Department proposes to require carriers to provide certain baggage fee information to ticket agents so that both carriers and ticket agents would be able to provide customer-specific baggage fee information to consumers. We invite all interested parties to comment on the proposals set forth in this notice. Our final action will be based on comments and supporting evidence from the public filed in this docket, and on our own analysis and regulatory evaluation.
Online travel agencies (OTAs), metasearch sites, “traditional” travel agencies, and travel management companies generally obtain most of their information regarding air transportation options indirectly through Global Distribution Systems (GDSs). GDSs essentially facilitate the purchase of tickets between airlines and consumers through third parties but do not have complete information regarding ancillary service fees. As a result, when researching air transportation options and making decisions on whether to purchase air transportation, consumers continue to have difficulty determining the total cost of travel because the fees for basic ancillary services are not available through all sales channels. Consumers also experience difficulty on carrier Web sites because fees are provided on lengthy static lists, and many ancillary service fees are listed as a range, so consumers do not necessarily know the
The Department's goal is to protect consumers from hidden and deceptive fees and enable them to determine the true cost of travel in an effective manner when they price shop for air transportation. The problem of hidden fees has been brought to our attention by consumer complaints, comments on the second Enhancing Airline Passenger Protections rulemaking, and comments to the docket for the Advisory Committee for Aviation Consumer Protection. We also note that members of Congress representing constituents have expressed support for full, more specific, disclosure of ancillary service fees.
In the 2014 NPRM, we provided an overview of the airline distribution system based on information gathered from representatives of carriers, GDSs, consumer advocacy organizations, and trade associations, as well as other interested entities, including third-party technology developers. We noted that approximately 50% of tickets are sold by airlines directly to consumers, and the remainder is sold through ticket agents. Further, in the United States, three GDSs (Sabre, Travelport and Amadeus) control the distribution of the airline product for the ticket agent channel and most airlines use the GDSs to distribute their products to ticket agents, including corporate travel agents that sell the higher revenue tickets. The NPRM noted that airlines state they have made some efforts to reduce their reliance on GDSs and transition to direct connections between airline reservation systems and ticket agent systems but contractual arrangements make that difficult. As stated in the NPRM, carriers and carrier associations have expressed concern that a Department requirement to distribute information through a GDS would reinforce the existing distribution patterns and stifle innovation. Some stakeholders have alleged that if existing distribution patterns are reinforced, carriers will no longer have sufficient incentive to invest in new distribution technologies, which might ultimately provide more information to the benefit of consumers. In connection with new distribution technologies, the 2014 NPRM also mentioned that the International Air Transport Association (IATA) applied to the Department of Transportation for approval of its agreement establishing the framework for the IATA New Distribution Capability (NDC). That application was pending at the time of NPRM publication but has since been approved. NDC is essentially an XML-based technical standard for use in airline distribution, including direct connect services, that has been developed by IATA in cooperation with air transportation stakeholders. The goal appears to be to change how airlines sell their products today by using the enhanced platform to quickly generate dynamic, personalized offers. For more information, see docket DOT-OST-2013-0048. The NDC standard is available to any party and has been implemented by some entities since the 2014 NPRM was published.
Our discussion in the 2014 NPRM explained that although airlines generally distribute fare, schedule, and availability information through GDSs, they generally do not distribute ancillary service fee information in the same manner. The NPRM also outlined some of the technological and competitive concerns raised by air transportation industry stakeholders. We also noted that in contrast to airlines, GDSs assert that any transition to direct connect services will succeed or fail based on whether the services meet the needs of travel agencies and the consumers they serve, regardless of existing contracts. As noted in the NPRM, GDSs disputed the position that there is no need for a Department requirement, stating that airlines and ticket agents have not been able to come to agreements that would allow airlines to provide ancillary service fee information to ticket agents so they could in turn provide such information to consumers.
The 2014 NPRM explained that our decision to initiate a rulemaking regarding distribution of ancillary service fee information rested on the conclusion that consumers are continuing to have difficulty finding ancillary service fee information, which limits consumers' ability to determine the true cost of travel. We also recognized in the NPRM that carriers and GDSs state they share our goal of transparency of ancillary service fee information. In the NPRM we made clear that the Department is working to find the most beneficial disclosure rule for consumers while avoiding any adverse impact on innovations in the air transportation marketplace, contract negotiations between carriers and their distribution partners, or a carrier's ability to set prices for its services in response to its own commercial strategy and market forces. As the NPRM stated, consumers need to be protected from hidden and deceptive fees that prevent them from effectively price shopping—that is, determining while shopping and before purchasing, the total costs of air transportation. The NPRM explained that failing to disclose basic ancillary service fees in an accurate and up-to-date manner before a consumer purchases air transportation is an unfair and deceptive practice. We identified a number of questions regarding the need for rulemaking on which we requested comment, including questions regarding the difficulty consumers have finding fee information, what fee information consumers wanted to have prior to purchase, and whether either of the Department's proposals would make fees easier to find. We also explained the alternatives that we had considered.
Open Allies, which described itself as a coalition of more than 400 independent distributors and sellers of air travel, corporate travel departments, travel trade associations and consumer organizations, commented in favor of Department action in this area. According to Open Allies, the rule is needed because ancillary service fees are not accessible and that identifying total travel cost is complex, confusing, and needlessly time consuming. According to Open Allies, the market is not reacting quickly or completely enough to address the issue. Open Allies pointed to a survey it conducted of over 1,000 adults in the United States, indicating that 55 percent of respondents said that they were surprised by additional fees after purchasing a ticket; 88 percent said that Department action is important; 81 percent believe that current airline practices are “unfair and deceptive;” and 47 percent said that it was hard to search and find the lowest price for travel.
Open Allies argued that the Department should not rely on competition because fees are still hidden, despite existing Department requirements, which results in consumers making sub-optimal purchasing decisions. Open Allies relied on consumer comments in the docket, saying that they show that consumers feel deceived and confused and do not understand the true, full cost of travel. According to Open Allies, consumers generally give two key reasons for supporting increased disclosure of ancillary service fees: (1) It would allow them to compare prices across various airlines; and (2) it would prevent airlines from surprising them with fees after they have purchased their airfare. Open Allies commented that there are many benefits to enhanced disclosure of price information such as ancillary service fees, including that it lowers prices, enhances competition, and promotes informed buyers. According to Open Allies, airlines lack a commercial incentive to provide ancillary service fee information to the “neutral” travel agency channel because airlines have an interest in not allowing ticket agents to show the full cost of travel at the shopping stage because if travel appears less expensive, consumers will be more likely to complete a purchase. Open Allies further pointed out that an airline is unlikely to voluntarily display ancillary service fees on a travel agent display because it would make the airline's fares appear more expensive when compared to the fares of other airlines that do not disclose ancillary service fee information.
In support of its position, Open Allies cited a 2010 GAO Report and a follow-on 2014 report, describing the problem of ancillary service fee disclosure as a continuing problem. Open Allies pointed out that while some individual airlines and individual GDSs have announced agreements regarding distribution of certain ancillary service fees, those agreements are generally limited to premium seating on some of the individual airline's flights and do not provide all ticket agents access to that information. Therefore, consumers are still unable to discover all basic ancillary service fees when searching for flights. According to Open Allies, the Department has substantial evidence to support its rulemaking as well as ample authority under § 41712 (unfair or deceptive practices). Open Allies compared the Department's authority to that of the FTC and stated that analogous FTC precedent on unfair or deceptive practices establishes that the Department has the legal authority to proceed with this rulemaking.
The three GDSs—Amadeus, Sabre, and Travelport—all supported the rulemaking, stating that consumers that use ticket agents to shop for air transportation do not have access to all ancillary service fee information. According to Sabre, for consumers to “know the full price of travel before they are locked into a purchase” the Department must act. The GDSs also stated that airlines will not share ancillary service fee information with ticket agents, except on a limited basis, unless the Department requires the information to be shared. Travelport stated that airlines are motivated to increase revenues by driving consumer costs up through “obfuscation of the true cost of flying.” Amadeus points to airline opposition to disclosure requirements, particularly opposition by U.S. airlines, as evidence that the market will not resolve the problem. Travel Technology Association (Travel Tech), a trade association for major OTAs, GDSs, and some entities operating metasearch engines focused on travel, also stated that a problem remains for consumers trying to uncover charges for additional services and stated that consumers must search to discover the true cost of their air travel.
Several travel agents and travel agent associations also stated there is a need for Department action in this area. The American Society of Travel Agents (ASTA) joined in the comments of Open Allies and stated that the Department's proposals do not go far enough to address widespread confusion among consumers. A number of travel agents submitted comments stating that their customers could not calculate the true cost of airfare with certainty and that the travel agents themselves could not provide a quote with certainty because of the complexity of and variation in ancillary service fees charged from airline to airline. Those travel agents supported mandating that airlines disclose the costs of bag fees and seat assignments. The United States Tour Operators Association (USTOA) opposed being subject to disclosure regulations but commented that consumers have expressed strong support for early disclosure of information on ancillary service fees. USTOA pointed to a survey that shows that 45 percent of respondents reported difficulty in budgeting for air travel due to the proliferation of fees and difficulty in determining the costs of flying. Survey respondents also indicated that total cost of travel is very important to purchasing decisions. Corporate travel agents also commented that they were concerned about disclosure. Global Business Travel Association stated that there is a need for disclosure requirements because despite investing resources, acquiring technologies, and changing travel policies, its members are still facing challenges finding basic ancillary fee information for baggage and seat assignments. Business Travel Coalition (BTC) commented in support of requiring disclosure of fees, stating that airlines are “masking the all-in price of air travel.”
Computer and Communications Industry Association (CCIA), advocating for metasearch entities, commented in favor of Department action to make sure consumers have the information needed to determine the full cost of travel. TripAdvisor and Skyscanner, which both operate flight search tools, also commented in favor of Department action requiring airlines to disclose ancillary service fee information to ensure transparency for the benefit of consumers. Of airline commenters, only Southwest supported the Department requiring greater fee disclosure, noting that consumers will “be better able to arrive at the true cost of air transportation.” Finally, several commenters, including ASTA, BTC, FlyersRights, and Travel Tech also noted that airlines are not subject to State and local consumer protection laws due to Federal preemption, and
The Department also received many comments that opposed any further requirement pertaining to disclosure of ancillary service fees as specific charges. A4A (Airlines for America, the trade association of the larger U.S. airlines) argued that there is no need for any proposal regarding ancillary service fee information because the industry has already provided that information in response to existing Department regulatory requirements and market pressure and no consumer harm is occurring. A4A further argued that the Department does not have the authority to require airlines to disclose certain ancillary service fees in displays of fare search results because the failure to provide that information at the time fare information is presented to consumers does not amount to an unfair or deceptive practice. A4A also pointed out that on some occasions when discussing the ancillary service fee disclosure issue, the Department has described it in terms of the ability of consumers to engage in comparison shopping. A4A argued that the Department does not have regulatory authority to dictate the terms of carrier distribution or ancillary service fee disclosure to enhance comparison shopping.
In addition to stating there is no need for any ancillary service fee proposals, A4A opposed any ancillary service fee disclosure requirement on competitive grounds, alleging that the rulemaking would effectively require airline distribution through GDSs, which would put airlines at a competitive disadvantage. According to A4A, the Department recognized the powerful market position of GDSs in a 2004 rulemaking
Meanwhile, according to airline associations, the market is working. A4A commented that existing Department regulations combined with market forces have led to “enhanced fee disclosure practices,” and that carriers want to sell ancillary services, especially to business travelers who constitute a large segment of their repeat customers and revenue producers. A4A went on to explain that carriers are already incentivized to distribute information about ancillary products and fees and to facilitate the sale of ancillary services through multiple channels, including travel agencies, if they can do so on commercially reasonable terms. According to A4A, carriers and GDSs have already developed the ability (using the ATPCO filing system) to disclose information such as first and second checked bag fees to travel agents. A4A further noted that some airlines have made it possible for some agents to purchase certain ancillary services for consumers and some GDSs have developed mechanisms for ticket agents to buy services directly from carrier Web sites. A4A also pointed to tools on carrier Web sites that allow consumers to obtain customer-specific information through an airline Web site after providing information from the purchased ticket, and third-party Web sites that provide ancillary service fee information as the “beneficial result of the existing environment.” A4A also criticized Open Allies' reliance on survey results, stating that the survey was flawed for a number of methodological reasons and “it should not be relied upon to arrive at conclusions concerning perceptions and attitudes about ancillary services held by people who fly on commercial airlines in the United States.” According to A4A, GDSs are trying to obtain the commercial benefit of access to ancillary service fee information through regulation instead of through negotiations, even though negotiated agreements are possible. A4A also stated that GDSs have made concessions on pricing and technology through commercial agreements. A4A concluded that regulation will result in higher GDS fees which will in turn be passed on to consumers through higher ticket prices, to the detriment of the public.
In supplemental comments, A4A stated that the three GDSs engaged in pilot projects to “begin adapting to” the NDC initiative and many airlines have invested in technology solutions. In addition, a variety of technology service companies are building solutions in the area. According to A4A, these marketplace developments prove that regulation is unneeded. A4A provided a number of examples of agreements between airlines and GDSs that it says show that carriers are sharing ancillary service fee information with GDSs. A4A went on to say that it is more and more common for carriers to sell bundled fares on their own sites, which A4A stated often results in discounts and is a consumer-friendly method of display. A4A further stated that mandating disclosures on the first page that displays fares interferes with airline efforts to differentiate their products and compete on service and price, as well as “squandering” the investment made by carriers on bundled pricing initiatives and technology to display those prices. A4A concluded in its supplemental comments that marketplace solutions that compel all parties to negotiate and use the most efficient data-sharing and latest technology will lead to time savings for consumers.
IATA commented that the market has fundamentally changed since the Department first considered requiring carriers to disclose ancillary service fees and consumers now have “more than ample” access to information about ancillary services and fees prior to making purchase decisions. According to IATA, there is no lack of information about ancillary service fees causing harm to consumers. Further the Department has not demonstrated there is any unfair or deceptive practice that will be prevented by further regulating the disclosure of ancillary service fees, therefore, they argued, the Department does not have the authority to regulate in this area.
IATA further argued that marketplace solutions are already making any rulemaking regarding ancillary service fees unnecessary as the rapid changes in distribution are working to the benefit of consumers and any Departmental intervention in this rapidly changing market will interfere and result in suboptimal solutions. IATA argued that airline Web sites already offer comprehensive and accurate information about ancillary services and fees. IATA acknowledged that airlines provide fee information as a range of fees in a static format but stated that this is not evidence of fraud or deception, merely “evidence of the complexity of capturing the wide variety of factors that are considered when dynamically setting the price for a specific ancillary service for a specific customer.” IATA went on to state that carriers are coming to agreements to provide ancillary service fee information to GDSs for distribution directly to agents rather
Several airlines also commented in opposition to the rulemaking. American Airlines joined in the comments of A4A and further stated that the Department's proposals do not address specific instances of demonstrated harm to consumers that cannot reasonably be avoided and the rulemaking is “beyond the recognized limits of the Department's regulatory powers.” American alleged that the Department based its reasoning on a need for comparison shopping, which American said is an unreasonable and inadequate basis for rulemaking. Frontier Airlines opposed any disclosure requirements, stating it “believes that competitive market forces and the Department's existing regulations are more than adequate to inform and protect consumers.” JetBlue also endorsed the comments of both A4A and IATA and stated that the Department should rely on market forces. According to JetBlue, the Department assumes a problem regarding consumers not knowing the true cost of travel and the NPRM does not provide a foundation for that assumption. United also endorsed the comments of A4A and stated that the market is already addressing many of the Department's concerns so the Department should refrain from issuing regulations regarding ancillary service fee disclosure. United further stated that the Department does not have evidence that supports the need for the proposed rulemaking. Spirit Airlines similarly opposed any rulemaking on disclosure of ancillary service fees, stating that it is not necessary and not in the public interest. According to Spirit, the Department should defer to the market place which is rapidly developing and “progressively improving reasonable consumers' ability to determine the total cost of their travel before purchase.”
Several foreign air carriers endorsed IATA's comments and opposed any Department regulation of disclosure of ancillary service fees. Aerovías de México, S.A. de C.V., (Aeromexico) and Air Transat endorsed the comments submitted by IATA regarding disclosure of ancillary service fees, and stated that the market is already addressing the issues raised by the Department. Further, any intervention by the Department will likely have a negative impact on consumers. In comments filed on behalf of the Avianca carrier group, Avianca endorsed IATA's comments, stating that the marketplace already is addressing the Department's concerns regarding disclosure of ancillary service fees, and any regulatory intervention likely will have a negative impact on both consumers and carriers. Air New Zealand supported the comments of IATA and stated that the current disclosure requirements are adequate to protect the consumer. Compañía Panameña de Aviación, S.A. (Copa Airlines) opposed Department rules regarding ancillary service fee disclosure, stating such rules may have “unintended adverse consequences that would significantly diminish any such benefits by making its implementation financially and technologically cumbersome for carriers.” Qatar Airways (Qatar) also endorsed the comments of IATA and added that the market is working. Qatar went on to state that Department intervention will have a negative impact on consumers. Scandinavian Airlines System also endorsed IATA's comments and stated the rulemaking will have a negative impact on consumers. Virgin Atlantic Airways (Virgin Atlantic) commented that the market is evolving to meet customer preferences and the Department's current fee disclosure requirements are adequate. Further, requiring carriers to provide ancillary service fee information to ticket agents deprives carriers of their right to decide how to market their ancillary services and to distribute such information in a way that is most cost-effective for them.
The Arab Air Carriers Organization (AACO) commented that market developments since the Department began to address ancillary services in rulemakings have resulted in market action that is heading towards developing a data transmission standard that would make the flow of information between the airlines and agents more efficient. AACO went on to state that the Department should not specify how airlines display information. AACO also stated that a requirement to distribute through the GDSs would have a negative effect on future innovation in the distribution and display of ancillary services and fees as well as give GDSs the upper hand in contract negotiations with airlines.
AAA, a leisure travel agent trade organization, commented that it supports transparency but specific mandates in this area may be premature at this time. AAA stated it was concerned about stifling innovation and wanted airlines to work with GDSs on agreements to distribute full ancillary fee information. Momondo Group, an online travel media and technology company that operates a flight search tool, commented that it supports transparency as its primary objective. However, it stated that it would be extremely costly to provide accurate information and avoid consumer confusion. It recommended that the Department conduct a more detailed examination of the problem before implementing a regulation that will impact a variety of entities, including operators of metasearch engines.
For the average consumer looking for the total cost of travel, he or she must frequently review a complex chart to determine his or her baggage fees particularly for interline itineraries and guess what an assigned seat fee might cost. We disagree with airlines and airline associations that these facts do not reflect consumer harm as we believe the additional time spent searching to find the total cost of travel and the additional funds spent on air transportation that might have been
The Department agrees with commenters that supported a need for rulemaking to allow consumers to have complete access to certain basic ancillary service fees in a manner that permits them to quickly and effectively determine their true cost of travel, although as explained further below, the Department has changed its view on what constitutes a basic ancillary service. Further, until all airlines and ticket agents are required to display certain basic ancillary service fees, and carriers are required to transmit fees for basic ancillary services to ticket agents, there is a strong incentive for carriers to obfuscate those fees. That is because if all competing carriers do not make similar disclosures, any airline that disclosed the cost of ancillary services, such as baggage fees, would appear to charge more for air transportation than the airlines that did not clearly provide fee information for those ancillary services. Therefore, even carriers that believe it is appropriate and consumer-friendly to provide the information in a clear fashion have a strong marketplace disincentive to disclose the cost of ancillary services. The Department notes that even the comments by airlines and airline associations that argued that the market is resolving the issue described the changes as ongoing and recognized that it will take time for airlines and ticket agents to come to agreement and implement new methods of disclosure. Although airline associations point to the number of agreements being reached between airlines and GDSs regarding GDS access to bundled fare packages that include an advance seat assignment, those agreements are bilateral agreements addressing limited services, primarily enhanced seating options, in limited markets and are not widely available to the general public.
Meanwhile, airlines are capable of disclosing some ancillary service fees in search results on their own Web site search result displays today, yet choose not to do so. The Department is not persuaded by airline arguments that the complexity of factors considered when setting fees is a sufficient justification for leaving it to the airlines to decide how much disclosure to provide regarding basic ancillary service fees. To the contrary, any argument that fees are difficult to explain or quantify militates for greater disclosure requirements of fees for basic ancillary services intrinsic to air transportation. The mere fact that airlines are unbundling fares and have implemented ancillary service fee policies that even the airlines acknowledge are complex justifies efforts by the Department to ensure that consumers are able to discern the true cost of travel that includes basic ancillary service fees. Moreover, the existence of complex fee calculations that take into account a variety of factors does not explain why airlines do not provide better disclosure of baggage fee information that they already provide as a specific amount on a static list. Although there are complexities involved in displaying baggage fees, the comments demonstrate there is no technical impediment to displaying baggage fees with search results on carrier Web sites, yet that information is still not displayed.
In support of its argument that the Department has not demonstrated a problem that it has authority to regulate, A4A provided two examples (from the NPRM and a docket record of an A4A meeting with Department staff)
On the other hand, several commenters opposed defining basic ancillary services as intrinsic to air transportation or including seat assignment fees as a basic ancillary service. USTOA commented that the Department should not include a requirement that seat assignment fees be disclosed in an itinerary specific manner because sellers of package tours may not have access to seat assignments at the time the package is sold or, since seats are inventory-controlled, the cost is likely to change before a consumer is able to purchase them on an airline Web site. Spirit asserted that any advance seat assignment fee disclosure should be eliminated because all airlines provide a seat with the cost of air transportation so disclosing an advance seat assignment fee at the beginning of a booking process may induce someone to purchase it when there is no need to do so. A4A, AACO, and United commented that advance seat assignments have not been traditionally provided to consumers as part of the price of air transportation. Comments by A4A and United noted that fare purchases guarantee a seat in a particular cabin, such as first class or economy, but not a particular seat number. In addition, historically seats often were not assigned until 30 days before a flight or at the gate on the day of flight. A4A and United further noted that Southwest does not provide seat assignments at all.
ATPCO and Farelogix did not comment on whether baggage or seat assignment fees are intrinsic to air transportation, but rather on the difficulty of disclosing the information. ATPCO stated that it can already support the proposed requirement to disclose first and second checked bag fees, which is also supported by A4A's comments indicating that airlines have provided itinerary-specific checked baggage fees to ATPCO for distribution to other industry participants. ATPCO also stated that the industry is working to address disclosure of carry-on baggage and seat assignment fees. However, given the complex pricing structure for seats, and the variation in carry-on baggage allowances depending on the aircraft, disclosure of this information is a complex undertaking that will take significant time to achieve. Farelogix stated that the industry is working towards distribution of seat assignment fees but that due to dynamic pricing of seats, and the need to determine availability at the time the price is displayed, it is not currently practicable to display dynamic seat assignment fees at the shopping stage. According to Farelogix, a requirement by the Department to provide seat assignment fees at the shopping stage would effectively force industry participants to provide static fees. Such a requirement would redirect industry efforts to implementing a static system rather than continuing to work toward modernizing distribution systems and ultimately would not be in the interests of consumers.
Turning to change and cancellation fees, we are aware that such fees are important information and in fact are significant restrictions that must be disclosed to consumers because it would be an unfair and deceptive practice not to disclose such fees. Further, carriers are required to provide direct notice with the ticket (14 CFR 253.7) of terms such as restrictions on refunds, and information regarding cancellation fees in their customer service commitments. We encourage carriers to make change and cancellation fee information as transparent and clear to consumers as possible. We also solicit comment on whether the Department should require airlines and ticket agents, prior to an online transaction being completed, to provide consumers a link to the airline Web sites where the change and cancellation information is available or if an agent prefers to its own site that displays airlines' change and cancellation information. However,, we are not convinced that change and cancellation fees are a cost that is intrinsic to air transportation and must be disclosed at the same point that itinerary information is disclosed. Like seat assignments, many consumers avail themselves of air transportation without making changes or canceling reservations.
Regarding bundled fares that include the fees that the Department initially considered basic ancillary service fees (
With regard to baggage fees, the comments did not offer any reason to change our view that a carry-on bag and first and second checked bag were traditionally included in the cost of transportation. We remain of the view that a carry-on bag and first and second checked bag are intrinsic to air transportation and it is reasonable to require carriers and ticket agents to disclose those baggage fees to consumers at the same point that fare and schedule information is disclosed. Therefore our revised proposal in this SNPRM includes a requirement that carriers disclose to ticket agents the fees for one carry-on item and a first and second checked bag. The proposal would also require ticket agents and carriers to provide those fees to consumers whenever fare and schedule information is provided as described in Section F below. We seek comment on the revised proposal.
Although we have tentatively concluded that only certain baggage fees should be included in our disclosure requirement, we note that some members of Congress have expressed the view that in addition to baggage fees, advance seat assignment fees, change and cancellation fees, priority boarding fees, and ticket fees should all be disclosed where fares are displayed. See, for example, HR 636 (as passed in the Senate in April 2016). In the event future similar legislation is enacted to require the Department to address whether advance seat assignment fees, change and cancellation fees, priority boarding fees, and ticket fees should all be disclosed where fares are displayed, we seek comment on such a disclosure requirement. What are possible benefits to consumers from a requirement to disclose baggage fees, advance seat assignment fees, change and cancellation fees, priority boarding fees, and ticket fees along with fares? What are the costs and potential challenges to implementing such a requirement? Comments that are most useful provide information regarding the reasons why additional disclosures should be required or should not be required. In addition, comments describing specific costs and benefits would be helpful.
Under both of the proposals, U.S. and foreign air carriers would have been required to distribute to certain ticket agents the standard fees for basic ancillary services. However, carriers would not have been required to provide information to ticket agents about individual customers, such as their frequent flyer status, though these factors may impact the fee for an ancillary service. Under both proposals, specific charges, not a range of fees, would have to have been disclosed to consumers for basic ancillary service fees. Neither of the Department's alternative proposals dictated the method that carriers must use to distribute the information, rather, the NPRM cautioned that carriers would have to be mindful that whatever distribution method is used would have to provide usable, accurate, and current information so the information would be accessible in real-time. Further, ticket agents would have had to work in good faith with carriers to come to agreement on the method used to transmit the ancillary service fee information.
Open Allies also supported option A. According to Open Allies, option B, which would not require distribution to GDSs, discriminates against ticket agents and is not a good solution. Open Allies stated that agents and airlines need GDS involvement for the potential benefits of the regulation to be put into place in a workable manner and that including GDSs is the lowest cost, most efficient way of achieving the Department's disclosure goal. The organization also argued that there is no valid reason to exclude intermediaries from disclosure requirements when to do so will make fee dissemination more challenging and costly.
Travel Tech also commented in support of option A, stating that it is the only option that will achieve the Department's goals. According to Travel Tech, 90 percent of ARC-approved ticket agents use GDSs and, although that may change over time, as a practical matter, many ticket agents currently rely on GDSs for data today. It is an efficient way for ticket agents to receive fee information, is currently in use for many charges that airlines already impose, and will facilitate display of the information. According to Travel Tech, option B raises a “nightmare” prospect for many travel agents, including OTAs, of not being able to rely on their established data source. Travel Tech noted the Department's desire to minimize government interference and encourage innovation but stated that not requiring disclosure to GDSs will be a disservice to consumers. Travel Tech stated that it is not a new concept and analogizes to existing Department requirements, such as the requirement that carriers provide GDSs code-share and change-of-gauge information when providing flight information to GDSs. Travel Tech went on to state that GDSs are technically capable of displaying ancillary services and fees as carriers want them displayed. Meanwhile, carriers can continue to develop alternative distribution arrangements for future use while allowing ticket agents to provide the disclosure to consumers as contemplated by the Department.
Sabre, in support of option A, stated that its services make sharing price information accurate and efficient as well as cost effective for ticket agents. Sabre further stated that if travel agents that rely on GDSs were forced to use an alternative, they would incur costs that would ultimately be passed on to consumers. Travelport commented in support of option A, noting the Department's statement that 50 percent of tickets are sold via a travel agent and virtually all of those agents rely on a GDS as an efficient data conduit. Amadeus offered similar reasons in support of option A, noting that ticket agents already rely on GDSs as an efficient source of data. Amadeus also pointed out that many travel agents are small businesses that rely on GDSs for airline data and if data were not provided through GDSs, they would not have a financially feasible way to obtain and distribute the information. Such agencies could not afford or manage the technical complexity of, for example, direct connects with multiple airlines, to obtain and disclose ancillary service fee information.
ASTA and several travel agents also commented that GDSs have the technology to allow travel agents to book ancillary services. ASTA also noted that travel agents rely on GDSs for a variety of business functions in addition to booking, and accordingly ASTA stated that option A, excluding GDSs, would harm travel agents. ASTA also stated that option B does not provide sufficient protection for consumers. Therefore, according to ASTA, the Department should not adopt either option A or B and instead should require transactability.
Corporate travel agents American Express Global Business Travel, Carlson Wagonlit Travel (CWT), and BCD supported option A. CWT commented that ticket agents cannot provide ancillary service fee information unless the information is first provided by carriers to ticket agents via GDSs; otherwise, ticket agents would be required to obtain the information from each carrier. BCD commented that ticket agents must have access to information about ancillary services through GDSs, the “normal and customary distribution channels” that are time-tested and functional. Without the requirement that GDSs have the information, BCD stated it will incur material costs in obtaining the ancillary service information from every airline and will not be able to ensure it has accurate and complete information. Travelers United and NCL supported option A as the best of the options proposed. BTC supported option A, commenting that there is no usable, workable mechanism for airlines to distribute ancillary service fee information to tens of thousands of individual travel agents, most of whom already rely on GDSs. Skyscanner noted that if the Department chooses option B over option A, consumers who conduct searches on metasearch Web sites that do not sell the ticket will not receive the same ancillary fee information that is disclosed on traditional travel agent or carrier Web sites.
A4A opposed the disclosure requirement on the grounds that it will place airlines at a disadvantage to GDSs in contract negotiations and also opposed it on technology grounds. A4A argued that GDSs have historically been in a stronger negotiating position than airlines and that GDSs were only willing to develop new technologies for accessing and distributing airline fare and flight information because the GDSs did not have contract provisions requiring airlines to provide ancillary services information. The ancillary services information, in addition to motivating GDS investments in technology, enabled airlines to negotiate lower GDSs booking fees. According to A4A, GDS concessions on pricing and technology resulted because airlines did not have the obligation to provide the ancillary service fee information to GDSs, and if the Department requires airlines to provide such information, it will restore GDSs to a stronger negotiating position over airlines. A4A stated this will be the case whether the Department adopts option A, expressly requiring airlines to provide the information to GDSs, or option B, requiring airlines to give the information to GDSs as a practical matter. A4A also objected to the proposal on the grounds that distribution channels would all have to offer the same functionality and not
Most airline comments objected to any ancillary service fee disclosure requirement, with several indicating that any Department involvement would unduly influence contract negotiations and distribution innovations. In contrast to ticket agents and their representatives, some carriers stated that any requirement to distribute fees will effectively require them to distribute to GDSs, which would unfairly disadvantage them in negotiations with GDSs as well as lock them into a distribution model that relies on static fees, which will create obstacles to innovation. However, some commented that to the extent that the Department adopts one of the proposals, some carriers supported Option B, requiring disclosure of ancillary service fee information to ticket agents that sell transportation only, excluding GDSs and other intermediaries. For example, Delta stated that the Department should refrain from any regulation of airline distribution channels, but option B would have less impact on negotiations between carriers and GDSs. United commented that option B would better allow for development of alternative systems for airlines to provide information directly to travel agents. United also notes that ATPCO (relied on by GDSs) does not have the technological capability to process constantly changing ancillary service prices, which makes this issue more complex than addressing baggage fees. Like AACO, Delta and United seem to indicate that a requirement to distribute ancillary service fee information through GDSs would essentially require carriers to distribute static fees to ticket agents.
China Eastern stated that option B would present fewer technical and development hurdles. Spirit commented that option B is less intrusive and that a requirement to distribute ancillary service fee information to all travel intermediaries as described in option A may cause Spirit to withdraw from one or more GDSs altogether due to increased distribution costs. Insel, a Caribbean carrier, commented that consumers must be informed of the total cost associated with their travel; however, requiring disclosure through GDSs would increase airlines' costs, and those costs would likely be passed on to consumers. Virgin Atlantic is concerned about the burden of ensuring ticket agents that have Virgin Atlantic's fare, schedule, and availability information also have ancillary service fee information and stated that if a carrier has shared information with ATPCO or a direct connect, that should be sufficient.
In connection with the requirement that the distribution method used would have to provide usable, accurate, and current ancillary service fee information so the information would be accessible in real-time, some entities comment that the 2014 NPRM does not define with sufficient specificity what constitutes usable, accurate, and current. Farelogix commented that distribution through GDSs would effectively halt or limit dynamic pricing because according to Farelogix, GDSs are only able to provide static pricing. However, the comments opposing use of GDSs to transmit fee information were focused on the technical limitations of GDSs in the area of dynamic fees (which GDSs dispute); there were no comments indicating that any entity thought that baggage fee information transmitted through GDSs would not be usable, accurate, and current. A4A's comment indicates that the fee information for checked baggage is already available in the GDS systems via ATPCO filings. We note that the proposed requirement to provide
After carefully considering all of the comments submitted, the Department has decided to propose requiring carriers to provide information on fees for one carry-on item and first and second checked bag to all ticket agents to which it provides fare and schedule information, including GDSs and other intermediaries in the air transportation marketplace. This option provides for wide distribution with the least disruption to existing business models and the shortest implementation time. We acknowledge that almost any distribution and disclosure requirement will involve Department intervention into business and contractual arrangements. However, the Department is counter-balancing these concerns by including in its proposal a prohibition on unilateral cost increases by GDSs on airlines as discussed in Section E. When the proposed requirement to provide information to GDSs is considered in conjunction with the Department's proposed restriction on certain contract provisions, we believe the Department's regulatory involvement in business arrangements is minimal and justifiable.
We note that in this SNPRM we are proposing to require carriers to provide certain ancillary service fee information to all ticket agents to which it provides fare and schedule information. This would ensure consumers receive key baggage fee information at the same time that they are identifying flight options so that they have enough information to determine the true cost of travel. We believe that furnishing availability information to ticket agents should not be a determining factor in whether the agent receives the ancillary service fee information in question. Requiring carriers to provide required ancillary service fee information to all ticket agents to which they provide fare and schedule information should ensure that all relevant ticket agents are provided with the ancillary service fee information without imposing an overly broad requirement. We seek comment on the substance of the proposal and whether the description of ticket agents that should receive basic ancillary service fee information is sufficiently broad.
Open Allies stated it believes that the lack of transactability is unlikely to be resolved by carriers absent a rule. The organization commented that ticket agents should be able to sell services because consumers support transactability. It pointed to a survey it conducted which showed 72 percent of survey respondents believe transparency includes transactability. Open Allies also noted that requiring transactability would save time and be more efficient for consumers. If transactability is not required, it contended, consumers will have to go to airline Web sites to find and purchase a service found on a ticket agent Web site and, unless fees are unchangeable, the service may no longer be available, or available at the quoted price, at that time. According to Open Allies, airlines are the only entities that “disaggregate” pricing and as a consequence the Department should regulate “pricing transparency” which is only possible with transactability. Open Allies disagreed with the carrier position that GDSs have greater bargaining power than airlines in contract negotiations, noting the reduced GDS fees airlines have negotiated since GDS deregulation. Open Allies also said the decreased number of legacy carriers in the United States has increased airline negotiating power. The organization argued that transactibility is necessary because, if the Department relied on requiring the carriers to lock in prices for ancillary services at the time consumers purchased tickets, it would be difficult to enforce and costly and time consuming to develop systems that would enable fees to be locked for individual consumers. Meanwhile, consumers would still face the inconvenience of having to go to airline sites to purchase the ancillary service, which would increase their transaction costs.
Several travel agents filed similar comments favoring transactability, stating that disclosure alone is not sufficient. According to those travel agents, add-on fees are complex and change from airline to airline, preventing travel agents from providing completely accurate quotes to customers. Although requiring
Travel Tech commented in support of transactability, stating that the existing GDS infrastructure already permits transaction of various airline service fees, such as baggage, in some cases, and also allows seat assignments for certain carriers' inventory. According to Travel Tech, the only question is whether airlines will allow ticket agents to transact the services once the airline makes the information available through GDSs. Travel Tech also commented that consumers should be able to purchase ancillary services at their preferred outlet to avoid the increased search and transaction costs of not having ancillary services available for purchase through ticket agents.
Amadeus, Sabre and Travelport also commented that consumers using ticket agent outlets experience increased transaction time without transactability. They stated that they are ready to implement transactability and point to their own technological developments and existing agreements with carriers on distribution of ancillary services. Sabre provided information regarding 23 carriers for which it both displays and transacts at least one ancillary service. Travelport stated ancillary services can be transacted using older technology but that it has introduced a new platform to allow airlines to differentiate their products from competing airlines. Amadeus stated that requiring transactability is the only way the Department can meet the goal of transparency. Amadeus commented that disclosure without transactability will confuse consumers. Amadeus stated that it already has a product that will enable transactability and that 58 airlines are already using this product, but concludes that the Department cannot rely on the market to move towards transactability because the factors that have inhibited widespread implementation are still present, particularly in the case of U.S. airlines.
Orbitz stated it is a member of Travel Tech and commented to elaborate on Travel Tech's comments. Orbitz stated that if the Department imposes disclosure requirements on ticket agents without transactability, consumers will only be more confused. Orbitz pointed to the static nature of some fees and dynamic nature of others, which will increase the confusion. Meanwhile, according to Orbitz, the Department should not assume that airlines will negotiate to allow ticket agents to transact ancillary services. The outcome of the rule may be that ticket agents that compete with airlines and offer consumers choices that they might not otherwise have been aware of, are left with an inferior product and asymmetrical disclosure requirements that disadvantage ticket agents and lead to consumer harm.
Corporate travel agents also supported transactability. BCD commented that the Department should require transactability through GDSs and if the information is not transactable, corporate travel agents should not be required to disclose those ancillary service fees. BCD stated customers will be frustrated if it is not able to book the services that it has just disclosed to its customers. BCD also stated its customers depend on having all of the costs of travel tracked through its systems so if it cannot book all services the customer wants, its travel cost data will not be accurate. CWT commented that to provide consumer benefit, the Department must require that ancillary services be transactable through GDSs or agents will be unduly burdened and the existing distribution system will be undermined. BTC commented that for consumers transparency and transactability are “interlocked” and without transactability, the booking process for consumers and travel agents involves multiple steps and is more confusing and time consuming as a result. BTC also commented on the risk of increased costs or lost opportunities to purchase certain ancillary services if they are not purchased at the time the ticket is purchased. International Airline Passengers Association also commented in favor of transactability and supported BTC's comments.
A4A opposed transactability, reiterating its view that there is no consumer harm to address. A4A also identifies practical considerations, including that some carriers do not allow for payment of baggage fees at time of ticketing even when travel is purchased directly from the carrier and many consumers do not know at time of ticketing whether or how many bags the consumer will want transported. Several carrier comments reflect agreement with the Department's tentative decision not to require transactability, including those of Delta and United. Frontier also opposed transactability, stating that it would increase airline costs which would in turn be passed on to consumers. Virgin Atlantic opposed a transactability requirement because it would undermine carrier ability to control its distribution scope and costs and essentially mandates the commercial relationship between a carrier and its agents solely to the benefit of agents.
We recognize that requiring airlines to make both baggage and seat assignments transactable services through ticket agents would potentially increase consumer satisfaction and decrease transaction costs of time spent on shopping and booking when using ticket agent Web sites to book travel. We are also aware of the importance of transactability as a business matter to ticket agents that must provide the services consumers want and expect or risk losing business. We recognize that comments by some stakeholders,
Finally, in connection with technical issues related to transactability, we note that some stakeholders alleged that a requirement to distribute ancillary service fees through GDSs would essentially require carriers to distribute static fees to ticket agents instead of the dynamic fees currently available on carrier Web sites. ATPCO's comments support that view to some extent based on its description of the current capability for entities to transact checked bag fees using ATPCO codes and the complexity of carry on and seat assignment fees, which would require more development by ATPCO. However, we also note that GDSs comment that they have been developing technology solutions and the technology already exists for ancillary services to be transactable through GDSs. Meanwhile, although carriers object to undue intrusion into their businesses, they also point to agreements carriers have reached on transacting ancillary services to support the position that the market is solving the disclosure problem. This leads us to conclude that technical obstacles to transactability are not insurmountable and would not require disclosure of only static baggage fees. Meanwhile, we remain of the view that the Department should limit its intervention concerning commercial negotiations in this area at this time and continue to rely on market forces to a large extent. Therefore, we are proposing a revised disclosure option that we believe offers the maximum consumer disclosure benefit while stopping short of requiring transactability. At this time, the Department is relying on competition and market forces but will continue to monitor the issue. If the Department identifies evidence of consumer harm resulting from a lack of transactability and a market failure preventing resolution of the problem, we will revisit the issue in a future rulemaking. At this time, however, we are not proposing a transactability requirement.
Open Allies commented that it is acceptable to ban the imposition of additional charges on carriers, but only for the length of the existing contract. Open Allies also argued that carriers should be required to provide the same fees for ancillary services, not higher fees, to ticket agents during the term of the existing contracts. ASTA opposed the contract provision, stating that it is outside the scope of Department authority. It also asserted that, as the provision is drafted, it is unclear about which ticket agents are covered. According to ASTA, most travel agents receive airline flight information through GDSs and their contracts with airlines are through the Airlines Reporting Corporation (ARC) and can be unilaterally amended by the airlines but not travel agents. Further, as a practical matter, travel agents are not in a position to unilaterally impose charges on airlines. ASTA commented that it would be inappropriate for the Department to prohibit travel agents from imposing charges on consumers, but it appears the Department meant to only cover ticket agents acting as
We recognize that distribution of ancillary service fees has been very controversial, in particular in GDS dealings with carriers, and in order to prevent business disputes from interfering with the implementation of a new Department requirement we have determined it is appropriate to implement a regulation with limited scope that covers only existing contracts that were negotiated based on a different regulatory background. The proposed restriction is only intended to cover contract provisions regarding charges imposed on airlines by ticket agent intermediaries for distributing certain ancillary fee information that the rule requires to be distributed along with fare information. The proposed restriction would only impact contracts for their current term at the time a final rule is issued in order to reflect the changed regulatory environment; future negotiations will enable all parties to negotiate based on the regulatory changes.
We believe that in practice the proposed disclosure requirement will not require significant investment in new technology by GDSs since GDSs already have a significant amount of baggage information through ATPCO filings. Accordingly, we would expect GDSs to work with carriers in good faith and not attempt to circumvent the restriction on additional charges by adding charges in other areas to evade the restriction. To the extent that a GDS engaged in such tactics, the Department would consider it a violation of the provision preventing such charges. The restriction only limits unilateral imposition of new charges on airlines by intermediary ticket agents. It is not intended to prevent good faith negotiations to revise existing contracts or to carry over to any new contracts negotiated after issuance of this final rule. We agree with some commenters that the rule text should be clarified to make clear it covers only existing contracts and have made the appropriate changes in the proposed rule text. We have also revised the proposed rule text in connection with ASTA's comment that the provision could be read to apply to travel agents that do not receive information directly from carriers. We do not intend for the proposed restriction to cover such contracts.
In connection with comments that carriers should be required to provide the same fees for ancillary services that carriers display on their own sites and not higher service fees, we have decided not to propose such a restriction. It is not the Department's position that the same ancillary service fees must be charged at all outlets, merely that consumers should be informed of the basic ancillary service fees so they can determine the true cost of air transportation and make an informed decision before making a purchase. Therefore, we tentatively believe it is appropriate to leave it to carriers and ticket agents to determine the ancillary service fees that will be charged through ticket agents. Although we recognize that this means a carrier would not be prohibited from implementing different fees for baggage, depending on the outlet from which the consumer chooses to purchase air transportation, as a practical matter, we believe it would be challenging for carriers to implement varying charges in the current technological environment. Therefore, under the proposed provision, carriers and ticket agents will have the opportunity to come to agreement on this issue as new contracts are negotiated and new commercial and technological arrangements are put in place.
In addition to providing itinerary-specific fees for a first checked bag, a second checked bag, a carry-on bag and an advance seat assignment, when displaying itinerary-specific information, the NPRM stated that ticket agents would also be required to clearly and prominently disclose that these fees may be reduced or waived based on the passenger's frequent flyer status, method of payment or other characteristic. In either case, whether customer or itinerary-specific fee information is displayed, both airlines and ticket agents that have Web sites marketed towards U.S. consumers would have to disclose, or at a minimum display by a link or rollover, the fees for these basic ancillary services on the first page on which a fare is displayed in response to a search for a specific flight itinerary.
During the comment period, an important clarification was made regarding the NPRM. A4A pointed out that the NPRM stated “Carriers would, of course, be required to provide ticket agents the fee rules for particular passenger types (
Southwest Airlines also supported a requirement to disclose ancillary service fees, stating that consumers are not necessarily able to determine the true cost of their own travel because they do not know how much bag fees will be for a particular flight option and as a result sometimes choose flights that they otherwise would not have chosen. Southwest also stated that requiring display of baggage fees will put downward pressure on those fees. Global Business Travel Association commented in favor of the proposed disclosure requirements, commenting that the Department should require both airlines and ticket agents to display certain ancillary service fees on the first page of search results.
However, many commenters opposed proposed display requirements which would result in carriers providing customer-specific information to consumers that identified their customer category while ticket agents would only be required to provide itinerary-specific information. ASTA pointed out that if the Department adopts display requirements as proposed in the NPRM, carriers would be subject to different disclosure requirements to the extent that a consumer provides identity information to a carrier, which according to ASTA discriminates against and disadvantages ticket agents and defeats the stated regulatory intent. Orbitz also opposed proposed display requirements, stating that providing more information at the start of the booking process will overwhelm and confuse consumers. Further, according to BCD, display requirements will impose additional compliance costs on travel management companies like BCD without providing an opportunity to recoup those costs by offering enhanced services, and those costs will be passed on to BCD clients. CWT also argued that the Department should consider the differences between corporate and leisure travelers and stated that only those fees that can be booked in advance should have to be disclosed, and they should also be transactable or the requirement undermines the distribution system. Instead, CWT supported leaving the existing disclosure requirements unchanged.
Many airlines and airline associations also opposed new display requirements. A4A commented that the proposal is not needed as the Department has already implemented fee disclosure requirements, including requirements for disclosures on carrier and ticket agent Web sites and in e-ticket confirmations. A4A argued that the Department should rely on market pressures to encourage carriers to provide any further disclosures to consumers regarding ancillary service fee information. According to A4A, there is no evidence of consumer injury to support additional display requirements, and the consumer comments and complaints regarding fees that the Department relies on are not specific enough to justify new display rules. In addition, A4A stated that a requirement that airlines and ticket agents provide itinerary-specific display results that are not based on the identity of the customer will provide inaccurate information to consumers that may be eligible for ancillary service fee discounts based on factors such as frequent flyer membership or method of payment. Air New Zealand and Copa commented on the increased costs that airlines will incur to ensure that ticket agents have additional and correct information to provide to consumers.
Google, Inc. (Google), Hipmunk, Inc. (Hipmunk), Kayak Software Corporation (Kayak), Skyscanner Limited (Skyscanner), Travelzoo, Inc. (Travelzoo), and TripAdvisor LLC (TripAdvisor), referring to themselves as the “Metasearch Providers,” filed joint comments summarizing their “consensus views on the nature of the services they provide and the Department's jurisdiction.” The Metasearch Providers argued that they have a different role from other ticket agents and should not be subject to display requirements because it is unnecessary and could hamper a consumer's search and discourage overall innovation. The Metasearch Providers stated that display of baggage and seat assignment fees is not necessarily useful to consumers that are just exploring travel options. They also stated that disclosure requirements would impose significant costs for programming and may discourage entities operating flight search tools from displaying prices at all. CCIA commented that display requirements should not apply to entities operating metasearch tools because those entities have strong incentives to provide their users with accurate information and a requirement to show particular information for every flight search would dampen innovation in the flight search exploration process. According to CCIA, the Department should require airlines to provide dynamic ancillary fee data without imposing any “rigid” display requirements, particularly on metasearch entities. Finally, both TripAdvisor and Skyscanner argued that requirements to disclose information to consumers should not apply to them and instead it should be left to the metasearch entities to determine the best method of disclosure to consumers.
We seek comment on whether the proposal in this SNPRM covers the appropriate categories of consumers that may be eligible for specialized baggage fees and should be included in the proposal. In the 2014 NPRM, we identified the following categories: Military, credit card holders (method of payment), and frequent flyer members. We have included those same categories in this SNPRM. We seek comment on whether those categories of consumers are sufficient to provide most consumers with specific baggage fee information. In the alternative, should the Department include any additional customer categories in the requirement? We also seek comment on whether the Department should include in the requirement a general obligation to disclose that baggage fees may be reduced or waived based on other consumer characteristics to be specified by the carrier. In other words, if there are additional categories of consumers that may be eligible for specialized baggage fees on a particular airline but it is not a general category across airlines and is not identified in this rulemaking, should the airline be required to provide additional notice to consumers?
Regarding method of payment, we are aware that there are many credit cards that may provide consumers with the benefit of free or reduced baggage fees. Should we identify specific credit cards that must be included in the list of options that consumers may select or simply require that all carrier-affiliated cards offering baggage fee benefits be included as options for consumers?
Regarding frequent flyer programs, we recognize that there is variation in each carrier's program, for example, different levels of membership with different benefits depending on the consumer's status. Should we specify the levels of membership and status for which information must be provided or is it sufficient to state that each carrier should identify the levels of membership and provide relevant benefit information for all levels of membership (
In addition, there are also carrier-alliance programs that confer their own benefits. Should we require airlines to provide information regarding carrier-alliance programs as well? If so, would it be necessary for each carrier to identify the levels of membership and provide relevant benefit information for all levels of membership (
Orbitz opposed proposed display requirements, stating that providing more information at the start of the booking process will overwhelm and confuse consumers. Orbitz also commented that any display standard adopted will quickly become obsolete or hinder innovation as technology changes. Orbitz also opposed imposing display requirements on mobile platforms as it would be difficult to implement and would impair the user experience. In connection with corporate travel sites, Orbitz opposed any display requirements, noting that display content is typically negotiated by the businesses involved. BCD also opposed display requirements on corporate travel agent sites, arguing that if it is not able to transact ancillary service fees, it should not be required to display such fees. According to BCD, display requirements will impose additional compliance costs on BCD without providing an opportunity to recoup those costs by offering enhanced services and those costs will be passed on to BCD clients. CWT also argued that the Department should consider the differences between corporate and leisure travelers and stated that only those fees that can be booked in advance should have to be disclosed and they should also be transactable or the requirement undermines the distribution system. In connection with Section 399.85, CWT commented that it should not be changed.
A4A argued that the proposed disclosure requirement will cause sub-optimal displays, providing fee information that consumers may not be interested in and taking up screen space that could be used to provide additional flight options or other information. A4A noted that the fee information might vary for every segment of the itinerary and argues that the sheer volume of information displayed is likely to overwhelm rather than assist consumers. A4A also stated that the proposed display requirements are contrary to the current carrier trend to offer bundled pricing and differentiated seat products and limit carriers' ability to provide such offerings. In addition, A4A stated that a requirement that airlines and ticket agents provide itinerary-specific display results that are not based on the identity of the customer will provide inaccurate information to consumers that may be eligible for ancillary service fee discounts based on factors such as frequent flyer membership or method of payment. Regarding searches for multiple passengers, A4A stated the search results displayed might not reflect the discounts available to some members of the group. A4A also noted that if more information must be displayed, search results will likely take longer to display due to increased processing time.
Regarding mobile applications, A4A commented that the problem of displacing information such as additional flight options on Web sites is particularly acute on mobile devices “because first-screen space is limited and valuable,” therefore the Department should not expand the display rules to mobile applications. Delta also opposed display requirements stating that it would have a negative impact on speed and performance of reservations systems and would be costly and time consuming to implement. United opposed a requirement to display basic ancillary service fees at the first point in a search process where a fare is listed, stating that it will waste time for consumers because search results will be slowed by additional processing time for the information, then consumers must review additional information they are not interested in or click on links or pop-ups to see the information. Meanwhile, fewer flight options will be displayed on each screen. United also argued that search results may display inaccurate information depending on whether the consumer is conducting an anonymous search but is entitled to reduced fees, or a consumer is searching for multiple passengers, and similar concerns.
CCIA also commented that display of ancillary service fee information could result in screen clutter, which would be frustrating to users and that the proposed display requirements “are not adequately designed to work on a mobile platform” and may impede the consumer experience. TripAdvisor also commented that the Department should exempt mobile displays from display requirements or tailor requirements to a range of display sizes. Skyscanner commented that display of a large volume of information is unfeasible on a mobile device so, if implemented, displays would become less useful to users of mobile sites or mobile applications. Displays would be slower and include fewer options in a more cluttered presentation. USTOA opposed the proposed display requirements, stating that they will limit development of new business models, and questions how tour operators that sell bundled packages that may include airfare would comply with disclosure requirements.
We recognize that the comments reflect legitimate concerns about the fact that if more information must be displayed, more screen space is consumed and search results will likely take longer to display due to increased processing time. However, we also note that many of the comments on this issue focused on the amount of screen space and increased processing time required for the display of seat assignment fees, which are generally dynamically priced and therefore would require additional processing time. As noted earlier, we have decided not to include disclosure of seat assignment fees in this proposal. Regarding baggage fees, although displaying such fees may also require some additional processing time and
Nevertheless, we agree it is important to make the information as easy to provide and as useful to consumers as possible. Accordingly, we request comment on whether we should permit the baggage fee information to be displayed by links or roll-overs on all displays or on certain mobile displays.
Regarding the comment by A4A and others that the fee information might vary for every segment of the itinerary and the volume of information displayed is likely to overwhelm rather than assist consumers, this concern does not apply to baggage fees since carriers must apply the baggage allowances and fees that apply at the beginning of a passenger's itinerary throughout his or her entire itinerary pursuant to 14 CFR 399.87.
Some comments expressed concern that the Department's proposed display requirements are contrary to the current carrier trend to offer bundled pricing and customized pricing. The Department's consumer protection rules in this area are intended to protect consumers from being surprised by unexpected fees and to allow them to discern the true cost of air transportation before making a purchase. To the extent carriers or ticket agents choose to offer bundled fares that include baggage in addition to, or instead of, offering fares that do not include baggage fees, they would not be prohibited from doing so. Under this proposal the display of such fares would only be required to make clear that there is no additional baggage fee associated with that fare if that is the case.
Regarding air-tour packages, we recognize that air transportation may be purchased in bulk by the seller of the tour package and the carrier may be unknown at the time of purchase which may make it difficult to provide specific baggage fee information. Accordingly, we have tentatively concluded not to require ticket agent sellers of air-tour packages to provide disclosure of specific baggage fees in certain circumstances. Specifically, if air transportation is arranged at a later date and specific airline and baggage fee information is not known at the time of booking, ticket agents would not be required to display the baggage fee. However, when displaying such air-tour package prices, such ticket agent displays would be required to prominently disclose that baggage fees may apply if that is the case. In addition, ticket agents would be required to disclose in online displays and oral communications that baggage fees may apply and that those fees may be reduced or waived based on the passenger's frequent flyer status, method of payment or other consumer characteristic. This exception would not apply to air carriers or foreign air carriers selling air-tour packages. We request comment on whether this exception for certain air-tour packages adequately addresses concerns of air-tour package sellers. We also request comment on whether such an exception adequately protects consumers.
Regarding the concern that consumers may not be interested in baggage fee information being displayed and it may take up screen space that could be used to provide additional flight options or other information, we recognize there may be reasons that consumers wish to opt-out of display of baggage fees, for example if the consumer will be traveling without checked baggage. We agree that it is reasonable to provide entities the flexibility to provide such an option. Most of the comments on this issue agreed that it was reasonable to provide an opt-out option. In addition, if an entity anticipates that there will be a significant impact on the speed of search results or particular display options the entity provides, the option to provide an opt-out for baggage fees would address those concerns by providing carriers and ticket agents the option to provide consumers what may be a faster or more streamlined display of search results, if consumers choose such displays. We anticipate that basic baggage fee information will be useful to many, if not most, consumers, and that they will often choose displays that include such information. However, by providing an opt-out option for baggage fee information, entities that display flight information would still have the flexibility to provide search results without that information if the consumer chooses a display option that does not include it. Accordingly, our proposal would permit carriers and ticket agents to provide various opt-out options. Opt-out options could include the choice to opt-out of seeing all baggage fee information that would otherwise be required to be displayed (first and second checked bag and carry-on bag) or to opt-out of seeing some of those fees. For example, a consumer might choose to see fees for carry-on and first checked bag, but not second checked bag. Another option might be that a consumer could choose to see only carry-on bag. A third option could be to see first and second checked bag fees but not the carry-on bag fee. The opt-out options that may be provided would be up to the carrier or ticket agent and no opt-out would be required under the proposal.
We seek comment on whether providing the flexibility to furnish a variety of opt-out options addresses some of the concerns of carriers and ticket agents regarding increased processing times and screen clutter. We also seek comment on whether providing opt-out options would adequately protect consumers.
In connection with applicability to mobile applications (apps) and mobile Web sites, several commenters state that the Department should consider more limited requirements for mobile outlets because implementation of new rules in the mobile environment is technically more difficult and detailed disclosures may be difficult to incorporate and display, particularly considering the screen size of some mobile devices. We recognize some of the inherent limitations of displays designed for mobile outlets. Comments suggesting more limited disclosure requirements for mobile outlets focused on the complexity of potential disclosure requirements. The limitation of disclosure requirements to certain baggage fees will reduce the amount of screen space used for additional disclosures.
In addition, some commenters stated concern that there would be technical difficulty in implementing increased disclosure requirements and increased processing time; however, we note that similar concerns apply to non-mobile internet displays. However, we have determined that the consumer benefit to having basic ancillary service fee information outweighs the potentially increased processing times. As some commenters noted, consumers in increasing numbers are using apps to book travel. Therefore, we believe it is important that the same consumer protections apply to apps as to other outlets directed to consumers. Accordingly, we have tentatively concluded that the disclosure requirements should be the same on apps as on Web sites or mobile Web
We also note that the FTC has provided guidance regarding internet disclosures (See .com Disclosures: How to Make Effective Disclosures in Digital Advertising, available at
Accordingly, we request that commenters provide any consumer research or data that indicates whether hyperlinked or other disclosures not adjacent to the fare on a mobile site would or would not be effective.
In connection with the time to implement rule, the Department is tentatively of the view that a six month implementation period to display consumer-specific fee information for a first checked bag, a second checked bag and a carry-on bag to consumers whenever fare and schedule information is provided would be appropriate and should provide enough time for both carriers and ticket agents to update Web sites and apps. We recognize that in order to make technical changes and accommodate new information, individual ticket agents will need to know in detail how the information will be distributed from carriers to the ticket agent and have the information from carriers well before the display deadline. We anticipate carriers will work in good faith with ticket agents, including GDSs and other ticket agent intermediaries, to ensure that the distribution method and details are worked out well in advance of the display deadline. In this regard, we have tentatively concluded that carriers should ensure ticket agents have the information no later than three months before the display deadline. We note many of the comments state that a lengthy implementation period will be necessary to implement any disclosure requirement and some suggested several years. However, many of the reasons presented for the multi-year implementation period had to do with the complexity of disclosing multiple dynamic fees. Since the Department is limiting the requirement to disclosure of one carry-on item and a first and second checked bag, the Department believes a six month implementation period is appropriate.
We request comment on whether this proposed implementation period is too lengthy or too short. If the proposed implementation period is either too lengthy or too short, how long of an implementation period would be appropriate?
This proposed rule, if adopted, would require carriers and ticket agents to provide customer-specific baggage fee information for one carry-on item and a first and second checked bag if they provide fare information. We are tentatively of the view that there would no longer be a need for a requirement that airlines and ticket agents provide a general statement on the first screen on which the agent or carrier offers a fare quotation for a specific itinerary that additional airline fees for baggage may. We are proposing in this SNPRM to remove the requirement under 14 CFR 399.85(b) that displays of fare quotations must include a statement that fees for baggage may apply and where consumers can see these baggage fees. The requirement to provide the more general statement that baggage fees may apply would be limited to certain ticket agent displays related to air tour packages that are unable to provide customer-specific baggage fee information.
In addition to eliminating rule text under 14 CFR 399.85(b), we are considering eliminating the requirement in 14 CFR 399.85(c) regarding disclosure of bag fee information on e-ticket confirmations as it may be of limited use.
We seek comment on whether eliminating 14 CFR 399.85(b) would be appropriate if the proposed requirement to display customer-specific baggage fee information is adopted. We also seek comment on whether we should consider keeping the existing requirement 14 CFR 399.85(b) with revisions to reflect the proposed changes. If the 14 CFR 399.85(b) disclosure requirement should be kept but modified, what changes would be appropriate?
Regarding 14 CFR 399.85(c), we request comment on whether the proposed revision would be appropriate and adequately inform consumers of the applicable baggage fees if the proposed requirement to display more specific baggage fee information is adopted. If not, what changes or additions would better ensure that consumers are provided with the specific baggage fee information that will be required if the proposal is adopted?
This action has been determined to be significant under Executive Order 12866 and the Department of Transportation's Regulatory Policies and Procedures. It has been reviewed by the Office of Management and Budget under that Executive Order. This section contains a summary of costs and benefits associated with this SNPRM. More detail on the economic impact of this proposed rule can be found in the Regulatory Impact Analysis (RIA), which is available in the docket. Due to the lack of key pieces of data, the Department was unable to quantify the costs and the benefits of the rule proposed in this SNPRM.
Under this SNPRM, the Department is proposing that all ticket agents and airlines that provide fare and schedule information to consumers while doing business in the United States be required to provide fee information to consumers for first and second checked bag, and one carry-on item adjacent to the fare. The information would include the necessary fee information to allow the display of these fees as either the standard fees charged by the carriers, or, at the consumer's choice, as the customer-specific charge if the consumer elects to provide his or her customer category information including, but not limited to, military/veteran status, frequently flier category, and method of payment. Airlines can potentially establish a large number of customer-specific factors that impact the fee that a consumer would pay for a carry-on and first and second checked bag. We solicit comment on whether the Department should limit the categories that have to be displayed on a ticket agent's Web site to the most commonly used categories. If the Department adopts such a limitation, how should
Carriers would be required to transmit this baggage fee information to all ticket agents to which they provide fare and schedule information, including GDSs and other intermediaries in the air transportation marketplace. Ticket agents and carriers would be required to be compliant with the rule within six months of its final publication date.
Ticket agents would be allowed to design the presentation of these fees as best suits them as long as they are available at the time when fares are first presented. This fee information must be customer-specific,
Carriers would incur costs related to preparing and transmitting ancillary service fee information to OTAs and GDSs. These costs would include the one-time set up costs to develop internal systems/processes to distribute the baggage fee information. These set-up costs would include upfront planning time to develop procedures to collect and distribute the necessary data, as well as any potential IT and software development costs to transmit data which is not already being transmitted to GDSs and ticket agents via ATPCO or NDC.
Carriers would also incur some incremental ongoing costs to manage and transmit data relating to any changes in baggage fees defined as basic ancillary service fees by this rulemaking. Carriers might also incur some additional costs for system updates to any new IT systems or programs incorporated for the purposes of complying with this rule. For this analysis, only the ongoing costs which would not have occurred except for the rulemaking are considered.
Carriers can present the information in a format of their choosing, including allowing consumers to opt out of viewing the information, or choosing only some of it, if that is their preference. The Department is requesting further comments on this specific issue with this SNPRM.
Multiple commenters to the 2014 NPRM provided information on likely costs to carriers of the proposed requirement for basic ancillary service fee information, though most of these costs comments were directed at the possible inclusions of requiring transactability for these fees as well as their display (
One mainline carrier (Delta) commented that the proposed rule as described in the NPRM would require the redesign of carrier distribution systems to provide ancillary fees at the first point of search. Delta estimates it would take 12 months and cost $1 million redesign its systems.
An economic consultant (who submitted comments with the carrier trade association, A4A) argued that the costs to carriers to comply with the requirement for greater transparency as proposed in the NPRM would cost more than $3 million in the first year, and $7.2 million over 10 years. This commenter also argued that carriers would incur significant additional ongoing costs for managing estimates of the process of “development and debugging programs and procedures that the carriers will have to create to report ancillary fee information.” The commenter noted that carriers typically employ one full time employee to monitor and debug the baggage fee information reporting to ATPCO. He also noted that carriers spend approximately $1 million to “establish each link to a GDS”.
ATPCO also commented that the costs to carriers of compliance with the requirement as proposed in the NPRM could be quite high, noting that ATPCO's efforts alone to comply with the simpler baggage fee information requirements of the 2011 consumer rule cost over $1 million.
The Department believes that the estimates from commenters to the 2014 NPRM overstate the likely costs to carriers of this SNPRM for several reasons. While reviewing these comments, the Department noted that much of the comments were directed to the challenges and additional costs of transferring information for advance seat assignment, which is dynamic information, changing frequently as carriers manage their loads. The cost for the transmittal of real-time advance seat assignment information to ticket agents would thus be significantly more than the transmittal of baggage fee information, which changes much less frequently. Additionally, the Department notes that several carriers are already in agreement to start providing that information to GDSs; and some carriers are moving to IATA's NDC which will allow for easier customization of flight and pricing options to consumers and at a lower cost to carriers (once they have incorporated NDC into their systems). And while the Department agrees that there will be ongoing costs to maintain and transmit data required by the rule, the Department does not believe that the SNPRM, if adopted as proposed, would generate the need for an additional full-time staff equivalent for each carrier, on average, to monitor and debug ancillary fee data shared with travel agents, given the current pace of technological improvements in all reporting systems, the pace at which carriers are adopting NDC, and the staff resources already committed to monitoring data transmittals.
Given the existing questions and comments to the 2014 NPRM, the Department does not believe that it has enough information to confidently quantify the total cost to carriers of complying with the proposed rule. The Department believes that the costs of compliance are likely to be less than $1 million per carrier, but is nevertheless seeking additional information on the likely costs to carriers of the requirement as specified in this SNPRM.
Ticket agents would incur costs related to accepting ancillary service fee information from GDSs and carriers and posting that information on their Web site engines, and of communicating the additional fee information to consumers during reservation phone calls. The most significant cost to ticket agents is likely to be the one-time cost to reprogram their Web site search engines to provide the necessary baggage information.
Larger ticket agents and OTAs are likely to have in-house capability to reprogram their Web sites accordingly, but small tickets agents probably will not. As the US Tour Operators Association (USTOA) noted in its comment to the 2014 NPRM, many tour operators are unlikely to have in-house web programmers and would likely need to hire consultants and contractors to bring their Web sites into compliance.
Ticket agents that market and sell online to consumers already have systems in place to receive flight and cost information from carriers and GDSs, but it is unclear whether these systems have the capacity to receive and process all the necessary information to comply with the proposed rule. Several commenters to the NPRM argued that the RIA for the 2014 NPRM underestimates the costs to ticket agents to update their systems to comply with the rule. The Department is seeking comments on this specific issue with this SNPRM.
At least three commenters noted that there could be significant ongoing compliance costs for ticket agents and tour operators to provide baggage fee information as per the proposed requirement, primarily in terms of longer times during reservation phone calls. The Department acknowledges that there may be additional time at the beginning of a call as ticket agents discuss baggage fees earlier in the reservation process but notes that such earlier discussion of baggage fees may also limit the likelihood of increased call time at the end of the call as some consumers are surprised by additional baggage fees and may revisit their flight searches.
Ticket agents would also incur some ongoing costs to refresh the required baggage fee information when it changes. The Department does not expect that these costs would be significant, since the systems to transmit the data are already in place and the programming to display the required baggage fee has already occurred. In addition, these fees need only be updated when changed.
We believe that the cost impacts of the proposal in this SNPRM would differ significantly from the costs which would have been incurred under the 2014 NPRM, since the current proposed rule no longer includes advance seat assignment in the basic ancillary service fees to be covered. Thus, the Department is seeking additional information on the potential costs of this SNPRM on ticket agents.
It is unclear if GDSs would incur additional costs to process the information required by this SNPRM. For this analysis, the relevant incremental costs to the GDSs would be those costs of efforts/improvements which they would otherwise not have incurred, but for this rulemaking. Costs for efforts of GDSs to collect and transmit the needed baggage fee information to ticket agents that were already planned or which would occur in the future for reasons other than this rule (such as responding to market forces) are not considered to be due to the rule. According to some of the comments received, GDSs are already improving the capacity of their systems to manage more ancillary service fee information.
Comments to 2014 NPRM regarding costs to GDSs to comply with it were somewhat inconsistent. At least two comments (one for from a carrier and another carrier trade association supported study) claimed that GDSs would incur significant costs. Yet one GDS (Sabre) commented that it already has the capability to comply with the requirements proposed in the 2014 NPRM (although it noted that ticket agents do not already have the needed systems in place). The Department thus expects that this SNPRM, if adopted as proposed, would not have significant costs to GDSs.
ATPCO could also potentially incur additional costs to process the required information, due solely to this rulemaking, although this is also very uncertain. In its comments to the NPRM, ATPCO stated that it already has the capacity to meet the proposed 2014 NPRM requirements. The Department also expects that the SNPRM would not entail significant costs for ATPCO.
Several commenters to the 2014 NPRM, including A4A, Delta, and IATA, argued that the Department's analysis should take into account potential costs to consumers from additional time spent waiting for the research results to load, given additional processing time required to display more ancillary fees. These commenters specifically cited the likely increased time needed to access real time information for up-to-date seat assignment fee information. A study prepared for A4A by Dr. Daniel L. Rubinfeld estimated the additional wait times to consumers would cost approximately $805 million per year, based on the assumption that the proposed rule would add approximately 20-40 seconds to each itinerary search (drawn from a survey by A4A of its members). Elsewhere in its submittal, A4A estimates that the additional processing time for the proposed ancillary service fee information would cost approximately $139 million a year from an estimated loss of 5.5 million hours per year for online ticket agents alone.
The Department notes that most of the costs relating to additional processing times and added wait times for consumers raised by commenters focus on the additional time and cost for transmitting advance seat assignment information, which, as noted above, is dynamic and thus more complicated and expensive to keep up-to-date. Since the SNPRM does not include advance seat assignment, the needed time to process and display the required fee information should be much less than what was estimated by commenters in response to the 2014 NPRM.
Additionally, to provide more flexibility to ticket agents, this SNPRM would permit ticket agents to provide consumers the opportunity to opt-out of receiving the baggage fee information for carry-on and first and second checked baggage, if so desired. If ticket agents do choose to incorporate such an opt-out feature, additional time for processing and displaying information on baggage fees which the consumer does not want to see should be significantly reduced. The cost of waiting for baggage fee information, which the consumer does want to see, should be off-set by the value to the consumer of getting that information (hence the choice made to receive it). The Department acknowledges that some portion of consumers may misjudge/underestimate the amount of time it would take to receive all the baggage information, especially in the beginning period after implementation and that, therefore, there will be some additional wait time and costs to consumers but that this cost will decrease over time.
Since the SNPRM does not include seat assignment fees in the basic ancillary fee data that must be communicated, the Department believes that there would not be significant additional wait time for consumers. Nevertheless, the Department is seeking additional comment on this issue.
Both consumers who purchase directly from carrier Web sites and those who use travel agents would benefit. A significant number of leisure travelers book online via online travel agencies, use metasearch engines, or even use their businesses travel management company. But since OTA Web sites do not currently have customer category-specific bag fees, these consumers must check multiple airline Web sites in order to get an accurate estimate of the flight costs including the fees for basic ancillary services related to carry-on and first and second checked bags. While information on baggage fees is already required to be available from travel agents, it is often available through links, which requires significant time and effort from the consumer to determine the actual fee that must be paid. The consumer must click the link or links to get the baggage information for the itinerary being considered and recalculate their cost. Not all consumers purchasing tickets via an OTA would experience a time savings, as not all consumers are concerned with baggage fees. For some consumers the additional cost for baggage will not factor into their choice of a flight, and as such these consumers
Meanwhile, a little more than a fourth of airline passengers purchase tickets directly from carrier Web sites (PhoCusWright estimates this figure at 23%).
Not all consumers purchasing from carrier Web sites would benefit. Consumers who purchase from a carrier Web site are more likely as a group to be aware of the carrier's baggage fees and policies. Many of these consumers are going directly to the carrier Web site because that carrier is one of the few or the only one to offer flights at the desired time and to the desired destination, or because the consumer is a member of the carrier's affinity program. Nevertheless, some portion of those consumers who purchase tickets on a carrier Web site do check to see what the baggage fees would be for their desired itinerary, and these consumers would save time under this SNPRM.
Together, the time savings may be quite significant. The Department does not yet have the information to confidently estimate the value of this benefit so it is seeking additional comment on it.
The increased transparency in ancillary service fee information would also lead to some portion of consumers making more informed purchasing choices: (1) Those who learn of the baggage fees for a flight they intend to purchase but do so near the end of the purchasing process, and (2) those who remain unaware of the baggage fee information until after they make a purchase. Both of these consumer groups may end up making purchasing decisions they otherwise would not have made had they been aware of the associated baggage fees when first reviewing search results.
Research has shown that when consumers first see a price which is lower than the final price they must pay (whether due to delayed display of taxes, fees, shipping and handling, etc.) they often end up paying more than if the first price they see is the final, total price (including taxes, fees, and/or shipping and handling). Studies and experiments have demonstrated that partitioned pricing (the separating of a price into its components) and the timing for when different pieces of pricing information (such as taxes) are revealed in a purchasing situation can lead to increases in consumer demand.
If revealing full prices later in the purchasing process leads to more purchases than if the full price had been seen immediately, (at least some) consumers are purchasing at a price higher than they otherwise would have. These “sub-optimal” choices lead to what economists call a “dead-weight loss.”
In other research conducted in market situations in which one group of consumers knows more about products and/or prices than others, some economists have proposed a “tourists and natives” framework, in which consumers are divided into two groups—those with access to more information about lower prices/better quality (the natives) and those with very limited information who will often pay more (the tourists). (Some researchers have called these two groups “savvy” and “unsavvy” travelers.) This framework has two price-equilibriums; the “tourist” one is higher than the one for “natives.” With respect to this SNPRM, one could consider the consumers who are well informed regarding fees for ancillary services (
While both of these theoretical constructs are useful in understanding how and why some consumers may be making sub-optimal air travel purchasing decisions, the Department does not have enough information to quantify or monetize this benefit.
Many businesses are also concerned with the ancillary fees associated with baggage. Travel can be a significant expense for many companies and ancillary service fees can substantially increase trip costs.
Many business travelers book flights via travel management companies that seek the best flight at the best price for the traveler, given his or her parameters. But much of the information needed to ensure that each traveler gets the best full price taking into account base fare, mileage club memberships, specific credit cards used and any other potential discounts are not often readily available. Travel managers have complained that not all baggage fee information needed to ensure that business travel is booked according to company policy is readily accessible and readily incorporated into internal reservation tracking or accounting programs. The information must be manually entered, often based on receipts or information provided by the travelers themselves. Thus, many businesses either pay more than they needed to for a particular flight or must have employees spend time seeking out the appropriate fee information in order to make the best choice. The increased effort results in higher company travel costs.
These costs associated with searching for baggage fee information have been identified repeatedly to the Department by travel management company representatives and raised at meetings of the Advisory Committee for Aviation Consumer Protection. In addition, several commenters, including trade associations, a GDS and at least one advocacy group, noted that benefits to business travelers of this requirement could be significant.
While there is much interest in the industry on the impact of unbundling
While there is concern about the added costs of this provision to ticket agents in terms of additional programming expenditures and staff time to communicate the added baggage fee information, there is also the possibility that ticket agents may experience some benefits of the SNPRM. At least one commenter raised the point that ticket agents would be able to access ancillary service fee information more quickly in response to consumer requests, and could conclude some transactions with consumers more quickly. The Department agrees that ticket agents may benefit from the rule in this manner but is unable to estimate by how much.
The Regulatory Flexibility Act (5 U.S.C. 601
For purposes of rules promulgated by the Department regarding aviation economic and consumer matters, an airline is a small entity for purposes of the Regulatory Flexibility Act if it provides air transportation only with aircraft having 60 or fewer seats and no more than 18,000 pounds payload capacity.
A significant number of small entities would be impacted by this SNPRM. Due to the relative lack of key pieces of data, the Department was unable to quantify the costs of the proposed rule to small (or large) entities, but notes that some small entities may incur substantial costs. The primary costs of the rule arise from programming, data management and other related costs to carriers and ticket agents to transmit or display the required baggage information. The Department is seeking additional information on the potential costs and benefits of the requirements proposed in the SNPRM.
This SNPRM has been analyzed in accordance with the principles and criteria contained in Executive Order 13132 (“Federalism”). The notice does not contain any provision that (1) has substantial direct effects on the States, the relationship between the national government and the States, or the distribution of power and responsibilities among the various levels of government; (2) imposes substantial direct compliance costs on State and local governments; or (3) preempts State law. States are already preempted from regulating in this area by the Airline Deregulation Act, 49 U.S.C. 41713. Therefore, the consultation and funding requirements of Executive Order 13132 do not apply.
This SNPRM has been analyzed in accordance with the principles and criteria contained in Executive Order 13084 (“Consultation and Coordination with Indian Tribal Governments”). The SNPRM would not significantly or uniquely affect the communities of the Indian tribal governments or impose substantial direct compliance costs on them, the funding and consultation requirements of Executive Order 13084 do not apply.
The Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501
The first collection of information proposed here is a requirement that air carriers and foreign air carriers provide useable, current, and accurate fee information for a first checked bag, a second checked bag, and one carry-on bag to all ticket agents that receive and distribute the air carrier's or foreign carrier's fare and schedule information. The second information collection is a requirement that air carriers, foreign air carriers, and ticket agents that provide an air carrier's or foreign carrier's fare and schedule information to consumers in the United States receive the information from carriers and disclose the air carrier's or foreign air carrier's fees for a first checked bag, a second checked bag, and one carry-on bag.
For each of these information collections, the title, a description of the respondents, and an estimate of the annual recordkeeping and periodic reporting burden are set forth below:
1. Requirement that air carriers and foreign air carriers provide certain baggage fee information to all ticket agents that receive and distribute the carrier's fare and schedule information.
2. Requirement that air carriers, foreign air carriers, and ticket agents that provide carrier fare and schedule information to consumers in the United States disclose carrier's fees for a first checked bag, a second checked bag, and one carry-on bag.
The Department has determined that the requirements of Title II of the Unfunded Mandates Reform Act of 1995 do not apply to this SNPRM.
The Department has analyzed the environmental impacts of this SNPRM pursuant to the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321
Administrative practice and procedure, Air carriers, Air rates and fares, Air taxis, Consumer protection, and Small businesses.
49 U.S.C. 40101
(b) Removed.
(a) The purpose of this section is to ensure that air carriers, foreign air carriers and ticket agents doing business in the United States clearly disclose to consumers at all points of sale the fees for a first checked bag, a second checked bag, and one carry-on bag wherever fare and schedule information is provided to consumers that may be purchasing or considering purchasing air transportation. Nothing in this section should be read to require that these ancillary services must be transactable (
(b) Each air carrier and foreign air carrier shall provide useable, current, and accurate information for fees for a first checked bag, a second checked bag, and one carry-on bag to all ticket agents that receive and distribute the air carrier's or foreign carrier's fare and schedule information. The information should be sufficient to allow ticket agents to express fees as itinerary-specific or customer-specific charges. “Customer-specific” refers to variations in fees that depend on, for example, the passenger type (
(c) Each air carrier, foreign air carrier or ticket agent that provides an air carrier's or foreign carrier's fare and schedule information to consumers in the United States must disclose the air carrier's or foreign air carrier's fees for a first checked bag, a second checked bag, and one carry-on bag.
(i) The fee information disclosed to a consumer for these ancillary services must be expressed as customer-specific charges as provided in subpart (b) if the consumer elects to provide his or her customer category information to the carrier or ticket agent, such as frequent flyer type, payment method, or military status.
(ii) If the consumer conducting a search does not opt out of receiving baggage fee information but elects not to provide his or her customer category information to the carrier or ticket agent, and conducts an “anonymous” search, the fee information disclosed to consumers for these ancillary services must be expressed as itinerary-specific charges. “Itinerary-specific” refers to variations in fees that depend on, for example, geography, travel dates, cabin (
(iii) This provision does not apply to air-tour packages advertised or sold online by ticket agents if the air transportation component is not finalized and the carrier providing air transportation is not known at the time of booking. However, the agent must clearly and prominently disclose on the first screen in which the agent or carrier offers a fare quotation for a specific itinerary selected by a consumer that additional airline fees for baggage may apply and where consumers can see these baggage fees unless no baggage fees will apply. An agent may refer consumers to carrier Web sites where specific baggage fee information may be obtained or to its own site if it displays carriers' baggage fees. In online displays and oral communications, prior to purchase, each ticket agent must disclose that baggage fees may apply if that is the case and that those fees may be reduced or waived based on the passenger's frequent flyer status, method of payment or other consumer characteristic.
(d) If a U.S. or foreign air carrier or ticket agent has a Web site marketed to U.S. consumers where it advertises or sells air transportation, the carrier and ticket agent must disclose the fees for a first checked bag, a second checked bag and one carry-on bag as specified in paragraph (c) at the first point in a search process where a fare is listed in connection with a specific flight itinerary, adjacent to the fare. When providing customer-specific fee information, if more than one baggage fee may be responsive to the search parameters,
(e) In any oral communication with a prospective consumer and in any telephone calls placed from the United States, an air carrier, foreign air carrier or ticket agent must inform a consumer, upon request, of the fees for a first checked bag, a second checked bag and one carry-on bag as specified in paragraph (c).
(f) Ticket agents with an existing contractual agreement at the time this rule becomes effective with an air carrier or foreign air carrier to act as an intermediary for the distribution of that carrier's fare and schedule information to other ticket agents shall not charge separate or additional fees for the distribution of the ancillary service fee information described in paragraph (b). Nothing in this paragraph should be read as invalidating any provision in an existing contract among these parties with respect to compensation.
(g) It is an unfair and deceptive practice in violation of 49 U.S.C. 41712 for an air carrier or foreign air carrier to fail to provide the fees for a first checked bag, a second checked bag and one carry-on bag as described in paragraph (b) to those ticket agents to which the carrier provides its fare and schedule information or for a U.S. carrier, foreign carrier, or ticket agent to fail to provide the fees for a first checked bag, a second checked bag and one carry-on bag to consumers as described in paragraph (c) and (d).
Environmental Protection Agency (EPA).
Proposed rule.
As required under section 6(b)(4) of the Toxic Substances Control Act (TSCA), EPA is proposing to establish a process for conducting risk evaluations to determine whether a chemical substance presents an unreasonable risk of injury to health or the environment, without consideration of costs or other non-risk factors, including an unreasonable risk to a potentially exposed or susceptible subpopulation, under the conditions of use. Risk evaluation is the second step, after Prioritization, in a new process of existing chemical substance review and management established under recent amendments to TSCA. This proposed rule identifies the steps of a risk evaluation process including scope, hazard assessment, exposure assessment, risk characterization, and finally a risk determination. EPA is proposing that this process be used for the first ten chemical substances to be evaluated from the 2014 update of the TSCA Work Plan for Chemical Assessments, chemical substances designated as High-Priority Substances during the prioritization process, and those chemical substances for which EPA has initiated a risk evaluation in response to manufacturer requests. The proposed rule also includes the required “form and criteria” applicable to such manufacturer requests.
Comments must be received on or before March 20, 2017.
Submit your comments, identified by docket identification (ID) number EPA-HQ-OPPT-2016-0654, by one of the following methods:
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Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at
EPA is primarily proposing to establish requirements on the Agency. However this proposal also includes the process and requirements that manufacturers (including importers) would be required to follow when they request an Agency-conducted risk evaluation on a particular chemical substance. This action may, therefore, be of interest to entities that are manufacturing or importing, or may manufacture or import a chemical substance regulated under TSCA (
EPA is proposing to establish the process by which the Agency would conduct risk evaluations on chemical substances under TSCA. The proposal identifies the necessary components of a risk evaluation, including a scope (composed of a conceptual model and an analysis plan), a hazard assessment, an exposure assessment, a risk characterization, and a risk determination. The proposed rule would also establish the process by which manufacturers (including importers) would request an Agency-conducted risk evaluation, and the criteria by which the EPA would evaluate such requests.
EPA is proposing this rule pursuant to the authority in TSCA section 6(b)(4), as amended (15 U.S.C. 2605(b)). See also the discussion in Units II.A. and B.
Although this proposal focuses on the process and activities that apply to EPA, it also proposes the process and requirements that manufacturers (including importers) would be required to follow when they request an Agency-conducted risk evaluation on a particular chemical substance. Since these requirements qualify as an information collection under the Paperwork Reduction Act (PRA), 44 U.S.C. 3501
The total estimated annual burden is 960.3 hours and $69,353, which is based on an estimated per request burden of 96.03 hours.
On June 22, 2016, the President signed into law the “Frank R. Lautenberg Chemical Safety for the 21st Century Act,” which imposed sweeping reforms to TSCA. The bill received broad bipartisan support in the U.S. House of Representatives and Senate, and its passage was heralded as the most significant update to an environmental law in over 20 years. The amendments give EPA improved authority to take actions to protect people and the environment from the effects of dangerous chemical substances. Additional information on the new law is available on EPA's Web site at:
When TSCA was originally enacted in 1976, it established an EPA-administered health and safety review process for new chemical substances prior to allowing their entry into the marketplace. However, tens of thousands of chemical substances in existence at that time were “grandfathered in” with no requirement for EPA to ever evaluate their risks to health or the environment. The absence of a review requirement or deadlines for action, coupled with a burdensome statutory standard for taking risk management action on existing chemical substances, resulted in very few chemical substances ever being assessed for safety by EPA, and even fewer subject to restrictions to address identified risks.
One of the key features of the new law is the requirement that EPA now systematically prioritize and assess existing chemicals, and manage identified risks. Through a combination of new authorities, a risk-based safety standard, deadlines for action, and minimum throughput requirements, TSCA effectively creates a “pipeline” by which EPA will conduct existing chemicals review and management. This new pipeline—from prioritization to risk evaluation to risk management (when warranted)—is intended to drive steady forward progress on the backlog of existing chemical substances left largely unaddressed by the original law. Risk evaluation is the second step of this process, after prioritization, which is being addressed in a separate rulemaking.
TSCA section 6(b)(4) requires EPA to establish, by rule, a process to conduct risk evaluations. Specifically, EPA is directed to use this process to “determine whether a chemical substance presents an unreasonable risk of injury to health or the environment, without consideration of costs or other non-risk factors, including an unreasonable risk to a potentially exposed or susceptible subpopulation identified as relevant to the risk evaluation by the Administrator under the conditions of use.” (15 U.S.C. 2605(b)(4)(A)). TSCA sections 6(b)(4)(A) through (H) enumerate the deadlines and minimum requirements applicable to this process, including provisions that direct which chemical substances must undergo evaluation, the development of criteria for manufacturer-requested evaluations, the minimum components of an Agency risk evaluation, and the timelines for public comment and ultimate completion of the risk evaluation.
Each risk evaluation must also: (1) “integrate and assess available information on hazards and exposure for the conditions of use of the chemical substance, including information on specific risks of injury to health or the environment and information on potentially exposed or susceptible subpopulations;” (2) “describe whether aggregate or sentinel exposures were considered and the basis for that consideration;” (3) “take into account, where relevant, the likely duration, intensity, frequency, and number of exposures under the conditions of use;” (4) “describe the weight of scientific evidence for the identified hazards and exposure.” 15 U.S.C. 2605(b)(4)(F)(i),(iii)-(v). The risk evaluation must not consider costs or other non-risk factors. 15 U.S.C. 2605(b)(4)(F)(ii).
Many stakeholders have expressed concern as to how EPA will apply “weight of scientific evidence” under
The phrase weight-of-evidence (WoE) is used by EPA and other scientific bodies to describe the strength of the scientific inferences that can be drawn from a given body of evidence, specifically referring to how studies are selected, the quality of the studies evaluated, and how findings are assessed and integrated. Weight-of-evidence is a complex issue and as stated by the National Academies this is “because scientific evidence used in WOE evaluations varies greatly among chemicals and other hazardous agents in type, quantity, and quality, it is not possible to describe the WoE evaluation in other than relatively general terms. It is thus not unexpected that WoE judgements in particular cases can vary among experts and that consensus is sometimes difficult to achieve” (NAS, 2009) (Ref. 3). The following is a brief description of how WoE is used at EPA, serving as an example of successful application of WOE in making the scientific determinations.
EPA utilizes the WoE approach in existing programs including IRIS and the Endocrine Disruptor Screening Program among others, and in the classification of carcinogens. In the 1999 Guidelines for Carcinogen Risk Assessment (Ref. 4) EPA refers to the WoE approach as “. . . a collective evaluation of all pertinent information so that the full impact of biological plausibility and coherence is adequately considered (Ref. 5). The Endocrine Disruptor Screening and Testing Advisory Committee (EDSTAC) referred to the WoE approach as “. . . a process by which trained professionals judge the strengths and weaknesses of a collection of information to render an overall conclusion that may not be evident from consideration of the individual data” (Ref. 6).
WoE is the process for characterizing the extent to which the available data support a hypothesis that an agent causes a particular effect (Ref. 4 and 5). This process involves a number of steps starting with assembling the relevant data, evaluating that data for quality and relevance, followed by an integration of the different lines of evidence to support conclusions concerning a property of the substance. WoE is not a simple tallying of the number of positive and negative studies, but rather it relies on professional judgment. The significant issues, strengths, and limitations of the data and the uncertainties that deserve serious consideration are presented, and the major points of interpretation are highlighted.
This WoE analysis is conducted on a case-by-case basis by first assembling and assessing the individual lines of evidence and then performing an integrated analysis of those lines of evidence. All data considered in the WoE analysis need to be documented and scientifically acceptable. A WoE analysis typically begins with a careful evaluation of each individual study. The process of evaluating the individual lines of evidence includes assembling the data, evaluating that data against current acceptance and quality criteria, and presenting the conclusions regarding the results for each study. The reviews of the available studies need to be transparent about what studies were considered or not, and how the quality of a study was judged.
After assembling and assessing the individual lines of data, an integrated analysis is performed. This means the results from all scientifically relevant published or publically available peer-reviewed studies, which are of sufficient quality and reliability, are evaluated across studies and endpoints into an overall assessment. In general, the WoE analysis examines multiple lines of evidence considering a number of factors, including for example the nature of the effects within and across studies, including number, type, and severity/magnitude of effects and strengths and limitations of the information.
A summary WoE narrative or characterization generally accompanies the detailed analysis of the individual studies and the integrative analysis of the multiple lines of evidence. Inclusion of a WoE narrative is common in WoE assessments and judgments (Ref. 4 and 7). The narrative/characterization is intended to be transparent and allow the reader to clearly understand the reasoning behind the conclusions. The narrative will generally explain the selection of the studies or effects used as the main lines of evidence and relevant basis for conclusions. The overall strength of the evidence supporting a conclusion from the WoE evaluation needs to be described.
The National Toxicology Program of the National Institute of Environmental Health Sciences has developed a tool called “systematic review” to assist in WoE evaluations particularly for hazard identification (
The NIEHS systematic review tool is one example of a documented systematic review approach. EPA believes the proposed risk evaluation process generally reflects the use of systematic review approaches that are appropriate for the types and quantity of information used in a chemical risk evaluation. EPA requests comment on this view. EPA is also requesting comment on the need for regulatory text requiring the use of specific elements of a systematic review approach for hazard identification, including the appropriateness of specific elements that might be included and/or concerns about codifying such an approach.
Since EPA's inception, human health and ecological risk assessment has informed decisions made to protect humans and the environment. Risk assessments performed by the Agency inform a broad range of regulatory decisions, and, over time, the scientific approaches and methods employed for these risk assessments have evolved. In developing and refining risk assessment processes, frameworks, and guidance documents, EPA has incorporated recommendations from expert technical panels, internal and external peer reviews, and a number of influential reports from the National Academy of Sciences (NAS) National Research Council (NRC) including Risk Assessment in the Federal Government (1983) (Ref. 9), Science and Judgement in Risk Assessment. (1994) (Ref. 10), Understanding Risk: Informing Decisions in a Democratic Society (1996) (Ref. 11), Toxicity Testing in the 21st Century: A Vision and a Strategy (2007) (Ref. 12), Phthalates and Cumulative Risk Assessment: The Tasks Ahead (2008) (Ref. 8), and Science and Decisions: Advancing Risk Assessment (2009) (Ref. 3). Specifically, the NAS NRC Science and Decisions Report (Ref. 3) recommended that EPA focus on the important roles of scoping or problem formulation so that a risk assessment will serve a specific and documented purpose. An additional recommendation encouraged EPA to develop risk assessments that are well-tailored to the problems and decisions at hand so that they can inform the decision-making process in the most meaningful way. EPA has evaluated, and will continue to evaluate chemical risks in a manner that is best suited for the particular chemical substance, including its manufacture, processing, formulation, uses, and disposal, and the evaluations may vary as necessary to best characterize potential risks related to the chemical substance under review.
As stated, TSCA requires EPA to evaluate risk to relevant potentially exposed or susceptible subpopulations identified by EPA as relevant to the risk evaluation under the conditions of use. 15 U.S.C. 2605(b)(4)(A). Although this was added as a component of the newly amended law, this will not be a new consideration for the Agency; for example, see EPA's Policy on Evaluating Health Risks to Children (1995) (Ref. 14). The Agency has evaluated the risk of chemical substances to all sectors of the population, with particular attention to workers, indigenous peoples, pregnant women, children, infants, the elderly, environmental justice communities, and fence-line communities, among others. The Agency utilizes a number of existing guidance documents (including but not limited to Ref. 15, 16, 17, 18, and 19) to evaluate risk at various life stages, and will use and refine these processes to protect the most vulnerable.
There are several key differences between previous chemical risk assessments conducted under TSCA and the new risk evaluation process mandated by TSCA amendments and established under these proposed regulations. These differences include considerations of conditions of use, timelines, and determination of unreasonable risk, and are discussed in more detail under those topics in this unit. This proposed rule and procedures described herein apply to risk evaluations conducted under TSCA, and do not apply to risk evaluations conducted by EPA pursuant to other statutes or programs.
Overall, the statutory text and purpose are best effectuated through a more encompassing reading. TSCA section 6(b)(4)(A) specifies that a risk evaluation must determine whether “a chemical substance” presents an unreasonable risk of injury to health or the environment “under the conditions of use.” The evaluation is on the chemical substance—not individual conditions of use—and it must be based on “
Second, a major objective of the new law is to require EPA to systematically evaluate existing chemical substances to determine whether or not they present unreasonable risk, and, if necessary, regulate them based on the results of the evaluation. Given the large number of existing chemical substances, it would not be feasible to complete risk evaluations on any significant number of them if EPA were to continually need to re-evaluate chemical substances based on different subset of uses. Rather the law's purposes will be best fulfilled by judging in a comprehensive way whether a chemical substance, under the known, intended, and reasonably foreseen uses and other activities, presents an unreasonable risk; ensuring through regulation that it does not present an unreasonable risk, if necessary; and then presumptively being done with that chemical substance (pending re-prioritization for some unforeseen reason). Finally, EPA notes that, if the law is read as allowing EPA to select particular conditions of use, it provides no criteria for EPA to apply in making such a selection.
Given these considerations, the instruction in TSCA section 6(b)(4)(D) for the Agency to identify the conditions of use it expects to consider in a risk evaluation is best read as directing the Agency to identify the uses and other activities that it has determined constitute the conditions of use, not as a license to choose among conditions of use.
Concerns have been raised about EPA's ability to meet the statutory risk evaluation deadlines if all conditions of use must be considered. Concerns have also been raised about ensuring that EPA can act promptly to address any unreasonable risks identified for particular conditions of use. EPA acknowledges that this will be challenging but based on the procedures outlined in this proposal, expects it will be manageable. First, a use or other activity constitutes a condition of use under the definition only if EPA determines that it does. EPA has authority to exercise judgment in making its determination of whether a condition of use is known, intended, or reasonably foreseen. Moreover, in this proposed rule EPA proposes to “lock down” the conditions of use included in a risk evaluation at the time of scoping, by providing opportunity for comment on the scoping document and specifying that any objections to the draft scope document are waived if not raised during this process. It will not be practicable to meet the statutory deadlines if stakeholders are free to identify additional conditions of use later in the process—for example, on the proposed risk determination.
As explained elsewhere in this preamble, EPA also generally intends to initiate risk evaluation on a chemical substance only when EPA determines that sufficient reasonably available information exists to complete the evaluation, and when it has already identified all of the conditions of use. As also explained elsewhere in this preamble, under certain circumstances EPA may expedite an evaluation for a particular condition of use to move more rapidly to risk management under TSCA section 6(a).
Finally, the proposed rule provides that EPA will rely on a combination of information, accepted science policies (
In this regard, EPA is also proposing to require that the components of its risk evaluations will be “fit for purpose.” All conditions of use will not warrant the same level of evaluation, and EPA expects it may be able to reach conclusions without extensive or quantitative evaluations of risk. For example, lower-volume or less dispersive uses might receive less quantitative, data-driven evaluations than uses with more extensive or complicated exposure patterns. Consistent with EPA's current practice in conducting risk assessments, technically sound risk determinations can be made, consistent with the best available science, through a combination of different types of information and other approaches.
In sum, Congress intended to create obligations that EPA can actually meet, and EPA intends to conduct risk evaluations in a way that is manageable given the statutory deadlines.
In general, EPA may weigh a variety of factors in determining unreasonable risk. These factors include, but are not limited to, characterization of cancer and non-cancer risks (including margins of exposure for non-cancer risks), the population exposed (including any susceptible populations), the severity of hazard (the nature of the hazard), the irreversibility of hazard, uncertainties, and estimates of cumulative exposure. Because of the case-by-case nature of each of these factors EPA has purposely not proposed a definition of unreasonable risk in this rule. However, EPA is specifically requesting comments on whether EPA should define unreasonable risk in the final rule. If so, acknowledging that the statute precludes consideration of costs and other non-risk factors at this step, what factors should EPA consider in making such a determination?
On August 9, 2016, EPA held a one-day public meeting to obtain public comment and feedback regarding the development and implementation of the risk evaluation rule. The meeting began with an explanation of how the Agency currently conducts risk assessments (see
The commenters included industry, environmental groups, academics, private citizens, trade associations, and health care interest groups and representatives. The comments were very informative for both rule development and risk evaluation implementation. While not all of the comments are captured here, there were a number of themes that emerged. Overall, there was a general expression of support for the new law and EPA's inclusive approach to implementation. Many of the commenters agreed the rule has the potential to increase transparency in EPA's chemical substance risk evaluation process. Many urged the Agency to work towards this goal, while creating an open scientific dialogue.
Questions arose about how the Agency will determine “unreasonable risk” and implement TSCA section 26 requirements including “best available science” and “weight of scientific evidence.” Some suggested that EPA should codify in this rule the meaning of these terms along with other details of the risk evaluation process. Due to changes in the law, manufacturers are now able to submit their own draft risk evaluations. Commenters noted that if these submitted evaluations are to be equivalent as Agency draft risk evaluations, having specific criteria, such as specific types of exposure and hazard information would ensure the Agency and the manufacturers were held to the same standard. Stakeholders also suggested that holding a public comment period for the draft risk evaluation scope would increase the transparency of each risk evaluation early in the process and allow the public to comment on any data gaps or discrepancies.
Other stakeholders urged the Agency to reserve specific scientific processes regarding hazard and exposure information for Agency guidance and discretion, suggesting the rule should address only the process and procedure. This approach would allow the Agency to be flexible and adapt to the changing science of risk evaluation and the science that informs risk evaluation.
A number of commenters spoke about the statute's requirement that the Agency determine the specific risk to “potentially exposed or susceptible subpopulation[s]”. Although the law defines this term to include “infants, children, pregnant women, workers, or the elderly,” many encouraged the Agency to consider expanding the definition to include for example: environmental justice communities, Arctic communities, American Indian communities, communities with little access to preventative health-care, subsistence fishers, and fence-line communities. There were a number of stakeholders who encouraged the Agency to work with the Occupational Safety & Health Administration (OSHA), the National Institute for Occupational Safety and Health (NIOSH), and the Consumer Product Safety Commission (CPSC), among other federal agencies, to better protect against occupational and consumer exposures. Also regarding exposure, stakeholders encouraged the examination of cumulative and low dose exposures in risk evaluations, which are not specifically mentioned in the new statute.
A number of commenters emphasized the need for EPA to maximize transparency throughout the evaluation process. The EPA received a number of comments about the science used to inform individual risk evaluations, including the types of data, models, policy assumptions (
EPA considered all of these comments in the development of this proposed rule, and welcomes additional feedback from stakeholders on the proposed process and requirements presented in this document.
The risk evaluation process under TSCA is ultimately how EPA will determine whether a chemical substance presents an unreasonable risk of injury to health or the environment. The overall objective of this action is to propose to codify the process by which the Agency evaluates risk from chemical substances for purposes of TSCA section 6. In this proposed rule, the Agency details those components of TSCA risk evaluation and key factors that EPA deems are necessary to consider in each risk evaluation to ensure that the public has a full understanding of how risk evaluations will be conducted. However, EPA is not proposing to establish highly detailed provisions that will address every eventuality or possible consideration that might arise. Due to the rapid advancement of the science of risk evaluation and the science and technology that inform risk evaluation, this proposed rule seeks to balance the need for the risk evaluation procedures to be transparent, without unduly restricting the specific science that will be used to conduct the evaluations, allowing the Agency flexibility to adapt and keep current with changing science as it conducts TSCA evaluations into the future.
EPA recognizes that other Federal agencies may be able to provide important use, exposure and hazard information that is likely to be relevant to a risk evaluation of chemical substances. EPA is committed to interagency engagement and dialogue throughout its risk evaluation process, including data sharing, information requests, and consultation regarding specific chemicals of interest. As such,
To coordinate with other agencies on TSCA implementation generally, EPA intends to continue to use—and expand where appropriate—existing interagency groups, such as the OMNE (OSHA-MSHA-NIOSH-NIEHS-EPA) Committee and the National Science and Technology Council (NSTC)'s Committee on Environment, Natural Resources, and Sustainability's new Toxicity Assessment Committee. EPA is also committed to interagency engagement at the working level on individual chemical evaluations.
To ensure that such collaboration can occur in a timely manner when needed, EPA intends to initiate interagency consultation through the existing mechanisms early in the process, and document these measures in the scope document. However, EPA is concerned that imposing a single, pre-determined consultation step might lead to an overly bureaucratic process that could limit or complicate ongoing collaboration efforts, and so is not proposing to codify any particular process in this regulation.
TSCA requires risk evaluations to determine whether or not a chemical substance presents an unreasonable risk of injury to health or the environment under the conditions of use, with conditions of use being defined as “the circumstances, as determined by the EPA, under which a chemical substance is intended, known, or reasonably foreseen to be manufactured, processed, distributed in commerce, used, or disposed of.” 15 U.S.C. 2602(4).
Although some of the commenters during the public meeting suggested that EPA could evaluate a specific use of a chemical substance, EPA is not choosing to adopt such an interpretation, for the reasons explained previously. Also, EPA recognizes that under certain circumstances it may be necessary to expedite an evaluation for a particular condition of use to move more rapidly to risk management under TSCA section 6(a) (15 U.S.C. 2605(a)): this could include a situation in which a single use presented an unreasonable risk of injury for the population as a whole or for a susceptible subpopulation (
TSCA defines a number of key terms necessary for interpretation of the new law. The definitions within the law apply to this proposed rule. EPA has also included some additional definitions in the proposed rule for further clarification; these are noted and defined later in this document. The law requires EPA to evaluate risk to “potentially exposed or susceptible subpopulation[s],” and although the law elaborates on this phrase, EPA is proposing to expand the definition for TSCA purposes. TSCA states that “the term `potentially exposed or susceptible subpopulation' means a group of individuals within the general population identified by the EPA who, due to either greater susceptibility or greater exposure, may be at greater risk than the general population of adverse health effects from exposure to a chemical substance or mixture, such as infants, children, pregnant women, workers, or the elderly.” 15 U.S.C. 2602(12). EPA is proposing to incorporate the phrase “including but not limited to” before the specific subpopulations identified in the statutory definition, to further clarify that EPA may identify additional subpopulations, where warranted. As suggested by the statute, EPA is also proposing to include specific authorization for EPA to consider both intrinsic (
TSCA section 26(k) (15 U.S.C. 2625(k)) states that in carrying out risk evaluations, EPA shall consider information that is “reasonably available,” but the statute does not further define this phrase. EPA is proposing a definition for “reasonably available” to mean existing information that EPA possesses, or can reasonably obtain and synthesize for use in risk evaluations, considering the deadlines for completing the evaluation. Generally speaking, EPA does not consider information that has not yet been generated, as reasonably available, because it will typically not be feasible for EPA to require significant chemical testing and receive and assess those test results during the three to three and a half year window allotted for risk evaluation. Accordingly, EPA intends to generally ensure that sufficient information to complete a risk evaluation exists and is available to the Agency prior to initiating the evaluation (indeed, prior to initiating prioritization). EPA also generally intends to use its authority under TSCA to require the development of new information, as necessary, prior to risk prioritization.
TSCA requires EPA, as a part of the risk evaluation, to document whether the Agency has considered aggregate or sentinel exposure, and the basis for that decision. 15 U.S.C. 2605(b)(4)(F)(ii). These terms are not defined in the law, so EPA has proposed a definition for aggregate exposure that is consistent with current Agency policies and practices. “Aggregate exposure” means the combined exposures to an individual from a single chemical substance across multiple routes and across multiple pathways (Ref. 20). “Sentinel” means the exposure(s) of greatest significance, which may be the maximum exposure to an individual, population (or subpopulation), or the environment to the chemical substance of interest (or any combination thereof). Although sentinel exposure is not a novel way of characterizing exposure, this is a new term for EPA.
Other terms defined in the proposed rule are designed to provide clarity regarding the science that will be used to conduct an evaluation. “Pathways” of exposure refers to the mode through which one is exposed to a chemical substance, including but not limited to: food, water, soil, and air (Ref. 20). “Routes” of exposure refer to the particular manner which a chemical substance may contact the body, including absorption via ingestion, inhalation, or dermally (Ref. 20). The statute requires EPA to consider “the extent to which the variability and uncertainty . . . are evaluated and characterized.” 15 U.S.C. 2625(h). EPA is adopting definitions for both “variability” and “uncertainty” from existing Agency guidance. “Uncertainty” means the imperfect knowledge or lack of precise knowledge either for specific values of interest or in the description of a system (Ref. 21). “Variability” means the inherent natural variation, diversity, and heterogeneity across time and/or space or among individuals within a population (Ref. 21).
As indicated, the statute requires EPA to complete risk evaluations within three years, with the possibility of a six month extension beyond the three year timeframe. This proposed rule simply adopts these timeframes without modification or elaboration. EPA acknowledges this is a relatively short timeframe, and, as discussed elsewhere in this preamble, is proposing to adopt other procedures that will allow the Agency to meet these deadlines.
As identified previously, chemical substances that will undergo risk evaluation can be put into three groups: (1) The first ten chemical substances the Agency is required to identify within the first 180 calendar days of enacting the amendments to TSCA (15 U.S.C. 2605(b)(2)); (2) the chemical substances determined as High-Priority Substances through the prioritization process proposed in a separate rulemaking; and (3) requested chemical substances submitted by manufacturers that meet the criteria for EPA to conduct an Agency risk evaluation.
TSCA allows a manufacturer or group of manufacturers to submit requests for Agency conducted risk evaluations for chemical substances that they manufacture. EPA is proposing the necessary components of the request in the proposed regulatory text. EPA is proposing to require that manufacturers demonstrate in their request that there is sufficient, reasonably available information for the Agency to conduct a risk evaluation on the chemical substance under the conditions of use. EPA must complete any manufacturer-requested risk evaluation that it determines meets the criteria within the statutory three years. Unlike those chemical substances that have come through the prioritization process, manufacturer-requested chemical substances have not undergone initial risk screening and therefore EPA will not assign such chemicals a high- or low-priority designation. The purpose of the requirements proposed as the necessary components of the request, is to allow the Agency to determine whether sufficient information is “reasonably available” for EPA to complete a risk evaluation of the requested chemical under the conditions of use, as that term is defined under TSCA section 3.
EPA is proposing to require a manufacturer to submit a list (
Consistent with TSCA section 6(b)(4)(E)(iii), EPA will prioritize requests where there is evidence that restrictions imposed by one or more States have the potential to have a significant impact on interstate commerce or health or the environment, and is therefore proposing to allow (but not require) manufacturers to include any evidence to support such a finding. Following this required initial prioritization, EPA is proposing to further prioritize chemical substances for risk evaluation based on initial estimates of exposure(s) and/or hazard(s) under one or more conditions of use or any other factor that EPA determines may be relevant. In general, EPA plans to prioritize those chemical substances where there is evidence of relatively high risk over those with less evidence of risk.
Instructions for submitting CBI are also included in the proposed rule. EPA believes that TSCA section 14(c)(3) is best read as requiring upfront substantiation of non-exempt CBI claims. In addition, EPA believes the obligation to review all non-exempt chemical identification claims and 25 percent of all other non-exempt claims will be best effectuated by requiring substantiation at the time of submission.
Chemical substances that EPA has prioritized through the prioritization process (proposed in a separate rulemaking), are subject to two separate public comment periods prior to the completion of the prioritization process. EPA expects that these comment periods will ensure that EPA has the necessary information to evaluate the chemical substances, including information on all conditions of use. Consequently, in order to ensure that chemical substances subject to manufacturer requests undergo risk evaluation only if the available information is comparable to what EPA will identify or generate through the measures identified in the proposed prioritization framework rule, EPA is proposing opportunities to collect additional information from the public.
Upon receipt of the request, EPA is proposing to verify that the request is facially valid,
Within 9 months after the end of the comment period, EPA will review the request along with any additional information received during the comment period to determine whether the request meets the regulatory criteria and will notify the manufacturer(s) accordingly. This time will allow EPA to develop the equivalent of a conceptual model to describe actual or predicted relationships between the chemical substance and the receptors, either human or environmental, with consideration of potential hazards throughout the life cycle of the chemical substance—from manufacturing, processing, distribution in commerce, storage, use, or disposal. If EPA determines that the request is compliant (
Since the law requires the development of additional “policies, procedures, and guidance the Administrator determines are necessary” to carry out the process in TSCA (15 U.S.C. 2625(l)). EPA may also develop additional guidance(s) for risk evaluation in the future.
To conduct a risk evaluation, EPA will rely on a combination of information, models, screening methods, and accepted science policies, which include defaults, reasonable estimates, and uncertainty factors, in addition to considering information generated from evolving science and technology. EPA expects to obtain scientific advice from the Science Advisory Committee on Chemicals, which the Agency is required to develop and convene under TSCA section 26(o). In compliance with the statute, EPA will work to reduce and replace, to the extent practicable, the use of vertebrate animals in testing chemical substances as outlined in TSCA section 4(h).
The announced availability of the final scope will be published in the
This hazard assessment may include, but may not be limited to, evaluation of the potential toxicity of the chemical substance with respect to cancer, mutation, reproductive, developmental, respiratory, immune, metabolic, and cardiovascular impacts, and
Where possible, a hazard assessment also will include a dose-response assessment. A dose-response relationship describes how the likelihood and severity of adverse health effects (the responses) are related to the amount and condition of exposure to an agent (the dose provided). The same principles generally apply for studies where the exposure is to a concentration of the agent (
Using reasonably available information, exposures will be estimated (usually quantitatively) for the identified conditions of use. For human health exposure, the assessment would consider all potentially exposed or susceptible subpopulation(s) identified in the scope and utilize any combination, as available, of population-based epidemiological studies, information related to geographic location of susceptible subpopulations, models representing exposures to the population, measurements in human tissues or relevant environmental or exposure media, and any other relevant, scientifically valid information or methodology. In an environmental health exposure assessment, the interaction of the chemical substance with any ecological characteristics identified in the scope will be characterized and evaluated.
In practice, each component of the risk assessment (
Each risk evaluation will quantitatively and/or qualitatively estimate and characterize risk for the identified populations and ecological characteristics under the conditions of use. The risk characterization will also describe whether aggregate or sentinel exposures were considered and provide the evidence and information to support the consideration.
In the risk characterization, EPA will further carry out the obligations under TSCA section 26(h) (15 U.S.C 2625(h)); for example, by assessing uncertainty and variability in each step of the risk evaluation, discussing considerations of data quality such as the reliability, relevance and whether the methods utilized were reasonable and consistent, explaining any assumptions used, and discussing information generated from independent peer review. EPA also may exercise it discretion to include a discussion of any alternative interpretation of results generated from the risk evaluation. For environmental evaluations specifically, EPA plans to include a discussion of the nature and magnitude of the effects, the spatial and temporal patterns of the effects, implications at the individual, species, and community level, and the likelihood of recovery subsequent to exposure to the chemical substance.
The goal of the peer review process is to obtain independent review from experts who have not contributed to its development. According to EPA's peer review policy, peer review of all scientific and technical information that is intended to inform or support Agency decisions is encouraged and expected. Both the EPA Peer Review Handbook and the OMB Bulletin provide standards for when and how to conduct peer review on science documents. The documents do not contemplate that peer review is necessary for every document or risk assessment, but is expected to occur for those documents that have either:
• Influential scientific information: scientific information that the Agency reasonably can determine will have or does have a clear and substantial impact on important public policies or private sector decisions, or
• Highly influential scientific assessment: a subset of influential scientific information that could have a potential impact of more than $500 million in any year on either the public or private sector or is novel, controversial, or precedent-setting, or has significant interagency interest.
The EPA Peer Review Handbook, first released in 1998 and last updated in
The peer review will address aspects of the science underlying the assessment, including, but not limited to hazard assessment, assessment of dose-response, exposure assessment, and risk characterization. Please note, however, EPA will not seek review of any determination as to whether the risks are “unreasonable”, which is an Agency policy judgement. The purpose of peer review is for independent review of the science underlying the risk assessment, not to evaluate EPA's policy judgments. TSCA expressly reserves to the Agency the final determination of whether risk posed by a chemical substance is “unreasonable.” 15 U.S.C 2605(i). EPA nevertheless will include its unreasonable risk judgment as part of the risk evaluation that is subject to public review and comment.
EPA will announce in the
While EPA is seeking public comment on all aspects of this proposed rule, there are areas where the Agency specifically requesting public input.
EPA believes further defining these and other terms in the proposed rule is unnecessary and ultimately problematic. These terms have and will continue to evolve with changing scientific methods and innovation. Codifying specific definitions for these phrases in this rule may inhibit the flexibility of the Agency to quickly adapt and implement changing science. The Agency intends to use existing guidance definitions and will update definitions and guidance as necessary.
However, the Agency welcomes public comments regarding the pros and cons of codifying these or other definitions and/or approaches for these or any other terms. EPA encourages commenters to suggest alternative definitions the Agency should consider for codification in this procedural rule. Please explain your views as clearly as possible, providing specific examples to illustrate your concerns and suggest alternate wording, where applicable. EPA is specifically requesting comments on whether EPA should define unreasonable risk in the final rule. If so, acknowledging that the statute precludes consideration of costs and other non-risk factors at this step, what factors should EPA consider in making such a determination.
4.
The Agency also anticipates the possibility that one manufacturer requests a risk evaluation but other manufacturers of the same chemical who have not joined in the request also possess relevant unpublished information. For manufacturer requests for risk evaluation, the burden is on the requester to include or reference all information that is necessary for EPA to conduct a risk evaluation. Although EPA could use its data collection authority to access information, including unpublished studies, held by entities other than the requestor, the Agency intends to deny requests for risk evaluation if the requester does not have access to the information necessary for risk evaluation.
5.
EPA expects that many of the risk evaluations conducted under TSCA will necessitate peer review. In cases in which a chemical substance is determined to present an unreasonable risk, the Agency must promptly move to manage the risk, a circumstance that would typically qualify the assessment as “influential scientific information” under current guidance and practice. The Agency also expects that some risk evaluations would also be highly influential scientific assessments,
As required under the amended TSCA, chemical substances must be prioritized as either low or high. Those categorized as high are subject to a risk evaluation, and those determined to be low are not. The bar for prioritizing a chemical as a low priority as required under the amended TSCA is fairly high. As such, EPA expects that, as an increasing number of chemical risk evaluations are completed, those chemical substances that present risk to human health or the environment will be managed accordingly, leaving an increasing number of chemicals that do not present an unreasonable risk. The Agency questions whether all future risk evaluations warrant peer review.
EPA is specifically requesting public comment on whether there are circumstances where conducting peer review may not be warranted. What circumstances might qualify, and whether the regulatory text should be adjusted to require EPA to make a case by case determination of whether and to what extent, consistent with the EPA Peer Review Handbook, peer review is warranted for the chemical substance undergoing a risk evaluation. In all cases, the rule would require that this determination, and any peer review activities that are conducted, be documented for each chemical evaluation, starting with the scope document.
The following is a listing of the documents that are specifically referenced in this document. The docket includes these documents and other information considered by EPA, including documents that are referenced within the documents that are included
Additional information about these statutes and Executive Orders can be found at
This action is a significant regulatory action that was submitted to the Office of Management and Budget (OMB) for review under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011). Any changes made in response to OMB recommendations have been documented in the docket.
The information collection activities associated with this proposed rule have been submitted to OMB for review and approval under the PRA, 44 U.S.C. 3501
An agency may not conduct or sponsor, and a person is not required to respond to a collection of information unless it displays a currently valid OMB control number. The OMB control numbers for the EPA's regulations in 40 CFR are listed in 40 CFR part 9.
Submit your comments on the Agency's need for this information, the accuracy of the provided burden estimates, and any suggested methods for minimizing respondent burden to EPA using the docket identified at the beginning of this proposed rule. You may also send your ICR-related comments to OMB's Office of
EPA certifies under section 605(b) of the RFA, 5 U.S.C. 601
This action does not contain any unfunded mandate as described in UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect small governments. The action imposes no enforceable duty on any state, local or tribal governments or the private sector.
This action does not have federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999). It will not have substantial direct effects on the states, on the relationship between the national government and the states, or on the distribution of power and responsibilities among the various levels of government.
This action does not have tribal implications as specified in Executive Order 13175 (65 FR 67249, November 9, 2000). It will not have substantial direct effects on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. Thus, Executive Order 13175 does not apply to this action.
The EPA interprets Executive Order 13045 (62 FR 19885, April 23, 1997) as applying only to those regulatory actions that concern environmental health or safety risks that the EPA has reason to believe may disproportionately affect children, per the definition of “covered regulatory action” in section 2-202 of the Executive Order. This action is not subject to Executive Order 13045 because it does not concern an environmental health risk or safety risk.
This action is not a “significant energy action” as defined in Executive Order 13211 (66 FR 28355, May 22, 2001), because it is not likely to have a significant adverse effect on the supply, distribution or use of energy.
This action does not involve any technical standards, and is therefore not subject to considerations under NTTAA section 12(d), 15 U.S.C. 272 note.
This action does not establish an environmental health or safety standard, and is therefore not is not subject to environmental justice considerations under Executive Order 12898 (59 FR 7629, February 16, 1994). This is procedural rule that will not affect the level of protection provided to human health or the environment.
Environmental protection, Chemicals, Chemical Substance, Hazardous substances, Health and safety, Risk Evaluation.
Therefore, it is proposed that 40 CFR chapter I, subchapter R, be amended as follows:
15 U.S.C. 2605 and 2619.
(a)
(b)
(c)
(d)
All definitions in TSCA apply to this subpart. In addition the following definitions apply:
(a)
(b)
(c)
(a)
(b)
(1) Name, mailing address, and contact information of the entity (or entities) submitting the request. If more than one manufacturer submits the request, all individual manufacturers must provide their contact information.
(2) Full information on the chemical identity of the chemical substance that is the subject of the request. At a minimum, this includes, all known names of the chemical substance, including common or trades names, chemical identity, CAS number, and molecular structure of the chemical substance.
(3) A complete list of the reasonably available information that is consistent with the standards in TSCA section 26(h) and that is relevant to whether the chemical substance presents an unreasonable risk of injury to health or the environment. The list must be accompanied by an explanation as to why such information is adequate to permit EPA to complete a risk evaluation addressing all the circumstances that constitute conditions of use of the chemical substance within the meaning of TSCA section 3 (
(i) The chemical substance's hazard and exposure potential;
(ii) The chemical substance's persistence and bioaccumulation;
(iii) Potentially exposed or susceptible subpopulations they believe to be relevant and that EPA should evaluate in the risk evaluation;
(iv) Whether there is any storage of the chemical substance near significant sources of drinking water;
(v) The chemical substance's conditions of use or significant changes in conditions of use;
(vi) The chemical substance's production volume or significant changes in production volume; and
(vii) Any other information relevant to the risks potentially presented by the chemical substance.
(4) The request must include a commitment to provide to EPA any referenced information upon request. In addition, if the manufacturer previously conducted its own risk assessment of the chemical substance, or possesses or can reasonably obtain any other pre-existing risk assessment, the request must include a commitment to provide such assessments to EPA upon request.
(5) A signed certification that all information contained in the request is accurate and complete, as follows:
I certify under penalty of law that this document and all attachments were prepared under my direction or supervision and the information contained therein, to the best of
(c)
(d)
(2) In submitting a claim of confidentiality, a person must certify the truth of the following statements concerning all information claimed as confidential:
I hereby certify to the best of my knowledge and belief that all information entered on this form is complete and accurate. I further certify that, pursuant to 15 U.S.C. 2613(c), for all claims for confidentiality made with this submission, all information submitted to substantiate such claims is true and correct, and that it is true and correct that
(i) My company has taken reasonable measures to protect the confidentiality of the information;
(ii) I have determined that the information is not required to be disclosed or otherwise made available to the public under any other Federal law;
(iii) I have a reasonable basis to conclude that disclosure of the information is likely to cause substantial harm to the competitive position of my company; and
(iv) I have a reasonable basis to believe that the information is not readily discoverable through reverse engineering.
(3) Each claim of confidentiality, other than a claim pertaining to information described in TSCA section 14(c)(2), must be accompanied by a substantiation in accordance with 40 CFR 2.204(e)(4).
(4) Manufacturers must supply a structurally descriptive generic name where specific chemical identity is claimed as CBI.
(5) Any knowing and willful misrepresentation is subject to criminal penalty pursuant to 18 U.S.C. 1001.
(e)
(2)
(3)
(ii) At any point prior to the completion of a risk evaluation conducted on a chemical substance at the request of a manufacturer(s), manufacturer(s) are required to supplement the original request upon receipt of information that meets the criteria in 15 U.S.C. 2607(e) and 40 CFR 702.37, or other information that has the potential to change EPA's evaluation of the risk of the chemical substance. Such information must be submitted within 30 calendar days of discovery.
(4)
(i)
(B) Failure to submit the additional information will be considered to be a withdrawal of the request to initiate a risk evaluation on the named chemical substance.
(C) Notwithstanding any such withdrawal, manufacturer(s) may submit a subsequent request on the same chemical substance.
(ii)
(5)
(i) That demonstrate that restrictions imposed by one or more States have the potential to have a significant impact on interstate commerce, health or the environment.
(ii) EPA will also give preference to requests where EPA has determined there are relatively high estimates of hazard and/or exposure for the chemical substance.
(iii) Any other factor EPA determines to be relevant.
(6)
(7)
(f)
(a)
(2) Existing EPA guidance, where available and relevant, will be used in conducting the risk evaluation. In addition, other scientifically relevant methods or guidance may be used in a risk evaluation.
(3) Where appropriate, a risk evaluation may be conducted on a category of chemical substances. EPA will determine whether to conduct an evaluation on a category of chemical substances, and the composition of the category based on the considerations listed in 15 U.S.C. 2625(c). In addition to the factors specifically enumerated in that provision, EPA may consider the hazards and exposures associated with the category of chemical substances, and the populations likely to be exposed.
(4) EPA will ensure that all supporting analyses and components of the risk evaluation are suitable for their intended purpose, and well-tailored to the problems and decision at hand, in order to inform the development of a technically sound determination as to whether a chemical substance presents an unreasonable risk of injury to health or the environment, based on the weight of the scientific evidence.
(5) The extent to which EPA will refine its evaluations for particular conditions of use in any risk evaluation will vary as necessary to determine whether a chemical substance presents an unreasonable risk of injury to health or the environment. To the extent a determination as to the level of risk presented by a condition of use can be made, for example, by the use of accepted science policies (
(6) EPA may conduct a risk evaluation on a chemical substance in phases to allow the Agency to proceed with risk management on particular conditions of use. For example, EPA may determine that a chemical substance presents an unreasonable risk of injury to health or the environment under one or more conditions of use, and address such unreasonable risk through rulemaking under TSCA section 6(a), while other conditions of use remain under evaluation. In all cases in which EPA conducts its risk evaluations in phases, EPA will nevertheless complete a full risk evaluation of the chemical substance for all of the conditions of use identified through the scoping process in 40 CFR 702.39(c) within the time frame in 40 CFR 702.43(d).
(7) In evaluating chemical substances that are metals or metal compounds, EPA will use the
(b)
(2) EPA generally expects to initiate a risk evaluation for a chemical substance only when EPA believes that all or most of the information necessary to perform the risk evaluation already exists and is reasonably available. EPA expects to use its authorities under the Act, and other information gathering authorities, when necessary to generate the information needed to perform a risk evaluation for a chemical substance before initiating the risk evaluation for such substance. EPA will use such authorities on a case-by-case basis during the performance of a risk evaluation to obtain or generate information as needed to ensure that EPA has adequate, reasonably available information to perform the evaluation.
(3) Among other sources of information, the Agency will consider information and advice provided by the Science Advisory Committee on Chemicals established pursuant to 15 U.S.C. 2625.
(4) In conducting risk evaluations, EPA will rely on an appropriate combination of information, accepted science policies (
(5) Where appropriate, to the extent practicable, and scientifically justified, EPA will use information generated without the use of testing on vertebrates in performing risk evaluation.
(c)
(1) EPA will identify those uses that constitute the conditions of use that will be assessed during the risk evaluation. Those uses shall be all circumstances under which the Agency determines that the chemical substance is intended, known, or reasonably foreseen to be manufactured, processed, distributed in commerce, used, or disposed of.
(2) When determining the scope, EPA will identify the exposed individuals and populations, including any potentially exposed or susceptible subpopulations as identified by the Agency that EPA plans to evaluate; the ecological characteristics that EPA plans to evaluate; and the hazards to health and the environment that EPA plans to evaluate.
(3) The combination of reasonably available information, accepted science policies (
(4)
(ii) The Conceptual Model will identify human and ecological health endpoints the EPA plans to evaluate for the exposure scenarios EPA plans to evaluate.
(iii) Conceptual Model development will consider the life cycle of the chemical substance, including manufacture, processing, distribution in commerce, storage, use, and disposal.
(5)
(ii) Hypotheses about the relationships described in the conceptual model will be described. The relative strengths of (any) competing hypotheses will be evaluated to determine the appropriate risk assessment approaches.
(6)
(ii)
(iii)
(iv)
(B) For a chemical substance designated as a High-Priority Substance under 40 CFR part 702 subpart A, EPA will not publish the final scope of the risk evaluation until at least 12 months have elapsed from the initiation of the prioritization process for the chemical substance.
(d)
(2) The hazard assessment process will identify the types of hazards to health or the environment posed by the chemical substance. This process includes the identification, evaluation, and synthesis of information to describe the potential health effects of the chemical substance.
(3) Based on the final scope document published pursuant to paragraph (c)(6)(iv) of this section, potential human and environmental hazard endpoints will be evaluated, including, as appropriate; acute, subchronic, and chronic effects during various stages of reproduction or life stage.
(4) The relationship between the dose of the chemical substance and the occurrence of human and environmental health effects or outcomes will be evaluated.
(5) Studies evaluated may include, but would not be limited to: Human epidemiological studies, in vivo and/or in vitro laboratory studies, mechanistic or kinetic studies in a variety of test systems, including but not limited to toxicokinetics and toxicodynamics, computational toxicology, data from structure-activity relationships, high-throughput assays, genomic response assays, and ecological field data.
(6) Hazard identification will include an evaluation of the strengths and limitations of the reasonably available information.
(7)
(i) Population-based epidemiology studies that identify risk factors and susceptible subpopulations;
(ii) Information related to geographic location of subpopulations;
(iii) Models that represent health effects of relevant subpopulations; and
(iv) Any other relevant, scientifically valid information, methodology, or extrapolation.
(8)
(e)
(2) For the conditions of use, exposures will be evaluated using reasonably available information.
(3) Chemical-specific factors including, but not limited to: Physical- chemical properties and environmental fate parameters will be examined.
(4)
(i) Population-based epidemiology studies that identify risk factors and susceptible subpopulations;
(ii) Information related to geographic location of subpopulations;
(iii) Models that represent exposure or health effects of relevant subpopulations; and
(iv) Any other relevant, scientifically valid information or methodology.
(5)
(ii) Exposures considered will include individuals as well as communities, depending on the chemical substance and the ecological characteristic involved.
(a)
(2) Describe whether aggregate or sentinel exposures under the conditions of use were considered and the basis for that consideration.
(b) The Risk Characterization will summarize, as applicable, the considerations addressed throughout the evaluation components, in carrying out the obligations under 15 U.S.C. 2625(h). This summary will include, as appropriate, a discussion of:
(1)
(2)
(3)
(4)
(c)
The EPA will determine whether the chemical substance presents an unreasonable risk of injury to health or the environment under the conditions of use as identified in the final scope document published pursuant to 40 CFR 702.39(c)(6)(iv).
(a)
(1) EPA will open a docket to facilitate receipt of public comment.
(2) All comments that could be raised on the matters addressed and issues presented in the draft risk evaluation must be presented during this comment period. Any issues not raised at this time will be considered to have been waived, and may not form the basis for an objection or challenge in any subsequent administrative or judicial proceeding.
(b)
(2) The Agency may extend the deadline for a risk evaluation for not more than 6 months.
(3) EPA will publish the final risk evaluation in the
(c)
(d)
(c)
For each risk evaluation, EPA will maintain a public docket at
(1) The draft scope, final scope, draft risk evaluation, and final risk evaluation;
(2) All notices, determinations, findings, consent agreements, and orders;
(3) Any information required to be provided to the Agency under 15 U.S.C. 2603;
(4) A nontechnical summary of the risk evaluation;
(5) A list of the studies, with the results of the studies, considered in carrying out each risk evaluation;
(6) The final peer review report, including the response to peer review comments; and
(7) Response documents to the public comments on the draft risk evaluation.
Internal Revenue Service (IRS), Treasury.
Final and temporary regulations.
This document contains temporary regulations that address transfers of appreciated property by United States persons (U.S. persons) to partnerships with foreign partners related to the transferor. The regulations override the rules providing for nonrecognition of gain on a contribution of property to a partnership in exchange for an interest in the partnership under section 721(a) of the Internal Revenue Code (Code) pursuant to section 721(c) unless the partnership adopts the remedial method and certain other requirements are satisfied. The document also contains regulations under sections 197, 704, and 6038B that apply to certain transfers described in section 721. The regulations affect U.S. partners in domestic or foreign partnerships. The text of the temporary regulations also serves as the text of the proposed regulations set forth in the notice of proposed rulemaking on this subject in the Proposed Rules section of this issue of the
Concerning the temporary regulations, Ryan A. Bowen, (202) 317-6937; concerning submissions of comments or requests for a public hearing, Regina Johnson, (202) 317-6901 (not toll-free numbers).
The collection of information contained in the regulations is listed with the Office of Management and Budget under control numbers 1545-1668 and 1545-0123 in accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)). Comments on the collection of information should be sent to the Office of Management and Budget, Attn: Desk Officer for the Department of the Treasury, Office of Information and Regulatory Affairs, Washington, DC 20503, with copies to the Internal Revenue Service, Attn: IRS Reports Clearance Officer, SE:W:CAR:MP:T:T:SP, Washington, DC 20224. Comments on the collection of information should be received February 21, 2017.
The collections of information are in §§ 1.721(c)-6T and 1.6038B-2T. The collections of information are mandatory. The likely respondents are domestic corporations. Burdens associated with these requirements will be reflected in the burden for Form 1065, U.S. Return of Partnership Income, and Form 8865, Return of U.S. Persons With Respect to Certain Foreign Partnerships. Estimates for completing these forms can be located in the form instructions.
An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a valid control number.
Until they were repealed as part of the Taxpayer Relief Act of 1997 (the 1997 Act), Public Law 105-34 (111 Stat. 788), section 1131, sections 1491 through 1494 imposed an excise tax on certain transfers of appreciated property by a U.S. person to a foreign partnership, which generally was 35 percent of the amount of gain inherent in the property. Congress believed that the imposition of enhanced information reporting obligations (including sections 6038, 6038B, and 6046A) with respect to foreign partnerships would eliminate the need for sections 1491 through 1494. Staff of the Joint Committee on Taxation, General Explanation of Tax Legislation Enacted in 1997, Part Two: Taxpayer Relief Act of 1997 (H.R. 2014) (JCS-23-97) (Dec. 17, 1997), at 314-315.
Notwithstanding these enhanced information reporting requirements, the 1997 Act granted the Secretary regulatory authority in section 721(c) to override the application of the nonrecognition provision of section 721(a) to gain realized on the transfer of property to a partnership (domestic or foreign) if the gain, when recognized, would be includible in the gross income of a person other than a U.S. person. In the 1997 Act, Congress also enacted section 367(d)(3), which provides the Secretary regulatory authority to apply the rules of section 367(d)(2) to transfers of intangible property to partnerships in circumstances consistent with the purposes of section 367(d). Regulations have never been issued pursuant to section 721(c) or section 367(d)(3).
Congress enacted section 367 (and its predecessor) in order to prevent U.S. persons from avoiding U.S. tax by transferring appreciated property to foreign corporations using nonrecognition transactions. Staff of the Joint Committee on Taxation, General Explanation of the Revenue Provisions of the Deficit Reduction Act of 1984 (H.R. 4170, 98th Congress; Pub. L. 98-369) (JCS-41-84) (Dec. 31, 1984), at 427. The outbound transfer of intangible property raises additional issues that Congress also sought to address. Specifically, section 367(d) was enacted to prevent U.S. persons from transferring intangibles offshore in order to achieve deferral of U.S. tax on the profits generated by the intangibles. H.R. Rep. No. 98-432, 98th Cong., 2d Sess., at 1311-15 (1984). Under section 367(d), a U.S. person that transfers intangible property (within the meaning of section 936(h)(3)(B)) to a foreign corporation in an exchange described in section 351 or section 361 is treated as having sold such property in exchange for payments that are contingent upon the productivity, use, or disposition of such property, and receiving amounts that reasonably reflect the amounts that would have been received annually in the form of such payments over the useful life of the property, or, in the case of a disposition following the transfer (whether direct or indirect), at the time of the disposition. Section 367(d)(2)(A). The amounts taken into account must be commensurate with the income attributable to the intangible property.
Section 721(a) provides a general rule that no gain or loss is recognized to a partnership or to any of its partners in the case of a contribution of property to the partnership in exchange for an interest in the partnership. Because section 367 applies only to the transfer of property to a foreign corporation, absent regulations under section 721(c) or section 367(d)(3), a U.S. person generally does not recognize gain on the contribution of appreciated property to a partnership with foreign partners.
Section 704(c)(1)(A) requires partnerships to allocate income, gain, loss, and deduction with respect to property contributed by a partner to the partnership so as to take into account any variation between the adjusted tax
Section 1.704-3(a)(1) provides that the purpose of section 704(c) is to prevent the shifting of tax consequences among partners with respect to pre-contribution gain or loss (forward section 704(c) layer). In addition, partnerships may, but are not required to, revalue partnership property pursuant to § 1.704-1(b)(2)(iv)(
Section 704(c) allocations must be made using any reasonable method consistent with the purpose of section 704(c). Section 1.704-3(a)(1). Section 1.704-3 describes three methods of making section 704(c) allocations that are generally reasonable, including the remedial allocation method.
The Treasury Department and the IRS are aware that certain taxpayers purport to be able to contribute, consistently with sections 704(b), 704(c), and 482, property to a partnership that allocates the income or gain from the contributed property to related foreign partners that are not subject to U.S. tax. Many of these taxpayers choose a section 704(c) method other than the remedial method or use valuation techniques that are inconsistent with the arm's length standard. In 1997, Congress recognized that taxpayers might use a partnership to shift gain to a foreign person and consequently enacted sections 721(c) and 367(d)(3). Based on the experience of the IRS with the taxpayer positions described above, the Treasury Department and the IRS have determined that it is appropriate to exercise the regulatory authority granted in section 721(c) to override the application of section 721(a) to gain realized on the transfer of property to a partnership (domestic or foreign) in certain circumstances in which the gain, when recognized, ultimately would be includible in the gross income of a foreign person. Although Congress also provided specific authority in section 367(d)(3) to address transfers of intangible property to partnerships, the Treasury Department and the IRS have concluded that acting pursuant to section 721(c) is more appropriate because the transactions at issue are not limited to transfers of intangible property.
On August 6, 2015, the Department of the Treasury (Treasury Department) and the IRS issued Notice 2015-54, 2015-34 I.R.B. 210 (the notice), which describes regulations to be issued under section 721(c) that would ensure that, when a U.S. person transfers certain property to a partnership that has foreign partners related to the U.S. person, income or gain attributable to the appreciation in the property at the time of the contribution will be taken into account by the transferor either immediately or over time. Comments were received on the notice and will be included in the administrative record for the notice of proposed rulemaking on this subject in the Proposed Rules section of this issue of the
The notice states that future regulations generally will override the application of section 721(a) to gain realized on the transfer of property to a partnership (domestic or foreign) in certain circumstances in which the gain, when recognized, ultimately would be includable in the gross income of a related foreign person. The notice further states that future regulations will allow for the continued application of section 721(a) to transfers to partnerships with related foreign partners when certain requirements intended to protect the U.S. tax base are satisfied. The notice described these requirements, in addition to others, as the “gain deferral method.”
The requirements of the gain deferral method described in the notice are that (i) the section 721(c) partnership adopts the remedial allocation method for built-in gain with respect to all section 721(c) property contributed to the partnership pursuant to the same plan by the U.S. transferor and all U.S. transferors that are related persons; (ii) the section 721(c) partnership makes consistent allocations of all section 704(b) items with respect to an item of section 721(c) property (the consistent allocation method); (iii) certain reporting requirements are satisfied; (iv) the U.S. transferor recognizes any remaining built-in gain with respect to section 721(c) property upon an acceleration event; and (v) the gain deferral method is adopted for all section 721(c) property subsequently contributed to the section 721(c) partnership by the U.S. transferor and all other U.S. transferors that are related persons until the earlier of two dates: the date that no built-in gain remains with respect to any section 721(c) property to which the gain deferral method first applied, or the date that is 60 months after the date of the initial contribution of section 721(c) property to which the gain deferral method first applied (unified application requirement). See Part III of the Explanations of Provisions section of this preamble for the definitions of “section 721(c) partnership,” “section 721(c) property,” “U.S. transferor” and other commonly used terms.
The notice generally provides that the regulations will define an acceleration event as any transaction that either (i) would reduce the amount of remaining built-in gain that a U.S. transferor would recognize under the gain deferral method if the transaction had not occurred, or (ii) could defer the recognition of the built-in gain. The notice also describes several situations that the regulations will not treat as acceleration events.
The notice states that the regulations will apply to transactions involving tiered partnerships in a manner that is consistent with the purpose of the regulations. As examples, the notice provides that the regulations will treat a contribution of section 721(c) property by a partnership (in which a U.S. transferor is a direct or indirect partner) to a lower-tier partnership, or a
The notice provides that the regulations described therein will apply to contributions occurring on or after August 6, 2015, and to contributions occurring before August 6, 2015, resulting from an entity classification election made under § 301.7701-3 that is filed on or after August 6, 2015, and that is effective on or before August 6, 2015. The notice provides, however, that the reporting requirements will not apply to taxable years that end before the date of publication of regulations described in the notice.
The notice also announced the intent to issue regulations under sections 482 and 6662 to ensure the appropriate valuation of controlled transactions involving partnerships. These regulations are not contained in this Treasury decision and will appear in future regulations. Section 482 continues to apply to controlled transactions (within the meaning of § 1.482-1(i)(8)) that are also subject to these regulations. An adjustment pursuant to section 482 does not prevent the application of these regulations.
Comments questioned whether the regulations described in the notice are within the scope of the grant of authority in section 721(c). Specifically, comments asserted that pre-contribution gain could not be taxed under section 721(c) until it is recognized in a sale or exchange by the partnership. The Treasury Department and the IRS disagree with these comments for several reasons.
First, as explained in the notice, Congress added the broad grant of regulatory authority in section 721(c) in the 1997 Act to address transactions in which property is contributed to partnerships in order to inappropriately shift gain offshore as a replacement for the repealed excise tax on transfers to foreign partnerships in sections 1491 through 1494.
Second, section 721(c) provides authority to tax the gain when the property is contributed if the gain “will be includible” in a foreign person's income; it is not a rule (like section 704(c)(1)(B)) that requires the “wait-and-see” approach suggested by the comments. The comments fail to acknowledge that neither the traditional method nor the traditional method with curative allocations will necessarily ensure that a contributing partner will bear all the tax consequences of pre-contribution gain. A contributing partner exchanges a share of the property it contributes for a share of the property the other partners contribute. Economically, a contribution is a current value-for-value exchange. The purpose of section 704(c) is to prevent the shifting of tax consequences among partners with respect to pre-contribution built-in gain or loss in contributed property. The regulations under section 704(c) provide three generally reasonable methods under which partnerships may allocate items with respect to contributed property so as to take into account the tax consequences of pre-contribution gain or loss—the traditional method, the traditional method with curative allocations, and the remedial allocation method. None of the methods are mandatory, and taxpayers may choose any of them (or another reasonable method) on a property-by-property and section 704(c) layer-by-layer basis. In the case of a contribution of depreciable or amortizable property with pre-contribution gain, under all three methods, book cost recovery deductions reduce the pre-contribution gain in the property (the gain that must be allocated back to the contributor) over the course of the recovery period for the property. Under the traditional method, tax cost recovery deductions (which are based on tax basis in the property) are, to the extent available, allocated first to the noncontributing partner up to its allocated book cost recovery deductions. If the noncontributing partner's book cost recovery deductions exceed its tax cost recovery deductions, the noncontributing partner will be overtaxed on its investment in the partnership property. The traditional method does not make up for shortfalls in available tax deductions, and if the partnership uses the traditional method with curative allocations, those shortfalls are cured only if there are other tax items available with which to cure. Because book cost recovery deductions reduce the built-in gain in the property regardless of whether the noncontributing partner has received all of the tax cost recovery deductions to which it is economically entitled or whether the contributing partner has received taxable income (or fewer tax deductions) commensurate with the pre-contribution gain in its property, neither the traditional method nor the traditional method with curative allocations prevents a shift of the tax consequences of pre-contribution gain to the noncontributing partner when tax basis or other tax items are insufficient to reflect the economics of the noncontributing partner. When this shift occurs, the contributing partner generally will not bear the tax consequences of the pre-contribution gain until, at the earliest, its partnership interest is liquidated or sold. In this way, the contribution of property to a partnership applying either of these two methods can result in a tax-advantaged exchange with respect to the contributing partner. When the noncontributing partner is foreign, this situation is the appropriate target for the temporary regulations.
Finally, the regulations under section 704(c) give wide latitude to taxpayers regarding how and when partners may choose to recognize pre-contribution gain. Subject to anti-abuse rules, taxpayers are allowed to adopt the traditional method and the traditional method with curative allocations despite those methods' inability to prevent a shift of the tax consequences of pre-contribution gain in all cases. This latitude raises more concern in the case of related partners, one or more of whom are foreign, given their likely overall alignment of tax interests, which would not necessarily exist among unrelated partners. As explained in Part II of the Background section of this preamble, the remedial allocation method is the only method that reliably and consistently ensures that the tax consequences of pre-contribution gain from contributed property are properly borne by the contributing partner. This feature of the remedial method is particularly relevant to the Congressional concerns about the erosion of the U.S. tax base that led to the enactment of section 721(c), and thus the remedial method is the method that is most appropriate for appreciated property that is contributed to a partnership controlled by the U.S. transferor and one or more related foreign partners. For these reasons, the Treasury Department and the IRS have determined that these regulations are within the scope of the grant of authority in section 721(c).
The temporary regulations adopt the rules that were described in the notice, with certain modifications, in part, in response to comments received.
Section 1.721(c)-1T provides definitions and rules of general application for purposes of all sections of the temporary regulations. Section
The temporary regulations apply on a property-by-property basis. Accordingly, as discussed in Paragraph b of Part VI of the Explanations of Provisions section of this preamble, the temporary regulations do not include the unified application requirement announced in the notice.
The temporary regulations apply to all contributions, actual or deemed, of property to a partnership, including, for example, a contribution of property that occurs as a result of (i) a partnership merger, consolidation, or division in the assets-over form, (ii) a change in entity classification that occurs pursuant to § 301.7701-3, or (iii) a transaction described in Rev. Rul. 99-5, 1999-1 C.B. 434 (change from a disregarded entity to a partnership). However, in response to a comment, the temporary regulations provide that a contribution in a technical termination of a partnership described in section 708(b)(1)(B) (technical termination) will not, by itself, cause a partnership to become a section 721(c) partnership subject to the temporary regulations. For further discussion, see Part IV of the Explanation of Provisions section of this preamble. However, the temporary regulations do apply to a technical termination of a section 721(c) partnership applying the gain deferral method. In this regard, see Part V and Paragraph c of Part VIII of the Explanation of Provisions section of this preamble, concerning the general rule of gain recognition and successor events, respectively.
The temporary regulations provide that a mere change in identity, form, or place of organization of a partnership or a recapitalization of a partnership will not cause the partnership to become a section 721(c) partnership. See § 1.721(c)-1T(c).
Finally, as announced in the notice, the temporary regulations contain rules for transactions involving tiered partnerships, as well as a general anti-abuse rule (see § 1.721(c)-1T(d)) that applies for purposes of all sections of the temporary regulations.
The notice states that future regulations would provide that a partnership is a section 721(c) partnership if a U.S. transferor contributes section 721(c) property to the partnership, and, after the contribution and any transactions related to the contribution, (i) a related foreign person is a direct or indirect partner, and (ii) the U.S. transferor and related persons own (directly or indirectly) more than 50 percent of the interests in partnership capital, profits, deductions, or losses.
A comment requested that the definition of section 721(c) partnership be revised to exclude partnerships when the interests held by related foreign persons are small and an unrelated third-party with a material adverse tax position to the U.S. transferor holds a meaningful interest in the partnership. According to the comment, these two factors would sufficiently mitigate the potential for the abuse that the notice is intended to address. While these factors may reduce the ability of a U.S. transferor to shift gain or income outside the United States, the Treasury Department and the IRS have concluded that these factors alone are insufficient to prevent the erosion of the U.S. tax base that section 721(c) was enacted to address. In particular, the Treasury Department and the IRS are concerned that even a small ownership interest held by a related foreign person may be used for a meaningful shift of gain or income outside the United States. Furthermore, the Treasury Department and the IRS have determined that such a rule would necessitate additional rules to address small interests that later become large either in absolute or relative terms. In this regard, the Treasury Department and the IRS have determined that both a general anti-abuse rule and a more targeted rule that would require periodic retesting of the size of a related foreign person's interest would be difficult to administer. Accordingly, this comment has not been adopted. The Treasury Department and the IRS, however, acknowledge that the higher the overall level of related ownership in the partnership, the more likely the arrangement among the partners will reflect tax considerations. After considering this comment and other comments that requested a higher level of related-party ownership in the definition of a section 721(c) partnership, the temporary regulations increase the threshold from a “more than 50 percent” test to an “80 percent or more” test (ownership requirement). See § 1.721(c)-1T(b)(14)(i) for the general definition of a section 721(c) partnership. The temporary regulations also provide rules that deem certain controlled partnerships in a tiered-partnership structure to be section 721(c) partnerships in order to apply the gain deferral method. See § 1.721(c)-1T(b)(14)(ii).
The temporary regulations define section 721(c) property as property, other than excluded property, with built-in gain that is contributed to a partnership by a U.S. transferor. See § 1.721(c)-1T(b)(15)(i) for the general definition of section 721(c) property. The notice incorporated the requirement that a U.S. transferor make the contribution in the definition of a section 721(c) partnership rather than in the definition of section 721(c) property. This adjustment to the definitions is intended to be a non-substantive change. The temporary regulations provide that if a U.S. transferor is treated as contributing its share of an item of property, the entire item of property is section 721(c) property. In addition, the temporary regulations provide rules that deem certain property of a tiered partnership to be section 721(c) property. See § 1.721(c)-1T(b)(15)(ii). When an interest in a partnership is contributed, the partnership interest, if it is not excluded property, is the section 721(c) property.
The temporary regulations define excluded property as (i) a cash equivalent; (ii) a security within the meaning of section 475(c)(2), without regard to section 475(c)(4); (iii) an item of tangible property with built-in gain that does not exceed $20,000 or with an adjusted tax basis in excess of book value (built-in loss); and (iv) an interest in a partnership that holds (directly, or indirectly through interests in one or more partnerships that are not excluded property under this clause (iv)) property of which 90 percent or more of the value consists of property described in clauses (i) through (iii) (partnership interest
Comments recommended that property that gives rise to income effectively connected with a U.S. trade or business (ECI property) be excluded from the definition of section 721(c) property, because the income will be subject to U.S. tax even if it is allocated to a related foreign person. The Treasury Department and the IRS agree with the reasoning behind this comment, and have determined that the temporary regulations should also address the situation when the property ceases to be ECI property and still has built-in gain. Accordingly, the temporary regulations continue to include ECI property in the definition of section 721(c) property but modify the application of the gain deferral method to ECI property, as discussed in Paragraph c of Part VI of the Explanation of Provisions section of this preamble.
Another comment similarly suggested that the definition of section 721(c) property exclude property the gain on which would be subject to U.S. tax under subpart F of the Code. The Treasury Department and IRS have declined to adopt such a rule, which would depend on a “wait and see” approach and would import the recognition rules of subpart F, including an earnings and profits requirement, rather than the more direct approach of section 721(c).
The temporary regulations define built-in gain with respect to an item of property contributed to a partnership as the excess of the book value of the property over the partnership's adjusted tax basis in the property upon the contribution, determined without regard to the application of the gain recognition rule of § 1.721(c)-2T(b). See § 1.721(c)-1T(b)(2). The temporary regulations clarify the definition provided in the notice in two respects. First, the notice states that built-in gain would be determined with respect to the contributing partner's adjusted tax basis in the property at the time of the contribution, whereas the temporary regulations provide that built-in gain is determined with respect to the partnership's adjusted tax basis in the property. The revision was made in order to more precisely describe the amount of gain that may be shifted to a related foreign partner. Second, the temporary regulations clarify that built-in gain is determined without regard to the application of the gain recognition rule under § 1.721(c)-2T(b).
The temporary regulations include a new term, “remaining built-in gain.” Section 1.721(c)-1T(b)(13)(i) generally defines remaining built-in gain, with respect to an item of section 721(c) property that is subject to the gain deferral method, as the built-in gain, reduced by decreases in the difference between the property's book value and adjusted tax basis. However, subsequent increases or decreases to the property's book value due to a revaluation other than a revaluation required under these temporary regulations for tiered partnerships are not taken into account in determining remaining built-in gain. The temporary regulations provide rules for determining remaining built-in gain in the case of tiered partnerships. See § 1.721(c)-1T(b)(13)(ii).
Consistent with the notice, § 1.721(c)-1T(b)(18)(i) of the temporary regulations generally defines a U.S. transferor as a U.S. person (within the meaning of section 7701(a)(30)) other than a domestic partnership. The temporary regulations also provide a rule that deems certain tiered partnerships to be a U.S. transferor solely for purposes of applying the consistent allocation method. See § 1.721(c)-1T(b)(18)(ii).
Finally, the temporary regulations, consistent with the notice, define (i) a related person as a person that is related (within the meaning of section 267(b) or section 707(b)(1)) to a U.S. transferor; (ii) a related foreign person as a person that is a related person (other than a partnership) that is not a U.S. person; and (iii) a direct or indirect partner as a person (other than a partnership) that owns an interest in a partnership directly or indirectly through one or more partnerships. See § 1.721(c)-1T(b)(12), (b)(11), and (b)(5), respectively.
Section 1.721(c)-2T provides the general operative rules that override section 721(a) nonrecognition of gain upon a contribution of section 721(c) property to a partnership. Section 1.721(c)-2T(b) provides the general rule that nonrecognition under section 721(a) will not apply to gain realized upon a contribution of section 721(c) property to a section 721(c) partnership. In contrast to the regulations described in the notice, § 1.721(c)-2T(b) provides that this general rule does not apply—and therefore that nonrecognition under section 721(a) continues to apply—to a direct contribution of section 721(c) property by an “unrelated” U.S. transferor (in other words, a U.S. transferor that does not, together with related persons with respect to it, satisfy the ownership requirement). The carve-out is consistent with the intent of the temporary regulations to address the shifting of income among related persons. Because this carve-out for an unrelated U.S. transferor is limited to direct contributions of section 721(c) property, it does not apply to a contribution that occurs pursuant to the partnership look-through rule in § 1.721(c)-2T(d)(1) (as discussed elsewhere in this Part V).
Section 1.721(c)-2T(c) provides a de minimis exception to the general rule. The temporary regulations modify the de minimis exception described in the notice—which focused on contributions made by a U.S. transferor (and all related U.S. transferors) during the U.S. transferor's taxable year—to focus instead on contributions during the partnership's taxable year, in order to align the rule with the reporting required under § 1.721(c)-6T. Under the de minimis exception in the temporary regulations, contributions of section 721(c) property will not be subject to immediate gain recognition if the sum of all built-in gain for all section 721(c) property contributed to a section 721(c) partnership during the partnership's taxable year does not exceed $1 million.
Section 1.721(c)-2T(d)(1) provides a look-through rule for identifying a section 721(c) partnership when an upper-tier partnership in which a U.S. transferor is a direct or indirect partner contributes property to a lower-tier partnership. For purposes of determining if the lower-tier partnership is a section 721(c) partnership, the U.S. transferor will be treated as contributing to the lower-tier partnership its share of the property actually contributed by the upper-tier partnership to the lower-tier partnership. If the lower-tier partnership is a section 721(c) partnership, absent application of the gain deferral method by the lower-tier partnership to the entire property and by the upper-tier partnership to the partnership interest in the lower-tier partnership, the upper-tier partnership will recognize the entire
Section 1.721(c)-2T(d)(2) provides that the partnership look-through rule will not apply to a deemed contribution by an “old” partnership to a “new” partnership that occurs as a result of a technical termination of the old partnership. Thus, a technical termination will not cause a non-section 721(c) partnership, in which a U.S. transferor is a direct or indirect partner, to become a section 721(c) partnership subject to these temporary regulations. If, however, a partnership is a section 721(c) partnership subject to the temporary regulations immediately before its technical termination, the technical termination would be a successor event (rather than an acceleration event) only if the new partnership continues the gain deferral method with respect to the section 721(c) property that was subject to the gain deferral method in the terminated partnership. In this regard, see § 1.721(c)-5T(c)(4) (defining a successor event to include certain technical terminations).
Section 1.721(c)-3T describes the gain deferral method, which generally must be applied in order to avoid the immediate recognition of gain upon a contribution of section 721(c) property to a section 721(c) partnership. Section 1.721(c)-3T(b) provides the five general requirements for applying the gain deferral method to an item of section 721(c) property: (i) The section 721(c) partnership adopts the remedial allocation method and allocates section 704(b) items of income, gain, loss, and deduction with respect to the section 721(c) property in a manner that satisfies the consistent allocation method; (ii) the U.S. transferor recognizes gain equal to the remaining built-in gain with respect to the section 721(c) property upon an acceleration event, or an amount of gain equal to a portion of the remaining built-in gain upon a partial acceleration event or certain transfers to foreign corporations described in section 367; (iii) procedural and reporting requirements are satisfied; (iv) the U.S. transferor extends the period of limitations on assessment of tax (as discussed in Part X of the Explanation of Provisions section of this preamble); and (v) the rules for tiered partnerships are satisfied if either the section 721(c) property is an interest in a partnership or the section 721(c) property is described in the partnership look-through rule in § 1.721(c)-2T(d)(1).
Comments questioned the necessity for the unified application requirement announced in the notice. The unified application requirement was intended to prevent taxpayers from disaggregating the contribution of separate but related business property and choosing to recognize gain upon contribution for some property and to apply the gain deferral method for other property, in an attempt to minimize the reported cumulative value for all contributed property or to minimize the reported value of property for which the gain deferral method was not adopted. This concern arises, in part, because the IRS may not be able to make an adjustment for the correct amount of gain with respect to property that is not subject to the gain deferral method due to the expiration of the period of limitations on the assessment of tax. While the Treasury Department and the IRS continue to be concerned that taxpayers will attempt to disaggregate related business property in order to undervalue their contributions, the temporary regulations adopt a more targeted approach to address these comments. Accordingly, the temporary regulations do not include the unified application requirement and instead apply on a property-by-property basis.
As described in the notice, in order to apply the gain deferral method with respect to a contribution of section 721(c) property to a section 721(c) partnership, the temporary regulations require the U.S. transferor to extend the period of limitations on assessment of tax on all items related to the property with respect to which the gain deferral method applies through the close of the eighth full taxable year following the contribution. To address the concerns that motivated the uniform application requirement, the temporary regulations require a U.S. transferor to extend the period of limitations on assessment of tax on the gain recognized under the general rule with respect to any section 721(c) property that is contributed to the partnership for which the gain deferral method will not be applied through the close of the fifth full taxable year following the contribution of such property, if the property is contributed within five full taxable years after a gain deferral contribution, defined in § 1.721(c)-1T(b)(7) as a contribution of section 721(c) property to a section 721(c) partnership with respect to which the gain is deferred under the gain deferral method. See §§ 1.721(c)-3T(b)(4) and 1.721(c)-6T(b)(5)(iii), discussed in Part X of the Explanation of Provisions section of this preamble. Additionally, it should be noted that § 1.482-1T(f)(2)(i)(B) provides that separate transactions must be aggregated for purposes of determining the arm's length pricing of such transactions under section 482, including for purposes of an analysis under multiple provisions of the Code or regulations, if the transactions are so interrelated that an aggregate analysis provides the most reliable measure of the arm's length result.
As discussed in Part IV of the Explanation of Provisions section of this preamble, the temporary regulations do not adopt the comment recommending that ECI property be excluded from the definition of section 721(c) property. Instead, the temporary regulations continue to provide that a contribution of section 721(c) property that is ECI property is subject to immediate gain recognition if the gain deferral method is not applied. However, in response to the comment, the temporary regulations modify the gain deferral method such that ECI property is not subject to the remedial allocation method or the consistent allocation method. This special exception for ECI property applies for as long as, beginning on the date of the contribution and ending when there is no remaining built-in gain with respect to the property, all distributive shares of income and gain with respect to the property for all direct and indirect partners that are related foreign persons will be subject to taxation as effectively connected with a trade or business within the United States (under section 871 or 882), and neither the section 721(c) partnership nor a direct or indirect partner that is a related foreign person claims benefits under an income tax treaty that would exempt the income or gain from tax or reduce the rate of taxation to which the income or gain is subject. See § 1.721(c)-3T(b)(1)(ii).
All the other requirements of the gain deferral method apply with respect to ECI property. Thus, a U.S. transferor must recognize gain upon an acceleration event with respect to ECI property, including when property ceases to be ECI property, and satisfy the procedural and reporting requirements with respect to ECI property. See § 1.721(c)-6T(b)(2)(iii), (b)(3)(vii), and (c)(1).
A comment also requested an exclusion for property subject to tax under section 897 (relating to U.S. real property interests) from the definition of section 721(c) property. The temporary regulations do not adopt this comment because the special rules for ECI property appropriately address the concerns expressed regarding U.S. real property interests.
Comments requested guidance on how the requirement to use the remedial allocation method interacts with the section 197 anti-churning rules. In general, section 197(f)(9) prohibits the amortization of goodwill and going concern value that was nonamortizable before the enactment of section 197 (section 197(f)(9) intangible property), and that prohibition continues if the property is transferred to a related person. Under § 1.197-2(h)(12)(vii)(B), when section 197(f)(9) intangible property is contributed to a partnership, a noncontributing partner generally may receive remedial allocations of amortization with respect to the property. A noncontributing partner that is related to the contributing partner, however, may not receive such remedial allocations.
One comment requested that a U.S. transferor not be required to include remedial income with respect to section 197(f)(9) intangible property when the gain deferral method is being applied. The temporary regulations do not adopt this comment. The Treasury Department and the IRS are concerned that providing favorable treatment for section 721(c) property belonging to a particular class would incentivize taxpayers to attribute excessive value to that class of property while simultaneously undervaluing related but separate section 721(c) property that remains subject to all of the requirements of the gain deferral method. This concern is especially pronounced in the case of section 197(f)(9) intangible property, which is often difficult to value separately from other identifiable intangible property. In this regard, see the preamble of the notice of proposed rulemaking (REG-139483-13) containing proposed regulations under section 367, published in the
Another comment recommended that regulations implementing the gain deferral method require the partnership to amortize the section 197(f)(9) intangible and allocate remedial items of amortization to a related foreign partner and corresponding remedial items of income to the contributing partner. The Treasury Department and the IRS have determined that changing § 1.197-2(h)(12)(vii)(B) to permit remedial allocations of amortization to related partners, or distinguishing between domestic and related foreign partners, would be contrary to section 197(f)(9) and therefore do not adopt this comment. In lieu of providing that remedial allocations may be made to a related partner, the temporary regulations provide a special non-amortizable tax basis adjustment to the property. This special adjustment is made solely with respect to the related partner. The Treasury Department and the IRS have determined that allowing this tax basis adjustment is consistent with the policy of the section 197 anti-churning rules.
More specifically, the temporary regulations revise the remedial allocation method in § 1.704-3(d) as to related partners when a section 721(c) partnership is applying the gain deferral method with respect to section 197(f)(9) intangible property. The revised rule requires the partnership to amortize the portion of the partnership's book value in the section 197(f)(9) intangible property that exceeds its adjusted tax basis in the property. Accordingly, the allocation of book amortization to a noncontributing partner will result in a ceiling rule limitation to the extent of this allocation of book amortization. If a noncontributing partner is a related person with respect to the U.S. transferor, the temporary regulations provide that, solely with respect to the related noncontributing partner, the partnership must increase the adjusted tax basis of the property by the amount of the difference between the book allocation of the item to the related person and the tax allocation of the same item to the related person and allocate remedial income in the same amount to the U.S. transferor. See § 1.704-3T(d)(5)(iii)(C).
The rules governing the tax consequences of the special tax basis adjustment are modeled on § 1.743-1 and proposed regulations under section 704(c)(1)(C) that are contained in a notice of proposed rulemaking (REG-144468-05) published in the
The Treasury Department and the IRS request comments on the following issues, and on any other issues relevant to a section 721(c) partnership's application of the remedial allocation method to section 197(f)(9) intangible property: (i) The application of the method to members of a consolidated group; (ii) the treatment of a tax basis adjustment when the adjusted section 197(f)(9) intangible property is transferred (a) in a like-kind exchange described in section 1031, (b) to a lower-tier partnership, (c) in a transaction described in section 351, (d) in a technical termination, or (e) in an installment sale; (iii) the treatment of a tax basis adjustment when the section 197(f)(9) intangible property is distributed to the related person for whom the adjustment was made or to another partner in a current or liquidating distribution; and (iv) any rules that are necessary to ensure that the tax basis adjustment does not become amortizable in contravention of the anti-churning rules.
Section 1.721(c)-3T(c)(1) describes the consistent allocation method, which, like the gain deferral method, applies on a property-by-property basis. The consistent allocation method requires a section 721(c) partnership to allocate the same percentage of each book item of income, gain, deduction, and loss “with respect to the section 721(c) property” to the U.S. transferor. Comments questioned the necessity of the requirement to apply the consistent allocation method. Some comments
According to another comment, the consistent allocation method is both over-inclusive, in that situations in which a U.S. transferor is allocated greater income than its share of deductions would violate the rule, and under-inclusive, because deductions allocated to a U.S. transferor that do not arise from section 721(c) property are beyond the scope of the rule. This comment proposed an alternative anti-abuse rule that would require that a minimum cumulative amount of income be allocated to a U.S. transferor. The Treasury Department and the IRS have concluded that the rule described in the comment would be difficult to administer. However, in response to comments, the temporary regulations provide exceptions (discussed in Paragraph e.3 of this Part VI) to the consistent allocation method for certain regulatory allocations and the allocations of creditable foreign tax expenditures.
The notice did not describe how partnership items are determined to be “with respect to section 721(c) property.” The temporary regulations provide guidance for making this determination based on principles that will be familiar to many taxpayers.
Section 1.721(c)-3T(c)(2) provides the rule for determining the extent to which partnership items of book income and gain are considered to be “with respect to” particular section 721(c) property for purposes of applying the consistent allocation method on a property-by-property basis. This rule provides that a section 721(c) partnership must attribute book income and gain to each property in a consistent manner using any reasonable method that takes into account all the facts and circumstances. The temporary regulations provide that all items of book income and gain attributable to each property will comprise a single class of gross income for purposes of determining the extent to which partnership items of deduction or loss are allocated and apportioned with respect to the section 721(c) property.
Section 1.721(c)-3T(c)(3) provides the rules for determining the extent to which partnership items of book deduction and loss are considered to be “with respect to” particular section 721(c) property for purposes of applying the consistent allocation method. A section 721(c) partnership must use the principles of §§ 1.861-8 and 1.861-8T to allocate and apportion all of its items of deduction, except for interest expense and research and experimental expenditures (R&E), and loss to the class of gross income with respect to each section 721(c) property. The section 721(c) partnership may allocate and apportion its interest expense and R&E using any reasonable method, including, but not limited to, the methods described in §§ 1.861-9 and 1.861-9T (interest expense) and § 1.861-17 (R&E).
In response to comments, the temporary regulations provide exceptions from the requirement to apply the consistent allocation method with respect to certain book items of a section 721(c) partnership.
The temporary regulations provide that a regulatory allocation (as defined in § 1.721(c)-1T(b)(10)) of book income, gain, deduction, or loss with respect to section 721(c) property that otherwise would fail to satisfy the requirements of the consistent allocation method nevertheless will, in certain cases, be deemed to satisfy the requirements. Specifically, a regulatory allocation is deemed to satisfy the requirements of the consistent allocation method if the allocation is (i) an allocation of income or gain to the U.S. transferor (or a member of its consolidated group); or (ii) an allocation of deduction or loss to a partner other than the U.S. transferor (or a member of its consolidated group). In addition, if the allocation is not described in clause (i) or (ii) but the U.S. transferor receives less income or gain or more deductions or loss with respect to the section 721(c) property because of the regulatory allocation, the allocation is treated as described in § 1.721(c)-5T(d)(2) (generally requiring that a portion of remaining built-in gain be recognized, as discussed in Paragraph d.2 of Part VIII of the Explanation of Provisions section of this preamble). See § 1.721(c)-3T(c)(4)(i)(C). The Treasury Department and the IRS have determined that this special rule for regulatory allocations is appropriate because an allocation described in clause (i) or (ii) will not reduce the U.S. tax base and an allocation described in clause (iii) will result in the U.S. transferor recognizing gain that will offset the reduction in the U.S. tax base resulting from the regulatory allocation.
The temporary regulations provide that a regulatory allocation is (i) an allocation pursuant to a minimum gain chargeback, as defined in § 1.704-2(b)(2), (ii) a partner nonrecourse deduction, as determined in § 1.704-2(i)(2), (iii) an allocation pursuant to a partner minimum gain chargeback, as described in § 1.704-2(i)(4), (iv) an allocation pursuant to a qualified income offset, as defined in § 1.704-1(b)(2)(ii)(
The temporary regulations provide that allocations of creditable foreign tax expenditures (as defined in § 1.704-
Section 1.721(c)-4T provides rules regarding acceleration events, which, like the gain deferral method, apply on a property-by-property basis. When an acceleration event occurs with respect to section 721(c) property, remaining built-in gain in the property must be recognized and the gain deferral method no longer applies. The temporary regulations provide exceptions to acceleration events that are discussed in Part VIII of the Explanation of Provisions section of this preamble.
Subject to the exceptions described in Part VIII of the Explanation of Provisions section of this preamble, § 1.721(c)-4T(b)(1) defines an acceleration event as any event that would reduce the amount of remaining built-in gain that a U.S. transferor would have recognized under the gain deferral method if the event had not occurred or that could defer the recognition of the remaining built-in gain. The temporary regulations clarify that an acceleration event includes the transfer of section 721(c) property via a contribution of the property itself or through a contribution of a partnership interest.
The rules described in the notice would have provided that a failure to comply with one of the requirements of the gain deferral method with respect to any section 721(c) property would cause an acceleration event for all section 721(c) property. Comments requested that the Treasury Department and the IRS eliminate this provision. Because the temporary regulations provide that the gain deferral method is applied on a property-by-property basis (in lieu of containing the unified application requirement), the temporary regulations adopt this comment.
Under the temporary regulations, an acceleration event with respect to section 721(c) property occurs when any party fails to comply with a requirement of the gain deferral method with respect to that property. See § 1.721(c)-4T(b)(2)(i). For example, if section 721(c) property is ECI property, an acceleration event occurs if a distributive share of income or gain from the property that is allocated to a direct or indirect partner that is a related foreign person is no longer subject to taxation as income effectively connected with a trade or business within the United States or if the section 721(c) partnership or a direct or indirect partner that is a related foreign person claims certain benefits under an income tax treaty with respect to the income (see § 1.721(c)-3T(b)(1)(ii)).
An acceleration event will not occur solely as a result of a failure to comply with a procedural or reporting requirement of the gain deferral method if that failure is not willful and relief is sought under the prescribed procedures. See §§ 1.721(c)-4T(b)(2)(ii) and 1.721(c)-6T(f).
When section 721(c) property is an interest in a partnership, the temporary regulations provide that an acceleration event will not occur because of a reduction in remaining built-in gain in the partnership interest as a result of allocations of book items of deduction and loss or tax items of income and gain by that partnership. See § 1.721(c)-4T(b)(3).
Under the temporary regulations, a U.S. transferor may affirmatively treat an acceleration event as having occurred with respect to section 721(c) property by recognizing the remaining built-in gain with respect to that property and satisfying the reporting required by § 1.721(c)-6T(b)(3)(iv). See § 1.721(c)-4T(b)(4).
Section 1.721(c)-4T(c) sets forth the consequences of an acceleration event. Specifically, the U.S. transferor must recognize gain in an amount equal to the remaining built-in gain that would have been allocated to the U.S. transferor if the section 721(c) partnership had sold the section 721(c) property immediately before the acceleration event for fair market value. Following the acceleration event, the section 721(c) property will no longer be subject to the gain deferral method.
The U.S. transferor generally must make correlative adjustments to its basis in its partnership interest. See § 1.721(c)-4T(c)(1). In addition, the section 721(c) partnership will increase its basis in the section 721(c) property by the amount of gain recognized by the U.S. transferor. This basis increase is made immediately before the acceleration event. See § 1.721(c)-4T(c)(2). If the section 721(c) property remains in the partnership after the acceleration event, the increase in the basis of the section 721(c) property generally would be treated in the same manner as newly purchased property, including for purposes of determining the depreciation schedule if the property is depreciable property.
Section 1.721(c)-5T identifies the following categories of exceptions to acceleration events, which, like acceleration events, apply on a property-by-property basis: (i) Termination events, in which case, the gain deferral method ceases to apply to the section 721(c) property; (ii) successor events, in which case, the gain deferral method continues to apply to the section 721(c) property but with respect to a successor U.S. transferor or a successor section 721(c) partnership, as applicable; (iii) partial acceleration events, in which case, a U.S. transferor recognizes an amount of gain that is less than the full amount of remaining built-in gain in the section 721(c) property and the gain deferral method continues to apply; (iv) transfers described in section 367 of section 721(c) property to a foreign corporation, in which case, the gain deferral method ceases to apply and a U.S. transferor recognizes an amount of gain equal to the remaining built-in gain attributable to the portion of the section 721(c) property that is not subject to tax under section 367; and (v) fully taxable dispositions of a portion of an interest in a section 721(c) partnership, in which case, the gain deferral method continues to apply for the retained portion of the interest.
Section 1.721(c)-5T(b) identifies the events that cause the gain deferral method to no longer apply. The Treasury Department and the IRS have determined that it is appropriate to terminate the application of the gain deferral method with respect to the affected section 721(c) property in these cases because the potential to shift gain or income to a related foreign person that is a direct or indirect partner in the section 721(c) partnership has been eliminated.
The temporary regulations provide that a termination event occurs if a section 721(c) partnership transfers section 721(c) property other than a partnership interest to a domestic corporation in a transaction to which section 351 applies. See § 1.721(c)-5T(b)(2).
A comment questioned whether the rules described in the notice would exempt from the definition of an acceleration event certain transactions after which the partnership ceases to exist, such as those described in Rev. Rul. 84-111, 1984-2 C.B. 88 (describing three methods for incorporating a partnership). See § 601.601(d)(2)(ii)(b). The temporary regulations provide that a termination event occurs upon an incorporation of a section 721(c) partnership into a domestic corporation by any method of incorporation other than a method involving an actual distribution of partnership property to the partners, followed by a contribution of that property to a corporation, provided that the section 721(c) partnership is liquidated as part of the incorporation transaction. See § 1.721(c)-5T(b)(3).
A comment questioned whether an acceleration event should occur as a result of a distribution of section 721(c) property to a partner other than a U.S. transferor outside of the seven-year period described in sections 704(c)(1)(B) and 737 (rules that address certain distributions of property within seven years of a contribution). While sections 704(c)(1)(B) and 737 also are intended to ensure that gain on contributed property is not inappropriately transferred to a partner other than the contributor, in the context of contributions to partnerships with related foreign partners, the Treasury Department and the IRS have determined that concerns about the erosion of the U.S. tax base remain as long as there is remaining built-in gain in the section 721(c) property. Accordingly, the Treasury Department and the IRS have determined that it is inappropriate to provide a termination event exception for all distributions of section 721(c) property after seven years.
The temporary regulations, however, provide that a termination event occurs if a section 721(c) partnership distributes section 721(c) property to the U.S. transferor. A termination event will also occur if a section 721(c) partnership distributes section 721(c) property to a member of a U.S. transferor's consolidated group and the distribution occurs more than seven years after the contribution. See § 1.721(c)-5T(b)(4).
In response to a comment, the temporary regulations generally provide that a termination event occurs when a section 721(c) partnership ceases to have any direct or indirect partners that are related foreign persons, provided there is no plan for a related foreign person to subsequently become a direct or indirect partner in the partnership (or a successor). See § 1.721(c)-5T(b)(5). The no-plan requirement applies independently of the general anti-abuse rule under § 1.721(c)-1T(d). An acceleration event, however, occurs upon a distribution of section 721(c) property in redemption of a related foreign person's interest in a section 721(c) partnership.
The notice treated a taxable disposition of section 721(c) property by a section 721(c) partnership, or an indirect disposition of section 721(c) property through a taxable disposition of an interest in a section 721(c) partnership interest, as an acceleration event. The Treasury Department and the IRS have determined that it is appropriate instead to treat a fully taxable disposition of section 721(c) property or of an entire interest in a section 721(c) partnership as a termination event because other sections of the Code require gain to be recognized.
Accordingly, the temporary regulations provide that a termination event occurs if a section 721(c) partnership disposes of section 721(c) property in a transaction in which all gain or loss, if any, is recognized. See § 1.721(c)-5T(b)(6). In addition, a termination event occurs if either a U.S. transferor or a partnership in which a U.S. transferor is a direct or indirect partner disposes of an entire interest in a section 721(c) partnership that owns section 721(c) property in a transaction in which all gain or loss, if any, is recognized. This rule does not apply if a U.S. transferor is a member of a consolidated group and the interest in the section 721(c) partnership is transferred to another member in an intercompany transaction (as defined in § 1.1502-13(b)(1)). See § 1.721(c)-5T(b)(7). See, however, Paragraph c.2 of this Part VIII, which describes the rule in § 1.721(c)-5T(c)(3) that provides that such a transaction may be a successor event.
Section 1.721(c)-5T(c) identifies the successor events that allow for the continued application of the gain deferral method. In each of these cases, it is appropriate to continue application of the gain deferral method (rather than accelerate gain recognition), because its application can be preserved in the hands of a successor U.S. transferor or a successor section 721(c) partnership, as applicable. If, however, the successor does not continue the gain deferral method, the event is an acceleration event. If only a portion of an interest in a partnership is transferred in a successor event, the principles of § 1.704-3(a)(7) apply to determine the remaining built-in gain in section 721(c) property that is attributable to the portion of the interest that is transferred and the portion that is retained. See § 1.721(c)-5T(c)(1).
The temporary regulations provide that a successor event occurs if either a U.S. transferor or a partnership in which a U.S. transferor is a direct or indirect partner transfers (directly or indirectly through one or more partnerships) an interest in a section 721(c) partnership to a domestic corporation in a transaction to which section 351 or 381 applies, and the gain deferral method is continued by treating the transferee domestic corporation as the U.S. transferor. See § 1.721(c)-5T(c)(2).
In addition, a successor event occurs if a U.S. transferor that is a member of a consolidated group transfers (directly or indirectly through one or more partnerships) an interest in a section 721(c) partnership to another member in an intercompany transaction (as defined in § 1.1502-13(b)(1)), and the gain deferral method is continued by treating the transferee member as the U.S. transferor. See § 1.721(c)-5T(c)(3).
In response to comments, the temporary regulations provide that a successor event occurs if there is a technical termination of a section 721(c) partnership, and the gain deferral method is continued by treating the new
The temporary regulations provide two other categories of successor events that involve successor section 721(c) partnerships. In each case, section 721(c) property is directly or indirectly contributed to a successor section 721(c) partnership and the gain deferral method is applied down the chain of ownership with the result that the remaining built-in gain will continue to be subject to U.S. tax.
In the first category, a successor event occurs if (i) a section 721(c) partnership contributes section 721(c) property to a lower-tier partnership that is a controlled partnership; (ii) the gain deferral method is applied both with respect to the section 721(c) partnership's interest in the lower-tier partnership and with respect to the section 721(c) property in the hands of the lower-tier partnership; and (iii) the lower-tier partnership either is a section 721(c) partnership, or is a controlled partnership that fails the ownership requirement but is treated as a section 721(c) partnership. See § 1.721(c)-5T(c)(5)(i). In the case in which the lower-tier partnership is a controlled partnership but not a section 721(c) partnership, the Treasury Department and the IRS have determined that it is appropriate to allow the parties to continue to apply the gain deferral method to the section 721(c) property, rather than triggering an acceleration event, provided the parties treat the lower-tier partnership as a section 721(c) partnership for purposes of applying the gain deferral method.
In the second category, a successor event occurs if (i) either a U.S. transferor or a partnership in which a U.S. transferor is a direct or indirect partner contributes (directly or indirectly through one or more partnerships) an interest in a section 721(c) partnership to an upper-tier partnership that is a controlled partnership; (ii) the gain deferral method is continued with respect to the section 721(c) property in the hands of the section 721(c) partnership; (iii) if the upper-tier partnership directly owns its interest in the section 721(c) partnership, the gain deferral method is applied with respect to the upper-tier partnership's interest in the section 721(c) partnership and the upper-tier partnership is, or is treated as, a section 721(c) partnership; and (iv) if the upper-tier partnership indirectly owns its interest in the section 721(c) partnership through one or more partnerships, the principles described in clause (iii) are applied with respect to the upper-tier partnership and each partnership through which the upper-tier partnership indirectly owns an interest in the section 721(c) partnership. See § 1.721(c)-5T(c)(5)(ii).
Both categories of successor events involve tiered partnerships. Therefore, pursuant to § 1.721(c)-3T(b)(5), the rules for tiered partnerships (described in § 1.721(c)-3T(d)) must be applied in order to satisfy the requirements to apply the gain deferral method as required under the rules described in the two preceding paragraphs.
To illustrate, consider the following simplified example: In year 1, USP, a domestic corporation, and CFC1, a wholly owned foreign subsidiary of USP, form PS1, a partnership, as equal partners. USP contributes section 721(c) property, asset A, a depreciable asset with a $10 million built-in gain (fair market value of $10 million and tax basis of zero) (USP contribution). PS1 is a section 721(c) partnership as a result of the USP contribution, and the gain deferral method is applied with respect to asset A. In year 2, PS1 and CFC1 form PS2, a partnership, as equal partners. PS1 contributes asset A to PS2 (PS1 contribution) when asset A has remaining built-in gain of $8 million and a fair market value of $12 million (the tax basis is still zero). PS2 is a section 721(c) partnership as a result of the PS1 contribution. The PS1 contribution will be a successor event with respect to asset A if PS2 applies the gain deferral method to asset A and PS1 applies the gain deferral method to its interest in PS2 as described in § 1.721(c)-5T(c)(5)(i). The remaining built-in gain in asset A in the hands of PS2 will be $12 million (excess of book value of $12 million over PS2's adjusted tax basis of $0). If PS2 sells the property, PS2 will allocate $12 million to PS1, and PS1 will allocate $10 million of the gain to USP ($8 million of which would be allocated under § 1.704-3(a)(9)).
On the other hand, the PS1 contribution will be an acceleration event (rather than a successor event) with respect to asset A if either PS1 or PS2 does not apply the gain deferral method. In this case, USP will recognize $8 million of gain, which is the amount of the remaining built-in gain that would have been allocated to USP if PS1 had sold asset A immediately before the PS1 contribution for fair market value, and PS1 will increase its tax basis in asset A from $0 to $8 million. See § 1.721(c)-4T(c). Furthermore, the PS1 contribution will be subject to the general gain recognition rule under § 1.721(c)-2T(b) because PS2 is a section 721(c) partnership and asset A is section 721(c) property. PS1's realized gain with respect to asset A that will not qualify for nonrecognition under section 721(a) is $4 million (fair market value of $12 million less adjusted tax basis of $8 million) and PS1 will allocate half of that gain to USP.
Section 1.721(c)-5T(d) identifies the partial acceleration events, and, in each case, the amount of gain that a U.S. transferor must recognize. The basis adjustments in § 1.721(c)-4T(c) that must be made by a U.S. transferor and a section 721(c) partnership upon a “full” acceleration event also apply for a partial acceleration event, except in the case of a partial acceleration that occurs as a result of an adjustment under section 734 to section 721(c) property, as described in Paragraph d.3 of this Part VIII. If there is remaining built-in gain in the section 721(c) property immediately after the partial acceleration event, the gain deferral method must continue to apply following the partial acceleration event.
Section 1.721(c)-3T(c)(4)(i)(C) provides that a regulatory allocation that results in an over-allocation of book deduction or loss to a U.S. transferor or an under-allocation of book income or gain to a U.S. transferor will nevertheless be treated as satisfying the consistent allocation method if gain is recognized. See the discussion in Paragraph e.3.i of Part VI of the Explanation of Provisions section of this preamble. In order for such a regulatory allocation to be deemed to satisfy the consistent allocation method, the U.S. transferor must recognize an amount of gain equal to the amount of the allocation that, had the regulatory allocation not occurred, would have been allocated to the U.S. transferor in the case of income or gain, or would not have been allocated to the U.S. transferor in the case of deduction or
The temporary regulations provide that a partial acceleration event occurs if there is a distribution of other property by a section 721(c) partnership that results in a positive basis adjustment to section 721(c) property under section 734. In these cases, the U.S. transferor must recognize an amount of gain equal to the positive basis adjustment to the section 721(c) property under section 734. However, the amount of gain recognized is limited to the amount of the remaining built-in gain that would have been allocated to the U.S. transferor upon a hypothetical sale by the section 721(c) partnership of that portion of the property immediately before the regulatory allocation is made for fair market value. Furthermore, if the property that triggered the section 734 adjustment was distributed to the U.S. transferor or a member of its consolidated group, the amount described in the preceding sentence is reduced (but not below zero) by the amount of gain recognized by the U.S. transferor (or the consolidated group member) under section 731(a). See § 1.721(c)-5T(d)(3). The amount of gain recognized as a result of the acceleration event is not reduced by any step-down to distributed property described by section 734(b)(1)(B). The partnership will not increase its basis under § 1.721(c)-4T(c)(2) for the gain recognized by the U.S. transferor.
Section 1.721(c)-5T(e) provides rules for certain direct and indirect transfers of section 721(c) property to a foreign corporation. These rules apply if a section 721(c) partnership transfers section 721(c) property, or if a U.S. transferor or a partnership in which a U.S. transferor is a direct or indirect partner transfers (directly or indirectly through one or more partnerships) an interest in a section 721(c) partnership, to a foreign corporation in a transaction described in section 367. In this case, the underlying section 721(c) property will no longer be subject to the gain deferral method. The Treasury Department and the IRS have determined that this result is appropriate because to the extent any U.S. transferor is treated as transferring the section 721(c) property to the foreign corporation for purposes of section 367, the tax consequences will be determined under section 367. In this regard, see §§ 1.367(a)-1T(c)(3)(i) and (ii), 1.367(d)-1T(d)(1), and 1.367(e)-2(b)(1)(iii) (in general, providing an aggregate treatment of partnerships for purposes of applying the outbound transfer provisions under section 367). Furthermore, for the remaining portion of the property (which is the portion attributable to non-U.S. persons and therefore not subject to tax under section 367), the U.S. transferor must recognize an amount of gain equal to the remaining built-in gain that would have been allocated to the U.S. transferor upon a hypothetical sale by the section 721(c) partnership of that portion of the property immediately before the transfer for fair market value. The basis adjustments in § 1.721(c)-4T(c) that must be made by a U.S. transferor and a section 721(c) partnership upon a “full” acceleration event also apply in this case. If stock in the transferee foreign corporation is received by a section 721(c) partnership, the stock will not be subject to the gain deferral method.
Section 1.721(c)-5T(f) provides a special rule when there is a fully taxable disposition of a portion of an interest in a section 721(c) partnership. Specifically, if a U.S. transferor or a partnership in which a U.S. transferor is a direct or indirect partner disposes of (directly or indirectly through one or more partnerships) a portion of an interest in a section 721(c) partnership in a transaction in which all gain or loss, if any, is recognized, an acceleration event will not occur with respect to the portion of the interest transferred. The gain deferral method will continue to apply with respect to the section 721(c) property of the section 721(c) partnership. The principles of § 1.704-3(a)(7) will apply to determine the remaining built-in gain in section 721(c) property that is attributable to the portion of the interest in a section 721(c) partnership that is retained. This rule does not apply to an intercompany transaction (as defined in § 1.1502-13(b)(1)). See § 1.721-5T(c)(3). See also the discussion in Paragraph c.2 of this Part VIII.
This Part IX discusses the application of the gain deferral method to tiered partnerships. The temporary regulations employ two general principles in applying the gain deferral method to tiered partnerships. First, if the section 721(c) property is an interest in a partnership, the contribution of that partnership interest, and not the indirect contribution of the underlying property of the lower-tier partnership, to a section 721(c) partnership is subject to section 721(c), and the gain deferral method applies to the contribution of the interest. Second, the gain deferral method must also be adopted at all levels in the ownership chain.
These principles, however, raise various issues in applying the gain deferral method to tiered partnerships: (i) Not all partnerships in the ownership chain will necessarily be section 721(c) partnerships; (ii) when the book value of an interest in a partnership reflects appreciation in the property of the lower-tier partnership that has not yet been reflected in the book value of the property, there will be a discrepancy between the built-in gain in the partnership interest and the built-in gain in the underlying property; (iii) an upper-tier partnership's allocation of its distributive share of certain lower-tier partnership items must comply with § 1.704-3(a)(9) (concerning the application of section 704(c) to tiered partnerships) and with the consistent allocation method; and (iv) a partnership whose interest is section 721(c) property that is contributed to a section 721(c) partnership may have previously adopted a method other than the remedial allocation method with respect to its underlying section 704(c) property.
To address these issues, the temporary regulations specify requirements that must be satisfied, in addition to all the other requirements to apply the gain deferral method, in order for the gain deferral method to be applied to tiered partnerships. See § 1.721(c)-3T(b)(5) (the last requirement to apply the gain deferral method).
For purposes of applying the gain deferral method, the temporary regulations address the conditions required to be satisfied by upper-tier partnerships and lower-tier partnerships involved in tiered-partnership transactions to ensure that the gain
Section 1.721(c)-3T(d)(2) provides the additional requirements for applying the gain deferral method if the section 721(c) property is indirectly contributed by a U.S. transferor to a section 721(c) partnership and the partnership look-through rule applies. In particular, this rule applies if an upper-tier partnership in which a U.S. transferor is a direct or indirect partner contributes section 721(c) property to a lower-tier section 721(c) partnership. The upper-tier partnership need not be a section 721(c) partnership for the partnership look-through rule to apply, but, in order for the upper-tier partnership to avoid immediate gain recognition under the general gain recognition rule, the lower-tier section 721(c) partnership must apply the gain deferral method to the contributed property. This application of the gain deferral method has several additional requirements. First, the lower-tier section 721(c) partnership must treat the upper-tier partnership (which is not necessarily a section 721(c) partnership) as the U.S. transferor solely for purposes of applying the consistent allocation method. Second, the upper-tier partnership, if it is a controlled partnership, must apply the gain deferral method to its interest in the lower-tier section 721(c) partnership. If the upper-tier partnership is not a section 721(c) partnership, it is deemed to be so, and the interest in the lower-tier section 721(c) partnership is deemed to be section 721(c) property. See § 1.721(c)-1T(b)(14)(ii) and (b)(15)(ii).
For the upper-tier partnership to apply the gain deferral method to the interest in the lower-tier partnership, § 1.704-3T(a)(13)(ii) provides that the upper-tier partnership must treat its distributive share of lower-tier partnership items of gain, loss, and amortization, depreciation, or other cost recovery deductions with respect to a lower-tier partnership's section 721(c) property as though they were items of gain, loss, and amortization, depreciation, or other cost recovery with respect to the upper-tier partnership's interest in the lower-tier partnership. Section 1.704-3T(a)(13)(ii) is intended to reach the same result as if an aggregate approach governed the application of § 1.704-3(a)(9) in the context of the gain deferral method. Section 1.704-3(a)(9) provides that if a partnership contributes section 704(c) property to a lower-tier partnership, or if a partner that receives a partnership interest in exchange for contributed property subsequently contributes the partnership interest to an upper-tier partnership, the upper-tier partnership must allocate its distributive share of lower-tier partnership items with respect to that section 704(c) property in a manner that takes into account the contributing partner's remaining built-in gain or loss. The Treasury Department and the IRS considered comments about aggregate treatment that were received on Notice 2009-70, 2009-34 I.R.B. 255, in developing the rule in § 1.704-3T(a)(13)(ii). This rule applies only to a tiered-partnership structure that has at least one section 721(c) partnership and to which the gain deferral method is applied. The Treasury Department and the IRS intend no inference regarding the application of § 1.704-3(a)(9) to partnerships not applying the gain deferral method.
If the U.S. transferor is an indirect partner in the upper-tier partnership through one or more partnerships, these requirements must be satisfied by each controlled partnership in the chain of ownership between the upper-tier partnership and the U.S. transferor.
Section 1.721(c)-3T(d)(1) provides the additional requirements for applying the gain deferral method if the section 721(c) property that is contributed to a section 721(c) partnership is an interest in a lower-tier partnership. The lower-tier partnership need not be a section 721(c) partnership. First, the lower-tier partnership, if it is a controlled partnership with respect to a U.S. transferor, must revalue all of its property under § 1.704-1T(b)(2)(iv)(
The revaluation requirement ensures, to the greatest extent possible, that all appreciation in the underlying property of a lower-tier partnership that is reflected in the book value of the partnership interest in the lower-tier partnership is subject to the temporary regulations to the same extent that appreciation would be subject to the temporary regulations if the property of the lower-tier partnership (rather than the interest in the lower-tier partnership) were contributed.
Second, the lower-tier partnership must apply the gain deferral method with respect to each property (other than excluded property) for which there is a new positive reverse section 704(c) layer as a result of the revaluation. A property with a new positive reverse section 704(c) layer is deemed to be section 721(c) property, and the remaining built-in gain includes the new positive reverse section 704(c) layer. See § 1.721(c)-1T(b)(15)(ii) and (b)(13)(ii), respectively. Although § 1.721(c)-3T(b)(1)(i)(A) requires the application of the remedial allocation method to the remaining built-in gain, a lower-tier partnership may apply the gain deferral method by adopting the remedial allocation method only for the positive reverse section 704(c) layer if the partnership has previously adopted a section 704(c) method other than the remedial method for the property. Accordingly, the lower-tier partnership may continue to apply a different, historical section 704(c) method to forward section 704(c) layers or to pre-existing reverse section 704(c) layers, as applicable, and still satisfy the requirements of the gain deferral method. For further discussion of the revaluation requirement and the definition of a controlled partnership, see Paragraph c of this Part IX.
Third, the lower-tier partnership must treat a partner that is a partnership in which the U.S. transferor is a direct or
If the lower-tier partnership owns (directly or indirectly through one or more partnerships) one or more partnerships that are controlled partnerships with respect to the U.S. transferor, these three requirements must be satisfied by each controlled partnership.
In recognition of the possibility that a U.S. transferor may not be able to cause a lower-tier partnership to revalue its property when a partnership interest is contributed to an upper-tier partnership, the revaluation requirement is limited to those lower-tier partnerships that are controlled partnerships with respect to the U.S. transferor. Control is a facts-and-circumstances test, except that the U.S. transferor and related persons will be deemed to control a partnership in which those persons, in the aggregate, own (directly or indirectly through one or more partnerships) more than 50 percent of the interests in partnership capital or profits. See § 1.721(c)-1T(b)(4).
The definition of built-in gain in the notice excluded revaluation gain because a reverse section 704(c) layer with respect to property does not arise on the contribution of that property. However, a partnership that does not create and apply the remedial method to a positive reverse section 704(c) layer created on the contribution of a lower-tier partnership interest to an upper-tier partnership may shift the tax consequences of a portion of the built-in gain to a partner that is a related foreign person. The Treasury Department and the IRS believe that the description of the tiered-partnership rules contained in the notice notified taxpayers of an intention to promulgate a rule with the result reached by the temporary regulations.
The revaluation requirement described in the gain deferral method requires an expansion of permissible events for partnership revaluations under section 704(b). Accordingly, § 1.704-1T(b)(2)(iv)(
If a partnership revalues its property, § 1.704-3T(a)(13)(i) provides that the principles of § 1.704-3(a)(9) shall apply to any reverse section 704(c) allocations made as a result of the revaluation.
In developing the revaluation requirement and § 1.704-3T(a)(13)(i), the Treasury Department and the IRS considered comments received on revaluation rules in proposed regulations under section 751(b) that are contained in a notice of proposed rulemaking (REG-151416-06) published on November 3, 2014, in the
To comply with the gain deferral method, the notice described regulations that would be issued requiring reporting of a gain deferral contribution and annual reporting with respect to the section 721(c) property to which the gain deferral method applies. The notice requested comments on whether the regulations should provide rules similar to those in the regulations under sections 367(a) and 6038B regarding failures to file gain recognition agreements or to satisfy other reporting obligations, including the standards for relief therein. See T.D. 9704 (79 FR 68763) (the 2014 GRA regulations). Comments were received expressing support for this approach.
The temporary regulations implement the rules described in the notice in a manner consistent with the approach in the 2014 GRA regulations. For a U.S. transferor, the reporting requirements include, among other information, the information required to be filed under section 6038B. The temporary regulations also adopt procedural requirements in order to seek relief for a failure to meet the reporting requirements of the gain deferral method, which mirror the approach in the 2014 GRA regulations, including procedures relating to the manner by which a transferor can establish the lack of willfulness and that a failure was due to reasonable cause. See §§ 1.721(c)-6T(f) and 1.6038B-2T(h). The temporary regulations adopt these procedural requirements for all U.S. persons that have a reporting obligation under section 6038B with respect to a transfer of property to a foreign partnership and that are seeking relief under the reasonable cause exception, not only for U.S. transferors described in the section 721(c) regulations. The reasonable cause procedure in the temporary regulations applies to all requests for reasonable cause relief (regardless of the date on which the contribution or the failure to file occurred) filed on or after January 18, 2017.
In addition to adopting the current requirements of § 1.6038B-2(c), the temporary regulations require reporting necessary to demonstrate compliance with the gain deferral method. In general, the temporary regulations require a U.S. transferor to report information on a statement included on (or attached to) the Form 8865, Schedule O, Transfer of Property to a Foreign Partnership. The Treasury Department and the IRS intend that the Schedule O will be revised to include the information required by the temporary regulations.
For purposes of the U.S. transferor's reporting requirements under § 1.721(c)-6T with respect to a gain deferral contribution to a domestic section 721(c) partnership, a domestic section 721(c) partnership will generally be treated as foreign under section 7701(a)(4) for reporting purposes. See §§ 1.721(c)-6T(b)(4) and 1.6038B-2T(a)(1)(iii). As a result, a U.S. transferor that contributes section 721(c) property to a domestic section 721(c) partnership in a gain deferral contribution must file a Form 8865, Return of U.S. Persons With Respect to Certain Foreign Partnerships (including Form 8865, Schedule O, Transfer of Property to a Foreign Partnership), with its return for the taxable year that includes the date of the gain deferral contribution.
Also as a requirement of the gain deferral method, the temporary regulations require that the U.S. transferor agree to extend the period of limitations on the assessment of tax for eight full taxable years with respect to the gain realized but not recognized on a gain deferral contribution, and for six full taxable years with respect to the U.S. transferor's distributive share of all items with respect to the section 721(c) property for the year of contribution and two subsequent years. See § 1.721(c)-6T(b)(5)(i) and (ii). The U.S. transferor also must agree to extend the period of limitations on the assessment of tax for five full taxable years with respect to the gain recognized on the contribution of section 721(c) property for which the gain deferral method is not applied if
If section 721(c) property that is subject to the gain deferral method is ECI property, the temporary regulations require the U.S. transferor to obtain from the section 721(c) partnership and each related foreign person that is a direct or indirect partner in the section 721(c) partnership a statement pursuant to which the partner and the partnership waive any claim under any income tax convention (whether or not currently in force at the time of the contribution) to an exemption from U.S. income tax or a reduced rate of U.S. income taxation on income derived from the use of the ECI property for the period in which there is remaining built-in gain. See § 1.721(c)-6T(c)(1).
The temporary regulations require the U.S. transferor also to provide information with respect to related foreign partners and certain section 721(c) partnerships under section 6038B and the gain deferral method. This requirement also applies in the case of a partnership in a tiered-partnership structure that applies the gain deferral method under § 1.721(c)-3T(d). See § 1.721(c)-6T(b)(2). The U.S. transferor must attach this information to its return.
If the section 721(c) partnership has a reporting obligation under section 6031, it also will be required to report certain information under the temporary regulations. See § 1.721(c)-6T(d). Although the temporary regulations require the partnership to submit certain information to the IRS and comply with other requirements relating to the application of the gain deferral method, a failure to do so will not constitute an acceleration event to the U.S. transferor. The Treasury Department and the IRS intend that the Form 1065, Schedule K-1, or their accompanying instructions will be revised to describe this required information. Failure to include this information may result in imposition of a penalty. See sections 6721 and 6722.
The temporary regulations require the U.S. transferor to provide certain information on an annual basis with respect to section 721(c) property subject to the gain deferral method. See §§ 1.721(c)-6T(b)(3) and 1.6038B-2T(c)(9). This includes information about income from the section 721(c) property (book and remedial income) allocated to the U.S. transferor in the partnership taxable year that ends with, or within, the U.S. transferor's taxable year, a calculation of remaining built-in gain, and information about acceleration, termination, successor, and partial acceleration events. The U.S. transferor must also attach a Schedule K-1 (Form 8865), Partner's Share of Income, Deductions, Credits, etc., for all related foreign persons that are direct or indirect partners in the section 721(c) partnership (if the partnership does not have a filing obligation under section 6031) for the partnership taxable year that ends with, or within, the U.S. transferor's taxable year.
In the case of ECI property subject to the gain deferral method, the U.S. transferor must annually declare that, after exercising reasonable diligence, to the best of the U.S. transferor's knowledge and belief all the income from the property was income effectively connected with the conduct of a trade or business within the United States, and no benefits with respect to the ECI property were claimed under any income tax convention by related foreign persons that are direct or indirect partners in the section 721(c) partnership or by the section 721(c) partnership. This requirement eliminates the potential need for related foreign persons that are direct or indirect partners in the section 721(c) partnership and the partnership to submit to the U.S. transferor an annual waiver of treaty benefits.
The U.S. transferor must describe all acceleration, termination, successor, and partial acceleration events that occur with respect to the section 721(c) property during the partnership taxable year that ends with, or within, the U.S. transferor's taxable year. When there is a successor event, the U.S. transferor must identify the new partnership, lower-tier partnership, upper-tier partnership, or U.S. corporation (as applicable). If the section 721(c) partnership is a foreign partnership, the U.S. transferor must include the information described in § 1.6038-3(g) (contents of information returns required of certain United States persons with respect to controlled foreign partnerships), if not already reported elsewhere, without regard to whether the section 721(c) partnership is a controlled foreign partnership or whether the U.S. transferor controlled the section 721(c) partnership. If the U.S. transferor is not a controlling fifty-percent partner (as defined in § 1.6038-3(a)), the U.S. transferor may comply with this requirement by providing only the information described in § 1.6038-3(g)(1). These requirements also apply to a U.S. transferor that is a successor, as described in Paragraph c.2 of Part VIII of the Explanation of Provisions section of this preamble.
If the section 721(c) partnership has a filing obligation under section 6031, the partnership must include the information required under § 1.721(c)-6T(b)(2) and (3) on the Schedule K-1 (Form 1065), Partner's Share of Income, Deductions, Credits, etc., of the U.S. transferor and all related foreign persons that are direct or indirect partners in the section 721(c) partnership. See § 1.721(c)-6T(d)(2).
The applicability dates of the temporary regulations generally relate back to the issuance of the notice. Accordingly, in general, the temporary regulations apply to contributions occurring on or after August 6, 2015, and to contributions occurring before August 6, 2015, resulting from an entity classification election made under § 301.7701-3 that is filed on or after August 6, 2015 (referred to in this preamble as the “general applicability date”). However, new rules, including any substantive changes to the rules described in the notice, apply to contributions occurring on or after January 18, 2017, or to contributions occurring before January 18, 2017, resulting from an entity classification election made under § 301.7701-3 that is filed on or after January 18, 2017. Taxpayers may, however, elect to apply those new rules and substantive changes to the rules described in the notice to a contribution occurring on or after the general applicability date. The election is made by reflecting the application of the relevant rule on a timely filed or amended return.
Certain IRS regulations, including these, are exempt from the requirements of Executive Order 12866, as supplemented and reaffirmed by Executive Order 13563. Therefore, a regulatory impact assessment is not required. It is hereby certified that the
The principal author of these regulations is Ryan A. Bowen of the Office of the Associate Chief Counsel (International). However, other personnel from the Treasury Department and the IRS participated in the development of the regulations.
Income taxes, Reporting and recordkeeping requirements.
Accordingly, 26 CFR part 1 is amended as follows:
26 U.S.C. 7805 * * *.
Section 1.197-2T also issued under 26 U.S.C. 197(g).
Section 1.721(c)-1T also issued under 26 U.S.C. 721(c).
Section 1.721(c)-2T also issued under 26 U.S.C. 721(c).
Section 1.721(c)-3T also issued under 26 U.S.C. 721(c).
Section 1.721(c)-4T also issued under 26 U.S.C. 721(c).
Section 1.721(c)-5T also issued under 26 U.S.C. 721(c).
Section 1.721(c)-6T also issued under 26 U.S.C. 721(c).
Section 1.721(c)-7T also issued under 26 U.S.C. 721(c).
Section 1.6038B-2T also issued under 26 U.S.C. 6038B.
(h) * * *
(12) * * *
(vii) * * *
(C) [Reserved]. For further guidance, see § 1.197-2T(h)(12)(vii)(C).
(l) * * *
(5) [Reserved]. For further guidance, see § 1.197-2T(l)(5).
(a) through (h)(12)(vii)(B) [Reserved]. For further guidance, see § 1.197-2(a) through (h)(12)(vii)(B).
(C)
(viii) through (l)(4)(iii) [Reserved]. For further guidance, see § 1.197-2(h)(12)(viii) through (l)(4)(iii).
(5)
(B)
(ii)
(b) * * *
(2) * * *
(iv) * * *
(
(
(f) [Reserved]. For further guidance, see § 1.704-1T(f).
The additions and revisions read as follows:
(b)(1)(iii) through (b)(2)(iv)(
(
(b)(2)(iv)(
(f)
(ii)
(2)
(g)
(a) * * *
(13) [Reserved]. For further guidance, see § 1.704-3T(a)(13).
(d) * * *
(5) * * *
(iii) [Reserved]. For further guidance, see § 1.704-3T(d)(5)(iii).
(g) [Reserved]. For further guidance, see § 1.704-3T(g).
(a)(1) through (12) [Reserved]. For further guidance, see § 1.704-3(a)(1) through (12).
(13)
(ii)
(b) through (d)(5)(ii) [Reserved]. For further guidance, see § 1.704-3(b) through (d)(5)(ii).
(iii)
(B)
(C)
(D)
(
(
(E)
(
(F)
(d)(6) through (f) [Reserved]. For further guidance, see § 1.704-3(d)(6) through (f).
(g)
(ii)
(2)
(a)
(2)
(b)
(1)
(2)
(3)
(4)
(5)
(6)
(i) A cash equivalent;
(ii) A security within the meaning of section 475(c)(2), without regard to section 475(c)(4);
(iii) Tangible property with a book value exceeding adjusted tax basis by no more than $20,000 or with an adjusted tax basis in excess of book value; and
(iv) An interest in a partnership in which 90 percent or more of the property (as measured by value) held by the partnership (directly or indirectly through interests in one or more partnerships that are not excluded property) consists of property described in paragraphs (b)(6)(i) through (iii) of this section.
(7)
(8)
(9)
(10)
(i) An allocation pursuant to a minimum gain chargeback, as defined in § 1.704-2(b)(2);
(ii) A partner nonrecourse deduction, as determined in § 1.704-2(i)(2);
(iii) An allocation pursuant to a partner minimum gain chargeback, as described in § 1.704-2(i)(4);
(iv) An allocation pursuant to a qualified income offset, as defined in § 1.704-1(b)(2)(ii)(
(v) An allocation with respect to the exercise of a noncompensatory option described in § 1.704-1(b)(2)(iv)(
(vi) An allocation of partnership level ordinary income or loss described in § 1.751-1(a)(3).
(11)
(12)
(13)
(ii)
(14)
(A) A related foreign person with respect to the U.S. transferor is a direct or indirect partner in the partnership; and
(B) The U.S. transferor and related persons own 80 percent or more of the interests in partnership capital, profits, deductions, or losses.
(ii)
(15)
(ii)
(16)
(17)
(18)
(ii)
(c)
(d)
(e)
(2)
(3)
(f)
(a)
(b)
(c)
(d)
(2)
(e)
(2)
(3)
(f)
(a)
(b)
(1) Either—
(i) Both—
(A) The section 721(c) partnership adopts the remedial allocation method described in § 1.704-3(d) with respect to the section 721(c) property; and
(B) The section 721(c) partnership applies the consistent allocation method provided in paragraph (c) of this section; or
(ii) For the period beginning on the date of the contribution of the section 721(c) property and ending on the date on which there is no remaining built-in gain with respect to that property, all distributive shares of income and gain with respect to the section 721(c) property for all direct and indirect partners that are related foreign persons with respect to the U.S. transferor will be subject to taxation as income effectively connected with a trade or business within the United States (under either section 871 or 882), and neither the section 721(c) partnership nor a related foreign person that is a direct or indirect partner in the section 721(c) partnership claims benefits under an income tax convention that would exempt the income or gain from tax or reduce the rate of taxation to which the income or gain is subject.
(2) Upon an acceleration event, the U.S. transferor recognizes an amount of gain equal to the remaining built-in gain with respect to the section 721(c) property or an amount of gain required to be recognized under § 1.721(c)-5T(d) or (e), as applicable.
(3) The procedural and reporting requirements provided in § 1.721(c)-6T(b) are satisfied.
(4) The U.S. transferor consents to extend the period of limitations on assessment of tax as required by § 1.721(c)-6T(b)(5).
(5) If the section 721(c) property is a partnership interest or property described in the partnership look-through rule provided in § 1.721(c)-2T(d), the applicable tiered-partnership rules provided in paragraph (d) of this section are applied.
(c)
(2)
(3)
(4)
(A) An allocation of income or gain to the U.S. transferor (or a member of its consolidated group as defined in § 1.1502-1(h));
(B) An allocation of deduction or loss to a partner other than the U.S. transferor (or a member of its consolidated group); or
(C) Treated as a partial acceleration event pursuant to § 1.721(c)-5T(d)(2).
(ii)
(d)
(1)
(i) The partnership must revalue all its property under § 1.704-1(b)(2)(iv)(
(ii) The partnership must apply the gain deferral method for each property (other than excluded property) for which there is a separate positive difference between book value and adjusted tax basis resulting from the revaluation described in paragraph (d)(1) of this section (
(iii) The partnership must treat a partner that is a partnership in which the U.S. transferor is a direct or indirect partner as if it were the U.S. transferor with respect to the section 721(c) property solely for purposes of applying the consistent allocation method.
(2)
(i) The section 721(c) partnership must treat the upper-tier partnership as the U.S. transferor of the section 721(c) property solely for purposes of applying the consistent allocation method;
(ii) The upper-tier partnership, if it is a controlled partnership with respect to the U.S. transferor, must apply the gain deferral method to its interest in the section 721(c) partnership; and
(iii) If the U.S. transferor is an indirect partner in the upper-tier partnership through one or more partnerships, the principles of paragraphs (d)(2)(i) and (ii) of this section must be applied with respect to those partnerships that are
(e)
(2)
(3)
(4)
(f)
(a)
(b)
(2)
(ii)
(3)
(4)
(c)
(1)
(2)
(d)
(e)
(a)
(b)
(2)
(3)
(4)
(5)
(6)
(7)
(c)
(2)
(3)
(4)
(5)
(A) The lower-tier section 721(c) partnership is a section 721(c) partnership or is treated as a section 721(c) partnership.
(B) The gain deferral method is applied with respect to the section 721(c) property in the hands of the lower-tier section 721(c) partnership.
(C) The gain deferral method is applied with respect to the section 721(c) partnership's interest in the lower-tier section 721(c) partnership. See §§ 1.721(c)-3T(b)(5) and (d)(2).
(ii)
(A) The gain deferral method is continued with respect to the section 721(c) property in the hands of the section 721(c) partnership.
(B) The upper-tier section 721(c) partnership is, or is treated as, a section 721(c) partnership.
(C) If the upper-tier section 721(c) partnership directly owns its interest in the section 721(c) partnership, the gain deferral method is applied with respect to the upper-tier section 721(c) partnership's interest in the section 721(c) partnership. See § 1.721(c)-3T(b)(5) and (d)(1).
(D) If the upper-tier section 721(c) partnership indirectly owns its interest in the section 721(c) partnership through one or more partnerships, the principles of paragraphs (c)(5)(ii)(B) and (C) of this section are applied with respect to each partnership through which the upper-tier section 721(c) partnership indirectly owns an interest in the section 721(c) partnership.
(d)
(2)
(3)
(e)
(f)
(g)
(2)
(h)
(a)
(b)
(2)
(i) A statement, titled “Statement of Application of the Gain Deferral Method under Section 721(c),” that contains the following information with respect to the section 721(c) property—
(A) A description of the property and recovery period (or periods) for the property;
(B) Whether the property is an intangible described in section 197(f)(9);
(C) A calculation of the built-in gain, the basis, and fair market value on the date of the contribution, including the amount of gain recognized by the U.S. transferor, if any, on the gain deferral contribution;
(D) The name, U.S. taxpayer identification number (if any), address, and country of organization (if any) of each direct or indirect partner in the section 721(c) partnership that is a related person with respect to the U.S. transferor, and a description of each partner's interest in capital and profits immediately after the gain deferral contribution; and
(E) When the section 721(c) property is a partnership interest, the information described in paragraphs (b)(2)(i)(A) through (D) of this section with respect to each property of a lower-tier partnership to which the gain deferral method is applied under § 1.721(c)-3T(d)(1);
(ii) A statement, titled “Consent to Extend the Time to Assess Tax Pursuant to the Gain Deferral Method under Section 721(c),” completed and executed in the manner prescribed in forms and instructions, extending the period of limitations on the assessment of tax as described in paragraph (b)(5) of this section;
(iii) A copy of the waiver of treaty benefits described in paragraphs (c)(1) of this section (if any);
(iv) Information relating to the section 721(c) partnership described in paragraph (c)(2) of this section (if any);
(v) With respect to any foreign partnership (or partnership treated as foreign under paragraph (b)(4) of this section) the information required under § 1.6038B-2(c)(1) through (7); and
(vi) The information required under paragraph (b)(3) of this section.
(3)
(i) The amount of book income, gain, deduction, and loss and tax items allocated to the U.S. transferor with respect to the section 721(c) property, including a description of any regulatory allocations;
(ii) The proportion (expressed as a percentage) in which the book income, gain, deduction, and loss with respect to the section 721(c) property was allocated among the U.S. transferor and related persons that are partners in the section 721(c) partnership under the consistent allocation method;
(iii) The amount of remaining built-in gain at the beginning of the taxable year, the remedial income allocated to the U.S. transferor under the remedial allocation method, the amount of built-in gain taken into account by reason of an acceleration event or partial acceleration event (if any), the partnership's adjustment to its tax basis in the section 721(c) property, and the remaining built-in gain at the end of the taxable year;
(iv) A declaration stating whether an acceleration event or partial acceleration event occurred during the taxable year, the date of the event, and a description of the event (including a citation to the relevant paragraph of § 1.721(c)-5T(d) in the case of a partial acceleration event, and whether the acceleration event is described in § 1.721(c)-4T(b)(4));
(v) A description of a termination event or any successor event that occurred during the taxable year with a citation to the relevant paragraph of § 1.721(c)-5T(b) or (c), the date of the event, and, in the case of a successor event, the name, address, and U.S. taxpayer identification number (if any) of any successor partnership, lower-tier partnership, upper-tier partnership, or U.S. corporation (as applicable);
(vi) A description of all transfers of 721(c) property to a foreign corporation described in § 1.721-5T(e) that occurred during the taxable year, and for each transfer, the date of the transfer, the section 721(c) property transferred, and the name, address, and U.S. taxpayer identification number (if any) of the foreign transferee corporation;
(vii) With respect to section 721(c) property for which a waiver of treaty benefits was filed under paragraph (b)(2)(iii) of this section, a declaration that, after exercising reasonable diligence, to the best of the U.S. transferor's knowledge and belief, all income from the section 721(c) property allocated to the partners during the taxable year remained subject to taxation as income effectively connected with the conduct of a trade or business within the United States (under either section 871 or 882) for all direct or indirect partners that are related foreign persons with respect to the U.S. transferor (regardless of whether any
(viii) A statement, titled “Consent to Extend the Time To Assess Tax Pursuant to the Gain Deferral Method under Section 721(c),” completed and executed as prescribed in forms and instructions, extending the period of limitations on the assessment of tax, in the case of a gain deferral contribution, as described in paragraph (b)(5)(ii) of this section, and, in the case of certain contributions on which gain is recognized, as described in paragraph (b)(5)(iii) of this section;
(ix) If the section 721(c) partnership is a partnership that does not have a filing obligation under section 6031, the information described in § 1.6038-3(g) (contents of information returns required of certain United States persons with respect to controlled foreign partnerships), if not already reported elsewhere, without regard to whether the section 721(c) partnership is a controlled foreign partnership within the meaning of section 6038. If the U.S. transferor is not a controlling fifty-percent partner (as defined in § 1.6038-3(a)), the U.S. transferor complies with the requirement of this paragraph (b)(3)(ix) by providing only the information described in § 1.6038-3(g)(1);
(x) A description of all section 721(c) property contributed by the U.S. transferor to the section 721(c) partnership (including pursuant to a contribution described in § 1.721(c)-2T(d)(1)) during the taxable year to which the gain deferral method is not applied; and
(xi) The information required in paragraphs (c)(2) and (3) of this section for related foreign persons that are direct or indirect partners in the section 721(c) partnership and the section 721(c) partnership itself (if any).
(4)
(5)
(i) With respect to the gain realized but not recognized on a gain deferral contribution, through the close of the eighth full taxable year following the U.S. transferor's taxable year that includes the date of the gain deferral contribution;
(ii) With respect to all book and tax items with respect to the section 721(c) property allocated to the U.S. transferor in the partnership's taxable year that includes the date of the gain deferral contribution and the subsequent two years, through the close of the sixth full taxable year following such taxable year with which, or within which, the partnership's taxable year ends; and
(iii) With respect to the gain recognized on a contribution of section 721(c) property to a section 721(c) partnership for which the gain deferral method is not applied, if the contribution occurs within five partnership taxable years following a partnership taxable year that includes the date of a gain deferral contribution, through the close of the fifth full taxable year following the U.S. transferor's taxable year that includes the date of the contribution on which gain is recognized.
(c)
(2)
(3)
(d)
(2)
(e)
(f)
(2)
(ii)
(g)
(2)
(3)
(h)
(a)
(1) USP and USX are domestic corporations that each use a calendar taxable year. USX is not a related person with respect to USP.
(2) CFC1, CFC2, FX, and FY are foreign corporations.
(3) USP wholly owns CFC1 and CFC2. Neither FX nor FY is a related person with respect to USP or with respect to each other.
(4) PRS1, PRS2, and PRS3 are foreign entities classified as partnerships for U.S. tax purposes. A partnership interest in PRS1, PRS2, and PRS3 is not described in section 475(c)(2).
(5) A taxable year is referred to, for example, as year 1.
(6) A partner in a partnership has the same percentage interest in income, gain, loss, deduction, and capital of the partnership.
(7) No property is described in section 197(f)(9) in the hands of a contributing partner.
(8) No partnership is a controlled partnership solely under the facts and circumstances test in § 1.721(c)-1T(b)(4).
(b)
(ii)
(B) Under § 1.721(c)-1T(b)(2), the security has built-in gain of $80,000. Under § 1.721(c)-1T(b)(6)(ii), the security is excluded property because it is described in section 475(c)(2). Therefore, the security is not section 721(c) property.
(C) The tax basis of the machine exceeds its book value. Under § 1.721(c)-1T(b)(6)(iii), the machine is excluded property and therefore is not section 721(c) property.
(D) Under § 1.721(c)-1T(b)(12), CFC1 is a related person with respect to USP, and under § 1.721(c)-1T(b)(11), CFC1 is a related foreign person. Because USP and CFC1 collectively own at least 80 percent of the interests in the capital, profits, deductions, or losses of PRS1, under § 1.721(c)-1T(b)(14)(i), PRS1 is a section 721(c) partnership upon the contribution by USP of the patent.
(E) The de minimis exception described in § 1.721(c)-2T(c) does not apply to the contribution because during PRS1's year 1 the sum of the built-in gain with respect to all section 721(c) property contributed in year 1 to PRS1 is $1.2 million, which exceeds the de minimis threshold of $1 million. As a result, under § 1.721(c)-2T(b), section 721(a) does not apply to USP's contribution of the patent to PRS1, unless the requirements of the gain deferral method are satisfied.
(ii)
(iii)
(B) PRS2's property consists of a security and a machine that are excluded property, and a building with built-in gain in excess of $20,000. Under § 1.721(c)-1T(b)(6)(iv), because more than 90 percent of the value of the property of PRS2 consists of excluded property described in § 1.721(c)-1T(b)(6)(i) through (iii) (the security and the machine), any interest in PRS2 is excluded property. Therefore, the 40-percent interest in PRS2 contributed by USP to PRS1 is not section 721(c) property. Accordingly, USP's contribution of its interest in PRS2 to PRS1 is not subject to § 1.721(c)-2T(b).
(ii)
(iii)
(B) Under § 1.721(c)-2T(b), section 721(a) does not apply to PRS1's contribution of the patent to PRS2, unless the requirements of the gain deferral method are satisfied. Under § 1.721(c)-3T(b), the gain deferral method must be applied with respect to the patent. In addition, under § 1.721(c)-3T(d)(2), because PRS1 is a controlled partnership with respect to USP, the gain deferral method must be applied with respect to PRS1's interest in PRS2, and, solely for purposes of applying the consistent allocation method, PRS2 must treat PRS1 as the U.S. transferor. As stated in paragraph (i) of this
(iv)
(B) PRS1's distributive share of each of PRS2's items with respect to the patent is $16 million of book amortization, $0 of tax amortization, and $2 million of taxable income from the remedial allocation from PRS1. Under § 1.704-3(a)(9), PRS1 must allocate its distributive share of each of PRS2's items with respect to the patent in a manner that takes into account USP's remaining built-in gain in the patent. Therefore, PRS1 allocates $2 million of taxable income to USP. Under § 1.704-3T(a)(13)(ii), PRS1 treats its distributive share of each of PRS2's items of amortization with respect to PRS2's patent as items of amortization with respect to PRS1's interest in PRS2. Under the PRS1 partnership agreement, PRS1 allocates $8 million of book amortization and $0 of tax amortization to CFC1, and $8 million of book amortization and $0 of tax amortization to USP. Because the ceiling rule would cause a disparity of $8 million between CFC1's book and tax amortization, PRS1 must make a remedial allocation of $8 million of tax amortization to CFC1. PRS1 must also make an offsetting remedial allocation of $8 million of taxable income to USP. USP reports $10 million of taxable income ($2 million of remedial income from PRS2 and $8 million of remedial income from PRS1).
(ii)
(B) With respect to year 4, under § 1.721(c)-5T(b)(5), the sale is a termination event because, as a result of CFC1's sale of its interest, PRS1 will no longer have a partner that is a related foreign person, and there is no plan for a related foreign person to subsequently become a partner in PRS1 (or a successor). Thus, under § 1.721(c)-5T(b)(1), the trademark is no longer subject to the gain deferral method.
(ii)
(B) With respect to year 3, the transfer of the patent to FX is a transaction described in section 367(d). Therefore, under § 1.721(c)-5T(e), the patent is no longer subject to the gain deferral method. Under §§ 1.367(d)-1T(d)(1) and 1.367(a)-1T(c)(3)(i), for purposes of section 367(d), USP and USX are treated as transferring their proportionate share of the patent actually transferred by PRS1 to FX. Under § 1.721(c)-5T(e), to the extent USP and USX are treated as transferring the patent to FX, the tax consequences are determined under section 367(d) and the regulations thereunder. With respect to the remaining portion of the patent, which is attributable to CFC1, USP must recognize an amount of gain equal to the remaining built-in gain that would have been allocated to USP if PRS1 had sold that portion of the patent immediately before the transfer for fair market value. Under § 1.721(c)-4T(c)(1), USP must increase the basis in its partnership interest in PRS1 by the amount of gain recognized by USP and under § 1.721(c)-4T(c)(2), immediately before the transfer, PRS1 must increase its basis in the patent by the same amount. The stock in FX received by PRS1 is not subject to the gain deferral method.
(ii)
(iii)
(iv)
The revisions and additions read as follows.
(a) * * *
(1) * * *
(i) Immediately after the transfer, the United States person owns, directly, indirectly, or by attribution, at least a 10-percent interest in the partnership, as defined in section 6038(e)(3)(C) and the regulations thereunder;
(ii) The value of the property transferred, when added to the value of any other property transferred in a section 721 contribution by such person (or any related person) to the partnership during the 12-month period ending on the date of the transfer, exceeds $100,000; or
(iii) [Reserved]. For further guidance, see § 1.6038B-2T(a)(1)(iii).
(3) [Reserved]. For further guidance see § 1.6038B-2T(a)(3).
(c) * * *
(6) A separate description of each item of contributed property that is appreciated property subject to the allocation rules of section 704(c) (except to the extent that the property is permitted to be aggregated in making allocations under section 704(c)), or is intangible property, including its estimated fair market value and adjusted basis;
(7) * * *
(v) Other property;
(8) [Reserved]. For further guidance, see § 1.6038B-2T(c)(8); and
(9) [Reserved]. For further guidance, see § 1.6038B-2T(c)(9).
(h) * * *
(1)
(3) [Reserved]. For further guidance see § 1.6038B-2T(h)(3).
(j) * * *
(4) through (5) [Reserved]. For further guidance, see § 1.6038B-2T(j)(4) through (5).
(a) introductory text through (a)(1)(ii) [Reserved]. For further guidance, see § 1.6038B-2(a) introductory text through (a)(1)(ii).
(iii) The United States person is a U.S. transferor (as defined in § 1.721(c)-1T(b)(18)) that makes a gain deferral contribution and is required to report under § 1.721(c)-6T(b)(2). The reporting required under this paragraph (a) includes the annual reporting required by § 1.721(c)-6T(b)(3). For purposes of applying this paragraph (a)(1)(iii) to partnerships formed on or after January 18, 2017, a domestic partnership is treated as a foreign partnership pursuant to section 7701(a)(4).
(a)(2) [Reserved]. For further guidance, see § 1.6038B-2(a)(2).
(3)
(a)(4) through (c)(7) [Reserved]. For further guidance, see § 1.6038B-2(a)(4) through (c)(7).
(8) With respect to reporting required under § 1.721(c)-6T(b)(2) and paragraph (a)(1)(iii) of this section with regard to a gain deferral contribution, the information required by § 1.721(c)-6T(b)(2); and
(9) With respect to section 721(c) property for which a statement is required to be filed under § 1.721(c)-6T(b)(3) and paragraph (a)(1)(iii) of this section, the information required by § 1.721(c)-6T(b)(3).
(d) through (h)(2) [Reserved]. For further guidance, see § 1.6038B-2(d) through (h)(2).
(3)
(i) through (j)(3) [Reserved]. For further guidance, see § 1.6038B-2(i) through (j)(3).
(4)
(ii)
(5)
(ii)
(a) United States Attorney for the District of Columbia;
(b) United States Attorney for the Northern District of Illinois; and
(c) United States Attorney for the Central District of California.
(b) No individual listed in section 1 shall act as Attorney General unless that individual is otherwise eligible to so serve under the Federal Vacancies Reform Act of 1998.
(c) Notwithstanding the provisions of this order, the President retains discretion, to the extent permitted by law, to depart from this order in designating an acting Attorney General.
(a) General Counsel;
(b) Assistant Administrator, Office of Solid Waste;
(c) Assistant Administrator for Toxic Substances (also known as the Assistant Administrator for the Office of Chemical Safety and Pollution Prevention);
(d) Assistant Administrator for the Office of Air and Radiation;
(e) Assistant Administrator for the Office of Water;
(f) Assistant Administrator for the Office of Enforcement and Compliance Assurance;
(g) Chief Financial Officer;
(h) Assistant Administrator for the Office of Research and Development;
(i) Assistant Administrator for the Office of International and Tribal Affairs;
(j) Assistant Administrator for the Office of Administration and Resources Management;
(k) Assistant Administrator for the Office of Environmental Information;
(l) Regional Administrator, Region VII;
(m) Deputy Regional Administrator, Region II;
(n) Principal Deputy General Counsel;
(o) Principal Deputy Assistant Administrator for the Office of Enforcement and Compliance Assurance; and
(p) Deputy Regional Administrator, Region V.
(b) No individual listed in section 1(a)-(p) of this order shall act as Administrator unless that individual is otherwise eligible to so serve under the Act.
(c) Notwithstanding the provisions of this order, the President retains discretion, to the extent permitted by law, to depart from this order in designating an acting Administrator.
(a) in the preamble, by striking the phrase “My Brother's Keeper initiative” and replacing it with “Task Force on Improving the Lives of Boys and Young Men of Color and Underserved Youth”;
(b) in the preamble, by striking the phrase “The initiative” and replacing it with “The Task Force”;
(c) in section 1, by striking the phrase “My Brother's Keeper Task Force” throughout and replacing it with “Task Force on Improving the Lives of Boys and Young Men of Color and Underserved Youth”;
(d) in section 1(a), by striking everything that follows “In addition to the Chair, the Task Force shall consist of the following members:” in subsection (a) and inserting the following:
(e) in section 2(a)(i), by inserting “as appropriate” after “to be maintained by the Department of Education”;
(f) in section 2(a)(i), by inserting “and in consultation with the Office of Management and Budget, including the Office of the Chief Statistician of the United States, as appropriate” after “on an ongoing basis”;
(g) by adding, as section 2(f): “The Task Force shall also provide a status report to the President regarding the implementation of this memorandum at least once each calendar year. In addition, every 2 years, the Task Force shall review the recommendations from the 90-day report, determine whether updated recommendations should be sent to the President, and evaluate whether the set of critical indicators of life outcomes should be updated.”; and
(h) in section 2(v) and section 2(vii), by inserting “and underserved youth” after “boys and young men of color”.
(a) Associate Director (National Security and International Affairs);
(b) Associate Director (Technology);
(c) Associate Director (Science);
(d) Associate Director (Environment and Energy);
(e) Chief of Staff;
(f) Deputy Chief of Staff and Assistant Director; and
(g) General Counsel.
(b) No individual listed in section 1 shall act as Director unless that individual is otherwise eligible to so serve under the Act.
(c) Notwithstanding any provision of this memorandum, the President retains the discretion, to the extent permitted by law, to depart from this memorandum in designating an acting Director.
(b) This memorandum is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person.
(c) You are authorized and directed to publish this memorandum in the
(a) Managing Director;
(b) Chief of Staff;
(c) General Counsel;
(d) Associate Director for National Environmental Policy Act; and
(e) Other Associate Directors in the order in which they have been appointed as such.
(b) No individual listed in section 1 of this memorandum shall act as Chairman unless that individual is otherwise eligible to so serve under the Act.
(c) Notwithstanding the provisions of this memorandum, the President retains discretion, to the extent permitted by law, to depart from this memorandum in designating an acting Chairman.
(b) This memorandum is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person.
(c) You are hereby authorized and directed to publish this memorandum in the
(a) Deputy Director, Field Operations;
(b) Deputy Director; and
(c) Manager, National Programs and Initiatives.
(b) No individual listed in section 1 of this memorandum shall act as Director unless that individual is otherwise eligible to so serve under the Act.
(c) Notwithstanding the provisions of this memorandum, the President retains discretion, to the extent permitted by law, to depart from this memorandum in designating an acting Director.
(b) You are authorized and directed to publish this memorandum in the
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration |